Universal Credit: North-West

Neil Gray Excerpts

Wednesday 13th January 2016 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to contribute to this important debate under your chairmanship, Mr Nuttall. I pay tribute to the hon. Member for St Helens South and Whiston (Marie Rimmer) for securing this debate. It is primarily focused on the north-west of England, but as it concerns the roll-out of universal credit across the isles, the implications of what is said this morning stretch much further than the north-west. I congratulate her on her very good speech. She rightly did not shirk the opportunity to give the Government a kicking on their record on this matter. I pay tribute to other hon. Members who contributed. In particular, the hon. Member for Makerfield (Yvonne Fovargue) delivered a very powerful speech.

There are a great many issues at play around the changes to universal credit and the roll-out in the north-west and further afield. SNP Members are fundamentally concerned about the removal of the work allowance, which underpins the potential success of universal credit and the aim to support people into work and make work pay. We are also concerned about the monthly payment regime. Support for housing benefit recipients will not go directly to landlords, and payments will be made to households, rather than individuals.

[Graham Evans]

Will the hon. Gentleman give way?

[Neil Gray]

I will make some progress; I am just starting.

Pilot projects across the country have shown that those areas of concern are problematic. That has been highlighted by a raft of third-sector organisations in reports on this subject. In principle, universal credit sounds tempting. We are told that it is a smooth, streamlined system to assist low-income families. However, as has been emphasised today, in reality it is fraught with flaws, and low-income families are the casualties of the Tories’ poor economic choices and ideologically driven cuts. The ineffective and costly roll-out of the system to date highlights the need for an urgent rethink of these draconian policies.

Universal credit was first introduced as a pathfinder in Ashton-under-Lyne in April 2013. New claims were taken from single unemployed people who satisfied the gateway conditions. The pathfinder was then extended to three other areas in the north-west—Wigan, Warrington and Oldham—in July 2013, and in the summer of 2014 universal credit was expanded to a further 29 areas in the north-west for single people and couples who satisfied the gateway conditions. After a relaxation of the constraints on single people claiming between September and December 2014, universal credit was expanded to cover all parts of the north-west of England. New claims from families with children have been accepted in some areas, and since last January new claims from families with children have been accepted throughout the north-west.

The north-west was the first area in which universal credit was rolled out to all jobcentres. Of the 155,568 claimants at mid-November 2015, 77,378 were in the north-west, and of those, 26,521 were in employment and 50,855 were not in employment.

[Graham Evans]

May I go back to a point that the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) made about treating people like children? The hon. Member for Airdrie and Shotts (Neil Gray) mentioned paying housing benefit directly to the landlord. Are we not treating people like children if we do not think they are able to pay their housing benefit to their landlords? Surely people in receipt of benefits are perfectly capable of paying their landlords.

--- Later in debate ---

[Neil Gray]

Actually, I do not accept that.

[Graham Evans]

It is treating them like children.

[Neil Gray]

It is not treating people like children. I totally disagree with that. People in such circumstances often live chaotic lives. Sometimes, although not always, they do not wish to have the responsibility for managing that extra level of financial responsibility. A great many people in my constituency have told me that they would far rather know that they have a roof over their head that is secure regardless of what happens elsewhere, and that they would rather see their benefit paid directly to their landlord. People should be given the choice over that matter, and at the moment they are not. It is being paid to them, and they are being given the responsibility, which is not always welcome.

[Jonathan Reynolds]

I want to clarify for the record that my comment about treating people like children referred to people who have worked for 20 or 30 years and are forced to fill in a graph to show how many jobs they have applied for that day and that week. I do not think that is an appropriate way of treating people who have been in work for a long time and have lost their job; they should be treated with respect and dignity. On the point about paying housing benefit directly to landlords, I believe that there should be a choice. If people want to manage their money themselves, that is fine. There has been a huge increase in housing arrears in every area in which universal credit has been rolled out, which causes huge problems for everybody else because it has to be covered in some way. If that can be alleviated by paying housing benefit directly to landlords, I see no reason why that option should not be available to people.

[Neil Gray]

I appreciate the hon. Gentleman’s intervention.

The New Policy Institute’s report “The rise of sanctioning in Great Britain”, which was mentioned by the hon. Member for St Helens South and Whiston, states:

“The expansion of conditionality under Universal Credit could see a substantial increase in sanctions: if sanctioning occurred at the same rate as for JSA claimants, then the number could almost double, with an additional 600,000 sanctions.”

That is very concerning. The Institute for Public Policy Research, an independent think-thank, found that low-income families in Scotland will face an £800 a year cut in their income by 2020 following the UK Government’s cuts while the richest 40% will see their incomes rise as a result of tax cuts.

A number of National Audit Office reports have come to damning conclusions about the ongoing universal credit transition, highlighting the early setbacks, missed targets and overspending. The numbers simply do not lie: 17,850 claimants were on universal credit in October 2014, but the Government had planned to have 500,000 claimants on universal credit by April this year and 7 million by December 2019. Not only does that show that the Government are completely missing their own targets, but they are spending huge budgets, wasting vital funds that could be better spent supporting poor families who are struggling to make ends meet. Indeed, the NAO published a report in May 2015 entitled “Welfare reform—lessons learned”. Speaking about the report, Amyas Morse, head of the NAO, said that the DWP,

“has had to learn some hard lessons with significant financial and human costs.”

[Fiona Bruce]

The hon. Gentleman has reeled off reams of statistics during his speech, but the key statistic is the legacy of the previous Labour Government: nearly one in five households in our country had no one working at all. That in no way brought dignity to those households, those families or their communities. Should we not be addressing that statistic as a priority?

[Neil Gray]

Where people are capable of working, it is right that we should encourage them to do so. However, the problem with the changes that the Government are implementing through universal credit is that they are removing the work allowance, which is the only incentive to work in universal credit. It underpins the incentive to get into work and to remain there. Taking that away removes the premise that work should pay, which is a sad situation.

The DWP has said that universal credit will be simpler for claimants and will be treated like a wage for individuals, readying them for work. In reality, there are complex problems that will ultimately see less money in people’s pockets and more difficulties accessing adequate financial support. Analysis of the autumn statement by the IFS found that the benefit system is still much less generous in the long run, pointing out that universal credit now represents an additional cut on top of other changes, including the cut to benefit entitlement, of £3.7 billion a year in the long run. Some 4.5 million working families will be affected by the introduction of universal credit, and 2.6 million will lose an average of £1,600 a year.

This is where I must disagree with the hon. Member for Weaver Vale (Graham Evans) and where he missed the point in his contribution. People are being encouraged into work, which is right for those who can work, but removing the work allowance aspect of universal credit takes away the only incentive to work. He also made the point that the social security system needs to be fair for those who pay for it, but he perhaps forgets that those in receipt of the universal credit work allowance are in work.

[Graham Evans]

They are taxpayers.

[Neil Gray]

Absolutely. They are taxpayers.

Some 1.8 million non-working families will be affected by the introduction of universal credit, and 1.2 million families will lose an average of £1,000 a year. Over recent months, the focus of much discussion has been on tax credits, but changes to universal credit will also have profound effects. The Government’s so-called U-turn on tax credits is nothing more than a delay tactic, with the pain to be felt in the next few years under universal credit. Support for working households on low incomes getting universal credit was also reduced in the summer Budget. Ian Mulheirn of Oxford Economics said that,

“this may be a U-turn in April 2016, but it doesn’t look like a U-turn by 2020.”

In conclusion, the Scottish people voted in May 2015 for an end to austerity when they voted for the SNP. They deserve the leadership they voted for and not to face the social security storm that the Tories are brewing. The failures of the UK Government to give us full power over universal credit have left our country picking up the tab for the Tories’ poor economic choices and shoddy governance once again.

Universal Credit Work Allowance

Neil Gray Excerpts

Wednesday 6th January 2016 Commons Chamber

[Neil Gray (Airdrie and Shotts) (SNP)]

Thank you, Madam Deputy Speaker, and happy new year.

