Universal Credit and Debt

Richard Graham Excerpts

Wednesday 5th June 2019 Westminster Hall

[Richard Graham (Gloucester) (Con)]

This is a great opportunity for the Minister—a valuable chance to hear from different constituencies about the situation of those claiming benefits through universal credit.

Gloucester’s experience broadly mirrors that of the country over the past 18 months. The roll-out has steadily expanded. By February, just over 4,000 people were on universal credit. That represents 26% of our population—slightly more than the 24% figure for Great Britain as a whole, and marginally less than the figure for the south-west region, which is 27%. The figures have continued to rise and I suspect in Gloucester it is now close to 5,000 people.

I pay tribute to the staff of Jobcentre Plus, especially the work coaches, who are implementing the policy and working closely with my office when constituents have difficulties. It is of course true that there are difficulties, and 117 of my constituents have been in touch with me and my office about issues. The vast majority of them are having difficulties with application forms. One of my staff, who is dyslexic, did the form herself. It took her seven minutes. I have tested it myself and it took me marginally longer, but broadly the application form is challenging only for those without personal internet access or much experience of digital processing. That, of course, is why the contract with Citizens Advice is so important.

I shall briefly share the Citizens Advice experience of UC inquiries, which is important. First, the calculation of benefit entitlements is more transparent than under legacy benefits, which is, of course, a significant improvement. Secondly, with the exception of those in receipt of disability benefits, it sees little difference between UC and legacy benefits. Thirdly, the increased availability of advance payments has improved the situation, but further flexibility would, it is noted, be beneficial. The last comment is that it is fairly commonly recognised that those in receipt of disability benefits are worse off than they would be under the previous system. Perhaps the Minister could comment on that. In my experience the situation is varied. People suffering from multiple sclerosis have quite often received greater benefits than previously, so there seems to be a little variation from disability to disability.

Clearly, debt is an important issue. Large numbers of our constituents have debt issues. More research is needed on how those debt issues arise and why so many people have so much debt when they come on to universal credit. That is, of course, a wider issue than universal credit itself.

Pension Funds: Financial and Ethical Investments

Richard Graham Excerpts

Wednesday 22nd May 2019 Westminster Hall

[Richard Graham (Gloucester) (Con)]

I congratulate the right hon. Member for Kingston and Surbiton (Sir Edward Davey) on obtaining this debate, which is relevant, timely and of key interest to many Members across the House, not least those who are members of the parliamentary pension scheme. I draw attention to my entry in the Register of Members’ Financial Interests and highlight that I used to run the pensions business for a significant UK asset manager before coming to the House and that, along with my hon. Friend the Member for North East Hampshire (Mr Jayawardena) and the hon. Member for Sheffield South East (Mr Betts), I am one of the three current Members of the scheme’s board of trustees.

I have three points to highlight. First, this is a challenge for all pension funds not just in the UK but across the world. The rules and regulations by which pension funds are governed have changed significantly, not least under this Conservative Government. The Law Commission reports of 2014 and 2017 are relevant: 2014 was the first time that pension funds had in effect an obligation to take ethical or environmental issues into account. The 2017 changes allowed for some social investment. The parliamentary guidance to which my hon. Friend the Pensions Minister referred, which came in last autumn, made a significant change in requiring trustees to report, as part of the statement of investment principles, on the portfolio’s effect on climate change and what trustees intended to do about that. That is the background.

The parliamentary pension fund is conscious of its obligations under the 2018 regulations. We have had several meetings and discussions with different advisers to consider how we might best tackle the challenges and how to amend our statement of investment principles. The three existing Members who are trustees—me, my hon. Friend the Member for North East Hampshire and the hon. Member for Sheffield South East—had a separate meeting, and we also met one of the world’s leading green asset managers to look at what sort of investment vehicles are available to schemes that want to take a greener approach.

That leads to my second point. In trying to make a pension scheme greener, we have to be honest about the scale of the ambition that the right hon. Member for Kingston and Surbiton set out. I think I heard him correctly when he said that pension schemes should invest in new technologies to try to be carbon free. I challenge that gently, because I do not believe there is a company in the world that is completely carbon free and has never used a single vehicle, train or aeroplane that uses fossil fuels or any form of heater or boiler that runs on gas. It is virtually impossible, at this stage, to measure the complete carbon footprint of any business of significant scale.

