UNICEF: Child Poverty Rankings

Lord Rooker Excerpts

Wednesday 28th February 2024 Lords Chamber

Asked by

[Lord Rooker]

To ask His Majesty’s Government what assessment they have made of the position of the United Kingdom set out in the UNICEF’s Innocenti Report Card 18 Child Poverty in the Midst of Wealth.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, parental employment plays an important role in reducing the risk of child poverty, and there are 680,000 fewer children growing up in workless households compared with 2010. In 2023-24, we expect to spend around £124 billion through the welfare system on people of working age and children. With over 900,000 vacancies UK-wide, our focus is on supporting parents into, and to progress in, work, including through increasing the national living wage to £11.44 from April.

[Lord Rooker (Lab)]

My Lords, the actual Answer to my Question should be “With shame”. Can the Minister explain why child poverty rate changes in the seven years from 2014 to 2021, adjusted for Covid, on page 27 of the UNICEF report card published two months ago, showed that in two-thirds of the rich nations child poverty rates went down, whereas in four of the worst five nations they were up by 10%? Worst of all, rated 39 out of 39, was the UK, where the poverty rate was up by 20%. Is it not time for an election?

[Viscount Younger of Leckie (Con)]

The Government like to read all reports and regard this one with a great deal of interest. However, our argument is that it is hard to give these findings much weight, due to the methodology used to create this ranking. Let me explain. International comparisons of poverty rates are difficult, due to differences in the frequency and timing of data collection and the approach taken to gather this data.

I shall go further. UNICEF’s ranking uses two measures: recent rates of relative child poverty and the percentage change in those rates over an arbitrary comparison period. There are issues with both measures. First, in considering recent child poverty rates, the latest OECD data shows that the UK has a relative poverty rate for nought to 17 year-olds comparable to large European countries. Secondly, UNICEF’s ranking compares relative poverty rates between 2012-14 and 2019-21.

Universal Credit

Lord Rooker Excerpts

Thursday 7th December 2023 Lords Chamber

Asked by

[Lord Rooker]

To ask His Majesty’s Government what consideration they have given to the proposal from the Joseph Rowntree Foundation and the Trussell Trust for an ‘Essentials Guarantee’ in Universal Credit.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)]

My Lords, the department has taken note of the report and recommendations. We are aware of the continuing pressures people on lower incomes face. We will spend £276 billion through the welfare system in 2023-24 in Great Britain. From April 2024, benefits will increase by 6.7% and the national living wage will increase by 9.8% to £11.44. We are investing £1.2 billion in restoring local housing allowance rates, which ensure that 1.6 million low-income private renters gain, on average, £800 per year.

[Lord Rooker (Lab)]

My Lords, I remind the Minister that, of the 6.2 million people on universal credit, 38% are in full-time work. Has he read the latest report from Barnardo’s on bed poverty, published only in September? The research showed that, due to the lack of an essentials guarantee, 900,000 children share a bed or sleep on the floor. Can he imagine the anxiety and tiredness that this creates? There is a lack of an essentials guarantee, which could be monitored by an independent body. It is not just a question of upping the benefits; there ought to be some serious effort put into this.

[Viscount Younger of Leckie (Con)]

Yes, absolutely. The noble Lord’s points chime with what I said earlier about the fact that we understand the pressures that some people are experiencing. The Government have demonstrated their commitment to supporting the most vulnerable by providing one of the largest support packages in Europe. Taken together, the Government are providing total support of £104 billion from 2022 to 2025 to help households. I am aware of the Barnardo’s report. What we are doing for the household support fund includes funding to enable local authorities to help people with the cost of essentials in houses, including food, energy and furniture.

Pension Funds: Investments and Tax Relief

Lord Rooker Excerpts

Thursday 29th June 2023 Lords Chamber

[Viscount Younger of Leckie (Con)]

I hope I can answer a number of the points that my noble friend made. On her general push, she is right: there is a lot more we need to do to encourage pension funds to invest in net zero. The introduction of the TCFD reporting requirements for pension schemes was pioneering; these regulations are still relatively new and it would be premature to judge their effectiveness, but a lot more is happening in this space, as my noble friend will be aware. As well as the task force, we have a stewardship review, which will assess the effectiveness of the guidance, and alongside this the Financial Reporting Council, which works alongside the FCA, my department and the regulator.