The apparent tax credit cut U-turn performed by the Chancellor at the autumn statement appeared at the time to be a victory for common sense and the vigorous campaign fought by my colleagues in this place and in Holyrood, and by Labour, Plaid and the Greens. But as the dust settled on the much-hyped U-turn, it appears now that all the Chancellor did was delay the pain of those tax credit cuts and transfer much of them into universal credit, specifically the work allowance. The House of Commons Library briefing on the subject states:

“The work allowance reductions announced in the Summer Budget will ultimately have a similar impact to the changes to tax credits which are not now going ahead”.

So low income working households in Airdrie and Shotts and across these isles are still going to suffer painful cuts from this austerity-obsessed Government, and those low income families are again going to be asked to pay the price for economic failures not of their making. The cuts have just been deferred, deflected and dished out by other means.

Yet again we must ask how these cuts can possibly chime with the Government’s claim that they want to make work pay or with the aim of universal credit—that “work pays and more work pays for everyone”. Well, work will not pay for those on universal credit who are due to see their incomes cut by up to £3,000 a year, according to the House of Commons Library—£3,000 less for a single parent or a family before housing costs are considered, where one or both adults are disabled. These people are working hard, paying their taxes and are now to be hammered yet again.

The Minister said that he wanted a change to the cycle of taking money from low income workers and giving it back through social security. He is achieving that change, but now the Treasury will just take and not give back. Government Members may well suggest that the shortfall can be made up by working extra hours. The Work and Pensions Secretary has already suggested that, but for those with a disability which makes it possible to work but impossible to work full-time, or for someone with caring responsibilities who can work only part-time, or for those whose employer cannot afford to give them extra hours, this cut will be an unfair punishment for this Government’s flawed and reckless obsession with austerity at any cost.

The despicable suggestion that all those who are about to have their incomes cut can just pick up some overtime here and there goes to show how desperately out of touch Tory Ministers and, on the evidence of this debate, a great many Government Back-Benchers are. They do not have a clue about how people on low incomes get by or how devastating an impact these cuts will have.

If the Government were serious about reducing welfare spending, they would be creating more job opportunities and truly dealing with barriers to employment, particularly for the disabled and mentally unwell. Instead, we see savage cuts to social security support directed at those finding it most difficult to get into work—the universal credit work allowance and the employment support allowance work-related activity group are perfect examples. These benefits, which help those in need of extra support to get back into work or to stay in work are being slashed to ribbons by this Government. I hope the Government will heed the call from my hon. Friend the Member for Banff and Buchan (Dr Whiteford) in her excellent speech and publish an impact assessment.

We must remember that these cuts are being made out of choice, not necessity. The Tory Government should be refocusing their priorities for spending cuts elsewhere, not on poor and low-income families.

I hope we will see a similar rear-guard action from the Tory Back Benchers who spoke out against the tax credit cuts and that they will oppose these cuts to the universal credit work allowance. The House of Commons Library says the cuts to work allowance will have the same impact as the cuts to tax credits.

Benefit Sanctions

Neil Gray Excerpts

Wednesday 16th December 2015 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to serve with you in the Chair, Mrs Gillan. I congratulate my hon. Friend the Member for Banff and Buchan (Dr Whiteford) on securing the debate, which follows on from one that I secured in this Chamber two weeks ago. The Minister may well be getting fed up with responding to Scottish National party debates about the Government’s sanctions regime, but I warn her that the party will return to the issue and challenge the Government on it until we see fairness in the social security system.

My hon. Friend the Member for Banff and Buchan made an excellent speech and has been a constant campaigner on the issue for some time. I pay tribute to her for that. She highlighted the issue of work capability assessments and people being declared fit for work when they are clearly not. She also highlighted the fact that although there is a need for some form of conditionality, the conditions should be proportionate and fair. She called on the Government to look at the trial of the yellow card warning system, and argued that the very need for it shows that the system is not working. I call again on the Minister, as I did two weeks ago, to tell us about the detail of that trial—when we can expect it to happen, and where and how it will happen. That detail has not so far been forthcoming.

My hon. Friend the Member for Banff and Buchan also highlighted the hardship and destitution resulting from sanctions. The Crisis report gives excellent qualitative evidence on that: 1,000 people were spoken to in a survey, and the impact on their lives was documented. My hon. Friend’s speech, coupled with the Crisis research, reveals the urgent, desperate need for a review of the sanctions regime, and for better protection of homeless claimants and those with mental health conditions against extreme hardship resulting from sanctioning.

My hon. Friend also touched on issues to do with hardship payments, which I hope the Minister will reflect on and deal with. Sanctions have not become a deterrent. That is clear, and my hon. Friend showed it. Indeed, there is a debate to be had about whether a deterrent is needed. The Crisis report set out that homeless people accept the need for conditionality. The problem is that they are simply unable to comply with the conditions, because of their unfortunate circumstances.

My hon. Friend the Member for Glasgow North East (Anne McLaughlin) made an incredibly powerful speech on behalf of her constituents, and I must agree with her. Over the nearly eight years I have helped in and represented the constituency of Airdrie and Shotts, I have yet to come across anyone who has shirked the responsibility of looking for work, or anyone who does not want to get work. As my hon. Friend said, there is no bonus for living on social security support. I support her in challenging any of us here to live on £73 a week. Maybe we could do it for one week, but week after week it would be incredibly difficult. No one gets comfortable on benefits. For her to be able to draw on her own experience of living on social security support and applying for jobs, and of the dent to confidence from being knocked back, was powerful testimony to which I hope the Government pay heed.

My hon. Friend the Member for Aberdeen North (Kirsty Blackman) was worried about following my hon. Friend the Member for Glasgow North East, but she did so well. She drew on figures from the Crisis report, such as the one showing that 77% of those sanctioned had skipped meals. That has to be a wake-up call. That figure alone should trouble Members in all parts of the House. Another critical figure is that 60% of those sanctioned found it harder to find work as a result—little wonder, frankly. The rise in the number of food banks in her constituency is reflected in mine, but we should not be relying on food banks and third sector organisations to fill the gaps in the social security safety net caused by Government cuts. I hope that the Minister will reflect on that in her winding-up speech.

My hon. Friend the Member for Glasgow Central (Alison Thewliss) spoke about the case of her disabled constituent who was sanctioned for a year—an absolutely disgraceful example, which we should all be shocked by. She was also quoted in a newspaper report this morning—I have a copy, if the Minister wishes to read it—which highlights another of her constituency cases. My hon. Friend’s constituent had earned employment at the DWP, but was sanctioned while waiting for the employment to start. That sums up the omnishambles of the sanctioning regime.

[Michael Tomlinson]

The hon. Gentleman, too, is highlighting some of the hard cases. As the SNP spokesman, however, will he confirm whether it is his and his party’s policy for there to be no sanctions system? After all, sanctions have been part of the social security system since 1946.

[Neil Gray]

I pay tribute to the hon. Gentleman for his diligence, especially after the put-down by my hon. Friend the Member for Glasgow Central: the hon. Gentleman was himself late for the debate and, had he been on social security support, he would have been sanctioned. I do not believe that many of us could survive for longer than a month or so without our own salary, never mind the £73 a week that other people have to live on. It does him no service to push this. As for our view of sanctions, we believe that there should be conditionality, absolutely, but not the punitive sanctioning that has increased exponentially under this Government and the previous one. That is our concern, not conditionality or sanctioning in general. I hope that answers the hon. Gentleman’s question.

As my hon. Friend the Member for Banff and Buchan said, the sanctions regime is causing extreme hardship and is being operated in an arbitrary and unfair way. The Crisis report she quoted shows plainly what is happening to homeless people.

[Emily Thornberry]

Does the hon. Gentleman acknowledge that the rules were changed in 2012, resulting in the much greater use of sanctions than ever before?

[Neil Gray]

Yes, absolutely, the Labour spokesperson is right. There is clear, documented evidence of the rate of sanctioning for all social security benefits such as JSA and ESA having risen since the coalition Government came to power.

