Welfare Reform Bill

Debate between Lord McKenzie of Luton and Baroness Wilkins

Tuesday 17th January 2012 Lords Chamber

[Baroness Wilkins]

My Lords, I, too, put my name to the amendment. I declare an interest as someone who was awarded mobility allowance for life and was then moved to DLA at its inception. I have continued to receive this past pension age. I strongly support the amendment, which would put in the Bill the assurance that awards of PIP will be retained after retirement age, as is the case with DLA. When the amendment was discussed in Grand Committee the Minister tried to sound reassuring, but unfortunately the Government are not trusted.

We know that all Governments prefer to use regulations, which give them more scope and power. However, to quote Sir Bert Massie, the chair of the much lamented Disability Rights Commission, the difference between now and 1992, when the DLA was introduced, is that this Government are playing with false cards. If the Government are sincere in their assurance that PIP will be retained after retirement age, why will they not behave transparently and place the commitment in the Bill? Clause 82 only grants a power. The amendment of the noble Lord, Lord Low, imposes a duty. There is a massive difference.

Sir Bert fears, as I do, that the Government are planning to use the payment of post-retirement PIP awards as part of the Dilnot package for social care. On the argument about cutting the DLA mobility component for people in residential care, they will discover what they regard as double provision, and PIP will be lost to pensioners. In his response in Grand Committee, the Minister almost said as much when he stated:

“By setting out these provisions in regulations we can ensure that the legislation can be adapted in response to any future changes in the social care system which might affect pensioners”.—[Official Report, 16/11/11; col. GC 305.]

Given the demands of responding to the Dilnot commission report, would your Lordships trust the Government not to use the flexibility of regulations to devote the entire PIP budget for over-retirement age to social care?

DLA is an essential contribution to so much more than our social needs. Throughout the passage of the Bill I have tried to convey the enormous complexity of disability and the very wide range of extra costs with which we are faced. DLA gives the lie to the false dichotomy that the Minister always draws between benefit recipients and taxpayers. My DLA has enabled me to be mobile and be employed. It has enabled me to be a taxpayer all my life. As I have aged, my mobility needs have become considerably more expensive. I could not have contemplated buying that “nice bit of kit”, as the policemen outside the Peers’ entrance term the considerably adapted car that I can drive from my electric chair, without the assurance that my DLA is for life. Future PIP recipients should have the same reassurance and I ask noble Lords to support the amendment.

[Lord McKenzie of Luton]

My Lords, I will speak briefly in support of the amendment. The case has been very clearly made. The amendment is seeking the assurance of something written in primary legislation rather than the comfort that was given that this could be dealt with in regulations.

Perhaps I may take the opportunity to clarify a part of the debate we had in Committee. The Minister said:

“Turning to the current rules, broadly speaking, current DLA provisions have a one-year linking rule. This allows individuals over 65 to renew an award within one year of their previous award without losing DLA entitlement. Similarly, we intend to allow a linking period for PIP. This will support those individuals who reach the upper age limit and have a break in their claim through temporary improvement, provided the individual makes a claim within a defined period and continues to fulfil the eligibility criteria for PIP”.

I understand all of that. The next sentence says:

“As with DLA, there will be restrictions on new and existing claims for those over the age of 65”.—[Official Report, 16/11/11; col. GC 305.]

Can the Minister expand on what particular restrictions on existing claims for those over the age of 65 he is intending to implement?

Welfare Reform Bill

Debate between Lord McKenzie of Luton and Baroness Wilkins

Tuesday 17th January 2012 Lords Chamber

[Baroness Wilkins]

My Lords, I strongly support the amendment, which has the support of many disability organisations and thousands of disabled people and their families who face losing help under the Government’s plans.

The noble Baroness, Lady Grey-Thompson, has already outlined the numbers of people affected by the Government’s proposals. These people are not fakers and scroungers. Of current low-rate care claimants, DWP statistics show that 20,000 are blind, 57,000 have learning disabilities, 94,000 have arthritis, and more than 100,000 experience psychosis or psychoneurosis. These are some of the people affected, and these conditions are clearly not fake. These are the people who the Government suggest should lose support.

Disabled people have told the Government exactly what losing low-rate care could mean. Examples include people who categorically state the clear health and social care consequences of cutting DLA, as the noble Baroness, Lady Grey-Thompson, outlined. I shall cite examples of people who have commented. One said:

“If DLA was reduced or removed then I would be unable to attend doctors and hospital appointments due to the cost of getting to and from them, and my health would be severely put at risk due to not having enough money to either keep myself warm and/or fed”.

Another said:

“We would be in crisis—end of story … my son would start self-harming again”,

and that even,

“prescriptions would be out of the question”.

