Oral Answers to Questions
Stephen Timms Excerpts(8 years, 6 months ago)
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Stephen Crabb
My hon. Friend makes an important point, and I am not interested in playing politics. I am encouraging more than 700 jobcentres around the UK to explore fully how they work in partnership with local community initiatives, so that the third sector, working with work coaches, can provide the best possible support and advice to those who need it.
Stephen Timms (East Ham) (Lab)
When the Trussell Trust published the figures last month showing record food bank demand over the past year, it stated:
“In some areas foodbanks report increased referrals due to delays and arrears in Universal Credit payments.”
What steps is the Secretary of State taking to ensure that the introduction of universal credit does not drive food bank demand even higher?
Stephen Crabb
That is one reason why we are using such a careful and controlled timetable for rolling out universal credit. I am much more interested in it being rolled out safely and in a secure way, so as to avoid the kinds of problems that we had under the previous Labour Government, when tax credits were blasted out and huge numbers of people received overpayments and were required to pay back thousands of pounds.
Welfare Reform and Work Bill
Stephen Timms Excerpts(8 years, 9 months ago)
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Priti Patel
I will not give way. We are pressed for time, so I want to make some progress.
As the Secretary of State said last summer, the purpose of the reforms is to ensure that we give people with disabilities and health conditions all the appropriate and necessary support that they need to move them closer to the labour market and to support them into work. We are basing all that we do around what works for them. Importantly, as applies to the other amendments, we are focused particularly on life chances.
I will, if I may, move on to the debate in the other place. I can report that, since we last met, the other place has chosen not to insist on its amendments 8 and 9, which removed the changes to the ESA WRAG and the UC LCW element. However, it has agreed what is in effect a wrecking amendment, because it could in practice prevent the provisions from coming into force, despite the fact that my noble Friend and colleague Lord Freud committed to several additional measures to help those affected by the change, which addressed a number of the specific requests raised in the Lords.
Let me set out the extra measures we have committed to in the other place. First, the additional measures include an additional £15 million in 2017-18, when the changes to the ESA WRAG and the UC LCW element come into force, to increase the local Jobcentre flexible support fund. The money, which will be set aside specifically for those with limited capability for work, represents a 22% increase in the overall fund.
Secondly, in response to the concerns that were raised about claimants with progressive conditions, we have committed to improving the awareness of the reassessment process and the guidance for claimants and disability charities about reassessments. We will provide additional support and training to jobcentre staff to ensure that they are aware that they may need to talk about requests for reassessments with claimants with deteriorating conditions.
Finally, we will improve the work incentives for those who continue to receive ESA even further by removing the 52-week limit that applies to permitted work for those in the ESA WRAG. That will allow claimants to gain skills and experience and to build their confidence, while still receiving the benefit over a longer period. We will support these individuals to get back into work.
As I said earlier, despite those additional measures, the other place proceeded with amendments that ignore the clear voice of this democratically elected House, which has supported the changes to the ESA WRAG and the UC LCW element, and the fact that we have voted on this measure five times. Although, on the face of it, the amendments may appear to be reasonable, let me set out how they are, in effect, potentially wrecking amendments.
Priti Patel
I will proceed, because we have very little time. The right hon. Gentleman will get the chance to speak once all the introductory speeches have been made.
First, the amendments would require the Secretary of State to publish a report on the impact of the changes prior to the changes being made, and not to introduce the reform until the report had been published. Specifically, the report would be about the impacts on a person’s health, finances and ability to return to work. In line with normal practice, we of course intend to evaluate this change.
My noble Friend Lord Freud has confirmed in the other place that we will monitor the impact through regular national statistics. However, it will be impossible to provide the majority of the information requested in the amendments through our analysis prior to implementation, because the data that are currently available do not allow us to make any meaningful estimate. That means that the amendments would delay the implementation of the measure by four years and cost more than £1 billion of the savings for which this democratically elected House has voted.
The amendments would not only impact on the savings associated with this change, but would hinder the Government in their commitment to do the right thing by providing the right incentives and supporting people with health conditions and disabilities to allow them to improve their life chances, fulfil their potential and get the vital support that they need to enable them to get back to work.
Secondly, the amendments are unacceptable because they seek to require that the commencement regulations be made under the affirmative resolution procedure. At best, that is a delaying tactic that runs contrary to usual parliamentary process. In practice, it would allow the Lords to block the legislation by the back door. I am sure that I am not alone in thinking that the Lords has overstepped the mark on this.
This House voted convincingly for the changes on 23 February. That was the fifth time this House had voted overwhelmingly for this reform—a reform that is financially privileged and that is a key part of our efforts to reform the welfare system by supporting more people into work.
Simon Hoare (North Dorset) (Con)
Playing ping-pong with the other place, or receiving a Lords message, sounds rather genteel and polite, doesn’t it? However, I ask all Members almost to divorce their thinking from the issue on which we shall be voting later. Dare I say to my right hon. Friend the Minister, and indeed to the shadow Minister, that virtually everything they said was an irrelevance? The House has already debated the point, and, as my right hon. Friend the Minister noted, we have voted on it on five occasions and have voted in the affirmative. We are now concerned with a much bigger issue, which should, in my judgment, unite all quarters of the House: the issue of the supremacy of this place as the elected House of Commons. As we know, in the last century the House had exactly the same debate on the people’s Budget.
The Minister was right. The Lords amendments are wrecking amendments, and the unelectable seem to be relying on the unelected to try to frustrate the policies and the position of Her Majesty’s Government, which was well articulated during the general election campaign and has been debated incredibly thoroughly in the House and elsewhere. Last night the House of Lords played a very dangerous game. It said to the democratically accountable House of Parliament in this country, “We know better than you, the electorate; we know better than you, the elected Government.” We are on the cusp—issue apart—of a constitutional conundrum which will not end easily for the upper House. The authority of this place is now under significant and serious challenge. It is time for parties to unite, and for us to exercise and exert our supremacy in a democratic Parliament.
Stephen Timms
I think that the hon. Member for North Dorset (Simon Hoare) must be rather inexperienced in the procedures of Parliament, because ping-pong is a well-established feature of our proceedings.
I welcome the change of heart on the publication of child poverty indicators, but I am very disappointed by the position that the Minister has taken on the Lords amendments on the employment and support allowance. It is a shame that the Secretary of State is not here tonight. As we have heard, he has written to Back-Bench Conservative Members to tell them that it is “impossible to provide” the information that is required. However, that is not what the Equality and Human Rights Commission says, as my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) pointed out in her excellent speech. A letter from the commission’s chief executive dated 16 September last year made this point:
“Assessments need to include sufficient detail and analysis to demonstrate that the draft proposals have been adequately considered for their potential impact on equality. We have considerable expertise in this area”.
However, the Secretary of State rejected its offer of help and now says that it is impossible to provide the information. It is perfectly possible to provide that information, but Ministers do not wish to provide it because the House would then be able to see what the effects would be.
An attempt has been made to present these changes as in the interests of disabled people, but they are not supported by a single one of the organisations representing disabled people. Parkinson’s UK has made its position very clear:
“The policy is likely to have a significant, harmful impact on the health and wellbeing of people with Parkinson’s.”
Macmillan Cancer Support states:
“Macmillan strongly opposes the proposed reductions because of the negative impact they will have on people affected by cancer and other long-term conditions.”
The judgment that the House has to make tonight is whether Ministers are speaking for disabled people or whether the organisations representing disabled people are speaking for them. I hope that the House will choose in favour of the latter.
Graham Evans (Weaver Vale) (Con)
This is a very important debate. It is important to note that these changes relating to the provision of the employment and support allowance work-related activity component will have no impact on existing claimants. They will apply only to new claimants and to claims made after April next year.
Additionally, the Government have said that they will publish a White Paper this spring detailing how they plan to improve support for people with health conditions and disabilities. I look forward to seeing what is in that White Paper, particularly on the role of employers in reducing the disability employment gap. I carried out my fifth jobs and apprenticeships fair in my constituency recently, and the 40 employers I spoke to all agreed that they would commit to a Disability Confident-aware fair, which is what I will hold this year. I am going to play my part, and everybody in this House has a role to play in helping people who wish to get into work.
There is an overwhelming body of evidence that work is generally good for physical and mental wellbeing, and 61% of those in work-related activity groups say that they want to work. The existing policy set up by Labour in 2008 is failing those claimants. Despite £2.7 billion being spent this year supporting those in the ESA work-related activity group, just 1% of the WRAG claimants moved off ESA each month. The policy is clearly not working, and we need a better system than this.
Welfare Reform and Work Bill
Stephen Timms Excerpts(8 years, 9 months ago)
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Priti Patel
The Bill is a vital part of the Government’s reforms that are moving this country to a high wage, low tax, low welfare economy. It is fundamental to our commitment to end child poverty and improve children’s life chances, and to ensure that work always pays more than a life on benefits and that support is focused on the most vulnerable.
As is right and proper, the Bill’s provisions have been carefully scrutinised by both this House and the other place. Where appropriate the Government have tabled amendments to bring clarity or to remove unintended consequences, and they have made important commitments on supported housing and the social rents measure, on kinship carers and sibling adoptions under clauses 11 and 12, and on guardian’s allowance and carer’s allowance in relation to the benefit cap. The Government remain firmly committed to the aims and principles of the Bill as it left this House, and for that reason we wish to resist the non-Government Lords amendments.
Before I address each area in detail, allow me to set out the key principles that underpin our disagreement with the Lords. Our view is that the addition of child poverty income measures is unnecessary because we have already committed to publishing statistics on children in low-income families through the “Households below average income”—HBAI—publication. Lords amendment 1 would also reintroduce a failed approach to child poverty that is focused on tackling its symptoms rather than its root cause, and it would drive perverse behaviour focused on lifting people just above the poverty line, rather than on a life chances strategy that could transform children’s lives.
Stephen Timms (East Ham) (Lab)
Does the Minister accept that income has a huge impact on life chances?
Priti Patel
Income is one of many factors that impact on life chances and poverty, which is why the Government are very much focused on tackling the root causes of child poverty. I will come on to discuss that issue even further—[Interruption.] I know that Labour Members disagree with that, and they will soon have their chance to comment.
On the change to the work-related activity component of employment and support allowance, and to the limited capability for work element of universal credit, I stress that the Government are fully focused on helping people who can work into work. We want to end a broken system that is patently failing those it should be helping, and ensure that a good proportion of the savings are recycled into long-term practical support that will have a transformative effect on people’s lives.
Priti Patel
My hon. Friend is right. It is absolutely clear that when children are the future of our country, it is right to focus on delivering better life chances for them. When we publish the life chances strategy in spring, we will make the biggest difference to children’s life chances now and in the future. We must seek to rescue a generation from poverty by extending life chances right across our country. We must build a country where opportunity is more equal, with stronger communities and young people who can face the world with a background of experiences and characteristics that we know are vital for their success. As my right hon. Friend the Prime Minister said, we must seek to
“transform the life chances of the poorest in our country and offer every child who has had a difficult start the promise of a brighter future.”
Stephen Timms
Did the Minister see the report published by the Centre for Social Justice last month, which set out a way of combining the life chances indicators—interesting information will be provided in them—with income indicators, so that we do not ignore income, which is so clearly a key aspect of the whole issue?
Priti Patel
I thank the right hon. Gentleman for his intervention and his comment. We will publish the life chances strategy in the spring, and I think it will give us every opportunity to consider holistically all the factors that can lead to better outcomes for children and families. I recognise the right hon. Gentleman’s point. On the back of the remarks I have made, I urge hon. Members to support the Government motion and reject Lords amendment 1.
Let me deal now with Lords amendments 8 and 9, which as you indicated, Mr Deputy Speaker, impinge on the financial privileges of the House. These amendments would simply delete clauses 13 and 14 from the Bill. This would reverse the plan, announced in the summer Budget and endorsed by this House, to align the amount paid to ESA claimants in the work-related activity group to that which is paid to JSA claimants, and to align the amount paid to universal credit limited-capability-for-work claimants to that of the UC basic rate. Let me take this opportunity to stress the Government’s strong belief that this reform is the right thing to do. It is part of our efforts not just to improve people’s life chances but importantly to support them going into work so that they can reach their full potential. Let me explain why.