Homeless people are twice as likely as others to be sanctioned, which must shock us all. I hope that the Minister will advise us of what plans she has to extend the at-risk group to those with mental health conditions and to the homeless, as I called for two weeks ago. I hope she will provide some detail on that.

[Angela Crawley (Lanark and Hamilton East) (SNP)]

The Scottish Association for Mental Health published research that found that 98% of service users had said that their mental health had deteriorated as a direct result of welfare reform. The research confirmed that benefit sanctions had been detrimental to the mental health of service users. Does my hon. Friend agree that sanctions are inhumane? I call for a review of the practice.

[Neil Gray]

Absolutely. Two weeks ago I called for that same review, and the Select Committee on Work and Pensions has done so as well. I hope that the Minister will respond. It is little wonder that mental health of people who have been sanctioned suffers—their confidence, their ability to find work and their ability to feed and water themselves and their family are all damaged. It is little wonder that we find evidence that people’s mental health is suffering. What benefit does sanctioning give to people seeking work? Very little, if any.

In the Minister’s response to my earlier debate, she stressed the importance of sanctioning to the social security system and to getting people into work. I hope that in her response today she will provide some evidence of the effectiveness of sanctions in pushing people into work. I am genuinely interested to hear what the Department has done to get evidence of how many people have returned to work within three or even six months of a social security sanction. I am interested because there is certainly plenty of evidence to show that the system is not working.

One example of evidence is the academic research conducted by Oxford University and the London School of Hygiene and Tropical Medicine, which my hon. Friend the Member for Banff and Buchan cited. They looked at official data on sanctioning rates, employment rates and benefit off-flow between 2005 and 2014 in 375 local authority areas—a pretty comprehensive and wide-ranging study. They found that for every 100 JSA claimants who received a sanction, 42.4 no longer claimed the benefit. That sounds great until we realise that only a fifth of them actually reported having found work. So for every 100 sanctions, we get 8.5 people into work. Also, from those 100 sanctions, 34 people no longer claim the benefit but are not in work. How many of them are self-denying the support to which they are entitled and which they need because they are so scunnered and fed up with the system?

Has the Department carried out a social impact study? Has any work been done with those who have been sanctioned to find out what their experiences were, their destinations after the sanction and the impact on their quality of life? The Government have been quick to dismiss any link between work capability assessments and suicides, in spite of the study from Oxford and Liverpool Universities linking 590 suicides to WCAs. The Government have also been quick to say that the sanctions regime plays an important part in the social security system. As far as I can see, however, neither statement has so far been supported with fact. I hope that the Minister will enlighten us today.

[Emily Thornberry]

Is the hon. Gentleman aware of another statistic? If people go on the Work programme, they are as likely to get sanctioned as to get a job.

[Neil Gray]

That is a highly depressing statistic for the Government to reflect on.

I hope that the Minister will give us more detail on the yellow card sanction or early warning system. We heard that it was to be trialled in the new year, but where will the trial be, how long will it last and under what terms will it take place? I asked the same questions two weeks ago and hope that the Minister can now advise us of the answers.

Finally, will the Minister agree to the full independent review of the sanctions regime called for by the Work and Pensions Committee and by my party? With half of all sanctions being overturned on appeal, a sizeable increase in sanctioning rates and documented evidence from Oxfam, the Poverty Alliance, Crisis and many others linking sanctions to increased food bank need, now is the time for the Government finally to realise the damage that they are causing to individuals and communities and to review the sanctions regime.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Gillan.

I, too, did not expect to be back in Westminster Hall discussing benefit sanctions so soon after the previous debate. Nevertheless, I am grateful to the hon. Member for Banff and Buchan (Dr Whiteford) for securing the debate. I am also very grateful to the hon. Member for Glasgow North East (Anne McLaughlin) for speaking from the heart, for speaking the truth and for speaking so powerfully.

The debate has given us another opportunity to hold the Government’s feet to the fire. As the official Opposition spokesperson, I tend to speak second to last, before the Minister, so I do not get a chance to come back at her. We are two weeks on from the previous debate, so I will anticipate to an extent what the Minister will say this time. Perhaps that will challenge her on some of the things that I suspect will be in her speech and she might be able to answer some of the questions.

I spent a long time looking at the Minister’s previous speech from two weeks ago. It was interesting, but a number of things seemed odd. She seemed to indicate that the Government had given up even trying to persuade us that their sanctions regime is helping people into work, because she said,

“we know from claimants that there is a positive impact on behaviour” —[Official Report, 2 December 2015; Vol. 603, c. 174WH.]

and that, “sanctions make it…clear” to people that they must “follow the rules”, so they are not about jobs. As is obvious, following the rules in terms of looking for work is not the same as finding work. In fact, it has become increasingly clear that, in many cases, the rules are a set of arbitrary boxes to be ticked that are as likely to hamstring people looking for work as they are to help them.

Sanctions are a major concern in Scotland, as they are in the rest of the country, as today’s debate and the previous one show. I was struck by a case that came up at a recent hearing of the Scottish Parliament’s Welfare Reform Committee on sanctions. A man from the east end of Glasgow described his experience on the Work programme, which included being made to sit in an office from nine to five, cold calling local employers to ask whether they had any vacancies. Of course they did not, so he ended up with a string of rejections, which was deeply humiliating as well as being a complete waste of time. For the Minister to suggest that the rules are about tailoring to the needs and circumstances of the individual frankly contradicts all the evidence and experience, which is to the contrary.

The Minister spoke about the claimant commitment in our previous debate. It is worth saying a few words about that, not least because, by setting the conditions that jobseekers are expected to adhere to, it has become an inextricable part of the wider sanctions debate. What are the conditions? Like the sanctions regimes we have today, the claimant commitment was a bit of a wheeze, cooked up by the coalition Government in what seemed to be more of an effort to score political points than to help people find work. I read the two reports on universal credit published by the DWP a little over a week ago and one thing I found interesting was that only 37% of people surveyed by the Department felt that the claimant commitment set realistic expectations that would help them find jobs.

It is time for a proper evaluation of the claimant commitment. Although that was a key recommendation of the Work and Pensions Committee in its recent report on sanctions, the Government continue to refuse to do that or to give us a reason why. In her previous speech, the Minister referred to her Department’s efforts to “improve” the system by taking on board the recommendations of the two recent reports. One of them, which was by Matthew Oakley and published in July 2014, has been referred to, while the other is the Work and Pensions Committee’s report from March to which I just referred. She said that the Government have

“responded positively to the…Oakley review”,

and that they had

“accepted all 17 of the Oakley recommendations to improve the process”.—[Official Report, 2 December 2015; Vol. 603, c. 176WH.]

I found that interesting, so I had a good look into that. However, I am afraid that the Minister has been gilding the lily.

The Government actually said that that they would accept the recommendations

“wherever possible, and subject to detailed feasibility and securing the necessary resources”—

weasel words.

Effectively, they are giving no commitment at all and the reality is that, 18 months after the Oakley report was published, some of its most important recommendations have gone exactly nowhere. Recommendation 11, for example, called on the Government to pilot a system of non-financial sanctions. That seems entirely sensible, particularly for those with a strong record of meeting the requirements placed on them and who, for example, may simply have had a wife in labour.

To give another example, recommendations 12 and 14 suggested that the Government end the absurd practice of Work programme providers being required to refer people for sanctions even if the providers themselves do not believe that there has been an offence. The Government rejected that common-sense suggestion and once again gave no reason. Therefore, the Minister claims to have “responded positively” to Oakley, and to have accepted his recommendations “in full”, but, having had a good look at the reality as opposed to the rhetoric, I do not see how they match up.

Similarly, the Minister did not tell us the whole story when she described the Government’s response to the Select Committee report. She said that its Chair had

“welcomed our response and, importantly, our willingness to engage with the Committee to ensure that the conditionality system works as it should.”—[Official Report, 2 December 2015; Vol. 603, c. 176WH.]