As an illustration of the proof of that pudding, which shows the challenge for individuals, the chairman of Ecotricity—whose headquarters is in the constituency of my neighbour, the hon. Member for Stroud (Dr Drew)—is an outspoken champion of everything green, but he clocks up a huge number of air miles every year as a global ambassador for sport, for some United Nations subsidiary. My guess is that he does not travel economy class. There are challenges at an individual and at a corporate level.

[Sir Edward Davey]

To clarify, I was focusing on ensuring that companies were compliant with the Paris treaty. That does not mean that they need to be zero carbon now—that would be impossible—but they need to be on a pathway that is Paris compliant, and that is the case for many companies already. We just need fossil fuel companies and others to catch up.

[Richard Graham]

I am grateful for the clarification. I think the right hon. Gentleman understands that, from a personal investor or a pension fund investment point of view, finding an entirely fossil fuel-free investment would be very challenging.

My third point is that there is a challenge not just for pension funds, but for the wider financial sector. The most innovative green energy projects in the UK, particularly those looking at how we can mobilise some of the most powerful tidal streams in the world—including wave technology in the north of Scotland and cases being worked on in Cornwall, Hampshire and the west coast of Wales—are not easily accessible investment vehicles and are not at the scale that a significant pension fund could easily invest in. It would be useful to look at challenges around some investment regulations, including how major investors, such as large insurance companies that manage huge pension assets, could be allowed to invest more money almost in creating businesses to invest in new technologies.

I am conscious that time is running out, so let me move to my final point.

--- Later in debate ---

[Dr Alan Whitehead (Southampton, Test) (Lab)]

I congratulate the right hon. Member for Kingston and Surbiton (Sir Edward Davey) on securing this debate. I think he slightly understated the carbon bubble in his opening remarks. The carbon bubble—basically the evaluation of assets that we know will never be realised—is not something that might burst in the not too distant future. It will inevitably burst because energy companies have systematically overvalued their assets and put them on their balance sheets. Not only will the historical overvaluing be in question, but all the valuing for the future will be in question, basically in line with where we now know we have got to go on net zero in our economies.

I prefer to call the carbon bubble a carbon boil. I am afraid the image is rather poor, but what we can do with a boil is lance it before it bursts, and that is the exercise we should be engaged in right now. The suggestions that the right hon. Member for Kingston and Surbiton put forward for doing that were sound. However, pension funds are complicit in the carbon boil/bubble because, by and large, they consider their fiduciary duty to be about getting the best for their pensioners over the next few years. They do not generally look at the long term, and do not think they are required to do so as far as their funds are concerned. The Governor of the Bank of England recently described it as

“the tragedy of the horizon”.

[Richard Graham]

To reassure the hon. Gentleman and others, it is perfectly possible for pension fund trustees to take the view that their fiduciary duty of obtaining good returns to deliver the pensions expected is not incompatible with taking into account huge amounts of other issues, including climate change. It is important that we all recognise that. We have a duty to look at that as well.

[Dr Whitehead]

I agree with the hon. Gentleman that some pension funds are beginning to take a different view. Indeed, that different view is becoming more possible, but the general consideration of the fiduciary duty remains a short-term gain for pensioners in the funds. Of course, the people setting out on their working lives will not get the benefit of those pension funds for 30 or 40 years. During that time inevitably we have to move to the net zero carbon economy. It is therefore essential that pension funds have a duty to look at the long term.

Oral Answers to Questions

Richard Graham Excerpts

Monday 18th March 2019 Commons Chamber

[Guy Opperman]

It is a pleasure to answer this question, because both the hon. Gentleman, who is a friend of mine, and I have suffered from the disabling effects of brain tumour. The House will be aware that this is Brain Tumour Awareness Month and that it is Wear A Hat Day on Friday. I will ensure that the points he raises are addressed. He will be aware of the help to claim service, which is already in existence, and of the work that we are doing with Citizens Advice, which will come up to speed in April. A great deal of effort is also going into home visits for vulnerable claimants. However, he raises a legitimate point that we will most definitely look into.

[Richard Graham (Gloucester) (Con)]

The Employment Minister will recall the case of my constituent Ben Seaman, who received a payment following underpayment of ESA; his parent was concerned that as a result, he would be unable to receive ESA in future. I am very grateful for the letter that the Secretary of State has written to me, which arrived today. Will the Minister confirm that those transferring from ESA to universal credit, who have to log this collection of underpayment within a month, will be told in advance of transferring?

[Guy Opperman]

I am delighted to hear about the very welcome development that has been communicated by the Secretary of State today. I can confirm what the Employment Minister has set out today, and I am delighted that this progress has been made.