Record employment levels and strong jobs growth in recent years have benefited many, but those benefits have yet to reach those on ESA. While one in every five JSA claimant moves off benefit each month, this is true of just one in 100 ESA claimants in the work-related activity group. This Government believe that people with health conditions and disabilities deserve better and deserve more support. [Interruption.] I appreciate that Labour Members have no solutions for tackling the wider issues surrounding welfare and would rather simply continue to spend public money in an unsustainable way. We have listened to charities and campaigning organisations who say that improved employment support is key to helping people with health conditions and disabilities to move closer to the labour market and, when they are ready, into work.
Priti Patel
I rather think the hon. Gentleman makes my point for me in the sense that those in the work-related activity group need more support. Currently, they have been getting too little support. That is exactly the purpose of our reforms. We believe that we must tackle this issue, and provide—yes—the right financial security for individuals, but at the same time also look at the most effective ways to improve the wellbeing of those individuals by giving them support to get back to work. Almost half a million people in the work-related activity group get too little support to move back into work. We currently disincentivise them from doing so. As I say, they deserve better than that, and the Government are determined to take the necessary steps to transform their life chances by supporting them into work.
The Government are committed to ensuring that disabled people are able to participate fully in society, and we have set out our ambition to halve the disability employment gap. It is a duty of Government to support those who want to work to do so, and most people with disabilities and health conditions, including the majority of ESA claimants, tell us that they want to work. Some 61% of those in the work-related activity group tell us that they want to work, and we mean to put those people’s ambitions at the centre of what we do.
Stephen Timms
We have established that Macmillan Cancer Support disagrees with the Minister on this issue. Parkinson’s UK, Mind, and Rethink Mental Illness, whose chief executive wrote to all of us, say that they strongly disagree. So can the Minister tell us the name of any organisation representing disabled people that agrees with the position that the Government have taken?
Priti Patel
What I would say to the right hon. Gentleman is that we have been working with organisations and disability groups, and we have actually been listening to them. [Interruption.] Rather than making generalised comments from a sedentary position, Labour Members should realise that we are working with those organisations as we move forward with our White Paper—
Oral Answers to Questions
Stephen Timms Excerpts(8 years, 10 months ago)
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Mr Duncan Smith
I commend my hon. Friend for working for such organisations, about which he has spoken to me in the past. A huge amount of progress has taken place in this area, as he maintains. It is worth noting that, as a result of what we have been doing with the reforms and in working with organisations such as the one he mentions, the youth claimant count is at its lowest level since the mid-1970s, the number of those unemployed is down nearly 300,000 since 2010 and, most importantly, the unemployment rate for those not in education is 5.8%—pretty near the lowest it has ever been. We will carry on trying to get this right, but this is good evidence that welfare reform is working.
Stephen Timms (East Ham) (Lab)
On 1 November 2011, the Secretary of State issued a press release saying that
“the Universal Credit IT programme is…progressing well with 30% of the new technology required to deliver it now complete”.
Will the Secretary of State tell the House what proportion of universal credit IT has now been completed?
Mr Duncan Smith
The roll-out of IT across the country is nearly complete. The roll-out nationally will be complete before April, as I said to the right hon. Gentleman last time he asked exactly the same question. It is always good to have old questions: the old ones are always the best. The roll-out is progressing well. As he knows, he has an invitation to come and visit the final digital development, which will start to roll all the other benefits into universal credit in May.
Universal Credit Work Allowance
Stephen Timms Excerpts(8 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Disabled People (Justin Tomlinson)
I join the shadow Secretary of State in wishing everybody a happy new year. I am sorry that I am not the person with whom he wished to have this exchange, but this is a real area of passion for me. My background, my school, my work and starting my own business mean that I understand opportunity, which all too often is not a given in society. The changes that have helped shape my journey into politics are integral to why we need to reform the welfare state. That is absolutely key.
Stephen Timms (East Ham) (Lab)
Given the background that the Minister has set out, he will well understand why it would have been a mistake to go ahead with the tax credit cuts that were U-turned before Christmas. Why then are the Government going ahead with precisely those cuts for people whose only mistake is to have the misfortune of receiving universal credit instead of tax credits?
Justin Tomlinson
That was a very early intervention and, to be fair, I need a little time to expand my argument, which will address those points. An element of patience is needed; I know that we all needed it last night with the late sitting and the reshuffle news. A key point about tax credits was that people argued that all the changes needed to be phased in, and I will set that out.
The welfare system we inherited was simply not working. It was not supporting people to get into work, to stay in work and to progress in work. People were left with unfulfilled potential, languishing on benefits, with little or no incentive to work or to progress in work, and opportunity was stifled. Opportunity should be a given; it should not be stifled.
The truth is that our welfare system had become distorted and complex, as we all know from our casework with residents. Too often, residents were missing out on the benefits they were entitled to because they could not navigate something so complex. All too often, the system firmly shut the door on opportunity, because it paid more to be on benefits than to be in work. We all know that, and the electorate—hard-working families—were quick to remind us of it.
Let me be clear that I say that with no disapproval for those who claim benefits. The system itself was to blame, which is why we undertook to reform it. Our aim was and continues to be to create a system that extends opportunity and ensures that work always pays, moving Britain from a low wage, high welfare, high tax society to a higher wage, lower welfare, lower tax society. It is a common-sense approach, creating a system that is fairer to the taxpayers who face an ever-increasing bill and delivering a welfare system that is sustainable for our country but that, crucially, protects the most vulnerable.
Let me remind the House that welfare spending on people in work rose from £6 billion in 1998 to almost £28 billion in 2010.
Stephen Timms
The Minister said in response to my earlier intervention that there were to be transitional arrangements, but the trouble is that people receiving universal credit will get the full cut in April this year. They are going to be clobbered.
Justin Tomlinson
I gently remind the right hon. Gentleman that I shall be going into those details later, so he needs to have just a little more patience.
Crucially and uniquely, universal credit stays with claimants when they enter work until their earnings reach a certain level or until they can support themselves. That gives them the confidence to start a job without having to go through the bureaucracy of changing their benefit claim. Universal credit is not just about IT or streamlining bureaucracy, as it is often portrayed. It is about people having a single point of contact with a work coach who provides personalised support, advice and guidance. This is where universal credit comes into its own, and this is the bit that I am really passionate about.
In life, we are all confident individuals and when we are faced with challenges it is a given that we can normally take them on, but that is not the case for everybody. We are now giving people a named personal contact to help them to deal with their individual case when they are navigating complicated benefit systems. That work coach will be by their side helping them to develop their role when they first get their foot in the door. They will not simply say, “We wish you all the best now you’ve got a job”. They will help them to make progress and develop their role. They will help them to seek and secure more hours, and to develop the skills and confidence to progress through the grades. In other words, universal credit will not only support people to move into a job; it will also help them to build a career. It will break the cycle of dependency and create opportunities.
Justin Tomlinson
The hon. Member for Pontypridd has had his turn. I give way to the right hon. Gentleman.
Stephen Timms
I think we have now got to the appropriate point in the Minister’s speech. Does he acknowledge that the 50,000-plus working people who are today receiving universal credit will see their benefits sharply cut in April?
Justin Tomlinson
I will come on to those specific people—[Interruption.] In the overall numbers, it is the vast majority—[Interruption.] I am going to make some progress.
We have to see the bigger picture. A lot of the analysis that has gone on is static. Even the Institute for Fiscal Studies, which I know a lot of hon. Members will refer to, acknowledges that it is a static analysis. Universal credit is not a stand-alone measure. It is part of our wider, dynamic package of reforms to support families in work and to make sure work pays. We are raising the personal allowance to £11,000 for the next tax year, saving the typical taxpayer over £900 a year, and we have pledged to raise it to £12,500 by the end of this Parliament. The national living wage will come into effect from April. That will directly benefit 2.75 million people and it is forecast to reach over £9 an hour by 2020. That might upset Opposition Members who campaigned for £8 an hour, but we felt that that did not go far enough.
Stephen Timms (East Ham) (Lab)
I think that universal credit is a sensible idea. It has potential to make the system simpler and in particular to make it clearer to people what their financial position will be if they move from unemployment into work. We have always said that the idea is sensible. It is not a panacea—Ministers frequently tell us it is a solution to the problems, even though it is not—but it is a helpful step.
The delivery of universal credit, however, has been a shambles. It went very badly wrong right at the start. Ministers accepted terrible advice about how long it was going to take. Page 34 of the July 2010 Green Paper, “21st Century Welfare”, stated:
“The IT changes that would be necessary to deliver”
universal credit
“would not constitute a major IT project”.
How anybody persuaded themselves that replacing the entire benefits system was not going to constitute a major IT project is beyond me, but that was the naivety that underpinned the leadership of the project at the outset.
Warnings from Labour Members and others were cheerily waived aside and it was not until September 2013, when the National Audit Office first reported on the issue, that some shafts of light were trained on what was really going on. The NAO said that
“the programme suffered from weak management, ineffective control and poor governance”,
and it was absolutely right.
John Glen
Does not the right hon. Gentleman agree that, during his distinguished spell in government, a considerable amount of taxpayers’ money was wasted on IT projects and that, as of now, those lessons have been applied and significant, incremental progress is being made in the delivery of this important reform?
Stephen Timms
Unfortunately, we were told in 2010 that the lessons from all those problems had been learned and that things were going to be different, and that is true, because now we have not one, but two major IT projects for universal credit—the live service and the digital service—both under way in parallel. No one has yet told us when those two different systems will be brought together, and undoubtedly large sums of money are being wasted.
I want to spend a couple of minutes addressing the question of just how far behind schedule universal credit is now. If the Secretary of State had spoken at the beginning of this debate—as he should have done, as my hon. Friend the Member for Pontypridd (Owen Smith) correctly pointed out—he would have told us that it was on track, because that is what he always says. The Office for Budget Responsibility, however, pointed out at the time of the autumn statement that the project has been
“substantively delayed on at least three separate occasions”,
so just how far behind is it?
When the project started, we were told that transition to universal credit would be complete by 2017—an absurd claim, but that is what was said. Back in 2012, the belief was that transition would take five years from that point. Having failed to deliver on that date, Ministers have refused to announce a revised date; it is a question, I think, of once bitten, twice shy. The autumn statement, however, indicated that the Government now expect—the hon. Member for Banff and Buchan (Dr Whiteford) was correct to make this point in her speech—the roll-out to be completed by 2021. Therefore, exactly as in 2012, the Government in 2016 now expect the roll-out of universal credit to take another five years from that date. The completion date has gone back four years in the last four years.
Is it unfair to allege, therefore, that universal credit is running four years late? Let us look at a couple of other milestones, not just the completion date. On 1 November 2011, the Secretary of State published a press release that said:
“Over one million people will be claiming Universal Credit by April 2014 Work and Pensions Secretary…announced today”.
April 2014 was nearly two years ago and 1 million people are not receiving universal credit; the latest figure is 155,000. The OBR now expects that the figure will be 1 million by April 2018, so that milestone is also four years late.
Let us look at another example. On 24 May 2012, the Secretary of State announced in another press release— I always used to read them avidly—that
“all new claims to the current benefits and credits will be entirely phased out”
by April 2014. Again, the Department has not been willing to announce when it now expects all new claims to the existing benefits and credits to be phased out, but in a very helpful note, to which my hon. Friend the Member for Pontypridd referred in his opening speech, the House of Commons Library has worked out, by reading between the lines of opaque statements by Ministers, that new claims for legacy benefits are expected to be closed down by June 2018. That milestone is a bit more than four years late compared with what we were originally told. We can confidently say, therefore, that universal credit is at least four years late. It will undoubtedly slip further and I am equally certain that the Secretary of State will continue to tell us that it is on track.