Let us have a look at that. By far the most important recommendation was for there to be a full, independent review of the entire system. Inexplicably, the Government refuse to do that and will not give us a reason.

Another of the Committee’s particularly important recommendations was for there to be a thorough evaluation of the new approach to in-work conditionality. We all need to be mindful of what the Government are doing and what they are about to do. They are currently piloting, within universal credit, an expansion of the conditionality regime. That pilot is very shadowy. We do not know where it is, who is being put through it or how many people are on it and, when we ask, the Government do not give us any answers. In-work conditionality means that someone is working, but they are not working enough, so, as far as I understand it—if I am wrong, I would love to hear from the Minister about exactly what is going on—they are told that, even though they are working, they must look for more work and, if they do not, they will get sanctioned. If that is right, we would like to know the details.

We welcomed the recommendation of a review, not least because in-work conditionality is completely untested and unprecedented—it is a new concept within any social security system. The Government’s response to the recommendation was good. I give the Minister full marks for her response. She stated:

“We agree that individuals on Universal Credit and in work will not be subject to the full range of work-related requirements and sanctions beyond existing pilots until we have fully considered the learning from those pilots.”

Great.

However—surprise, surprise—we heard from the Chancellor of the Exchequer in the autumn statement seemingly just a few weeks thereafter that the Government will

“extend the same support and conditionality we currently expect of those on jobseeker’s allowance to over 1 million more benefit claimants.”—[Official Report, 25 November 2015; Vol. 602, c. 1371.]

I do not know whether the Minister knew that. Who are those claimants? What are the Government doing on this? We have a shadowy pilot and we are told that it will be looked at properly before it is extended, but then the Chancellor of the Exchequer says that it will be expanded to another million people and we do not know what the circumstances are. This is completely new. The current sanctions regime is bad enough and if the Minister is now to expand that to those in work, we need to know why and how.

[Neil Gray]

Does the hon. Lady share my concern that the conditionality and sanctioning regimes are just a fig leaf for social security cuts?

[Emily Thornberry]

With great respect, I think that is a simplistic argument and that it goes further than that. Those who have been subjected to a large number of sanctions lose confidence and end up “economically inactive” and, when they are asked why they have become economically inactive, we find out that it is because they have been discouraged. For many people, that means sleeping on the sofa, asking mum for a loan and begging. Many people are falling out of the system and a large number of them are very young, but that allows the Prime Minister to get up at Prime Minister’s questions and say that the number of claimants is going down. It is more cynical than cuts. Cuts is bad enough, but that takes things further.

The Government have not made clear exactly what they will do, but our assumption is that the 1 million people must include those on universal credit. I respectfully suggest that the Government saying one thing to the Select Committee and then the exact opposite in the Chamber just four weeks later does not look like the Minister’s promise to have “engaged” with the Committee in any positive way.

More troubling still are the implications of that U-turn for the future of sanctions policy. The sanctions regime is broken, but the Government will not look at it or allow an independent review. They are bashing on regardless and now they want to increase it to include those in work. During the previous debate we seemed to be fairly close to reaching cross-party consensus on the fact that it is broken. The only differences that arose were in relation to the scale of the problem. It does need fixing.

For the Government more or less out of the blue to suggest that they intend to expand the scope of sanctions is quite extraordinary. I hope that, this afternoon, the Minister will answer some of the questions rightly asked by the Opposition to hold the Government to account, because it is silly for us to have to keep coming back time and again to Westminster Hall to ask them.

[The Minister for Employment (Priti Patel)]

It is a pleasure to serve under your chairmanship, Mrs Gillan. I will endeavour, in the time I have, to cover as much ground as possible.

It is fair to say that I am always happy to come to the Chamber to participate in debates on this important issue. Today’s debate has given all Members the opportunity to give their constituents’ views and their personal views on the sanctions and benefits system. It has also provided opportunities for Members of the House to discuss how we can support and encourage people back into work. On a day when we see figures showing record numbers of people in employment, we should welcome all the support put in place through our jobcentres and work coaches to help people into work. It is somewhat disappointing that we have not heard much from Members in this afternoon’s debate on the support available to help people into work.

Conditionality is a key part of the approach that has helped to deliver record-breaking levels of employment, labour market improvements and the lowest claimant count since 1975. As we have debated not only today and in the debate a few weeks ago but continuously, sanctions have been part of the welfare system for a considerable number of decades.

[Neil Gray]

Does the Minister accept that since her Government and their predecessor, the coalition, came into power, the sanctioning rate has increased for not only ESA but JSA? Can she give any reason for that?

[Priti Patel]

I do not accept what the hon. Gentleman says at all. Sanctions have been a part of the welfare system for a considerable number of decades, and successive Governments of all parties have acknowledged the principle that there should be a link between benefits and engagement with the labour market. That principle has been at the heart of the system, and it is important to recognise that that is exactly how the system works right now; we engage claimants and ensure they are being supported in their work searches, while ensuring fairness and balance in the system.

The claimant commitment clearly sets out the consequences of failing to meet the requirements of the claim. As I have stated in previous debates, the claimant commitment is discussed at length with the claimant and, of course, takes account of any barriers to work, health conditions, disabilities or caring responsibilities.

[Priti Patel]

I will not, because I have many comments to make and we are short of time.

Two weeks ago, in the previous debate on sanctions, a number of Members quoted from reports and gave statistics to support their claim that the system is broken. We have heard similar quotes today, but we should be clear that much of what has been quoted is not fully representative of the system. We have heard extensive quotes from Oxford University and the London School of Hygiene and Tropical Medicine report that suggests only 20% of JSA claimants find work after a sanction has been imposed. That is misleading, because it makes the assumption that the 80% of people who leave JSA with unknown destinations do not enter work. In fact, many people do not inform Jobcentre Plus of their post-benefit destination because they are getting into work.

Statistics published by the Office for National Statistics put a clear disclaimer on the data, stating that the destinations data are unreliable and that it should not be assumed that all movements into employment are accurately reported. It would have been more accurate for Members to quote from the comprehensive DWP destinations survey that found that 68% of those leaving JSA move into work.

Members have rightly raised the issue of sanctions for people with mental health conditions. Less than 1% of ESA WRAG claimants with mental health conditions are sanctioned each month. The latest available data show that the number of sanctions across ESA WRAG claimants has decreased over the past year, including for those with mental health conditions. That is because, as we have continuously stated, we are seeking to support people with health conditions and, in particular, mental health conditions into employment.

The Government have just pledged more than £40 million to develop a proper and robust evidence base on which approaches are effective for people with mental health conditions. Over the next three years, that investment will enable us to have informed pilots that are based on evidence, to see exactly what kind of support works for those people and whether cognitive behavioural therapy for people on ESA, JSA and UC makes a difference. We are now working in a more integrated approach with the Department of Health on the use of talking therapies in our jobcentres and other community locations.

Several hon. Members mentioned the recent Crisis report, but they did not highlight that the report found there was support for a system of conditionality among the respondents interviewed.

[Neil Gray]

I said that.

[Priti Patel]

Let me finish my point. The report noted that

“the sanctions regime does prompt some behavioural change”.

Scottish National party Members have secured this debate; I congratulate them on that, but they have had their say. They have been giving very inaccurate reports about the sanctions regime. As I have said at least six or seven times on the Floor of the House, if individual Members want to raise their cases with me, I am happy to look into them. If they want to raise cases about jobcentres in their constituencies or the conduct of work coaches, I would like to pick those up with them. Members who have raised such cases have not done so previously, but I give them the opportunity to do so.

Oral Answers to Questions

Neil Gray Excerpts

Monday 7th December 2015 Commons Chamber

[Mr Duncan Smith]

It does not suit the Opposition to know it, but all those who transfer from tax credits, through the legacy system, into universal credit will be transitionally protected. That is critical. They do not want to know that, because, as I said, they are the party who failed to transitionally protect anybody when they abolished the 10p tax rate.

