Universal Credit Deductions

Maria Miller Excerpts

Wednesday 19th July 2023 Westminster Hall

[Dame Maria Miller (in the Chair)]

It is a little warm in here today, so if Members want to remove their jackets, that is perfectly allowable.

[Chris Stephens (Glasgow South West) (SNP)]

I beg to move,

That this House has considered the matter of Universal Credit deductions.

It is a pleasure to see you in the Chair, Dame Maria. This is a matter of considerable interest and concern to me, as it will be to many other Members, each of whom will have busy caseloads from worried or despairing constituents, many of them describing how the universal credit system has worked for them or, more to the point, has abjectly failed to work for them.

In March last year and earlier this month, I questioned the Secretary of State on how many universal credit claims were having deductions taken from them in the most recent month for which data was available in each parliamentary constituency, what was the average size of sums deducted in each constituency, what was the total sum deducted from claims in each constituency, and what proportion of each sum was deducted to repay advance payments. The figures in the Scottish context were quite revealing to me. For example, I learned that in one month alone in 2021, 180,000 households in Scotland had an average of £60 deducted from their social security payments, and that between December 2022 and February 2023, the UK Government deducted £12.1 million a month from 206,000 Scottish households. The number of households affected by deductions and the sums being recouped seem to be increasing.

Those figures were disturbing but maybe not surprising. After all, last year the Work and Pensions Committee, of which I was then a member, published a report on the cost of living, which called on the Department for Work and Pensions to pause the deductions and restore them gradually only as the rate of inflation reduced, or when benefits had been increased to accurately reflect the rise in prices. The Government rejected the report’s recommendations, stating that pausing deductions is not

“necessarily in the claimant’s best interest.”

But claimants know that since then, inflation has remained very high, and the rise in the price of basic foodstuffs for the poorer has been ferocious. It is time to take a broader look at the problems with universal credit deductions. That is why I secured this debate.

--- Later in debate ---

[Chris Stephens]

Yes, I do agree. My hon. Friend is right again about the lack of information in journals. The example I gave of the individual in Manchester is typical of what happens to universal credit claimants who get caught up with deductions and other aspects of the social security system that I want to see resolved. The Government have recognised some of the problems and have reduced the rate of deductions by lowering the cap and extending repayment periods, but that is not enough; significant reductions to already low incomes remain, and there is no affordability assessment to ensure that people can afford the payments.

What action can we take? Research from the Joseph Rowntree Foundation shows that support has eroded over decades, and that universal credit standard allowance is now at its lowest ever level as a proportion of average earnings. Together with the Trussell Trust, it is calling on the Government to implement an essentials guarantee to ensure that the basic rate of universal credit at least covers life’s essentials and that the support can never be pulled below that level.

Rather than offering one-off payments to shore up the incomes of struggling families, the UK Government should reverse the damaging policies impacting on our most vulnerable, including by reinstating the universal credit uplift of £25 a week, removing the benefit cap and the two-child limit, and halting punitive sanctions regime, which the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) outlined. In addition, the Scottish National party recommends that the Government immediately introduce an amnesty on deductions resulting from the Department of Work and Pensions’ own errors. Advance payment loans should be turned into non-repayable grants after a claimant has been deemed eligible, as the Work and Pensions Committee recommended in our report. Too often, we hear that advances are not loans, but if someone is paid money and is expected to pay it back, that is indeed a loan, not an advance.

We are also arguing for the cap on the monthly rate of deduction to be lowered, and for the widespread use of sanctions to be stopped, as there is clear evidence that they do not work. A London School of Economics study found that the impoverishment of larger low-income households has helped few parents to get a job, and is instead pushing families further into poverty and damaging their health.

I said at the start that I will intersperse my contribution with comments, examples and solutions from Scotland, so here are some. Social Security Scotland can take deductions from some benefits—the adult disability payment, the child disability payment and the Scottish child payment—to pay back an overpayment, but when overpayments occur, it engages with clients to discuss their circumstances and agree a payment plan that takes them into account. Its debt management strategy states:

“Where the repayment method is voluntary deductions from benefits, we will mutually agree a value with client as part of Affordability Assessment. Where enforced deductions are applied due to client not engaging with us to agree a payment plan, a maximum deduction of 10% of Scottish Benefit Entitlement will be applied unless the overpayment is due to Fraud, in which case a maximum of 15% will be applied.”