[Lord Rooker (Lab)]

What legal authority do the Government have to attempt to create a de facto sovereign wealth fund by manipulating our pension assets? Unlike countries such as Norway, we do not have experience of running a sovereign wealth fund. I feel uneasy. I want the investment to be in this country—that makes sense—but doing it in the way it seems to be being done is fraught with difficulty. Will the Government take extra care over this attempt to manipulate pension funds, because we now have trustees with powers they did not have 30 years ago?

[Viscount Younger of Leckie (Con)]

I do not know about manipulation of pension funds, but I can say that there are strong fiduciary duties on trustees. The noble Lord will know that in the green finance strategy, published in March, the Government committed to engaging with interested stakeholders on how we can continue to clarify fiduciary duty through a series of round tables and a working group of the Financial Markets Law Committee. I think it fair to say that many larger schemes consider climate change risk, which I think is the gist of his question, to be financially material; we have made this clear in guidance.

Commonwealth Countries: Reciprocal Pension Agreements

Lord Rooker Excerpts

Monday 1st March 2021 Lords Chamber

[Baroness Stedman-Scott (Con)]

The UK Government have continued to honour their legal obligations in relation to uprating pensions overseas. While I realise this will be disappointing, we have no plans to change that policy at the moment.

[Lord Rooker (Lab) [V]]

My Lords, I could not defend this policy when I was the Pensions Minister 20 years ago and I did not, but the Treasury would not move on it and this is a real problem. How is asking people to work around the world but freezing their pensions in 150 countries if they retire consistent with global Britain? It is absolutely unfair and incompatible with being an international nation, as we claim to be. I ask the Minister to think about her answers, because it seems she has given contradictory answers on Canada to the noble Baroness, Lady Altmann, and the noble Lord, Lord Foulkes.

[Baroness Stedman-Scott (Con)]

I am sorry, I do not agree that I have given contradictory answers. I say again that the Government have no plans to change their policy on this. When people retire to different countries, information about the impact on their pensions is made very clear to them.

Supporting Disadvantaged Families

Lord Rooker Excerpts

Thursday 12th November 2020 Lords Chamber

[The Deputy Speaker (Baroness McIntosh of Hudnall) (Lab)]

My Lords, the noble Baroness, Lady Bennett of Manor Castle, has withdrawn her name, so I call the next speaker, the noble Lord, Lord Rooker.

[Lord Rooker (Lab) [V]]

My Lords, what is happening about the decline in the number of health visitors in respect of the youngest children in disadvantaged families? If the Government, as was said in the Statement, are taking a long-term holistic approach, why has there been no national health inequality strategy since 2010? Is this why life expectancy in England has stalled since 2010—something that has not happened since 1900, according to The Marmot Review 10 Years On?

[Baroness Stedman-Scott (Con)]

There is an exam question to finish this session. I will need to ask my colleagues in the Department of Health and Social Care to provide the noble Lord, Lord Rooker, with the information about health visitors and the other valid points that he raises.

Universal Credit: Managed Migration

Lord Rooker Excerpts

Tuesday 23rd July 2019 Lords Chamber

[Baroness Goldie (Con)]

My Lords, I am sorry. This is to allow Back-Benchers to ask questions. There are one or two more who wish to in the remainder of the 20 minutes.

[Lord Rooker (Lab)]

The Minister has taken more than half of the time allotted. I have only a simple question. I declare an interest: I was a member of Sub-Committee B of the Secondary Legislation Scrutiny Committee, which dealt with this matter late last year and early this year.

The hard stop came from the stakeholders, not the Opposition. I did not quite hear the answer to the question. When the pilot has taken place, there will be an assessment of and report on it—lessons to learn, what we expected or whatever. Will Parliament have the chance to debate that report before the transfer over to the full Monty for the 3 million? We have not had a specific answer to that question. That is the key, because nobody will take any notice of what we say otherwise.

[Baroness Buscombe]

The noble Lord is quite right. There is no question—it is quite right, absolutely right—that we should report once we have done the pilot, before regulations are laid to roll out the entire managed migration. I apologise to your Lordships if I failed to make that absolutely clear. I think the suggestion put forward by that committee that we have a pilot was right. It has taken us time to get it ready. We absolutely will report the results of the pilot in full.

Financial Guidance and Claims Bill [HL]

Lord Rooker Excerpts

Report: 1st sitting: House of Lords
Tuesday 24th October 2017 Lords Chamber

[Lord Rooker (Lab)]

My Lords, I am sorry to interrupt, and I have listened to the whole debate, but how can a Government bring forward an amendment in the other place unless there is a vehicle sent from this place to allow them to do so? You cannot simply amend on the exchange like that without an amendment from this place.