The amendment could help prevent an explosion of avoidable NHS and social care needs, as the noble Baroness said. Will those needs of the disabled people who are losing help be met elsewhere? I fear that no support may be available from any other public service for many of the 400,000 who will lose all their DLA. The past decade has seen a shrinking of council social care service provision through the tightening of eligibility criteria. More than 80 per cent of councils in England now help only people with critical or substantial needs. The people losing DLA may very well not be able to access care services until crises develop. This leaves families, friends and neighbours to care for them. We already have one of the highest economic inactivity rates due to informal care provision. By not accepting this amendment the Government risk ignoring the impact on carers—especially on women aged between 46 and 64 who are more likely to have to take up caring responsibilities in lieu of formal services or benefit provision.

In proposing to abolish low-rate care provision, the department appears to fail to understand or, worse, to wilfully ignore the genuine needs of disabled people and carers. The amendment would help the Government ensure that they did not simply end the lifeline of DLA for disabled people and families who are unable to access alternative help until they receive expensive NHS treatment or residential care. Accepting the amendment and devising a fairer way to share the burden of the proposed dramatic cut in DLA resources would also help the Government ensure that they do not permanently undermine disabled people and the trust and confidence of carers. I hope that the Government really mean what they have said—that we are all in this together.

[Lord McKenzie of Luton]

My Lords, I will speak just briefly on this. It seems to me that the importance of this amendment has been heightened by the documentation we got just yesterday from the DWP, which emphasised that half a million people are going to miss out under the new system compared with the current arrangements. In passing, I might say that it would have been more helpful had we had that documentation a little earlier so we could have studied it in more detail, although clearly the noble Baroness, Lady Grey-Thompson, has delved into it more deeply than I have had the chance to do.

There must be an onus on the Government to undertake some sort of assessment of the consequences for those half a million people who are not going to be able to benefit under the new system. Some of the consequences have been spelt out, such as extra pressure on social services and the health service. We know there will be loss of income tax and national insurance because DLA helps many people to stay in work or to work longer than they otherwise would. All those consequences are quite apart from the worst feature which is the human cost for people who are going to miss out who had been able to rely on funding and not just at the lower rate. It may be that most of those who fall out of the system are currently on the lower rate of DLA, but that certainly is not the case for all of them.

It seems to me that this approach reinforces the perception that is too prevalent that if you claim these benefits then somehow you are not worthy and you do not really deserve them. Half a million people will come out of the system under these proposals. What are the consequences for them? What assessment have the Government undertaken of their needs as a consequence of falling out of the system? Have they or will they look at the sort of proposal that this amendment covers so that there is some basis for bringing some redress for those people who, on any analysis, are bound to suffer as a result of these proposed changes?

Welfare Reform Bill

Debate between Lord McKenzie of Luton and Baroness Wilkins

Thursday 3rd November 2011 Grand Committee

[Baroness Wilkins]

My Lords, I support the amendment which has been so comprehensively introduced by the noble Baroness, Lady Thomas of Winchester. I wish to make one additional point, which is that one of the very dispiriting elements of having a long-term health condition or a disability is the fact that you are so often on the receiving end of help. It can almost get to the point where you are not expected to be able to do things for other people. For example, I very rarely get leafleted in the street by charity workers. If I go to the door to a charity worker, they apologise that they have bothered me. It is as if you are not expected to be able to contribute to society in any way. However, one very obvious way in which we can contribute is by sharing the experience of our condition, making some value out of it and aiding research in this way. That can surely only be beneficial for future generations, for medical professionals and for ourselves and our self-esteem. It seems nonsensical that red tape in the benefits system should stand in the way.

[Lord McKenzie of Luton]

My Lords, I support the thrust of the noble Baroness’s amendment. I do not think that there was much that I ever did as Minister which was the cause of great rejoicing, but I was grateful for at least one memory. I recall several meetings that we had together, trying to see that we ended up in a situation where amounts paid to service users did not inadvertently affect their benefits. I have been trying to recall all of the detail of that. I am not sure that I can, but I am sure that the Minister will be able to bring us up to date or remind us.

Part of what we were trying to do then was to see if a sensible application of the current rules, by way of clear guidance across Jobcentre Plus, would be a route to tackling it. It was in part, but it did not deal with the whole of the situation. There can be no doubt that engagement of those who actually use our services in shaping how they are organised and delivered can be of enormous public benefit. This particularly applies to the multiplicity of research projects which can underpin innovation and vital developments in services. Service user engagement is to be strongly encouraged. We are thoroughly supportive of this.