That social security philosophy and those actions work.

The Scottish National party believes that social security is an investment in the people of Scotland and a key part of the Scottish Government’s national mission to tackle child poverty. It continues to do everything it can with the limited powers and fixed budgets it receives from this place. That includes investing £5.2 billion in benefits expenditure in 2023-24, supporting more than 1 million people. I have stated clearly that we need to tackle child poverty. The Scottish Government’s tackling child poverty delivery plan estimates that 90,000 fewer children will live in relative and absolute poverty this year, as a result of the policies of the Scottish Government. However, the Scottish Government should not have to pick up the broken pieces left by this place, or keep using their limited powers and fixed projects to mitigate damaging Conservative party policies.

With every day that this Government fail to fix the known problems of universal credit and the social security system, and fail to use their reserve powers to tackle the rising cost of living adequately, they demonstrate that independence is the only way for Scotland to boost incomes and build a fairer society. The rest of the United Kingdom needs to fix its broken social security system; Scotland is already determined to do so.

[Dame Maria Miller (in the Chair)]

I remind Members that they need to be here for the full debate if they are going to take part. I was also going to ask Members to bob if they want to take part; I thank Members for doing that. I call Jim Shannon.

--- Later in debate ---

[Ian Byrne (Liverpool, West Derby) (Lab)]

It is a real honour to serve under your chairship, Dame Maria. I thank my good friend, the hon. Member for Glasgow South West (Chris Stephens), for securing this important debate and for his excellent speech, and other hon. Members for their fantastic contributions.

The DWP has the power to make direct reductions from benefit payments to pay certain debts and costs owed by an individual. This can include money paid to the Government due to a benefit overpayment, or a loan to a third party such as a landlord, utility provider, local authority or the courts. It is worth noting that the majority of benefit deductions are for DWP debts, including those related to universal credit advance payments, overpayments and budgeting loans.

I want to draw attention to several factors of universal credit deductions that seem to be having an extremely negative impact on my Liverpool, West Derby constituents. First, many new universal credit claimants now take out an advance while they wait for their first payment, and the advance is usually recovered by deductions of equal instalments over a period of 24 months. The pain that our constituents are facing right across the UK has been outlined today, but taking out that advance payment seems to be actively encouraged by the DWP. Secondly, when someone moves on to universal credit, any outstanding tax credit debt is now transferred to the DWP, allowing it to recover the debt through any of the methods available to it, which are far more extensive than those available to His Majesty’s Revenue and Customs. Universal credit rules allow the DWP to make deductions for overpayments caused by DWP error, which was not the case with legacy benefits.

A major area of concern with deductions is the basic premise of affordability. It is staggering that there is no requirement for the DWP to determine whether someone can actually afford a deduction, or to consider what that deduction would do to their and their family’s life. From the weekly emails I receive from desperate Liverpool, West Derby constituents, and from speaking to people in my surgeries, it is plainly clear that many simply cannot afford the deductions enforced on them The levels of universal credit deductions faced by far too many of my constituents, including extremely vulnerable people, are causing them to struggle to pay for essentials such as heating, fuel, food and toiletries—the very essentials of life. It is driving them into absolute, abject poverty.

At the mobile food pantry that we run in Liverpool West Derby every Friday with Fans Supporting Food Banks and St Andrew’s Community Network, I hear many stories of people being forced into using emergency food aid as a result of DWP deductions. This is replicated across the city at the other five services that we run, and the pattern repeats across the UK, as we have heard from Members today. The Government argue that their deductions can help claimants to better manage their finances, but in December 2022 the Trussell Trust reported that more than half of all universal credit claimants who experienced deductions in their benefits had one day when they could not afford to eat at all or only had one meal because they could not afford to buy enough food in the previous 30 days. We need to remember that we are the sixth richest country in the world, and to drive people into these circumstances is completely immoral.