[Baroness Buscombe]

My Lords, I beg to differ. Despite the noble Lord’s extensive experience in another place, it is entirely possible for us to bring forward an amendment in the Commons to introduce such a ban.

As I was saying, we want to ban pensions cold calling because a private pension plan is often an individual’s most valuable asset. A ban will send a powerful message to consumers to put the phone down. My officials recently met a range of stakeholders to explore the details of the ban and are currently working on developing the details of the policy arrangements.

Pensions cold calling is also a complex area which we want to get right. Indeed, the recent discussion with stakeholders uncovered interesting questions around how to define existing relationships and express requests for information. The Government will continue to finalise these complex policy details and we intend to publish draft legislation for scrutiny in early 2018. Following this, we will legislate at the earliest opportunity. This gives us the opportunity to develop legislation which is more carefully targeted and allows us to make proper provision for enforcement which this current draft does not allow.

The Government have listened and want to work at pace to introduce a targeted response which will strengthen the arrangements already in place. However, the proposed approach in this amendment could delay implementation of any such ban. If this amendment were passed, the Government would first have to wait for the body to be set up. It is not expected to be set up and operational until October 2018. Then, recommendations would have to be made to the Secretary of State. No doubt, this would not be immediate because this body will have a huge amount of work to undertake when it is first set up. So it could be at least another year or two before any consideration could be made, prior to a recommendation being put to the Secretary of State to introduce such a ban. Then the Secretary of State would have to make and lay affirmative regulations.

The noble Baroness, Lady Kramer, said that we need protection now. If Amendment 2 were passed, there would be much more delay than if the Government were to wait.

State Pension

Lord Rooker Excerpts

Thursday 28th April 2016 Lords Chamber

[Baroness Altmann]

My noble friend is absolutely right. The aim of the new state pension is that people will have a much clearer idea of how much they can get from the state pension without extensive means testing so that it is clear and safe for them to save as they can on top of it.

[Lord Rooker (Lab)]

What estimate have the Government made of the result of less means testing, which means less passporting to other benefits for those who were means tested, who presumably will not now receive those benefits? What is the overall saving to the Government in that respect?

[Baroness Altmann]

The estimates are that the new state pension will be cost-neutral for the first few decades. Therefore, the aim is that we can give people security and an understanding of what they will get from the state system, and that, as we roll out auto-enrolment to ensure that every worker will have a private pension, it is safe for those workers all around the country to save for their future so that they can supplement their own income.

State Pension Age

Lord Rooker Excerpts

Wednesday 2nd March 2016 Lords Chamber

[Baroness Altmann]

The noble Baroness raises relevant points. I stress again that the review is not just about raising the state pension age but about considering the appropriate way to run state pension age policy. I encourage her to raise those issues with the reviewer.

[Lord Rooker (Lab)]

Did the Minister approve the wording of the press release that has been referred to, with the word “immediacy” in it?

[Baroness Altmann]

My Lords, the press release has been compiled by the department and the wording of the release has, of course, been approved.

Welfare Reform and Work Bill

Lord Rooker Excerpts

Monday 21st December 2015 Lords Chamber

My questions are about whether claimants are getting the full value of the assignations that they make. What are the tender processes that allow other providers to compete in this market? How does one become a shareholder in the organisation when all shares are held in the bank? Most of all—this is the real reason for asking for some responsibility in reporting to Parliament—who oversees the public interest in what is being delivered in the round? I am sorry that that is a bit technical. It is late at night and I understand that. But this is important. I hope that the Minister will explain a little. If he would like to do that in a letter to the noble Lord, Lord Rooker, and me, that might save some time. The chance to consider some of these issues only comes up every so often. I hope the Minister does not mind that I am detaining the House slightly on what I consider to be an important issue.

[Lord Rooker (Lab)]

My Lords, I support the noble Lord, Lord Kirkwood. He was quite friendly towards me about raising this matter in Committee. It was the noble Lord who drew my attention to Clause 20. I had not known about it. As will become clear, it is to the Minister we owe this debate because he alerted us to these banker-sized salaries in answering a question a couple of years ago.

In the 1970s, I was in the Commons when the scheme to replace the old invalid trike was set up, so I am aware of the positive change. When I had a proper job before I was an MP, I used to work in Thames Ditton as production manager at a loudspeaker company. AC Cars Ltd, which was in Thames Ditton, built what was known as the invalid trike, the single seater. Like my noble friend I make no comment on the Motability scheme, save to say that it has given access to mobility for some 4 million people over the years. I hope that it will for years to come.