Department for Education

Richard Graham Excerpts

Tuesday 26th February 2019 Commons Chamber

[Richard Graham (Gloucester) (Con)]

It is a great pleasure to be the tail-end Charlie in this high-quality debate and to follow the hon. Member for Brighton, Pavilion (Caroline Lucas).

I should declare an interest: I come from a family of teachers. In fact, my elder son is now a teacher too. What comes with that is a commitment to not only visiting schools but engaging with them, as well as with our further education college—the outstanding Gloucestershire College—and the University of Gloucestershire. I also ought to refer to the newest university in the country, Hartpury University, in the constituency of my neighbour, my right hon. Friend the Member for Forest of Dean (Mr Harper). They all have masses to offer lots of people with skills and interests in various sectors.

This debate focuses on estimates and therefore inevitably on money. However, it is encouraging that the debate has been about not only what an Opposition spokesman in an earlier debate called “growing the cake” but improving the cake. How do we get the outcomes that are obviously affected by the input of money but where the relationship is not absolute? What really makes the difference?

I ask myself that a lot because in my constituency we have outstanding primary schools in areas that would be considered economically deprived, such as Tredworth, Coney Hill, Robinswood and Finlay Community School, which is on the verge of outstanding. Coney Hill is in fact rated the fourth best primary school in the county of Gloucestershire, and the second best is Field Court, also in my constituency, which is in a slightly more affluent part of the city. We therefore know that it can be done, and schools that have succeeded, such as Coney Hill, have not done so because they get a great deal more money.

It seems to me that the challenge for us as MPs is how to know what does make a difference. How can we be sure about what a school needs and whether it is getting enough of it? How can each school—every one of which will claim, and they may be right, that they have cut to the bone in order to make sure that every penny is used effectively—know how good they are as against other schools? How can we compare them, and how can we see how good they are at managing the business of a school, as well as being an outstanding place of learning for all the pupils there?

In this sense, of course, the statistics do not always help to shed light. The IFS, an independent body, tells us that the funding for five to 16-year-olds will have gone up by 50% in real terms from 2010 to 2020. If I translate this into a local figure, Gloucestershire schools will be getting 3.1% more in 2019, but salaries have increased by 3.5% and there are the pension increases as well. I deduce from that that this is an issue not of cuts—that is a very easy word to use, particularly in opposition—but of costs growing faster than the increases that schools, further education colleges and universities are getting from the Government. That is the challenge for heads and others who are running schools.

In a debate in Westminster Hall at the end of January on education in Gloucestershire, the Minister for School Standards referred to a number of things that the Government are doing to try to help schools with the issues I have mentioned. They include the schools buying club, the schools commercial team, the DFE schools buying strategy, a pilot project in the south-west of England at which 39 schools in Gloucestershire are registered, a focus on supply teachers and agency workers costs, and a benchmarking website. All these things sound very encouraging, but I sense—the Minister for Apprenticeships and Skills will be able to shed light on this—that not all of these are really up and running or are easy-to-access tools for us or the heads of the schools.

I turn now to further education funding, which is of course the worst part for funding in the education sector, despite all that has been done with the new national colleges, T-levels, the investment in apprenticeships and so on. The fundamental fact we have to deal with is that we are in the bottom quartile for OECD skills, at level 4 or 5, for the education of our apprentices and others. At level 4 or 5, we are really way below where we should be in terms of the numbers studying. The letter I wrote with my colleague the hon. Member for Scunthorpe (Nic Dakin) to the Chancellor focused on the fact that, of all the areas in education that need funding, we really are looking for more to boost productivity and to boost what our young people can give. As 165 Members signed that letter, I urge the Minister to consider it.

Pensions Dashboard

Richard Graham Excerpts

Wednesday 6th February 2019 Westminster Hall

[Richard Graham (Gloucester) (Con)]

Ms Ryan, I apologise for joining the debate slightly late. It is a pleasure, though, to follow my hon. Friend the Member for North Warwickshire (Craig Tracey). I congratulate my hon. Friend the Member for Hendon (Dr Offord) on this important debate. I entirely agree with much that has been said so far.

The key thing is that the pensions dashboard is a modern solution for modern needs, at a time when having a single-employer career and a defined-benefit pension is largely a minority and public sector exception to the rule. In today’s world, as a result of the pension freedoms introduced by this Government, there are many opportunities for individuals both to access their pension and to pass it on. That means that, alongside the figure that my hon. Friend the Member for North Warwickshire cited for unclaimed pensions, there is not only greater opportunity for people in how to use the pension pots they have accumulated, but greater uncertainty about how to use them and, as my hon. Friend the Member for Clacton (Giles Watling) said, about how to access the relevant information. For all those reasons, a pensions dashboard is a very good thing.