The Trussell Trust highlighted new research showing that 47% of people referred to food banks had faced deductions to their or their partner’s benefits income to pay back a benefit advance, benefit overpayment, DWP loan, or any other debt or fine. That rose to 57% among those referred to food banks who were in receipt of universal credit. In its June 2023 report, “The welfare debt trap: Adjusting the level and priority of deductions from benefits to prevent hardship”, Citizens Advice found that the deductions have created hardship and are applied disproportionately to households in which someone has at least one long-term health condition or disability and to households with children, which are also more likely to have deductions applied at a higher level. Those people are the most vulnerable.

The current system of deductions clearly targets our most vulnerable citizens and is driving millions of people into poverty. It is supposed to be a safety net. Let us be crystal clear—amazing, I can see the Minister puffing his cheeks— that the current universal credit deductions system is not fit for purpose and needs fixing urgently. Where do we go from here? I urge the Minister to take the following measures into consideration for the benefit of the huge number of people, many extremely vulnerable, who are suffering as a consequence of these actions. The DWP must place affordability at the heart of deductions and prioritise the reduction of the total amount being deducted from households. At the heart of the calculations must be the basic human right every citizen should have: to be able to afford food, water, shelter, clothing and heating. The DWP must not be allowed to push people into abject poverty.

The Government must provide immediate breathing space for low-income households that are under extreme pressure due to the cost of living crisis. The priority order for deductions must be changed to put greater emphasis on debts where non-payment has the most serious consequences and less emphasis on debts to the Government. The Government must get serious about helping people not to accrue debts in the first place, especially through the use of advanced payments or loans. Deductions for overpayment owing to DWP error should not be made. Minister, my door is always open to discuss how a right to food could be implemented to tackle the scourge of food poverty, which we see across all our communities and have heard about so bleakly today. The ball is firmly in his court.

[Dame Maria Miller (in the Chair)]

We come to the last Back-Bench speech and will then move to Front-Bench contributions at 10.28 am.

Oral Answers to Questions

Maria Miller Excerpts

Monday 7th February 2022 Commons Chamber

[Dr Coffey]

I am very sorry for the family of the individual to whom the hon. Gentleman refers. It is the role of the coroners to undertake appropriate investigations. I am surprised, and am sorry to hear, that the letter has not gone back. It is not my intention to meet them, recognising the ongoing work that we continue to do to try and provide service to such people.

[Mrs Maria Miller (Basingstoke) (Con)]

Afghan refugees in north Hampshire have been supported through the hard work of many organisations, including our local jobcentre. Many of those refugees now want to get back into employment. What specific support is my hon. Friend giving to that group?

[Mims Davies]

There is incredible work going on across DWP, including the launch of Jobs First. We are in every bridging hotel, our work coaches are at the forefront of helping people into work, and we have great news and great stories every day.

Oral Answers to Questions

Maria Miller Excerpts

Monday 8th November 2021 Commons Chamber

[Chloe Smith]

That strategy and its implementation will be one of my utmost priorities; I look forward to discussing it in a constructive manner with the hon. Lady and everybody else here today, but I think she may have misread the £1.1 billion in targeted support for those with disabilities that was in the Budget and the spending review last week, which covers access to work, more work coaches and the Work and Health programme.

[Mrs Maria Miller (Basingstoke) (Con)]

I have seen at first hand how assistive technology can change the lives of young people with disabilities at Treloar School and College in Alton in Hampshire. Can my hon. Friend update the House with any further details on the national centre for assistive and accessible technology, which could do so much to support adults with a learning disability and other disabilities to get into employment?

[Chloe Smith]

I am really pleased that my right hon. Friend has raised that point, and I agree on the centrality of assistive and accessible technology. That is why our national disability strategy contained a commitment to invest up to £1 million in 2021-22 to develop a new centre for assistive and accessible tech, reporting on progress by next year. I look forward to working with her to do that.

Supporting Disadvantaged Families

Maria Miller Excerpts

Monday 9th November 2020 Commons Chamber

[Dr Coffey]

One of the things the hon. Lady fails to mention is that if those who are new to benefits have had full contributions over the last nine months, there is no cap on the benefits that they may receive. The support for mortgage interest is continuing. She is right to say that the Government changed that from a grant to a loan. That was the right thing to do, because people have an asset, and we are helping them to keep it. I am conscious of the extensive work undertaken by the Chancellor on ensuring that mortgages could be rearranged or that payments could be made. I am also conscious of the excellent work done by my right hon. Friend the Secretary of State for Housing, Communities and Local Government on ensuring that no evictions would happen as a result of the issues we are facing, except, more recently, for people who are nuisance neighbours. We have done a lot to ensure that people can stay in their homes and keep a roof over their heads.