[Neil Gray (Airdrie and Shotts) (SNP)]

We welcome the apparent tax credits U-turn, but it appears that the cuts to the work allowance, which will still go ahead under universal credit, will hit families just as hard. Will the Secretary of State assure us that the tax credits U-turn will also apply to the corresponding elements of universal credit, or will he confirm our suspicions that this so-called U-turn is merely a delaying tactic?

[Mr Duncan Smith]

The universal credit position is exactly as set out at the time of the summer Budget, which means, as we understand it and calculate it, and as figures released in the last 24 hours show categorically, there will be a huge improvement in the numbers of people going back to work, working full time and earning more money. I absolutely believe that, in the next few years, the hon. Gentleman will be one of the first to say, “Thank God we introduced universal credit.”

Benefit Sanctions

Neil Gray Excerpts

Wednesday 2nd December 2015 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

I beg to move,

That this House has considered benefit sanctions.

I thank you for taking the time to chair the debate, Ms Dorries; it is a pleasure to serve with you in the Chair. I also appreciate the time that right hon. and hon. Members from across the House have taken to be present in Westminster Hall, especially given our sombre and difficult discussions in the main Chamber.

It is important to state that the Scottish National party accepts the need for some level of conditionality in the social security system and that sanctioning has been part of the system for many years. However, of great concern to us is the evidence that points to claimants being sanctioned in a hasty manner and at an increased rate, and the evidence that social security sanctions link directly to the exponential rise in the use of emergency food aid, or food banks.

We cannot allow conditionality and sanctioning to be a fig leaf for social security cuts. There is strong evidence that sanctions are being applied too quickly, with half of them being overturned on appeal. People cannot live off fresh air, so it is understandable that the Trussell Trust, the Poverty Alliance, Oxfam and others have directly linked increased food bank dependency to social security sanctions, delays in welfare payments and low incomes.

I will focus my contribution this afternoon on the report of the Select Committee on Work and Pensions entitled “Benefit sanctions policy beyond the Oakley Review”, which was published on 18 March this year, and on the written statement from the Secretary of State in response, dated 22 October. The report stated that

“expert and academic witnesses reported that the international evidence on the specific part played by the application, or deterrent threat, of financial sanctions in successful active regimes was more nuanced and far from clear-cut.”

Evidence from the University of Oxford and the London School of Hygiene and Tropical Medicine highlighted their comparative analysis of the social security sanctions systems applied in the European Union and in the USA, which indicated variable effectiveness in getting claimants back into work and that the UK’s system was one of the most punitive.

What was of great concern to me was the Committee’s view that it was

“concerned that support for claimants was likely to reduce or stop during a sanction period, as the claimant might stop engaging with JCP or the contracted provider.”

That correlates with the anecdotal evidence that I have from constituents, family members and friends who have decided against claiming the social security support to which they should be entitled because of the undue stress and aggravation that the system places on them, including sanctions, work capability assessments and threatening letters—often wrong—about alleged overpayments. We should not be getting ourselves into a place where people are becoming so exasperated by the system that they are self-denying the support available to them, whatever the consequences.

The Oxford and LSHTM research examined official data on sanctioning rates, employment rates and benefit off-flow from 2005 to 2014 in 375 local authority areas in the UK. The study found no relationship between local sanctioning rates and employment rates, but it found a strong relationship between sanctioning rates and off-flow, and that that relationship had become stronger since 2011, when there was an escalation in conditionality brought about by the introduction of the mandatory back to work schemes, followed by the changes in the Welfare Reform Act 2012.

For 2011 to 2014 the study estimated that for every 100 jobseeker’s allowance sanctions applied there was an associated off-flow from JSA of 42.4 persons. The study claims that only about 20% of those leaving benefit following a sanction reported having found employment, so what about the rest? Part of my primary concern is that the sanctions regime is being used as a fig leaf for social security cuts, whether direct or indirect, and that there is little evidence that the stated aim of Government regarding sanctions—that they push people into work—is playing out in reality.

That view is supported by Crisis in its March 2015 publication, “Benefit sanctions and homelessness: a scoping report”. The report highlights the fact that the number of JSA sanctions per 100 claimants has almost tripled between 2001 and 2014; that the average monthly number of JSA sanctions has rocketed from 35,000 up to October 2012 to nearly 85,000 thereafter; and that there has been a threefold increase in employment and support allowance sanctions between March 2013 and March 2014. I do not believe that all of a sudden, upon the election of the coalition Government and beyond, jobseekers and social security claimants became less compliant. Something else appears to be in play.

The Committee report was damning about the sanctions regime as it stands. The Secretary of State’s response was published in the House on 22 October. It focused on three main areas: the so-called yellow card sanctioning system; automated sanctions letters; and the at-risk or vulnerable groups. I will address each in turn.

The statement was a step in the right direction—we acknowledge that—but my colleagues and I none the less have significant concerns about the direction of travel. The Work and Pensions Committee called for a full and independent review of the sanctions regime, which we in the SNP have long called for, but the Secretary of State announced a trial yellow card system. A 14-day warning is welcome and a step in the right direction, but the introduction of the trial yellow card system shows that the existing regime is failing. Perhaps the Government will consider a real yellow card system, which would have not only a 14-day timescale for appeal, but a “first offence” warning without sanction. Perhaps the Minister will consider that.

I am also concerned that the Department will be reintroducing the automated system for sanctions letters, which will open the regime up to more mistakes being made than is already the case. I hope that the Minister will advise what support will be made to claimants to allow them to appeal quickly and at no cost to them. I would also appreciate the Minister’s guidance on how incorrect sanctions will be avoided under the automated system. At present, according to the Government’s March figures, 50% of the sanctions dished out are overturned on appeal. The Secretary of State said in his statement that the yellow card system would be trialled “early next year”, but no further detail has been forthcoming. Perhaps the Minister present will give this debate an exclusive and explain where, when and how the trial will work.

A commitment was also made to consider extending the at-risk group to include homeless claimants and those with mental health conditions, which would be important—that is important to all Members. I hope that the Minister will consider the issue carefully. My pitch today is for the Minister’s consideration to end in confirmation that people with mental health conditions and the homeless will be included in the at-risk groups and therefore exempted from the most excessive sanctioning levels. We want a root-and-branch review, but the immediate introduction of protections for those with mental health conditions and for those who are homeless will provide protection in the interim.

The Crisis report that I quoted earlier suggests that not only are homeless people disproportionately at risk of being sanctioned, but that sanctions in themselves increase the risk of homelessness as claimants are forced to cut back on housing costs. Clearly, homelessness only pushes people to the margins of society and further from the labour market, so we have strong evidence that sanctions force people into temporary and long-term destitution.

Where is the evidence to suggest that the stick is forcing people into work, which is what the Government claim as they apply the sanctions? How does removing people’s ability to pay their bus fare to a job interview, to buy an appropriate interview outfit, or to buy the food that they need to think clearly help a jobseeker into work? My argument is that it does not. Sanctioning simply pushes people further from the labour market and into destitution. Indeed, it would appear that the Government are struggling to justify sanctioning as well. In August this year it was discovered that in order to convince the public of sanctions’ worth, the Government had used fabricated quotations from fictitious people talking about their positive experiences of the welfare and sanctions system.

We cannot ignore the clear and absolute need for a full and independent review of the sanctions regime. There is little or no empirical evidence to suggest that sanctioning aids people into work that is relevant to their abilities and desires—never mind well paid or secure work—while there is a plethora of evidence that the existing set-up is driving people towards food banks and poverty. The Government cannot stick their head in the sand about the consequences of austerity at all costs and the impact of sanctioning social security claimants.

In conclusion, I appeal directly to the Minister: if she cannot listen to me or the SNP, will she please listen to the cross-party Select Committee, or to the likes of Oxfam, the Poverty Alliance, the Trussell Trust, Crisis and a swathe of other third sector organisations about their concerns about sanctioning, and will she instruct an independent review of the system? While such a review is carried out all sanctions should be halted as a new system is agreed.

I thank you, Ms Dorries, for your time this afternoon and I thank right hon. and hon. Members for their consideration.