The management has been a shambles and we have still not been told about key outstanding policy issues. Which recipients and claimants of universal credit will be entitled to free school meals for their children? We have been waiting for an answer to that question for more than five years, but we still have not been told. It makes an enormous difference, because the answer we expect the Government to give will introduce a huge new cliff edge to the social security system. It will be far worse than anything in the prior system, even though the whole point of universal credit was to get rid of such disincentives.
I want to pick up on the points so well made by my hon. Friend in his opening speech about the way in which the changes to universal credit since it was first announced are undermining so fatally its objectives. In the early debates, the Secretary of State used to make a lot of the fact that universal credit was going to cost more than £2 billion more than the previous system, but that is not true anymore—it is now going to cost £3.7 billion a year less. That has been done by eroding the work incentives that were supposed to be the whole point of doing it in the first place.
The whole House has accepted that it would have been wrong to go ahead with the tax credit cuts, which would have had a huge impact on and reduced the incomes of working families on modest incomes. There would have been a reduction of £1,000, £2,000 or £3,000 a year for those with a household income of £20,000 a year. The whole House accepts that that would have been wrong, and yet the Government are going ahead with precisely those cuts for the relatively small number of people—there are, I think, 50,000 of them at the moment—who are in work and claiming universal credit. If we have all accepted that it is wrong to impose such draconian cuts on the incomes of working families who are claiming tax credits, why is it right to go ahead with precisely the same cuts, which will have a huge impact, to the incomes of working families in receipt of universal credit? I intervened to ask the Minister that question three times. Each time he told us that he would come to it later in his speech. Unfortunately, he never got there. If he is able to explain to us how that can be right, I hope that he will do so.
My hon. Friend the Member for Pontypridd is right to say that all the way through the process of universal credit, we have been told that there would be transitional protection, yet this group of 50,000 working people, who are already receiving universal credit, will suffer enormous cuts in their incomes in April because of the changes to the universal credit work allowance. That cannot be right and the Government need to change their mind.
Mr Vara
I will not give way, as I have limited time available and I am keen to address as many of the points raised as possible. We have turned that situation around. Our reforms, the centrepiece of which is universal credit, are working and are getting people back into work.
Stephen Timms
The Government are not going ahead with the tax credit cuts, so why is it right to go ahead with precisely the same cuts for the minority of people who have the misfortune to be claiming not tax credits but universal credit?
Mr Vara
It is important that the right hon. Gentleman and others take into account the need to consider the broader perspective: the raising of personal allowances; the introduction of the new living wage; the doubling of free childcare to 30 hours; tax-free childcare from early 2017; and, let us not forget, the fact that every time we fill up our tank with petrol there is a saving of £10 because of the freezing of the fuel duty. It is important to consider everything in a broader perspective, not the narrow perspective that we have heard from so many Opposition Members.
A number of speeches have been made today and, unfortunately, time simply does not allow me to address them all. I shall simply say that the right hon. Gentleman made a passionate contribution. I have huge respect for him and I am sorry that he is no longer on his party’s Front Bench. May I also pay tribute to my hon. Friend the Member for Hertsmere (Oliver Dowden), who made a learned contribution, clearly setting out the reasons why Labour’s proposals are simply not sustainable? My hon. Friend the Member for Lewes (Maria Caulfield) made a powerful contribution, telling us of her experiences growing up, which had the whole House in agreement with her.
This is an important subject and we need to recognise that the IFS has pointed out that no one on existing benefits or tax credits whose circumstances remain the same will lose out in cash terms as a direct result of being moved on to universal credit. These claimants will get transitional protection to avoid cash loss at the point of change. It is important to note that the only people who will be directly affected by the change to work allowances in April will be those already in work, the majority of whom will be single claimants without dependants. [Interruption.] The shadow Work and Pensions Secretary chunters away, but we have checked the Hansard record and found that he was wrong and we were right. Conservative Members await a withdrawal of his earlier comments, which we debated. We have checked Hansard and he should do likewise. For those people who are affected, we have been careful to put measures in place to ensure that they are fully supported. As well as the additional work coach support that these claimants will receive, we have increased the amount available through the flexible support fund to help people progress in work and increase their earnings.
Universal credit is a major reform of welfare that is designed to make sure that work always pays. Through the removal of the requirement to work 16 hours per week that exists in the tax credits system, people will see a financial benefit from every extra hour they work. The universal credit taper means that financial support is withdrawn at a consistent and predictable rate, helping claimants to understand clearly the advantages of work. The IFS has said that anyone being moved on to universal credit from tax credits will be protected—they will not be cash losers. Opposition Members need to take that on board—that comes from the IFS.
Oral Answers to Questions
Stephen Timms Excerpts(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Priti Patel
Of course, my hon. Friend raises a valid point about what the Labour party is now clearly saying, despite the fact that sanctions have been in place for a considerable time, including under previous Labour Governments. The purpose of sanctions is to support claimants and to encourage them back to work. Let us also remember that the sanctions are there for claimants to comply with reasonable requirements, which are developed with the claimant as well as the work coach.
Stephen Timms (East Ham) (Lab)
In the Work programme, extra help has been given to jobseekers who have been out of work for 12 months, but under the new programme it will not be until two years have passed. Will Jobcentre Plus get extra resources to support people who have been out of work for between one and two years, given that the Work programme’s successor will not be doing that?
Priti Patel
The new programme will be accompanied by a structural reform that will better target support for those individuals who are furthest away from the labour market. On top of that, as my right hon. Friend the Secretary of State has emphasised again today, universal credit in particular will provide support and engagement for those individuals who are furthest away from the labour market but who are looking for work. Alongside that, the new Work and Health programme will integrate services, particularly for those with mental health conditions or health barriers, to help them get closer to the labour market and back into work.
Mr Duncan Smith
Under universal support, which is delivered locally, we are talking hugely to local authorities and all the local organisations in the area, and my hon. Friend will find that this will be swept up as part of that process; it is a dramatic improvement on where tax credits are right now, because it brings in all those other benefits as well.
Stephen Timms (East Ham) (Lab)
The latest projections show that universal credit is running about four years behind the timetable that the Secretary of State originally set out. He has told us today that the new digital IT solution is to be rolled out from next April. How will he merge that with the prior IT system, which is already in use in quite a lot of jobcentres?
Mr Duncan Smith
The universal programme is on track and has been approved by the Major Projects Authority, which has said that it is delisted. I say to the right hon. Gentleman, who has been here long enough to remember, that I will take no lessons from a Labour Government who gave us a tax credit debacle—they rolled it out and more than three quarters of a million people failed to receive any benefit on the day it was launched. He should come to see this system; the live service and the digital service are merged because a lot of the digital service will use elements of the live service. They are therefore merging in the run-up to May and will then be rolled out together at the same time.
Welfare Reform and Work Bill (Fourth sitting)
Stephen Timms Excerpts(9 years, 2 months ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Kate Green
It is good to have your endorsement, Mr Streeter.
We also know that progress on tackling unemployment is not necessarily linear. Even if the Government’s programmes are entirely commendable, effective and produce very positive results—hon. Members will not be surprised to learn that we may have some questions about the efficacy of some of them—as we famously heard from our political forebears, events happen that can blow the finest ministerial plans off course. Looking at the recent history of employment figures, if we are prepared to accept that the definition of full unemployment is, let us say, an employment rate of 80%, we were nearly at full employment in 2008. Then, of course, there was a significant rise in unemployment as a result of the world financial crash.
Although we have begun to see the very preliminary shoots of recovery—it is notable that people tended to stay in work after the 2008 recession, compared with previous recessions—the progress has not been constant since the economy began to recover after the recession. The last two sets of unemployment figures we have seen—we expect some more tomorrow—show unemployment rising again, and there are particularly worrying trends in relation to youth unemployment, which has proven to be a particularly stubborn nut for the Government to crack.
Amendment 24, tabled by the hon. Member for Livingston, is really interesting. I hope the Minister will tell us why she thinks it is right to have a sunset clause. Is she trying to protect future Governments? It is very kind of her to think about protecting future Labour Governments, but we are ambitious about full employment. We were the first to speak about it 10 years ago.
Kate Green
Twenty, my right hon. Friend says; I am too young to remember.
We would be happy for an incoming Labour Government to be held to account for full employment. It is an ambition that goes to the heart of my party; indeed, it is embedded in our name. This is an interesting amendment. I want the Minister to explain to the Committee why the Government want to put a sunset clause in the Bill. I very much look forward to the debate we are going to have.
Stephen Timms
I beg to move amendment 1, in clause 1, page 1, line 4, leave out from ‘and’ to end of subsection and insert
‘for the purposes of this report “full employment” is defined as 80% of the working age population.’
To specify that the purpose of reporting on progress toward full employment, full employment is defined as 80% of the working population.
The Chair
With this it will be convenient to discuss the following:
Amendment 106, in clause 1, page 1, line 6, at end insert—
“(1A) The report in subsection (1) must include information about:
(a) the job quality of new jobs created, as set out in section [Definition of job quality] of this Act;
(b) the distribution of the quality of jobs by occupation, industry, sector and region; and
(c) the distribution of the quality of jobs by sex, race, disability and age.’
To require the report on progress towards full employment to also report on progress on quality of jobs, the distribution of those jobs and a breakdown of the employees in those jobs.
New clause 11—Definition of job quality—
‘(1) Within six months of section 1 of this Act coming into force, the Secretary of State must, by regulation, provide a definition of job quality.
(2) Before issuing regulations under this section the Secretary of State must carry out a public consultation.’
To require the Secretary of State to bring forward a definition of job quality and to ensure there is a consultation on defining job quality.
Stephen Timms
I welcome you to the Chair, Mr Streeter. We know that you will guide our deliberations with a firm but fair hand, and we look forward to benefiting from that.
Some 18 months ago, the Chancellor of the Exchequer explicitly repudiated a notorious statement made by one of his Conservative predecessors that unemployment was a price “well worth paying” to bring down inflation. I suspect that all members of the Committee would support the Chancellor in repudiating that remark, which was made in 1991 or 1992 by the then Conservative Chancellor, now Lord Lamont. By contrast, today’s Chancellor affirmed the goal set out in modern times, first by Gordon Brown.
My hon. Friend the Member for Stretford and Urmston said that 10 years ago—I persuaded her to say that it was 20 years ago; I think it was in 1993—Gordon Brown set out what was, at the time, a radical aspiration to achieve full employment. The Labour Government who were elected a few years later formally signed up to that goal and went on to explain what full employment meant to them. That is the point on which I want to press the Minister, through amendment 1.
I welcome the fact that the Chancellor has said he wants us to achieve full employment, but we need to know what the Government mean by that. The amendment would make that clear. The last Labour Government, of which I was a member, was committed to full employment and said that that meant a rate of employment of 80%, which is why that figure is included in the amendment.
I accept that other definitions of full employment could be used. The Chancellor has given the impression, from time to time, that the definition he would like to see would be that of the highest rate of employment in the G7. That is a reasonable alternative definition; it is not as good a definition, but one could run with it. The central point is that we need to know what definition of full employment the Government are using in setting out their goal. Otherwise the target, and the purpose of the report required under the clause, is meaningless.
G7 employment rates in July were 74% in Germany, 73% in Japan, 72.6% in Canada and the UK, 68.7% in the US, 63.8% in France and 56% in Italy, so on the most recent figures the UK’s employment rate is squarely in the middle. I think we would all agree we should be doing significantly better than that. I think Bill Clinton said:
“I do not believe we can repair the basic fabric of society until people who are willing to work have work.”
All of us would sign up to that sentiment, but what exactly are the Government setting out to achieve in clause 1 and the required report?
A couple of years ago, the TUC carried out research on employment rates across the OECD—so beyond the G7. At that point the highest rates of employment were 84.1% in Iceland and 80.4% in Switzerland, so if the definition used was to be the highest rate of employment in the OECD aside from very small countries such as Iceland, that would also get us to a figure close to the one of 80% that we use in the amendment. I hope the Minister will agree that that is where we should aim.