[Mrs Maria Miller (Basingstoke) (Con)]

I warmly welcome this package of measures to support families through what will undoubtedly be a very hard winter. My right hon. Friend will be aware that, in constituencies such as mine, more than half of the people on low incomes are in single-person households, and they face a very different set of issues this winter. Can she confirm that funding for programmes that help people through homelessness, support rough sleepers and provide support on issues around mental health will not be diminished by the package of measures announced today?

[Dr Coffey]

I know Basingstoke well, because that is where I worked for many years, and I am conscious of the wide variety of communities there that are supportive of one another. I hope my right hon. Friend will be aware of the £700 million package announced by my right hon. Friend the Secretary of State for Housing, Communities and Local Government last week, to ensure that rough sleeping really does become history.

Covid-19: Disability-Inclusive Response

Maria Miller Excerpts

Thursday 15th October 2020 Westminster Hall

[Mrs Maria Miller (Basingstoke) (Con)]

It is a great pleasure to serve under your chairmanship Mr Rosindell, and also to be able to take part in this debate called by the hon. Member for East Kilbride, Strathaven and Lesmahagow (Lisa Cameron).

The impact of coronavirus on disabled people has been profound. It is absolutely right that we should be drawing attention to that at this time. The scale of the issue is concerning: disabled people have accounted for 59% of deaths due to coronavirus between March and July. It is an enormous issue. Another issue is the hidden deaths that have occurred as a result of people not being able to access the healthcare they need, and the way that that has particularly impacted people with learning disabilities. The deaths of people detained in hospitals subject to the Mental Health Act 1983 in the community have doubled from the number of deaths in the same period last year. It is a concern, and we are right to be debating it.

There is also the impact on people who care for disabled people. Like my hon. Friend the Member for Beaconsfield (Joy Morrissey), during lockdown I was speaking to my constituents in that position, who were caring for somebody without the support that they may otherwise have. We need to look at the whole family when we consider the issue as we move forward. The Government’s response has been entirely as it should be: an extra £9 billion of welfare support has been put in place. Specifically within the area of disability, spending this year has increased from £19 billion to £20 billion. I am pleased to see the Minister in his place, and we could not have a better Minister looking at these issues with the sort of credentials that he has for action in the area.

I would like to talk about three issues. The first is easements, the second is communication relating to disability, and the third is employment. The easements are causing all of us concern. The emergency Coronavirus Act 2020 allowed the suspension of some of the duties that local authorities have within the Care Act 2014. Many organisations are now calling for a rethink on that, including Liberty and Disability Rights UK. The easements are there for a reason: to make sure that local authorities can operate in a really difficult situation. Where easements are operated, local authorities may not be complying with what disabled people need within their community. There has been no correlation between the number of covid-19 positive cases and the decision to operate easements in local authority areas. I would appreciate the Government giving us an update on that and on their plans with regards to guidance on the use of easements in the future.

The second issue is communication. A number of hon. Members in the Chamber today will, I think, hope that as we move forward, accessible communication will become fully embedded into every single bit of Government communication. I remember sitting in the Minister’s place, and it is difficult to get easy-read versions and British sign language versions when trying to bring out policy recommendations. It takes time and I understand that. We must still challenge ourselves to communicate with everybody when we are communicating with the British public, not just with those who do not have a disability. I challenge the Minister to think of new and better ways to ensure that a lack of information for disabled people is a thing of the past.

Finally, on employment, we know that many thousands of disabled people in this country want to be in employment but are not. The Minister has done an enormous amount to make sure there is support in place to ensure that as many disabled people as possible are able to get into employment, though Access to Work, the Work and Health programme and intensive personalised employment support programmes. We need to redouble those efforts and challenge Access to Work, to make sure adaptive technology is available to disabled people who may now be having to work from home for the first time.

The national strategy for disabled people is a crucial part of supporting people with disabilities in our country and I applaud the work of the Government on that. Can the Minister provide an update on the work that he is doing to make sure that the strategy delivers for every single disabled person in the country, across all Government activity?