--- Later in debate ---

[Priti Patel]

We know from claimants that the principle of conditionality and the claimant commitment have a positive impact on behaviour. Nearly three quarters of people on JSA and over 60% of those on ESA say that sanctions make it very clear to them that they will follow the rules, in terms of the claimant commitment and their discussions with work coaches. Those rules will also help them to gain employment, so they understand the discussions and dialogue that take place with them with regard to conditionality.

[Neil Gray]

Further to that point and the helpful intervention from the Labour shadow Minister, does the Minister not accept that, when a claimant has been sanctioned, that removes their ability—for a long time, because these are often cases involving people who have very little means—to access the services and job interviews and all the other issues associated with getting back into work? Does she not accept that and see, in a number of cases, that it is clear that the sanction has damaged the claimant’s ability to get back into work?

[Priti Patel]

Specific to individuals who have been sanctioned, first, there is a proper process on sanctioning, so we must not lose sight of that. That process includes a tailored claimant commitment and an action plan, so that individuals know what is expected from them, and importantly, the support that they will access and get from jobcentres and work coaches. The hon. Gentleman also mentioned mental health, which I will come on to. With regards to the proper process on sanctions, we have safeguarding and hardship payments, and those provide the support arrangements for people who are subject to a benefit sanction.

--- Later in debate ---

[Neil Gray]

I thank all Members for their contributions. They have all been fair, but also have shone a light on what is going on for many hon. Members locally. My hon. Friend the Member for Ayr, Carrick and Cumnock (Corri Wilson) made an impassioned speech based on her knowledge of the system from her working life. That brought great scope to the debate.

My hon. Friend the Member for Coatbridge, Chryston and Bellshill (Philip Boswell) made another fantastic speech, elaborating on local issues that we share, as we represent neighbouring constituencies. I am sorry that given the circumstances, which are understandable, he could not elaborate further, particularly on issues such as fuel poverty. I know he was very keen to get across points about that.

My hon. Friend the Member for Rutherglen and Hamilton West (Margaret Ferrier) made good points about how any one of us who might find ourselves relying on social security support at any point in our lives would respond to being sanctioned. She also mentioned the Bill being promoted by our hon. Friend the Member for Ochil and South Perthshire (Ms Ahmed-Sheikh), which I fully support.

I greatly appreciate the comments of the Labour shadow Minister, the hon. Member for Islington South and Finsbury (Emily Thornberry). I thought that her position was rightly very close to that held by the SNP. She reiterated that the research showed that just 20% of the 42% of people who had left JSA after being sanctioned had reported finding work. I thank her for her supportive comments and for her flexibility over how the debate happened this afternoon.

I also thank the Minister. I appreciate her personal comments to me, but also the way she made her contribution. She acknowledged that the points that Opposition Members have been raising are important, and I welcome that. She mentioned hardship payments. We have to realise that they are at a level far less than the normal income that people are used to. Even though people are receiving those payments, we have to consider the impact on their lives in the short, medium and long term.

The Minister said that circumstances had to be taken into consideration, but she stopped short of saying that the at-risk groups would be expanded to include people with mental health conditions and the homeless. I hope that we can work on that over time. She said that 60% of ESA claimants say that they wish to get back into work. My experience is that far more would work if they could, but they feel that they have been unfairly assessed. The cuts to ESA that are to come will hinder people who need that extra support to get back into work, particularly those with mental health conditions. I hope that the Minister will take that issue away and consider it with colleagues.

I thank the Minister, my colleagues, the Labour shadow Minister and you, Ms Dorries. I look forward to making further progress on these matters in the coming weeks and months.

Question put and agreed to.

Resolved,

That this House has considered benefit sanctions.

Young Jobseekers

Neil Gray Excerpts

Tuesday 27th October 2015 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Gray, and to have the opportunity to sum up on behalf of my party. I congratulate the hon. Member for Norwich North (Chloe Smith) on securing this debate and on what I thought was a fair and balanced speech. I admire her positivity, although her experiences and those of her constituents are not necessarily shared elsewhere.

I share the hon. Lady’s respect for jobcentre staff. I will quote some of the findings of the YMCA that perhaps point to the idea that some of the issues being experienced arise from policy rather than staffing. The YMCA report points out that although hardship payments are available to sanctioned claimants, in practice

“YMCA know that in many cases claimants are not being made aware of the availability of such schemes”.

The YMCA found that young people were not being given adequate information about sanctions, including support on how to avoid being sanctioned, explanations of why they have been sanctioned and practical advice on what to do once they have been. YMCA research on the effects of sanctions on vulnerable young people found that 84% had cut back on food as a result of being sanctioned. That is a troubling statistic.

My hon. Friend the Member for Lanark and Hamilton East (Angela Crawley) made an excellent contribution. Youth unemployment is indeed a tragedy, and we must recognise young people’s potential to contribute to our society and economy. She pointed out the narrow-mindedness of pushing young people towards work through sanctions. We should believe in our young people. She drew on the example of free higher education in Scotland, which provides real opportunities for young people, and made it clear that higher education should be about ability to learn, not ability to pay. I completely agree with that sentiment.

As for the remarks of the hon. Member for Mid Derbyshire (Pauline Latham), I laud the fact that youth unemployment is dropping in some areas, but I am not sure that all those jobs will be in full-time, secure and well-paid work. So many new jobs in recent years have been insecure, low-paid zero-hours contracts. The Government must report on the quality of new jobs. I agree completely with the remarks of the hon. Member for Ealing Central and Acton (Dr Huq) on sanctions; I will say more on that shortly.

The hon. Member for Bolton West (Chris Green) pointed out that jobcentres are not sufficiently flexible to meet the needs of those relying on them for support, which I agree with absolutely. The hon. Member for Strangford (Jim Shannon) made, as ever, a thoughtful contribution. I agree that young people are not feeling the benefit of economic recovery as yet and are not feeling supported. Perhaps that is being worsened by the Welfare Reform and Work Bill being debated on the Floor of the House at the moment. The hon. Member for Derby North (Amanda Solloway) said that jobcentres are not the only route to work, pointing to education and apprenticeships. On that point I again echo the remarks of my hon. Friend the Member for Lanark and Hamilton East.

The debate has been useful and worth while, and in general very positive, but we must point to the facts as they are. The DWP is failing workers and jobseekers with its dangerous welfare reforms and sanctions regimes. The reforms are already going to have a devastating effect on young people in general and will have the combined effect of hitting young jobseekers very hard. An increasing number of young homeless people are being sanctioned. Those who are vulnerable are being asked to comply with unrealistic conditions, resulting in sanctions that only deepen their disadvantage. I draw on the evidence already presented by the Joseph Rowntree Foundation, on the Trussell Trust report on food poverty from June 2014 and on the March 2015 Crisis report on homelessness, which says that the number of JSA sanctions has almost tripled from 2.5 sanctions per hundred claimants per month in the year ending 2001 to seven per hundred per month in the year ending 2014.

In conclusion, it is clear that something is going fundamentally wrong with how the DWP deals with young people seeking work. In my view and in the view of my colleagues, it is time to devolve to Scotland all social security functions and the resources to support that, so that we can plot a different path from the punitive and marginalising approach currently deployed by this Government.

[Mr James Gray (in the Chair)]

It may be helpful for colleagues to know that the official time for the end of the debate, owing to injury time in a previous debate, is 5.53 pm, although I am told there will probably be a Division in the main Chamber at 5.45 pm.

Child Poverty

Neil Gray Excerpts

Tuesday 15th September 2015 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Howarth. I congratulate my hon. Friend the Member for East Renfrewshire (Kirsten Oswald) on securing this debate. It is a pleasure to follow the hon. Member for Strangford (Jim Shannon), who made a measured, reasoned and impressive contribution.