Given that we are dealing with public money, I support the amendment moved by the noble Lord, Lord Kirkwood. It should go beyond the PAC and at least include the DWP Select Committee, which has never shown any interest in this, and the Charity Commission, which is useless as the regulator of charities. Implementing the amendment at least would lead to an inquiry into the finances of the scheme.

DWP is paying the Motability charity around £20 million. The charity gets about £7 million in lease levy from the vehicles used. It has an income of about £30 million. The charity, which is more than 60% dependent on government funds—this is public money but not in the way we expect public money to be raised; it is government money from the DWP paid to the charity—has two employees on more than £160,000, which is more than the Prime Minister earns, and another employee is on a six-figure salary. Last week, when the Times exposed anger about six-figure charity pay deals, it did not mention this, but it could well have looked at the Motability charity, which is supported and 60% paid for by the DWP. We are not talking about individual donors—this is a straightforward 59.6%, according to the latest accounts. That is partly responsible, in duty, for the whacking great salaries of the charity, and that is before we come to the operations arm. One of the chief executives of the charity is on more than £170,000, another is on more than £160,000 and someone else is on between £100,000 and £110,000. As I say, this is a charity that is 60% paid for by the Department for Work and Pensions.

But the main scheme, as the noble Lord, Lord Kirkwood, said, is operated by Motability Operations group, which is a company owned by four banks: Barclays, Lloyds, HSBC and the Royal Bank of Scotland. It operates as a contractor to and is directed and overseen by the charity. This, for me, is the crucial link to where public funds are involved. It is public money we are talking about here, but there seems to be no real accountability. The revenue of the company is around £2 billion from the operating leases and £2 billion from the resale of vehicles at the end of the three-year lease. Some 600 cars a day are placed on the second-hand car market. As I said in the debate earlier this year, I am well aware that someone in my family once had such a car. Motability Operations claims that it gets no money from the Government. It states that on page 4 of its latest accounts. But the £2 billion from the leases is in fact the DWP Motability payment to more than half a million people, and because they have agreed to assign their DWP allowance to the scheme, the money is paid directly to Motability Operations. That is what Clause 20 is all about.

I support Clause 20, by the way, and in my view it ought to be retrospective in order to claw some public money back from this company and thus enable the Government to recover their costs. There is a direct link, and this clause is the missing piece of the jigsaw. After our debate in February I went to the Public Accounts Committee, the National Audit Office and the Charity Commission, but no one wanted to know. They said, “It is not public money so it is nothing to do with us”. This clause links it all together, so it is a really useful one and I am grateful that it is in the Bill.

As my noble friend said, the chief executive of the operations company is on a package of more than £900,000. The chair is on a package of £195,000 and a handful of directors—fewer than five, I think—take £3.3 million between them. There are also loads of long-term incentives for the CEO and the directors. The whole system depends on the DWP payment, which Clause 20 makes clear; it shows the direct link. As such, the NAO and the PAC should take a look at it, and that is what the amendment is about. The Charity Commission should be interested in the governance arrangements. It could ask, for example, why the chair of the company operations remuneration committee thinks it right to stand down after two three-year terms, as set out on page 43 of the accounts, and yet the charity trustees have been serving for four decades. I repeat: four decades. When you ask the Charity Commission about it, all it ever gives you is the last time they were elected. Of course, they are all on something like three-year terms, but no one is interested.

I have to say that Alan Yentob came unstuck after serving loyally as a trustee at Kids Company for 18 years because after that length of time he could not tell the difference between management and governance. His 18 years as a trustee is less than half that of some of the Motability trustees, but the Charity Commission does not seem to bat an eyelid about it. There is a strong case for the Nolan principles of public life being applied to the third sector, which of course they are not, but I think they would cover this point. In short, we have here a service that everyone agrees is a public good. There is no argument about that. But it is based on public funds and however the risk factors are dressed up—they are minimal in comparison with the real private sector—they are being used to pay these banker-sized salaries. Of course, I accept that the second-hand car market is highly specialised, but let us face it, it is the biggest company going with 600 cars a day feeding into the market.

[Lord Davies of Stamford (Lab)]

I was hoping to catch my noble friend before he sat down, which I thought he was about to do.