Of course, that is a challenging goal. There is no question about it. I am not for a moment suggesting that an 80% rate of employment will be delivered readily or in a short time. I suspect that it will take some time, and I think that strengthens the case for the proposal in amendment 24 that there should not be a sunset clause. We are going to have to go some to reach an 80% employment rate by 2020. It would mean an extra 2.5 million jobs—an additional 9% on the UK jobs total—but aiming for anything less would be short-changing Britain’s jobseekers.
My hon. Friend the Member for Stretford and Urmston will move an amendment later relating to the Government’s equally welcome commitment to halve the currently very large disability employment gap. The fact is, it will not be possible to achieve an 80% overall employment rate without making significant progress in reducing the current disadvantage that people with disabilities, and other disadvantaged jobseekers, face—or indeed without making progress in localities where the employment rate is exceptionally low. We need the full employment target to deliver improvements for disadvantaged groups, as well as to others, so that everyone benefits from the achievement of that aspiration and large numbers of people are not left behind.
Of course, others have argued for other definitions of full employment, and I entirely accept that the Minister might want to do that, although I suspect that if she signs up to a definition it will be one of those that I have suggested. For 25 years after the second world war, everyone agreed that we should have full employment and, by and large, we did. Between 1950 and 1973 the average rate of unemployment was 2%. It was always less than 1 million. In 1955 the unemployment rate actually fell to 1%.
Of course, full employment never meant zero unemployment. William Beveridge, the architect of the post-war welfare state, said that full employment meant an unemployment rate of less than 3%. Milton Friedman referred to a natural rate of unemployment, whereby no one stays out of work for very long; unemployment would fluctuate, he suggested, between 5% and 6%. On top of that, of course, there will always be some people who are prevented from working by ill health—a number that seems to be rising quite significantly in the UK.
I entirely accept that different definitions of full employment can reasonably be adopted. I think that the best definition is an 80% rate of employment. I accept that the case could be made for others, but we need to know what the Government’s definition is. Otherwise, the aspiration that has been set out is a pretty meaningless one. I hope that this afternoon the Minister will tell us what the Chancellor means by full employment, because there is not much point in having a commitment to it—indeed, there is an obligation in this clause on Ministers to report on progress towards it—if we have no idea what Ministers actually mean by the term, as is currently the case.
I am looking forward to hearing in a moment the case for the SNP amendments that have been grouped with amendment 1. Of course, they raise an entirely reasonable point about the quality of the work being undertaken, and I will say a couple of words about them. A number of our witnesses commented on that issue, and what Julia Unwin from the Joseph Rowntree Foundation said about it this morning was interesting. Her written evidence to us makes the point that
“work also now offers less of a guarantee of a decent living standard than it did in the past. This suggests a need to look more closely at both the amount and type of work available to each household, as both these will influence whether people can reach an acceptable living standard through earned income. Specifically, one of the significant trends underneath the long term picture of jobs growth over the past five years has been the increase in self-employment, especially part-time self-employment.”
We know—we discussed this with our witnesses as well—that a significant majority of almost two thirds of children living in poverty are now living in a household where somebody is in employment. Julia Unwin suggested today that the report that clause 1 requires ought to say something about progression in work as well as the actual proportion of people in employment. I would be interested to know what the Minister thinks about that idea.
We used to think that being in work was the way to get out of poverty. Today, that on its own is clearly not enough. Low pay, low hours, insecure work and the proliferation of zero-hours contracts over the past few years have all undermined the reliability of work as a way out of poverty. Oxfam’s evidence to the Committee makes the point that
“people place high value on satisfying, secure and suitable work as well as jobs which provide a sufficient income”.
The concept of decent work has been debated in recent years. It has been defined by the International Labour Organisation, the Adam Smith Institute and others as including
“fair pay, job security, mental health, recognition of overtime, work-life balance, job satisfaction and autonomy, safety, achievable work, skills development, and effective management”.
What I am unsure about is the practical potential for measuring those things across the economy in the way that SNP Members suggest in amendment 106. I will be interested to hear the arguments they make about that. Certainly, that was precisely what some of our witnesses called for, such as Oxfam in its written evidence, but I am not sure how practical it is. Of course, we could also look at issues of equality in work such as whether opportunities are open equally to all and why all too often they are not. Those issues would come under the amendment as well.
Coming back to my amendment 1, I hope that the Minister will be able to satisfy us on this question of the definition of full employment that the Government are using. It is time for people who have seen the commitment to full employment in the Conservative party manifesto, and heard the Chancellor’s commitments over the past 18 months, to know what Ministers mean by that term. I hope the Minister will accept amendment 1, which would finally make the position clear.
Priti Patel
We were about to discuss the progress towards full employment. As I said on the previous clause, the Government set out in our manifesto our aspirations for the UK to be the best place in the world to start a business and to achieve the highest level of employment in the G7. The right hon. Member for East Ham pointed out that landing on a single definition is difficult, as many definitions are used around the world. Our pursuit of full employment is important, because sustained economic growth depends on having a flexible work force. Some Opposition Members commented on changes to the labour market. The fact that our employment market has evolved benefits individuals and changes lives, which means that sustained employment gives people new opportunities. In addition to the overall benefit of driving down welfare spending, we are enabling people to aspire to live different lives and have sustained employment.
We now have one of the highest employment rates in the developed world and the second-lowest unemployment rate in the EU. We have already exceeded the full employment goal set out in the Europe 2020 strategy of securing a 75% employment rate for men and women aged 20 to 64 by 2020. As I said earlier, that was achieved by supporting people who require help and assistance in accessing the labour market.
Stephen Timms
To be clear, is the Minister saying that the aim for full employment is to achieve the highest employment rate in the G7? Is that what the aspiration means?
Priti Patel
I thank the right hon. Gentleman for that question. We set out in our manifesto our aspirations for the UK to be the best place in the world to start a business and, in particular, to achieve the highest level of employment in the G7. We are focusing on putting measures in place. It will not happen through one target or one measure; it is about having a combination of policies across Government.
Stephen Timms
The Minister has clarified the point. Just so it is absolutely clear, can she confirm that the report required in clause 1(1) will be about progress towards the highest rate of employment in the G7?
Priti Patel
The report, which, as clause 1 outlines, must be produced annually, is to illustrate progress towards full employment across the UK. It demonstrates the Government’s clear aspirations and ambition to achieve the highest level of employment in the G7.
Priti Patel
No, I do not agree with the hon. Lady. In addition to having work, being in a job and being in employment, it is about the quality of life that that job gives. That means different things to different people. For some, it could be about salaries but it is also about self-confidence, self-worth and self-esteem. It may be the opportunity to work for the first time if they have not had the opportunity to do so and have now had skills training, or for a variety of reasons.
We will consider what further analysis can be included in the annual report including how the level, distribution and composition of employment have evolved over time. We feel that that is a more transparent approach, rather than trying to summarise a varied and complex picture into a simple measure of a definition of job, work or job quality.
Since 2010, two thirds of the increase in employment has been across a range of sectors, in particular managerial, professional and associate professional occupations, which command greater salaries. The growth in employment has been dominated by full-time employment, accounting for nearly all of the annual rise in the number of people in work. There are a variety of factors, which we will consider through further analysis in the annual report so that we have a better picture, rather than just one measure. The UK has one of the lowest proportions of temporary workers in the EU. The proportion is less than half the EU average and is lower than that of Germany, France and Denmark. We are talking about employment and how we work across Government to achieve full employment, but we are also working with employers, schools and colleges. Employers communicate with Members of Parliament on a regular basis, and they all tell us that it is about individuals having a range of soft skills and how we work to support individuals in enhancing their skills, be they soft skills, technical skills or vocational skills. That particularly applies in the case of younger workers. My Department, as I have highlighted many times, is working across Government, not just with the Department for Business, Innovation and Skills on apprenticeships but with the Department for Education, to focus on training and engaging young people in particular so that we can all work collectively to achieve the objective of full employment.
I urge the right hon. Member for East Ham to withdraw his amendment.
Stephen Timms
I am grateful to the Minister for her response, because at least we now have a definition. She is clearly saying that the Government’s definition of full employment is the highest rate of employment in the G7, and it is helpful to have that on the record. I do not think it is a very good definition of full employment. As I said in my earlier remarks, the highest rate of employment in the OECD, even if we miss out Iceland, which is perhaps an exceptional case, is that of Switzerland, at 80%. We ought to be aiming for better than 74%, which is currently the highest rate of employment in the G7—it is the rate of employment in Germany.
I will press amendment 1 to a vote, which I hope the Committee will support.
Neil Coyle
The Minister, who unfortunately did not give way, referred to two things during her speech—one was Jobcentre Plus and the other was universal credit. Should the Government provide more information and documentation on the role Jobcentre Plus will have during this Parliament and on how many people are expected to be receiving universal credit by the end of this Parliament? We need those answers if the measurements are to have any validity, particularly in the context of the changes to Jobcentre Plus. If that support is meant to be available, hopefully the Government will ensure that it is available throughout the course of this Parliament.
Stephen Timms
My hon. Friend is absolutely right. We need to know more about what is proposed for Jobcentre Plus. We certainly need to know more about what is going on with universal credit. As far as I can tell, universal credit is running about four years late. We were told initially that 1 million people would be receiving universal credit by April 2014, and the last figure I saw was about 60,000.
Stephen Timms
Indeed. The Minister referred to universal credit as a tool for getting people into employment and for delivering full employment. We certainly hope it will be one day, but there will be a rather large period before we are anywhere near that stage. I hope the Committee supports amendment 1.
Question put, That the amendment be made.
The Chair
It is my opinion that we have had a good old debate about the clause, so I do not propose to allow a stand part debate.
Clause 1 ordered to stand part of the Bill.
Clause 2
Apprenticeships reporting obligation
Stephen Timms
I beg to move amendment 75, in clause 2, page 1, line 16, at end insert—
‘(aa) information about the uptake of apprenticeships broken down by region, gender, age, ethnicity, disability, sector, qualification and level,
(ab) a report by the UK Commission on Employment and Skills on the quality of apprenticeship being provided, and’.
To specify additional information that must be included in the Secretary of State’s report progress towards meeting the apprenticeship target.
The Chair
With this it will be convenient to discuss amendment 102, in clause 2, page 1, line 16, at end insert—
‘(aa) information about the number of people with special educational needs and disabilities entering into apprenticeships; and
(ab) information about the number of people with Education Health and Care plans entering into apprenticeships.’
To require the Secretary of State to report on the number of people with special educational needs and disabilities entering into apprenticeships.
Stephen Timms
We come to the part of the Bill that deals with apprenticeships, and we are keen to get on to the second group of amendments on the clause, so I will get a move on.
We welcome the target set out for England in the Bill. I think it is rather unusual that there should be 3 million apprenticeship starts in the period 2015 to 2020—the target is ambitious and one that we support and welcome.
However, we heard in our evidence sessions that there is a danger. Rebecca Plant, the head of apprentices and graduates for Capp, told us on Thursday that she thinks the only way the target can be achieved is by sacrificing quality. She told us of
“myriad examples, such as apprenticeship barman and of apprenticeships in really low skills.”
She asked:
“How is that an apprenticeship?”,
and went on to say,
“people are just turning a job role into an apprenticeship…That is not right.”
She argued that the 3 million target
“should be broken down into levels of skills, so that higher level—level 4—degree apprenticeships should be broken out and there should be clarity.”
She continued:
“I would break it down and give transparency. What is a level 2 apprenticeship? What are people signing up to? Badging level 2 programmes as an apprenticeship is fundamentally wrong.”
She gave an impressive account of her thinking. In the middle she said,
“I am sorry…I am not very good at this”,
but actually she gave us valuable evidence. She also said that
“traineeships should not count towards that 3 million at all.”––[Official Report, Welfare Reform and Work Public Bill Committee, 10 September 2015; c.8-9, Q8-9.]
I do not imagine that traineeships will count towards the 3 million target, but I would be grateful if the Minister could confirm that.