At the outset I must declare an interest. It is not financial and therefore does not appear in my entry in the Register of Members’ Financial Interests, but it is certainly relevant to the debate and without doubt influences what I have to say. My constituency of Airdrie and Shotts has a child poverty rate of 27% after housing costs have been considered; in some wards, one third of children are living in poverty. That is truly depressing and heartbreaking. I will briefly point out how that figure compares with that for the constituencies of other Members. Witney has a child poverty rate of 13%; in Witham, the rate is 17% and in Tatton it is 16%. Those rates are all far too high and require much work; nevertheless, they are among the lowest in the UK.

The causes of child poverty are without doubt complex. However, the Institute for Fiscal Studies, which has been much quoted in this debate, has made it clear that the projected rise in the rate of child poverty is largely down to UK welfare cuts. Indeed, the conclusion to a 2014 IFS report states:

“Real cuts to working-age benefits are a key reason behind rising child poverty.”

Little wonder that the Secretary of State for Work and Pensions is so determined to withdraw the criteria for measuring child poverty. His Government’s welfare cuts will plunge countless more families and children into poverty. A very large chunk of those who will find themselves desperately struggling to make ends meet—and who will be forced to choose between heating and eating, as the hon. Member for Strangford said—will be households where at least one adult is in work.

[Douglas Chapman]

My hon. Friend will perhaps be aware of the report by the Educational Institute of Scotland called “Face up to Child Poverty”, the stand-out quote from which was:

“Not only is the incidence of poverty increasing, the nature of poverty is changing. Low wages mean that more than half (59%) of children living in poverty are within families in which at least one adult is employed…Scotland has seen a 400% increase in the use of food-banks…and organisers report that a significant proportion of their clients are in work”.

Will he comment on that view of how the nature of child poverty is changing? What should the UK Government do to change that situation?

[Neil Gray]

I thank my hon. Friend for pointing out that important report. It is a very sad state of affairs when our teachers have to deal with children who are hungry when they come to school. That is shocking and depressing.

Wholescale cuts to tax credits will reduce the allowance before tax credits start to be withdrawn from £6,420 to £3,850 and increase the taper rate at which tax credits are withdrawn from 41% to 48%. Those cuts will slash household incomes for 197,200 families in Scotland with nearly 350,000 children. Nearly 250,000 families in Scotland will be worse off by an average of £1,000 per year as a result of changes to tax credits alone. As they qualify for tax credits, those families by definition have the lowest incomes in the country. They are least able to deal with those cuts to their income and, as they are in low-income work, will have little opportunity to increase their wages to a degree that would make up the shortfall. They are also far more likely to live week to week and simply cannot cut their cloth to suit.

All that completely flies in the face of Government rhetoric about making work pay. Indeed, when the Budget measures are taken in the round, the IFS has said that people in the four lowest income deciles will see their net income cut by between £600 and £1,300; compare that with people in the ninth decile—the second richest decile in society—who are to receive a net income rise. Levels of income without question have an absolute bearing on levels of poverty, yet as a result of scrapping the Child Poverty Act 2010, this Government will no longer have to account for income levels in the UK.

Poverty robs children of their childhood. Children living in poverty are more likely to live in poor housing, and to have poorer education outcomes and greater health issues. Poverty is the greatest barrier to children achieving better life outcomes—the aim at the heart of the UN convention on the rights of the child. Given that it has been demonstrated that their measures will push more children into poverty, it is time for this Government to think again and take a different path.

For their part, with their limited influence over these matters, the Scottish Government are providing over £300 million between last year and next to help mitigate the worst of the Westminster welfare cuts for families in Scotland. That means the people of Scotland are paying twice for the Tory cuts—the Scottish Government have their budget slashed and they have to set aside extra cash to ease the burden for hard-pressed families.

In conclusion, for all the reasons I have mentioned, I say, in accordance with the traditions and procedures of this place, that yes, this House has considered child poverty in this debate, but in reality, its current Tory majority is certainly not considering child poverty, and it is about time that it did.

--- Later in debate ---

[Justin Tomlinson]

I thank the hon. Gentleman for his intervention, but again I plead with hon. Members to be patient; I am coming to those points.

There are now 800,000 fewer people in relative poverty, including 300,000 children. Compared with the second quarter of 2014, there are 50,000 fewer households where no one has ever worked. And importantly, the number of children living in workless households has fallen by 390,000 since 2010 and is now at a record low.

On the specific point about in-work poverty—that theme was followed in the majority of speeches and is important—the figure for relative low income in work is now 200,000 lower than the peak in 2008-09. However, we all recognise that more needs to be done. Wages are rising faster than inflation. That is on the back of having a strong economy. Everything that we do must be underlined by a strong economy. We talk about austerity, but without taking the difficult decisions, we would not now have a strong economy. We have only to look at our neighbours in Europe to see the consequences of not having a strong economy.

We have increased income tax thresholds year on year. We have now taken the lowest 3.8 million earners out of paying any income tax at all. We have set a commitment to raise the allowance to £12,500, and once we reach that point, we will link that to wages going forward, so the lowest earners will never be dragged back into paying income tax. We have set out our ambitious plans for the national living wage. That will make a huge difference. People are forgetting that the impact will not be just on those who get an immediate pay rise, which I think is about 2.6 million people. There will be a ripple effect that could impact on more than 6 million, according to some predictions. Also, the introduction of universal credit will remove the barriers preventing people from increasing their hours. As I mentioned, the biggest improvement is for those people who go from part time to full time. The benefits system was putting in artificial barriers, preventing people from increasing their hours. Universal credit will give people the flexibility steadily to increase their hours where they wish to do so.

We want to build on that progress, which is why we are bringing forward our new life chance measures. The Welfare Reform and Work Bill introduces a new duty to report annually on worklessness and educational attainment in England. We have chosen those measures because the evidence tells us that those factors have the biggest impact on child poverty and children’s life chances, and that is what matters. We want legislation to drive action that makes the biggest difference in the lives of our children. The worklessness measures will identify the proportion of children living in workless households and of children in long-term workless households. The educational attainment measures will focus on GCSE attainment for all pupils and for disadvantaged pupils. We will develop a range of other measures and indicators of root causes of child poverty, including family breakdown, problem debt and addiction, and set those out in our life chances strategy. As my right hon. Friend the Secretary of State has made clear, we will continue to publish low-income statistics annually, as part of the “Households Below Average Income” publication.

We should be focused on those pathways to poverty, not moving people around an arbitrary income line. As the right hon. Member for Birkenhead (Frank Field) put it,

“raising everybody above a set percentage of median income is rather like asking a cat to catch its own tail.”

Focusing on work and education will drive real action, which will make the biggest difference to children’s lives now and in the future.

Education is key to transforming children’s futures. Good English and maths skills are key to improving children’s future life chances. Nearly two thirds of men and three quarters of women with low literacy never receive promotion and are locked into their starting income.

[Neil Gray]

I would appreciate it if the Minister could advise how children attending school hungry are expected to achieve good educational standards.

[Justin Tomlinson]

I thank the hon. Gentleman for that point. Again, I will cover it as I progress.

Part of our commitment to social justice is the determination to ensure that every child is given an education that allows them to realise their potential. That is why we are raising standards with a vigorous new curriculum, world-class exams and a new accountability system that rewards those schools that help every child to achieve their best. Crucially, we introduced the pupil premium in the previous Parliament—it is worth £2.5 billion in 2015-16—to improve the life chances of disadvantaged pupils, and we have invested £50 million in the early years pupil premium to support disadvantaged three and four-year-olds.

Let me address issues such as children coming to school hungry when their parents have not been able to provide food—are not in a position to do so. I look at a lot of innovative schools that have provided food across the board. The school that was initially the worst-rated school in my constituency is now the highest rated. It used the pupil premium innovatively to provide food across the board, for all pupils. It recognised that that was a particular challenge and that if it did not solve that problem, what hope was there that pupils could concentrate and progress in the work environment?

[Neil Gray]

Will the Minister give way again?

[Justin Tomlinson]

This will have to be the last intervention because we are getting tight on time.

[Neil Gray]

Are we not taking this in a back-to-front way? Why should the schools be expected to provide that food when the parents themselves are unable to do so? Surely we need to address the income levels of the parents to ensure that they can provide for their children.