I ask my hon. Friend the Minister to respond to just one thought. There are two aspects to the pensions dashboard. One is the technology, on which members of the ABI have made significant progress. No doubt we will hear more about that, because it is very encouraging. The other aspect is the preparation that is needed from pension providers. That is important because if the dashboard is up and ready but the information from the pension providers is not there, it will be as much use as a new car without wheels. That would be a very sad thing for the current cross-party consensus in the House that a pensions dashboard will be very useful for many people. I therefore encourage the Pensions Minister to say a few words about what the Government might do to encourage pension providers to ensure that when the technology is ready, everything on their side of the equation will be ready as well.

Oral Answers to Questions

Richard Graham Excerpts

Monday 19th November 2018 Commons Chamber

[Alok Sharma]

As we have pointed out, under universal credit people are able to get the one-to-one support with their work coach that was not possible under the legacy benefits system. Again, I reach out to the hon. Gentleman. If he has concerns in his own constituency, I am very happy to have a discussion with him and his local jobcentre, because we want to support absolutely every single person who is in the welfare system.

[Richard Graham (Gloucester) (Con)]

The welfare system undoubtedly encourages our constituents into work and rewards them in work, but the system does not always capture that because of the anomaly of the claimant count being used as a proxy for unemployment, whereas in fact many people who are on universal credit are working. What can the Minister do to try to improve the statistical way in which this is recorded?

[Alok Sharma]

My hon. Friend raises an important question. As he will know, we had a consultation on this particular point. We have published our findings, and I would be very happy to share those with him. Perhaps it would be appropriate for me to write to all colleagues setting out the changes that we are proposing.

Draft Child Support (Miscellaneous Amendments) Regulations 2018

Richard Graham Excerpts

Monday 12th November 2018 General Committees

[Richard Graham (Gloucester) (Con)]

I support the draft regulations that the Minister has introduced. It is incredibly important that child support maintenance regulations reflect the realities of how some parents escape their responsibilities. Although I am absolutely enthusiastic about the new regulations on non-resident parents, would the Minister tell us about the situation for resident parents? A parent may pay CMS and possibly earn good money, perhaps as a sole trader, but not declare it all to Her Majesty’s Revenue and Customs, yet his former partner will know him to be accumulating expensive cars and perhaps a new and expensive home. The Minister will have heard a similar story in his surgeries; at what stage can those assets be brought into the equation and lead to higher CMS payments, so that everyone’s assets can be considered where there is a serious disagreement on the income levels?

Universal Credit

Richard Graham Excerpts

Wednesday 17th October 2018 Commons Chamber

[Richard Graham (Gloucester) (Con)]

It is a pleasure to speak in this important, if familiar, debate. I regret the way that it was framed by the Opposition spokesperson, because this should not be a hugely political issue. When unemployment and youth unemployment are at record lows and 4 million people have been taken out of income tax altogether, through the doubling of the tax-free allowance, it is not the time to question the principle of the work and welfare reforms that this Government have rightly introduced. No Opposition Member has tried to defend the situation that existed in 2010, when people were better off on benefits or working a maximum of 16 hours a week.

Let us focus, as many Members on both sides of the Chamber have, on whether the roll-out of universal credit is working effectively. The situation is different in different constituencies, so let me share the facts from mine. In Gloucester, we have 3,440 constituents on universal credit. About 150 have sought help from our citizens advice office, of whom about 100 have had difficulties with their applications—something that I hope the new contract between the DWP and Citizens Advice will help to resolve. I have had 17 constituents contact my office for help with universal credit, out of over 12,000 who have been in touch with my office over the past year. I am not saying that the roll-out is perfect, but I am putting it in context and perspective.

The hon. Member for Airdrie and Shotts (Neil Gray) referred to the experts out there, but I do not accept that they know better than we do what is happening in our constituencies. I know what is going on in my constituency, as he will in his, better than the lobbying groups, one of which has produced a template that one of my constituents sent to me. It tells me that she is worried about what will happen when she moves on to universal credit. Her email, which comes from the lobbying group, says,

“I will face at least 5 weeks without any money, if I am lucky.”

That is complete nonsense. If she is in real trouble, she will be advanced money within 24 hours.