As the noble Baroness has said, it seems entirely reasonable, as we reflect on the introduction of universal credit, to see how far a legislative solution will cover the situation, rather than perhaps just relying upon practice and guidance, as happens in part at the moment. However, as we have heard, that does not cover all of the gaps, and there are a range of issues about whether payment just covers actual outgoings, about whether there is an excess or profit, about the frequency of activity and about whether any spreading or averaging rules would apply—we went down that avenue at one stage. There is also the issue of protecting those who decline a payment from the notional income rules. It may be that the disregard regime in universal credit could help or could be made to help. On the basis of the noble Baroness’s figure, that may not be the case.

Turning to the specifics of the amendment, I have an issue about terminology. It refers to expenses,

“wholly, exclusively and necessarily incurred in the performance of the duties of the employment”.

It is an interesting point to distinguish employment and involvement. It is certainly the case in tax legislation, and I think in benefits legislation also, that the phrase “wholly, exclusively and necessarily” precludes taking the costs of travel from home to work out of the arrangements. There has always been a distinction between the cost of undertaking travel as part of your work or involvement and putting yourself in a position to do that, which is travel from home to work. Therefore I am not sure that the formulation is necessarily the right one.

This has been going on for a number of years. Progress has been made, but it clearly has not solved the problem, as we have heard. It would not have a huge price tag, if any, to use this opportunity with universal credit to deal with it absolutely.

Welfare Reform Bill

Debate between Lord McKenzie of Luton and Baroness Wilkins

Thursday 6th October 2011 Grand Committee

[Lord McKenzie of Luton]

My Lords, Amendment 2 seeks to attach a clear but succinct purpose to the universal credit; that is,

“to support work for those who can and provide security for those who cannot”.

Much of the focus of our discussion about the universal credit is on the former, helping people into work and closer to the labour market, but there is an obligation also to help those individuals and families for whom work is, for one reason or another, not currently reasonably practicable. We subscribe to the view of the importance of work in helping people out of poverty, in the development of their self-esteem and, as per Waddell and Burton, as being generally good for their health. This has the potential to translate at the macro level to the prospect of lower benefit costs, higher taxes and national insurance and, other things being equal, higher growth. That approach characterised the reforms, which I will call welfare reforms notwithstanding our discussion last Tuesday, of the previous Government and this Bill is a significant development of that trend. Of course, the Minister has been present in both of them.

Contrary to popular belief, it might be contended that receiving financial support from the state when unemployed and unable to work is harder now than at any time for 60 years—that is certainly the view of the Child Poverty Action Group—because the eligibility criteria for benefits have been heightened, benefits are more conditional on actively seeking work and there are tougher sanctions for non-compliance. Some of this happened on our watch as a Government and universal credit provisions go further and, in some respects, too far. We will discuss this when dealing with later clauses, but we support the concept of good and clear work incentives. We also support the requirement for those who can work to meet their obligations. There are some who need to rely on benefits and who do not lack the motivation to work, who see the benefits of work even with existing incentives. As we go through the Bill, we will seek to test that the new universal credit works for them also. These include those with caring responsibilities and health conditions, but also those who simply cannot get a job, be they from Bombardier, BAE systems, or, indeed, anywhere else.

It is worth reminding ourselves of what has gone before. If we look at the recent history of welfare reform, the Welfare Reform Act 2007 introduced the employment and support allowance and the personal capability test; the report of the noble Lord, Lord Freud, focused on the large-scale marketisation of employment services; in 2008 we saw the employment and support allowance introduced; we saw lone parents move off income support and onto jobseeker’s allowance and flexible New Deal pilots introduced to replace the New Deal 18-24 and New Deal 25+. The Welfare Reform Act 2009 established a structure for the future abolition of income support, the progression to work conditions for lone parents and partners of unemployed people, and the extension of work-related activity for employment and support allowance recipients. So hitherto an increasingly active regime has been developed. As I say, we support the concept of good and clear work incentives. We also support requirements for people to meet their obligations.

Of course, the “work first” approach is not the only model of support that countries have adopted. The “human capital development” approach would be claimed by some to be a more effective approach. The Minister often talks about universal credit as engendering a cultural change in attitudes towards work, and that is fine, but he will be aware that in some countries benefit conditionality is also being used to leverage non-employment related outcomes, such as health outcomes and child welfare outcomes. This happens in the US and Australia in particular. I understand that the Secretary of State has recently been on a trip down under. We see speculation in the press that Ministers are turning their minds to benefit sanctions, as the noble Lord, Lord Kirkwood, said on Tuesday, to address a range of other problems. Can we have some clarity on this today, and will the Minister confirm that there are no plans or intent to follow the Australian path and use conditionality for anything other than employment-related outcomes?

It would be extremely helpful when Ministers, including the Prime Minister, are discussing changes to conditionality that they do so in a measured way to avoid creating the impression that everyone on benefits is seeking to avoid work. In his speech to the Conservative Party conference, the Prime Minister said:

“For years you’ve been conned by governments. To keep the unemployment figures down, they’ve parked as many people as possible on the sick. Two and a half million, to be exact. Not officially unemployed, but claiming welfare, no questions asked”.