The concerns raised by Rebecca Plant were echoed and amplified by Marcus Mason, our witness from the British Chambers of Commerce, who said:
“I would like to echo Rebecca’s comments and the worries about the 3 million figure…the apprenticeship starts from the previous Parliament—just over 2 million—included a lot of rebadging of Train to Gain programmes, and we do not want to see that again. We do not want to see a decline in quality because we are just chasing an arbitrary figure.”––[Official Report, Welfare Reform and Work Public Bill Committee, 10 September 2015; c.9, Q10.]
I am confident that every member of the Committee will agree with his sentiment.
Amendment 75 addresses those concerns about apprenticeship quality, which are widely expressed by businesses and others, in two ways. First, it requires the report produced each year to split the apprenticeship starts in that year by sector, qualification and level, which is exactly the split Rebecca Plant called for in her evidence on Thursday. Secondly, the amendment requires the Secretary of State to publish each year a report from the UK Commission for Employment and Skills specifically addressing and describing the quality of the apprenticeships on which participants have embarked in the previous year.
Is the UK Commission for Employment and Skills the right body to produce that report? Clearly, what we want is an independent, reliable report on quality, which might be achieved in a number of ways, but the UKCES is in a good position to fulfil the task. It is, of course, a Government-appointed commission, so I hope the Government feel that they can have confidence in its conclusions. The commission’s chair, Sir Charlie Mayfield, is also chairman of the John Lewis Partnership, and the commission includes such distinguished business people as the director general of the CBI and the general secretary of the TUC. It includes representatives of large and small businesses, including Will Butler-Adams, the managing director of Brompton; Julie Kenny, the chairman of Pyronix, with whom I worked when I was a Minister; Grahame Smith from the Scottish TUC; and Liz Sayce of Disability Rights UK.
The commission has a broad range of experience and perspectives, and it has done a lot of relevant work in this area. It has published reports on understanding skills and performance challenges in a range of sectors, and those reports address apprenticeship issues. It has produced a series of reports called “Working Futures”, “Careers of the Future”, and “The Future of Work: Jobs and Skills in 2030”. It also has the capacity to give independent advice. It does not simply say what the Government want to hear. I do not know whether the commission is subject to the same sort of pressure as the Office for Budget Responsibility—we have discovered over the past couple of days that the Treasury leans on the OBR to prevent it saying things that will embarrass the Government—but we do know that the commission is able to make independent remarks.
On the persistent problem of stubbornly high unemployment among young people, to which my hon. Friend the Member for Stretford and Urmston has referred, the commission has said:
“High quality apprenticeships should be a normal career pathway for many more young people, and a normal way for businesses to recruit and develop…talent”.
The commission has the necessary independence, as well as the expertise, to provide the independent review of quality that, from the evidence we have heard in Committee and from what everyone in the field says, is needed.
The amendment also specifies a number of breakdowns of apprenticeship numbers that could be useful for informing policy and understanding of how the apprenticeships programme is working in practice. We should know the number of apprenticeships taken up each year by people with disabilities—my hon. Friend will move a separate amendment on that in a moment—and we need information by region and by gender. The importance of those breakdowns will be apparent to everyone.
I want to say a little more about the other two breakdowns the amendment calls for. The first is the breakdown of apprenticeships by age. As we heard from the witness from the British Chambers of Commerce, a lot of things that are called apprenticeships are really just rebadged Train to Gain programmes. Train to Gain was a programme under the last Labour Government wherein existing employees would take often quite short training courses to increase their skill levels. There is nothing wrong with that, of course, but it is not what most of us think of when we hear the term “apprenticeship”. One consequence of that emphasis in the apprenticeship programme is that only quite a small proportion of apprenticeships are undertaken by young people. Worse still, the number of young apprentices fell last year—a pretty disastrous development that is contrary to what we all want—so it is important to get a breakdown of apprenticeships by age each year.
Secondly, it is important that we see a breakdown of apprentices by ethnic origin. I pay tribute to the work of the Black Training and Enterprise Group and its chief executive, Jeremy Crook. Ethnic minorities are seriously under-represented among apprentices: 20.2% of the population are from an ethnic minority and 25.4% of apprenticeship applications are from ethnic minorities—a larger proportion than in the population as a whole—but the proportion of people from ethnic minorities who start an apprenticeship is only 13.8%, which is way less than the proportion in the population and around only half the proportion of those who applied.
The problem of under-representation of ethnic minority citizens among apprentices is not new. I first asked a written question on the subject three years ago, when I was told that 9.8% of starts were from ethnic minorities, so the current proportion, 13.8%, has gone up, of which I am glad. In fairness to the Government, the problem is not repeated throughout their employment support measures. For example, of sustained job outcomes in the Work programme, 19.9% are secured by ethnic minorities, which is almost up to the full 20.2% in the population. Nevertheless, there seems to be a particular problem in the apprenticeship programme that must be addressed. I know that efforts are being made to do so, but so far they have fallen well short of what we would want to see.
It is vital that the problem is fixed. Amendment 75 specifically requires a breakdown by ethnic origin, so that we can track what is happening. I hope that the Minister accepts that the amendment would build constructively on clause 2, and so will accept our proposals for strengthening the report.
Stephen Timms
I am grateful to the Minister for what she has told us about the data that will be published, which does pick up on the points in the first part of amendment 75. I am disappointed, however, that she was unable to confirm to my hon. Friend that we will be able to find out the number of people with education, health and care plans entering into apprenticeships, but I hope that the Minister will have another look to see whether that can be provided.
The Minister is a bit complacent on the quality point. I accept that it is not really a matter for her—it is for her colleagues in BIS—but we heard during our evidence from the British Chambers of Commerce, no less, that the only way the 3 million target will be achieved is by watering down quality. The mechanism that we proposed would have dealt with that. I will not press the amendment now, but I hope that she might commend our idea to her colleagues. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Jess Phillips (Birmingham, Yardley) (Lab)
I beg to move amendment 99, in clause 2, page 2, line 5, at end insert
“and that 20,000 of these apprenticeships are taken up by children and young persons leaving care.”
To amend the apprenticeships target to require that 20,000 of the three million apprenticeships are taken up by children and young people leaving care.
Jess Phillips
It is a matter of time, isn’t it, Chair?
I will come back on some of the things that the Minister has said. I welcome her concerns. I will send my constituent to her, as she is keen to get her into work. Although I understand what she says about targets and the policy being employer-led, there are a lot of things that other Government Departments, as well as hers, could potentially do to try to reach targets in both areas. I welcome that, so I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 ordered to stand part of the Bill.
Clause 3
Support for troubled families: reporting obligation
Stephen Timms
I beg to move amendment 4, in clause 3, page 2, line 46, at end insert—
‘(2A) The matters by which the progress made by a household that receives relevant support shall be measured under subsection (1)(b) include whether a member of the household is in employment.”
This requires one of the factors which is used to measure whether a household receive support is making progress is whether or a not a member of the household is employed.
The Chair
With this it will be convenient to discuss amendment 5, in clause 3, page 3, line 6, at end insert—
‘(4A) A report prepared under this section must include information about the number of households receiving support where a member of the household, who had not previously been in employment during the last 12 month, has entered employment.”
To require the report on support for troubled households to specify the number of households receiving support where a member of the household has become employed.
Stephen Timms
We now deal with the troubled families programme, for which there is widespread support. As Ministers have acknowledged, it has its roots in the family intervention projects introduced by the previous Labour Government. The pioneering Dundee families project, established in 1995, has been particularly influential. The approach has all-party support, and we welcome the proposal in the clause to introduce a new and more formalised reporting obligation.
The troubled families programme as it currently stands was given a big push by the riots in summer 2011 and was launched by the Prime Minister later that year. Louise Casey was appointed director general in November 2011. The troubled families programme is in touch with a lot of agencies: with housing departments because of rent arrears; with social services about the wellbeing of children; with police and youth offending teams; sometimes with drug and alcohol services; with education departments over school non-attendance and exclusion; and with the health service. All of that means that the families we are talking about impose a high cost on the taxpayer. They are also often high-harm to themselves and to others. Outcomes for children in those families tend to be poor, and many are on the borderline of being taken into care. A solution has to involve all family members and a multiplicity of agencies, so inter-agency planning delivery is the key to the effectiveness of the programme.
The goal announced in 2011 was to turn around 120,000 troubled families in England by this year, aiming to turn around the patterns repeated in generations of poor parenting—abuse, violence, drug misuse, antisocial behaviour and crime—with the Government investing some £4,000 per family over three years on a payment by results basis. The key element of the programme—this was distinctive to the family intervention projects as well—is that each family has an assigned caseworker responsible for turning their fortunes around and bringing together the efforts of all the agencies working with that family to maximise the chances of success.
The official evaluation, published last July, gave us some detailed information. Some 49% of all families in scope are lone-parent families. The under-18 conception rate is only 2%—rather contrary to the stereotypes we sometimes hear. Some 90% of the adults in the families involved have committed no criminal offence. Only 3% have been treated for alcohol dependency, and it is the same proportion for drug dependency. But 46% of households have an adult or adults suffering a mental health problem, and 33% of the children have mental health problems—that is a particularly troubling figure. Some 32% of the adults and 20% of the children have a long-standing physical illness or disability. Some 74% are workless households. For 83%, at least one person receives out-of-work benefits; 27%are in rent arrears; and 21% are at risk of eviction from their homes.
Priti Patel
I thank the right hon. Gentleman for his contribution and for the focus on the troubled families programme, because it has been designed to turn around the lives of families with challenges. In fact, the first troubled families programme turned around the lives of more than 116,000 families. That is not to say that those hardest-to-help families’ complex needs and multiple problems can be resolved overnight.
Amendment 5 would require information to be included in the Secretary of State’s report on the number of households receiving support where a member of that household progresses into employment following a period of 12 months out of work prior to engagement with the troubled families programme. Getting parents and young people into work is at the heart of the troubled families programme. To reflect that, there are specific progress measures on continuous employment, as set out in the programme’s operating framework.
As with the original programme, we expect the majority of families in the new troubled families programme to be claiming out-of-work benefits. Due to the complexity of the problems they face, they will also be a long way from the labour market. We know that getting a parent into work can have a transformative effect on the whole family. Any Committee member who has any engagement with constituents who have been involved in the programme will recognise the impact on families of the measures and interventions, which can really be transformative. That is what such programmes are about.
In recognition of that, the programme aims to support families with a multitude of problems where adult family members are currently out of work, irrespective of the length of time they have been unemployed. Information on how the programme has supported adults into employment is therefore already an important part of the troubled families programme’s independent national evaluation, which will be the basis of the Secretary of State’s annual report to Parliament.
On amendment 4, clause 3 provides that, at the start of each financial year, the Secretary of State shall issue a notice “specifying the matters” by reference to which progress will be measured and reported on in the following financial year. The amendment would place employment as a progress measure into statute. We have purposely not set out a progress measure for the programme within the clause, so as to ensure that the programme remains flexible enough to respond to families’ emerging needs and to reflect future Government priorities. The right hon. Member for East Ham mentioned that the programmes are varied geographically, and in respect of the local authorities involved and the multi-agency work that is taking place. Ensuring that the programme can remain flexible to respond to the needs of those families is therefore vital.
Stephen Timms
The Minister emphasised that getting people into employment is at the heart—I think those were her words—of the troubled families programme. I welcome her assurance, but that should surely then always be in the criteria against which the programme is assessed.
Priti Patel
The full employment measure, which we have discussed, is outlined in an annual report. This is about the troubled families programme, which already has an independent national evaluation. That will be the basis of the Secretary of State’s annual report to Parliament. We take the view that we are already reporting on those measures. Different information that can be used to measure progress may, of course, become available during the lifetime of the programme. The annual notice issued by the Secretary of State will accommodate that information and will be based on the operating framework for the programme.
The current financial framework includes progress measures for employment, and therefore the first report to Parliament will include information on the number of adults in families supported by the programme who have moved into continuous employment. We believe that that is covered and that the amendments are therefore not necessary, so I urge the right hon. Gentleman to withdraw them.