[Nigel Huddleston (Mid Worcestershire) (Con)]

My hon. Friend is making a valid point. Conservative Members do listen and do care. We are also a very pragmatic bunch of people, so if there is evidence that more money or further changes are needed, we will support that.

--- Later in debate ---

[Richard Graham]

My hon. Friend is absolutely right. That brings me to my next point. It is important that the Government continue to listen and to make the changes that were needed over the past three years, as my hon. Friend the Member for South Cambridgeshire (Heidi Allen) mentioned, particularly on the housing element, the speed with which some of our constituents get their first payment and reassuring private sector landlords of the value of having tenants on universal credit on their books.

[Neil Parish (Tiverton and Honiton) (Con)]

We all believe in universal credit, but we also realise that it deals with some of the people in society who are most challenged with their income. It is about ensuring that we get the money to them quickly and listen to what is happening. I believe that we are, but we need to carry on listening to what is happening.

--- Later in debate ---

[Madam Deputy Speaker]

Order. The hon. Gentleman does not have a right of reply. He is here and that is the end of it.

[Richard Graham]

Thank you, Madam Deputy Speaker. I was trying to make two crucial points. First, scaremongering is being organised by certain lobbying groups who are sending emails to our constituents that, frankly, they should be ashamed of. I would like the Minister later on to confirm that this sentence is as untrue as the one I read out earlier:

“I’ve read that the Prime Minister has said that people will be protected when they transfer to Universal Credit”.

That is correct as far as it goes, but it goes on to say:

“the draft rules the government have published show that won’t happen if the first attempt to claim isn’t successful.”

I invite the Minister, when he sums up, to confirm that that is simply not true.

The most important point in this important exercise of rolling out universal credit successfully across the country is that the Government continue to look at what is working well and replicate it, and at what is not working so well and take the opportunity to improve it, so that, for example, constituents with learning disabilities get all the help they need with their applications.

The proposal from the shadow Chancellor, the man who would foment the overthrow of capitalism, that the solution is simply to get rid of universal credit and reverse us back into a world where people were better off on benefits than in work and had no incentive to work more than 16 hours a week would be a catastrophic decision that I do not believe Opposition Members agree with or would do if they thought it through carefully. I will not support the motion.

Oral Answers to Questions

Richard Graham Excerpts

Monday 15th October 2018 Commons Chamber

[Mr Speaker]

I call Richard Graham. Why is he surprised by that? He is standing. Get in there.

[Richard Graham (Gloucester) (Con)]

23. The Secretary of State knows that one of the difficulties with trying to correlate the people on universal credit with those who go to food banks is that there is no precise data to compare the two. I know anecdotally that the number of foreigners claiming food bank vouchers is quite high. Is there a state at which we can, with the Trussell Trust, arrange to have data that tells us much more about who is going to food banks and what sort of help they need, including DWP people in their food banks?

[Ms McVey]

Of course we have to understand the underlying issues and problems and support people as best we can. I met the Trussell Trust and various poverty groups and we have talked about how we best support families. We believe that the best way to support a family out of poverty is by getting them into work—hence why I pointed out that, under the previous Labour Government, the number of households where no one ever worked doubled. This Government believe that work is the best way out of poverty and we will continue helping people.

Widowed Parent’s Allowance

Richard Graham Excerpts

Wednesday 5th September 2018 Commons Chamber

[Justin Tomlinson]

I thank the right hon. Gentleman for that. I enjoyed my brief four or five weeks as part of his Select Committee, where he was a formidable, excellent and well-respected Chair. Fairness is the key. In my defence, this judgment was made only last week and it would have been churlish of me to make a rushed decision, as this has very serious implications and we need to consider it carefully. I will return to update the House as quickly but as sensibly as possible.

[Richard Graham (Gloucester) (Con)]

When I served on the Work and Pensions Committee, under the chairmanship of the excellent right hon. Member for Birkenhead (Frank Field), whose party no longer seems to find room for him, although he remains Chairman of the Committee, we looked at various issues to do with the widowed parent’s allowance. I hope the Minister will look carefully at the recommendations in that report, which tackled the issue of partners and of how income would be treated under universal credit, because there is a question of fairness to address in how widowed parent’s allowance is currently treated.

[Justin Tomlinson]

My hon. Friend raises an important point, and that is why under the new benefit payments any income that is gained is not means-tested and the benefit cap does not apply to it, to make sure that people are not given money on the one hand that is taken away on the other, and that the most vulnerable people get the support that they need.