[Justin Tomlinson]

That is where we agree. We disagree just on how to get to that point. Government Members believe that work and educational attainment are the best way to provide the opportunity to break that cycle.

There are the wider education reforms, about which I have been very passionate. In the previous Parliament, we saw 2 million new apprenticeships. That figure is rising to 3 million new apprenticeships. We have had the introduction of university technical colleges, giving young people the real, workplace-based skills that will provide the best opportunity to get into work. We have also had the introduction of the national citizen scheme. I have seen year after year the increasing number of young people who are being transformed and who are then in a strong position to step into good careers.

The hon. Member for Strangford (Jim Shannon) talked about sport. I have long said that our schools, between 4 and 6 o’clock, should be opening up to provide free use of their facilities to community groups to provide sporting opportunities. Sport helped me not to follow the path of two of my colleagues at school, who went to serve at Her Majesty’s pleasure, although when I told my school that I had got elected to Parliament, the head did say that he was not sure which was worse!

I will turn to Scotland, because I recognise that most of today’s speakers were from Scotland. The Scottish Government have the power to address child poverty through action in areas such as health, education, housing, employability and childcare. Following our proposals in the Welfare Reform and Work Bill, they also have the freedom to choose what approach to take and how to act on, measure and report on life chances and child poverty, in line with the substantial areas of policy devolved to them. The UK Government are already giving Scotland through the Scotland Bill significant new taxation and welfare powers, including £2.5 billion-worth of new welfare powers and responsibility for raising more than 50% of what it spends. We will work closely with the devolved Administrations as the Welfare Reform and Work Bill proceeds and are open to reflecting their preferences regarding their jurisdictions in the legislation. We will take a keen interest in how that develops. In England, local authorities are being encouraged to come to the Government with their own innovative proposals, and we will always consider opportunities for further devolution.

In conclusion, our approach will ensure that tackling the root causes of child poverty and improving future life chances become central parts of our business as a one-nation Government. We will focus on transforming children’s lives by extending opportunity for all, so that both they and their children in turn can escape from the cycle of poverty and improve their life chances. Our new approach will drive real action, which will make the biggest difference to children now and in the future.

Oral Answers to Questions

Neil Gray Excerpts

Monday 7th September 2015 Commons Chamber

[Priti Patel]

My hon. Friend is correct. This Government have had a very strong track record in supporting young people in getting back into work. As I said earlier, this area was discussed at the recent G20. We have now joined an international commitment to do even more because we are ambitious for our young people. We have agreed to have a target for doing more by reducing the number of NEETs by 15% by 2025. We are committed to that. She will be interested to know that our international counterparts are also interested in what the United Kingdom has done and achieved.

[Neil Gray (Airdrie and Shotts) (SNP)]

T10. What assessment has been made of the impact of cuts to ESA for those with mental health conditions?

[Priti Patel]

I did not quite hear the hon. Gentleman’s question, but I think he was alluding to ESA. Ten days ago, my right hon. Friend the Secretary of State gave a speech that basically outlined that we will continue to support those on ESA with the right interventions to help them get back to work.

DWP Data

Neil Gray Excerpts

Tuesday 21st July 2015 Commons Chamber

[Priti Patel]

My hon. Friend makes a valid point. It is hugely ironic to hear the remarks of Labour Members, whose Government never published any information or data in this area. We are expected to meet the high standards required for the official publication of statistics, and that is exactly what this Government will do.

[Neil Gray (Airdrie and Shotts) (SNP)]

With all due respect to the Minister, she has not answered the question asked by my hon. Friend the Member for Glasgow South West (Chris Stephens) and the hon. Member for St Helens South and Whiston (Marie Rimmer). Will she appeal the Information Commissioner’s decision? Will the data be backdated to November 2011? Given that 200,000 people, including many of my constituents, have signed a petition calling for the data to be published, will there be parliamentary time to scrutinise it?

[Priti Patel]

The data will be published. The urgent question is specifically about the publication of mortality statistics.

Welfare Reform and Work Bill

Neil Gray Excerpts

Monday 20th July 2015 Commons Chamber

[Neil Gray (Airdrie and Shotts) (SNP)]

The Bill’s title is one of the finest examples of doublespeak I have seen outside of Orwell’s own texts. The Bill is not about welfare reform; it is about welfare cuts. As for being about work, I repeat what I said last week in my maiden speech: this Government must realise that they cannot threaten, demonise or sanction people into work.

It is absolutely clear that the best route out of poverty is work, but we must keep open the safety net of the social security system for those who cannot work permanently or temporarily. The Bill cuts away many of the links in that safety net and will leave people to fall through into poverty. For example, removing the work-related activity component of ESA just punishes those who are sick or temporarily unable to work through no fault of their own.

ESA is supposed to be available for people identified as having a “limited capability for work” as a result of sickness or disability. According to the House of Commons Library briefing, there were just short of 500,000 ESA claimants in that group in November 2014. Of those, 250,000 suffer from mental ill health or behavioural disorders. Under this cut, claimants will receive £1,500 less than they do now, which is an absolute scandal.

The chief executive of Mind, Paul Farmer, has said:

“People being supported by ESA receive a higher rate than those on JSA because they face additional barriers as a result of their illness or disability, and typically take longer to move into work. Almost 60 per cent of people on JSA move off the benefit within 6 months, while almost 60 per cent of people in the WRAG need this support for at least two years. It is unrealistic to expect people to survive on £73 a week for this length of time.”

I could not agree more. This cut does nothing to encourage people into work. It just forces them into poverty, and will ultimately push people with mental health issues and illnesses, which have held them back from work, further to the margins of society.

Yet again, we have heard welfare described in this debate as a lifestyle choice, which is utterly shameful. I say to the hon. Member for Mid Dorset and North Poole (Michael Tomlinson) and his colleagues, “There by the grace of God go I”. We never know when mental illness will affect us, our friends, colleagues or family members. It does not happen by choice; yet this Government have chosen to cut the support available to help them to return to work. It is disgraceful.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

My hon. Friend mentioned sanctions. As reported in today’s Paisley Daily Express, my constituent Colleen Duncan has had her benefits stopped erroneously not just once, but twice. The first time was for not attending a meeting that she actually attended. The second sanction was for missing a back-to-work interview when she was actually securing a job by attending a job interview. Does he agree that we cannot trust the Government to implement fuller welfare reform when they cannot run the current system properly?

[Neil Gray]

My hon. Friend makes a point that any SNP Member could have made, and he makes his point well on his constituent’s behalf. I hope that the Minister for Employment was listening.

The four-year benefits and tax credits freeze will reduce the real terms value of benefits received by most working-age recipients. The IFS has estimated that 13 million families across these isles will lose an average of £5 per week as a result of the freeze. That includes 7.4 million families in work, whose incomes will drop on average by £280 per year. That £5 may be a cheap lunch for some Conservative Members, but £5 a week could be the difference between heating or eating, new school shoes for the kids or getting transport to their work. Taking money from those in low-income jobs does not make work pay; it just pushes them closer to the breadline.

SNP Members came into politics to pursue progressive policies and social justice and if we are to stay true to that—I am looking at Labour Members—we cannot do anything other than oppose the Bill. As the IFS has pointed out, when the measures are taken in the round with other Budget measures, we can see the real winners and losers. The poorest four income deciles will see their annual net income cut by between 3% and 8%, or a drop of between £600 and £1,300. The higher up the income deciles, the smaller the income decline until the ninth decile, the second richest in society, who are to receive a net income rise.

What happened to the social solidarity Scotland was promised last year? What happened to the pooling and sharing of resources? What happened to the promises that our social security system would be safe with a no vote? They are all nailed to the wall, with this Bill and the Budget, as being utter fabrications, myths and untruths. The Bill, along with the Budget, is part of this Tory Government’s ideological, social-engineering agenda. They are punishing the poor, the disadvantaged, the sick and low-income working families for economic failings that are not of their doing. Hon. Members should see that this Bill will take our society backwards and vote against it.