Stephen Timms
I am glad that the point will be covered in the first report, but I am rather puzzled as to why the Minister is not willing to say that it should be covered in all reports, given the centrality of employment to the goals of the programme. Nevertheless, I am grateful for her response and will not press the amendment to a vote. I hope that, in practice, we will find employment featuring prominently in each of those reports in each of the years they appear.
Amendment, by leave, withdrawn.
Stephen Timms
I beg to move amendment 6, in clause 3, page 3, line 6, at end insert—
‘(4A) A report prepared under this section must include information about the total value of expenditure directed at supporting relevant households by—
(a) local government,
(b) central government, and
(c) government agencies.”
To require the report on support for troubled households to specify how much has been spent to support targeted households by different parts of government.
I will not take up much of the Committee’s time on amendment 6, but there is one other set of data that we need to make a full evaluation of this programme: how much is being spent on it? As I understand it, the central Government allocation is £4,000 per participating family but, of course, other resources are also being allocated to those families. In particular, many local authorities, because it makes such a big difference to them if the families can be set on a new and positive path, are supplementing the resources provided by central Government, and other agencies are also contributing. We need to know the total value of spending on those households by the relevant agencies, and amendment 6 simply requires the report produced under clause 3 to include that vital piece of information.
The Government say that the 120,000 or so troubled families in the current programme cost the state £9 billion a year. Ideally, we would like to have a set of figures that add up at the beginning to £9 billion being spent on those families but that then fall as the programme starts to take effect. The announcement last March, on which the Full Fact website was rather sceptical, claimed that £1.2 billion had been saved as a result of the programme but, to secure a robust evaluation of the programme and to grasp the impact of those families on the Exchequer and the effect of the programme, there is no alternative to compiling the figures required by amendment 6, which would hopefully decline year on year if the programme is having the impact that we all want.
This is my final point, Mr Streeter, because I have a shrewd suspicion that you may not call a stand part debate on the clause today. The Local Government Association has made the point to us that, to minimise additional work in producing the report required by clause 3, data contained in the report must, so far as is practicable, be derived from any relevant official statistics, the national impact study and family progress data. What is the Minister’s response to that specific proposal?
Priti Patel
Again, I thank the right hon. Gentleman for his comments. Obviously, the troubled families programme is focused on better outcomes through the more efficient use of resources. It is therefore right that the primary focus of the report to Parliament is on the outcomes for those families.
Local authorities have been given the freedom to shape their own local programmes with their own local public service partners. In exchange, the Government have asked local authorities to provide information that will enable us to assess the impact of those programmes, which of course includes an understanding of what is being spent on families and the savings being achieved across local public services. That information on costs is part of the troubled families programme’s independent national evaluation, which I have touched on and which will also be published as the basis of the Secretary of State’s report. Information on Government spend on the programme is published annually in the Department for Communities and Local Government accounts. On that basis, it is not necessary to expand the scope of the duty.
There are a couple of points on the £9 billion estimate, which was based on the best information available at the time for the purpose of designing the original troubled families programme. The figure was the result of an analysis of a range of spending on troubled families by central Government Departments. The right hon. Gentleman also mentioned the £1.2 billion figure and the Full Fact website. That figure comes from a report published during the previous Parliament, and it is simply an indicative figure that suggests what potential savings could be made if average savings were replicated across local authorities.
It is fair to say that, because the information on costs identified in the independent national evaluation of the troubled families programme is already published, and will continue to be published—there is a line in the DCLG accounts, too—we do not believe we need to expand the scope of the duty. I therefore urge the right hon. Gentleman to withdraw his amendment.
Stephen Timms
I am grateful to the Minister. When the evaluation came out in March, the then Secretary of State for Communities and Local Government did not speak in the circumspect terms used by the Minister. He claimed that £1.2 billion had been saved.
Full Fact points out, however, that that was based on just seven of the 152 local authorities that took part. Most areas showed gross savings per family of between £6,000 and £10,000, but in Salford savings were £18,000 and in Staffordshire they were claimed to be £49,000. The average was taken from those seven and grossed up to the 152, with the result being the £1.2 billion figure that Full Fact is understandably rather sceptical about. Ministers claim the figures to be savings with some authority, but it would be advisable to provide the more robust data that underpin the figures and estimates before such a claim is made. I do not propose to press the amendment to a Division, but the next time figures are claimed for savings resulting from the programme, I hope we have a more robust basis than that used in March.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
Stephen Timms
In my earlier remarks I raised a question for the Minister about the request from the Local Government Association that information should be taken from existing sources where possible to minimise the amount of work. Is she in a position to comment on that, or perhaps will she drop me a line?
Priti Patel
I cannot comment at this stage, but I will be very happy to take that offline and drop the right hon. Gentleman a line.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Guy Opperman.)
Welfare Reform and Work Bill (First sitting)
Stephen Timms Excerpts(9 years, 2 months ago)
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The Chair
The first witnesses this morning are from the British Chambers of Commerce, Capp, Manchester City Council and Family Action. Before calling the first Member to ask the panel a question, may I ask you to introduce yourselves for the record? I remind you that we will finish this session at 12.30 pm. Who would like to start?
Marcus Mason: Good morning. I am Marcus Mason, head of business, education and skills at the British Chambers of Commerce.
Rebecca Plant: Good morning. My name is Becky Plant. I am head of apprenticeship solutions at Capp.
David Holmes: Hello. I am David Holmes, chief executive of the charity Family Action.
Geoff Little: Morning. I am Geoff Little, deputy chief executive of Manchester City Council.
Stephen Timms (East Ham) (Lab)
Q 1 I welcome you all to our Committee.
This is probably a question for Marcus in the first instance. The Bill requires the Government to report on progress towards full employment. How do you think full employment should be defined? What is the right definition for this purpose?
Marcus Mason: I will give that a stab. We all know that full employment can be defined in different ways, with different levels of full employment in different countries. In that sense, we very much think that full employment is a moving target. Our latest economic forecast shows unemployment reaching around 5% by 2017 and flattening out to 5% in Q2 2018. As a result, we feel that a level of unemployment of around maybe 5% to 4.5% is probably the point where, if you went below that, you might start causing inflationary pressures. So that is the sense that we get from the forecast that our chief economist does at the British Chambers of Commerce.
Emily Thornberry (Islington South and Finsbury) (Lab)
Q 2 I think the important thing, though, is to look beyond the 4% or 5% unemployment as being full employment. Isn’t it important to look at how we define employment? The Office for National Statistics says that someone on a zero-hours contract, perhaps working no more than two or three hours a week, is in employment, but that is hardly a good situation for that individual to be in. If we have a reporting requirement that focuses solely on those sorts of numbers, using that broad definition, how can we really be helping ourselves? Are we not just putting forward an incentive for people to be in insecure and low-paid jobs?
Marcus Mason: Obviously you need the headline unemployment figure, because that is most sensitive to Government policy and has the most impact on inflationary pressures. Of course, you could imagine a situation where a Secretary of State reports using that headline unemployment figure, but other figures could go into that report as well.
Hannah Bardell
Q 7 Surely we need something. There needs to be something around quality and decent work, rather than it being purely numbers based.
Marcus Mason: I guess it depends how you define quality.
Stephen Timms
Q 8 I want to ask a question about apprenticeships. This is really a question to Rebecca. We gather that you are concerned that the only way the 3 million apprenticeships target will be hit is if quite a lot of the apprenticeships are rather poor quality. Could you explain to us why you have that fear? Could you also tell us what it would take, in your view, to deliver both the target and the quality that all of us would want to see?
Rebecca Plant: I have been involved heavily with apprenticeships over the past six years, with the previous Government and the coalition really putting their hands around it and making it a credible work route. Specifically, my interest is around young people. The concern comes from sitting in the middle of some really heavy apprenticeship reforms that are taking place currently with Trailblazers. I am part of the digital Trailblazers group and have worked tirelessly for two years creating new digital apprenticeship standards for the sector.
Purely in my opinion, what you are starting to see with those new standards being released is that, for the tech sector particularly, the high-level skills that are needed are stuck at the moment. So the apprenticeship reforms in Trailblazers are making the ability for us to release and get young people on to Trailblazers really difficult, because we cannot get the standards through.
All of us who are interested in apprenticeships then look at myriad examples, such as apprenticeship barman and of apprenticeships in really low skills. How is that an apprenticeship? I understand about work and I am not patronising that as a job role but, when you are reporting on a number, you have to dig deeper than that number. How much of that 3 million is dedicated to higher skills?
My interest particularly comes with those young people who are “okay”. How do you use apprenticeships to progress them through a lifelong learning route, as the Prime Minister said when he released the new apprenticeship standards nearly two years ago? The idea is lifelong learning. Those people in those low-level jobs are put in there just to gain money for skills, for training. This is my opinion, but what is the route out? How does that help social mobility, when people are just turning a job role into an apprenticeship? That is not right.
Stephen Timms
Q 9 What would it take to deliver the target and the quality? How do we avoid that problem?
Rebecca Plant: In my personal opinion, the target should be broken down into levels of skills, so that higher level—level 4—degree apprenticeships should be broken out and there should be clarity. There should be some reflection on how that matches the skills gaps. Employers talk about skills gaps until they are going blue in the face. How does that work? With the lower sector, I would look at entry and ensuring that there were full-time job contracts at the end of those apprenticeships. I would ensure the commitment from the employer to keep training and to move that young person through. I am sorry that my answers are woolly. I am not very good at this.
Jess Phillips (Birmingham, Yardley) (Lab)
You’re doing great!
Rebecca Plant: Thanks! I’m really nervous.
Stephen Timms
That was a good answer.
Rebecca Plant: I would break it down and give transparency. What is a level 2 apprenticeship? What are people signing up to? Badging level 2 programmes as an apprenticeship is fundamentally wrong. That should be an entry point into an apprenticeship but there needs to be tightening up of these low-skilled, dead-end, monotonous jobs for these poor people.
Finally, just to add, traineeships should not count towards that 3 million at all. The traineeship piece is a really good on-ramp for some people, but does it lead to real job opportunities at the end? I question that completely. It is hard for employers to digest the traineeship, in my opinion. There needs to be an onboarding Work programme into an apprenticeship so that, no matter where you come from in your life, you have a level playing field with everybody else. That is what my particular passion is.
Amanda Milling (Cannock Chase) (Con)
Q 10 I have several questions for both Rebecca and Marcus. In the previous Parliament, about 5,000 apprenticeships were created in my own area, and I have met businesses and apprentices themselves. What can the Government and businesses—other providers as a collective—do to raise awareness of apprenticeships and the value of apprentices to firms both in the short and long term?
Rebecca Plant: This is the same question that has been going around for the past six years. On raising awareness, Sue Husband from the National Apprenticeship Service has done a fantastic job of trying to engage, but we always seem to be stuck at the same point. There is a real difference between delivery on the ground and understanding the National Apprenticeship Service and what it takes to deliver an apprenticeship, which is really different from what it feels like for an employer. There is still a massive mismatch between what Government-funded bodies are saying takes an apprenticeship to the reality of delivery on the ground—a huge disparity. When we hear that some of the large organisations in this country are struggling to take five apprenticeships, we really should be worried.
Marcus Mason: A good way of increasing awareness is to focus on the small and medium-sized businesses, because our research suggests that that is where there is the most potential for growth, and networks like the Chamber network can be an effective way of reaching that market. We have had events in partnership with other business groups and also the Skills Funding Agency, identifying businesses that had not previously taken on an apprentice and informing them about how they could go about doing that. That also has to go hand in hand with finding ways of incentivising schools to promote apprenticeships in their careers advice, because there is still a bias towards the standard A-level to university academic route, and a lot of schools judge themselves against that benchmark. We hear of businesses that offer high-quality, well paid apprenticeships, but still do not get enough applicants for those apprenticeships, so I think it has to work on both sides.