I am very grateful to my noble friend, and I think the whole House will probably be very grateful to both him and the noble Lord, Lord Kirkwood, for raising this fascinating matter. I have two questions to put to him. Normally speaking, a high salary is justified, where it can be justified at all, either by the high risk incurred by the person who is receiving it or by the great competitive merits of that person in showing great skill in the face of competition. Can my noble Friend tell the House, first, what risk is being run by the operations company in this case? How risky is its business? Secondly, how much competition is there for this business, or does the operations company have an effective monopoly on the motability business in this country?

[Lord Rooker]

I am grateful to my noble friend and I will come to that very point because it is crucial. I am not clear what the banks get out of this; I do not believe that they are doing it for nothing. The Library has not been able to explain it to me anyway.

That brings me to my final point and I will cover the points made by my noble friend. As the noble Lord, Lord Kirkwood, said, there is another £180 million in another charity within the Motability charity sitting there doing virtually nothing. The Motability Tenth Anniversary Trust was set up by the Motability charity. It has the same trustees, an income of £50 million a year and expenditure of £5 million. It has assets of £180 million. It has no employees or volunteers, so it cannot possibly be fulfilling the public benefit rules for charities on those figures. I checked them again on the web the other day.

The website AccountingWEB had some interesting points to make. It referred to the asset seemingly sitting around not doing much. The original funding for this charity within a charity was 50% from Motability Operations, the company, and 50% from the DWP. There is a direct link with this charity within a charity—50% of it was funded by the DWP to start with. Does it mean that the not-for-profit status of operations is maintained by recycling the Motability Operations profits back into the Motability Tenth Anniversary Trust in order to swell the coffers, and so avoid tax? It asked whether this incestuous arrangement is there because someone has worked out a way to get their hands on it, and in due course extract it from the trust. Again, this is a direct link—the DWP funded 50% of the charity within a charity. It funds 60% of the main charity so it is directly responsible for the salaries of the charity staff. I fully accept it is the Motability Operations company that is responsible for the real bankers’ salaries—almost £1 million for the chief exec.

I am coming to the end. The Treasury, I understand, loses around £350 million in VAT by this whole complex set-up. Operations installed a new IT system in August. It cost around £100 million but did not provide any upgrade to functionality. I am reliably informed that this required a lot of hospitality and team rebuilding—all on the cash of people with a disability.

Maybe it is time, as the notes on Clause 20 say, or envisage, to bring some competition into the market because there is no competition. Clause 20 is set up where it envisages that there might be another provider. Well, there is not. In some ways, if the DWP wanted to get its hands clean and do some real governance on this—and the Government, because they are all part of the issue—a bit of competition would not go amiss. That is where we come in. The opportunity of Clause 20 is useful for the Select Committee in the other place which, as far as I know, has not batted an eyelid. The issue has been raised very occasionally but not properly. It has never been taken seriously by the Government or the department.

--- Later in debate ---

[Lord Freud]

I was able to say that the department considered value for money and had drawn up this clause to allow for other providers. That is as far as I can go at this stage. Motability is a long-established and very well-loved organisation; that is the current position.

On the second charity, the Motability-run fund is used to support the objectives of Motability and is not government-run. The remuneration of Motability Operations directors, and indeed those of the charity, is a matter to be decided by Motability.

[Lord Rooker]

Can we just pause there on the charity? I fully accept that Motability Operations is a company and that it is up to the directors what they pay the chief exec, given what the risk is and the competition. The charity is different. This charity is 60% grant-funded by the Minister’s department—to be accurate, it is 59.6%. Does he go back to the Prime Minister occasionally and justify it by saying, “We’re paying out 60% of the money to this charity and, by the way, we are paying the chief exec a lot more than you”? There were supposed to be some rules in Whitehall about people not being paid more than the Prime Minister. I knew that when I was at the Food Standards Agency. We had charities exposed in the Times last week for paying six-figure salaries. It is no good the Minister saying that it is down to the trustees of the charity when the department is funding 60% of that charity, which is not going out collecting money from the public with tin cans. I know that it has other donors—I am not arguing with that—but if it is 60% directly funded by grant from his department, can the Minister really justify it having three people on six-figure salaries, one of them on more than £170,000 a year, and paid for by his department? Is he happy with that?

[Lord Freud]

There is a key issue about charities having to attract the best people when they are very substantial operations, which Motability is. I know, because I was involved for a period in a foundation in the charitable area, that to attract the kind of people who are commercially competent puts you into that bracket. I have said enough.