Nobody who has any knowledge of the benefits system could reasonably accept that as a fair representation of the situation in recent years. When we left Committee on Tuesday last week, there was a headline in the Evening Standard saying that people would have to travel for up to 90 minutes to take up work. Can the Minister say how conditionality is to be amended in this way? If everyone is to be better off in work, will this be before or after travel costs?

Of course, the universal credit is being developed in a period of rising unemployment. I do not propose to open the wider challenge to the Government on their growth strategy this afternoon, although we may drift into that, but we should use this opportunity to seek to understand how the “work first” approach of universal credit is being complemented by the work programme—the “black box approach”, which I believe is entirely appropriate.

Perhaps the Minister would take this opportunity to update us on the programme, particularly as we understand that providers are being sworn to secrecy about how it is all going. In the interests of transparency, perhaps the Minister could tell us directly how many individuals have been referred to the work programme to date, clarifying which of the eight categories they fall into. Can he also tell us a little about how the WCA and the role of Atos Healthcare are feeding into all of this? We are aware of the improvements to the WCA and Professor Harrington’s ongoing work. However, is it right that individuals are being referred to the work programme if the prognosis is that they will be fit for work in three months? Are we comfortable that the precision of “fit to work” within three months, six months or any other time period is within the competency of those making the assessment?

If this benefit is to work, it must work for all—this is very important. It must be free from stigma, and it must work in a fair yet firm way. I beg to move.

[Baroness Wilkins]

My Lords, I support the amendment, especially to say that it should benefit everybody. The simplification of benefits and plans to taper income to ensure disabled people who can work retain more of their income has been welcomed. However, there is very deep concern in the disability community that while some disabled people will gain under the universal credit, many will be made considerably worse off. In its current form, the Bill will dramatically increase disability poverty and leave many thousands of families lacking essential support.

At the moment, a disabled person receiving middle-rate disability living allowance who is found fit for work is eligible for the severe disability premium of £55 a week, whether they are working or not and if they live alone and do not have a carer. They may also be eligible in some circumstances for the disability premium of £29 per week as a single person and £41 per week for a couple, as well as the disability element of working tax credit, which is about £50 per week if they work for at least 16 hours per week. It is not unusual for someone to be eligible for middle-rate care, but to be found fit for work. For instance, it would apply to me because I can self-propel my manual wheelchair for 50 metres. Similarly, someone who is severely visually impaired from birth is quite likely to receive middle-rate care, but be found fit for work.

However, under the universal credit, the gateway for extra support for disability will not be through DLA—or in future PIP—it will be through the work capability assessment conducted by Atos for the employment and support allowance. Under the universal credit system, unless a disabled person is put in the work-related activity group or the support group, they will get no more extra help than someone who is not disabled. These people are still disabled. They still face all the extra costs of disability not met by DLA; for instance, the need for extra help with housework, extra heating, extra laundry, help with the garden if they are lucky enough to have one. We also know that disabled people are more likely to have lower earning power and to be unable to work full-time. Let us face it, in the current economic climate, few employers are going to choose to employ disabled people over the non-disabled, and yet those people are going to lose any extra help because the universal credit will be based on the extremely flawed Atos assessment.

Noble Lords will no doubt have been inundated with e-mails and letters about this as I have, demonstrating that Atos is routinely failing to identify disabled people’s needs. I am sure the Minister will remember from his visit last week to Hammersmith and Fulham Action on Disability a young woman with mental health difficulties. She had spent six years struggling to find help. She finally managed to get therapy about six months ago, and has been progressing well when she innocently attended her Atos assessment, not realising what she was up against. Atos found her fit for work. All her benefits were stopped as of last Friday and her mental state has been set back by months. She is now in debt for the first time and she is distraught.

I know the Minister is very concerned about disabled people’s fears. As he said on Second Reading:

“The most disturbing thing that I heard today was the concerns of many noble Lords about the anxiety of disabled people”. [Official Report, 13/09/11; col. 737.]

The noble Baronesses, Lady Murphy and Lady Gale, talked about how people were terrified or petrified, and that worries me more than anything I have heard. However, those fears are very justified unless this Bill is amended. I know we will come back to this many times during the course of the Committee, but will the Minister say what steps he is taking to ensure that disabled people’s fears are met? Is he considering the proposals by the Disability Benefits Consortium, for instance, to retain the severe disability premium? Does he recognise that the universal credit risks oversimplifying needs by providing for only one disregard which ignores some disabled people’s multiple levels of disadvantage? I hope he will reconsider.