I would like to echo Rebecca’s comments and the worries about the 3 million figure and flag up that, ultimately, we are talking about a huge increase in apprenticeships. When you bear in mind that, the apprenticeship starts from the previous Parliament—just over 2 million—included a lot of rebadging of Train to Gain programmes, and we do not want to see that again. We do not want to see a decline in quality because we are just chasing an arbitrary figure. Ultimately, if we get the quality right, the businesses will take them on and will offer apprenticeships, and so will the young people go for them. So the focus has to be on that. When it comes to reporting, we need to absolutely think about how many of these people are going to progress into jobs and the quality of these apprenticeships. We really need to dig into all of that in the report that the Secretary of State does.
Jo Churchill (Bury St Edmunds) (Con)
Q 16 It is just a quick one, to Rebecca and Marcus, really, as to how Government can be more innovative.
You have outlined many of the problems. Perhaps I should declare an interest: I am a shareholder of an SME and have run an SME for some decades. What you are saying is exactly right. The big problem is not the lack of will. Sometimes it is the lack of skills both from the business and from the joined-up agencies. There is a problem with always having a job at the end of an apprenticeship, because you do not always know what your economic environment in a small business is going to look like in two years’ time, and that is something that very much needs to be taken on board.
So are there ways of looking at this in an innovative sense? Farming would be one example, where often the work is seasonal and therefore the farmer can offer practical work; but maybe there could be some alignment with colleges in order to make up that difference. One of the problems that we are having is that bums on seats in schools mean money, so they are unlikely to encourage apprenticeships at that stage because of that trade-off. Is there some positive way that we as a Government can help incentivise innovative thinking around apprenticeships, particularly for small businesses, which make up 99.9% in volume terms of all the companies in this country?
Marcus Mason: There are programmes by apprenticeship training agencies, for example, to pool apprentices so that they can work with different employers. That can help where there is seasonal working or—for example, in the construction industry—where work is project-based and they might be on one project with one business and then another project with another. Those can work in certain sectors. Looking at some of the lessons from those programmes and thinking about how to scale those up could be one area.
Also, you could encourage large businesses to work more effectively with their supply chain. At the moment, apart from the very best examples, small businesses and large businesses operate in silos, and a lot of recent announcements on apprenticeship policy have been aimed at larger employers. There is a bit of a gap between the two. I do not have the answer, but perhaps it might be worth investigating how you could encourage and incentivise larger businesses to help support training in their supply chain.
Rebecca Plant: There is an amazing man called David Barlow up north who has an electrician’s business. He is a larger employer, although not large. He supports his SMEs by bringing apprentices back into his business to train when they have periods of downtime. That is such an innovative model that we should be rolling it out further.
Stephen Timms
Q 17 I would like to ask David and Geoff about the troubled families programme. The Bill requires the Secretary of State to report on the progress made by households benefiting from the programme. I would be interested to know how you think progress should be measured. What is success for a family who have been in the troubled families programme? How fair, in your view, is the criticism I have sometimes heard that although a lot of families have been helped by the troubled families programme, not many unemployed family members have gone into jobs? Is that a fair criticism of the programme? Would you say that it has been a success so far?
David Holmes: Family Action delivers a range of troubled families schemes in different parts of the country. We strongly support the troubled families programme inasmuch as it supports and helps fund family support. I begin my comments by saying that troubled families are inevitably complex families, with a range of difficulties that they need help to manage.
If you will permit me a quick case study, we worked with a single-parent family: a mum with daughters aged 14 and two. The mum had experienced domestic violence in previous relationships and had had to leave where she was living. She had come with her two daughters into an area where she did not have support networks or family; she was quite isolated. The two-year-old was sharing a bed with mum. There was a lot of poverty in the family, and there were concerns about parenting and the child’s development, including her not meeting speech and language milestones. The 14-year-old was missing a lot of school and had had three exclusions from school over the past year; there were problems with mum’s relationship with the 14-year-old. There were concerns about mum’s mental health. Mum was also in debt.
I would say that in a lot of ways, that is a typical troubled family. It shows the range of issues with which the family is grappling. Mum has not worked for more than 14 years, and is on benefits. In order to make a difference to that family, we cannot just focus on getting mum back into work or getting the 14-year-old back into school; we need to think about all the issues that that family has and try to address as many of them as we can at the same time. We worked on mum’s relationship with the 14-year-old, we got the two-year-old into nursery provision, and we got the mum on a debt repayment scheme so that she could manage her finances better and got her counselling through the local GP service. We did as much as we could to address as many of that family’s problems as possible. The good news is that the relationship with the 14-year-old is much better and she is now back in school, the two-year-old is doing well in nursery and things are looking up for her, and that family is making progress.
I make those comments because in the current troubled families programme, one measure of success is to look at whether we can demonstrate significant and sustained progress. In the report that is going to be delivered under the provisions of the Bill, we need to be sophisticated in recording how significant and sustained progress has been made. It is about not only single factors such as whether someone has got back into employment, but what has happened to that family across all their needs to help them move forward.
Stephen Timms
Q 18 I would be interested to know how Geoff feels about the same issues.
Geoff Little: Well, there are three parts to the question. First, how should we measure success? Secondly, is it really effective for employment? Finally, do I think it has been successful so far?
I will take the last part first, because that is a good way to get into it. From my personal view, without a doubt, the troubled families 1 programme over the past four or five years has been a resounding success. It has been a great example of how taking an integrated approach to public service delivery can have a real impact on the direction of people’s lives. The example that David gave is replicated many times. In Manchester, for example, in troubled families 1, according to the definition in the programme, we turned around the lives of 2,385 families. That has had a significant impact on outcomes in Manchester.
In the next programme over the next five years, we will take on just over 8,000 in Manchester and 27,000 in Greater Manchester. We think we have demonstrated success on the ground in two ways. We are giving people a lead worker who works in a system in which their leadership can actually be turned into integrated plans, because all the public services recognise and respect their leadership role. In that system, we have seen the effect on families’ lives. We have also seen public spending reduced in the right way by reducing the need and demand for specialist and targeted services, which are obviously the most expensive. By getting demand down, we have released funds to spend instead on universal services that create the sort of placements that attract successful people, so the economy of our place will grow over time. You get a virtuous circle. It is about reducing demand for targeted services, but it is also about economic growth.
I would suggest that the evidence we have in Manchester is probably some of the best in the country, because when we started our work on this back in 2008-09, we all saw what was coming post-recession in terms of public spending cuts, but we were determined, as we went through the process, to have evidence. Does this way of working really allow you to allocate your budgets in an intelligent way? When you get to the budget-setting process, you cannot do it on hope; you have to have evidence. We therefore got best-quality evaluation, including cost-benefit analysis. That allowed us, as a council, in our budget-setting process last winter, which was the toughest I have ever been through, to nevertheless invest substantially in the development of our troubled families programme over the next five years.
It is right that Parliament gets an annual report from the Secretary of State for Communities and Local Government that explains the impact of the programme, not only for Department for Communities and Local Government objectives, but for objectives across Whitehall. If you can get that cross-cutting look across Whitehall, that has to be a move in the right direction. I think it does work, so the clause that requires annual reports is correct.
How do we measure success? The proposals in the troubled families 2 programme feel about right to me. One part of measuring success is by place. There should be a troubled families outcome plan for the place, where we understand the number and distribution of troubled families, according to the definition; what our plan is to change outcomes over a period of time; and how we measure ourselves against the relevant objectives for our place, and we report that in.
There is also a specific way of measuring progress, which is by employment. If we can get people into jobs or sustained work through this programme, that almost trumps all the other requirements and the payment by results follows. It is absolutely right that the new programme is measured by employment specifically.
I think you are right that it was clear in the first programme that getting people into jobs was probably the most difficult part of the exercise, but we all found—certainly those of us in some of the more deprived parts of the country—that the vast majority of our troubled families were suffering from worklessness, normally long-term worklessness. More than two thirds of Manchester’s troubled families were workless. It was a very slow start, but when we got through the four-year programme, of those two thirds—a total of 2,300—we got 26% of those people into work, and 19% of that total was sustained for more than 12 months. I think that is reasonably good progress, given the difficulty of getting people into work. However, as we go forward, it is not only about the troubled families programme, it is also about applying the troubled families programme way of working to other interventions.
In the last Parliament, we convinced the Treasury and the Department for Work and Pensions that we should apply the principles of the troubled families programme to our version of a locally commissioned Work programme, and we called that “Working Well” programme. We got some excellent providers to come in and provide top-class employment interventions, but coupled that with their lead workers slotting, at a place level, into our system of integrating all of the public services. That is still rolling out, but it has been so successful that so far that we have convinced Government to allow us to scale that up through our devolution agreement to another 55,000 families in Greater Manchester over the course of the next Parliament. I think you can apply the principles specifically to employment and have really beneficial impacts.
Jess Phillips
Q 19 I was involved in developing two different troubled families services, both in the black county and in Birmingham. You have already covered the fact that employment is always the hardest target to reach. I want to hear about the reporting mechanism that is going to come in. I used to sit in troubled families offices listening to the headlines saying that we were helping 10 billion families, and think “Are we”—well, I will not swear. “We are not, actually; those are headline figures. We are at the first step of helping these families.”
The way that the troubled families scheme works at the moment means that there is very little step-down support once time on the programme is completed, and therefore long-term measures of success would be near impossible to measure, beyond employment capability, for a long time. What are your views on the reporting mechanism being headline candy for a scheme that is definitely extremely positive, aside from the employment headline? I was specifically working with vulnerable women and children and female offenders, and I have seen thousands of families like the one that you described. The woman you described is a real success, but I bet you did not get her into employment. If you didn’t, when her two-year-old turns three, she is going to be sanctioned and end up right back where she started.
Is the report going to have returns in it? Will it be cyclical? Will I see a report that says that that family has come back into the troubled families programme? There is no step-down support, so once families are done with the programme, they are done with the programme, and we do not know what success looks like. With this level of reporting, I am worried that the headline figure will be anyone who has ever been referred by any agency and it will not actually mean anything.
David Holmes: That is why I emphasise that we need sophisticated reporting, so that we unpick what “significant and sustained progress” means. While we were working with the woman I was talking about, we managed to help her to volunteer. So much of the success of the troubled families programme is the journey that we help families to take towards improved outcomes. It is not always about the achievement of predetermined outcomes at the beginning, and it is something about valuing and celebrating the progress that is made on that journey, because it is helping people to begin that journey that gives them the confidence and resilience to continue it.
Oral Answers to Questions
Stephen Timms Excerpts(9 years, 2 months ago)
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Stephen Timms (East Ham) (Lab)
Unemployment went up last month. The Government’s commission on employment and skills pointed out earlier this year that although we currently have German levels of adult unemployment, we have eurozone levels of youth unemployment, which went up in July and in August. Does the Secretary of State accept that much more needs to be done to give young people the chance of a decent start?
Mr Duncan Smith
Of course we are focused on youth unemployment, but it has actually been falling from what we inherited. It has fallen by more than 200,000 since we took over, and the claimant count has fallen every month in the past three and a half years. The right hon. Gentleman talked about the figures going up, and in a sense I am not surprised, because they cover the period leading up to the last election. Given what the Opposition were saying, and looking at the polls that some businesses carried out, it is no surprise to me that they might have held back. If he looks at the vacancies, he will see that there are 735,000 vacancies in the jobcentres every week, which is more than he managed.
Mr Duncan Smith
We inherited a situation where nearly one in five households in Britain had nobody in work at all. It is far more likely for someone who is out of work to be in poverty and for their children to be in poverty. We have pretty nearly halved that level and have the lowest number of workless households since records began.
Stephen Timms (East Ham) (Lab)
Until a few weeks ago, the Secretary of State told us that he was committed to the targets in the Child Poverty Act 2010, but now he has brought forward legislation that not only scraps those targets, but, as my hon. Friend the Member for Cardiff Central (Jo Stevens) pointed out, will leave Ministers with no child poverty targets at all. He has just denied that from the Dispatch Box, but the fact is that the Welfare Reform and Work Bill removes all the child poverty targets. Why are the Government, in reality, despite his fine words, throwing in the towel on child poverty?
Mr Duncan Smith
We are not; we are committed to eradicating child poverty and we will have to report every year on our achievement in line with the figures that I gave the right hon. Gentleman earlier. I simply say to him that his Government failed to meet their targets—they spent £75 billion on tax credits in their last six years and still failed—and it is under this Government, in the past five years, that child poverty has actually fallen by some 300,000, rather than under them.
Stephen Timms
The truth is that child poverty is now going to rise even faster than already predicted because of the huge cuts in tax credits next April, to which my hon. Friend the Member for Eltham (Clive Efford) referred. With most children in poverty now living in working households, not workless households, should the Secretary of State’s children’s life chances reports not include data on children in low-income working households, as well as on those in workless households?
Mr Duncan Smith
I believe that our reports will cover a much wider range of issues that affect child poverty. I have always felt that issues to do with family stability, drug and alcohol addiction and education are critical to a child achieving a decent outcome. If the right hon. Gentleman has anything further to add, I am always willing to take his submissions, and the Select Committee has also said that it will do the same. My point is that an arbitrary target simply for an income line, which is what his Government did, leads to a huge distortion in the benefits system, and the right hon. Member for Birkenhead (Frank Field) has said exactly the same.
Mr Duncan Smith
I can give my hon. Friend that assurance. In all the areas in which we have rolled out universal credit—in more than half of jobcentres—it is dramatically improving people’s lives. Unlike when the previous Government rolled out tax credit and hundreds of thousands of people lost their money, this scheme is ensuring that people who deserve the money and are ready for it are paid it.
Stephen Timms (East Ham) (Lab)
The number of people receiving universal credit remains derisorily small. Four years ago, the Secretary of State told us that the transition to universal credit would be complete by 2017. We told him he would not manage it. We were right; he was wrong. He still has not given us a revised date for the completion of universal credit roll-out. Has he given up entirely on ever having one?
Mr Duncan Smith
I am on the verge of giving up speaking to the right hon. Gentleman, because he misuses all the facts. As I have told him again and again and again, he is more than welcome to visit the sites where it has been rolled out. He has had an open invitation to come to see the digital site and I recommend that he does so. Universal credit is already working; no one has lost any money; it will be online; and it will go out fully and start next year. This is a successful programme and if the right hon. Gentleman wants to compare notes about tax credit roll-outs, I would be more than happy to do that.
Draft Health and Safety at Work etc. act 1974 (General duties of self-employed persons) (Prescribed Undertakings) Regulations 2015
Stephen Timms Excerpts(9 years, 4 months ago)
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Stephen Timms (East Ham) (Lab)
I welcome you as Chair of our Committee, Mrs Moon. I also welcome the Minister to his new role and congratulate him on his appointment.
The regulations, as implied by their name, amend the Health and Safety at Work etc. Act 1974. Last year, we celebrated the 40th anniversary of that landmark piece of legislation. Barbara Castle originally commissioned Lord Alf Robens to undertake a review of health and safety at work, given the high level of workplace accidents and fatalities in the late 1960s. The work to convert his recommendations into legislation took place largely under Edward Heath’s Government but it was Michael Foot, as Employment Secretary, who oversaw the legislation in 1974.
The essential principle of the Act was that those who create risk should have the key responsibility for mitigating it. The legislation took a flexible, non-prescriptive approach that stood the test of time and allowed adaptation to a radically changed economic and social environment since then. It has been looked to as a model for common sense and safety throughout the world.
The Minister gave us a brief précis of the rather long and winding road that has led to this point. The regulations began when Professor Löfstedt made his recommendation in an excellent report commissioned by the previous Government. He said:
“I…recommend exempting from health and safety law those self-employed whose work activities pose no potential risk of harm to others.”
The Government initially tried to turn that recommendation on its head with a proposal that no self-employed people had health and safety obligations other than those undertaking activities included on a list, which was to be set out in regulations. Inevitably, in the background to this discussion is a concern that the good and obviously welcome long-term fall in accidents at work—workplace fatalities are down 75% since 1974—is showing worrying signs of starting to move in the wrong direction.
The Health and Safety Executive has reported that fatal injuries went up from 136 to 142 in the year to March. Fatalities in the agricultural sector increased, which underlines the importance of including that sector in the schedule to the regulations. We must all hope that this increase is just a blip, but it is absolutely clear that there is no ground for complacency, or for the rather cavalier approach to these matters that some of the Minister’s colleagues—not the current Minister, I am pleased to say—appear to have favoured in the past.
The Government’s initial approach was superficially attractive to people with an ideological hostility to health and safety legislation. Analysis by the HSE showed that that approach would more than double the number of self-employed people who would be exempt from health and safety obligations compared with Professor Löfstedt’s recommendation. The proposed list of high risk activities left out a lot with injury rates statistically higher than the average. For example, it was proposed that there would be no health and safety obligations on self-employed motor mechanics, van drivers, heavy goods vehicle drivers, furniture makers, woodworkers, metalworkers and maintenance fitters. That struck many people as a pretty serious list of omissions.
The proposed approach was fraught with other problems. In particular, it would have introduced huge uncertainty for self-employed people about whether they had obligations. The existing arrangement was felt by some to be onerous, but at least everybody understood what it was. The Government’s first proposed approach did not have that virtue. How exactly were the listed activities in the regulations defined? What about people who spent some of their time on prescribed activities and some on other activities? Under the Government’s proposal, even though people engaged in activities on the prescribed list did not have obligations under the Health and Safety at Work etc. Act 1974, they would still have obligations under other legislation. How would they know what those obligations were and how to fulfil them? In response to that initial proposal, EEF The Manufacturers Organisation said:
“EEF understands the logic of excluding the self-employed from the scope of the Health and Safety at Work etc. Act 1974 where they pose no potential risk, but do not believe it will be easy to determine or define (with any accuracy) who poses a potential risk and who doesn’t. This will lead to a very complex legal situation which will prove impracticable to interpret and enforce. On that basis we believe that current requirements should be retained.”
It is certainly the Opposition’s view that the important virtues of clarity and certainty in health and safety legislation should not readily be given up.
The CBI responded to the Government’s consultation. In answer to the question it posed,
“would a self-employed person know if the law applied to them or not?”
61% said that they would not. It was frankly a terrible mess.
The regulations represent a significant shift from the initial, unattractive proposal and I welcome that the Government made those changes. It has been a long and winding road, but the scale of the problems that we were heading towards has been averted. I pay tribute in particular to my noble Friend Lord McKenzie of Luton, who, through his tireless efforts in the other place, should take much of the credit for the Government’s change of heart.
The TUC described the regulations as
“unnecessary legislation that no-one wanted, aimed at resolving a non-existent problem”,
and that remains correct. As I look through the impact assessment, I am struck by the scale of the so-called problem. At paragraph 52, it tells us that research was carried out in 2012 involving interviews with 60 people and only five of them
“thought they had any health and safety obligations.”
Therefore, fewer than one in 10 were conscious that they had any obligations that the Government wanted to remove from them. The remaining 55 either said that they did not have any such obligation—they were the majority—or that they were not sure.
Paragraph 62 of the assessment says:
“Interviewees who took part in the qualitative research were asked directly whether they thought the removal of health and safety obligations would make any difference to their working practices. The response was unanimous, with all participants stating it would not.”
It is not quite clear what the Government are trying to achieve. Paragraph 67 says:
“One of the questions asked of interviewees in the 2012 qualitative research was how much time they spent each year ensuring they were compliant with health and safety law”—
as we know, of the 60 respondents, 55 did not think that they had any obligations. It continues:
“The five respondents who were aware that legal requirements in this area applied to them provided estimates centred around 30 minutes.”
The impact assessment assumes that those self-employed people probably do only half of that anyway, so perhaps that 10% will save 15 minutes a year as a result of the regulations. I guess that is why the Government came up with the extremely modest total net present value of £4.65 million benefit from the changes.
Compared with the long-standing position that everyone is covered, the regulations stipulate that people who are not involved in activities listed in the schedule and who do not pose a risk to the health and safety of another person are no longer covered by the Health and Safety at Work etc. Act 1974. In principle, that is a reasonable position finally to have arrived at, but I want to press the Minister on how self-employed people will know what their obligations are. As we know from the impact assessment, the great majority of self-employed people do not think that they have any obligations under the Act at the moment.
For people undertaking activities listed in the schedule—now a much clearer and broader list—including agriculture, asbestos, construction, gas, genetically modified organisms and railways, the position is as it always was: they are covered by the Act. However, how are those not participating in those activities to know whether they should be regarded as posing a risk to the health and safety of another person and so have legal obligations under the Act? If they reach the view that they do not pose a risk to anyone and then there is an accident in which someone is badly injured or even dies, will they be liable for having reached the wrong conclusion? What penalty might they suffer? How can self-employed people who, in good faith, do not believe they pose a risk to anyone but, in fact, do, protect their position?
The £4.65 million claimed benefit to business from the change, which is an extremely modest amount, will quickly be lost if a few difficult and costly legal cases arise from the uncertainty that might be created. Does the Minister expect the courts to clarify the position, or will the guidance that he mentioned make that clear? If he intends to follow the latter approach, can he tell us now what the guidance will say, and when does he expect to publish it? How do the Government intend that we establish whether someone poses a risk to the health and safety of another person if they are self-employed? Will he reassure us that guidance will be available in good time before the regulations come into effect on 1 October? The regulations provide for a review to be undertaken in five years’ time, but it is not clear to me why we are waiting so long. Will the Minister comment on whether that review could be brought forward?
There is not much to admire in the regulations, even though I do not think they will cause the problems that the Government’s previous suggestions would have created. We welcome the Government’s re-think, especially following the debates in the other place on the Deregulation Act 2015. I will not be calling on my hon. Friends to vote against the regulations, but I hope that the Minister will be able to clarify the important points that I have raised.
Justin Tomlinson
I thank the shadow Minister for his characteristically thoughtful and assured speech, in which he raised important points. I am delighted to hear about Barbara Castle’s involvement. She was my mother’s MP, so that bodes well.
The right hon. Gentleman is absolutely right to highlight the importance of the long-term fall in injuries. The driver for that is not the £4.7 million, but ensuring that the perception of health and safety exists so that the workplace is made safer and businesses engage. As a former self-employed person in a relatively small office, I know that things are a lot harder for a small business than for companies with big human resources departments that are skilled and well-trained in such areas.
On why the list is not more exhaustive, those occupations listed were the ones that were deemed to involve high risk, and that therefore were high profile, but the crucial catch-all proviso remains. It is vital that we encourage wider engagement, and I have already done a huge amount of work with the HSE board. If we look at all the statistics over recent years, there has been good progress in how much businesses are engaging and their seeing that it is beneficial to do so, but the change will clarify where there is no risk and no duty, thus helping to reduce the perception that health and safety law is inappropriately applied, which was turning businesses off from engaging and helping to maintain a safe workplace.
As I said, it is not the £4.7 million that, in the grand scheme of things, will make a huge difference, but 1.7 million self-employed people. The Government consider that the proposal will encourage an increase in self-employment and boost economic growth by removing negative perceptions about health and safety law in circumstances in which there is a low risk of harm, which we would all welcome.
The shadow Minister rightly highlighted the need to ensure that people are aware of the changes and guidelines. Once the changes have been agreed by Parliament, the Health and Safety Executive will implement an extensive communications plan to publicise them. Every effort will be made to ensure that self-employed workers are aware of the changes and that they can easily understand how those changes affect them. That is especially the case for those to whom the law will continue to apply. As I have said, in recent years there has been a complete transformation in the documents and communications provided by the HSE, which has been well received by the business community, but the self-employed will not be exempt from the Health and Safety at Work etc. Act 1974, only from section 3(2). Other sections will still apply even if someone is exempt from section 3(2), so this is not a complete wipe-away of any responsibility.
The right hon. Gentleman asked who is responsible if the wrong conclusion is reached. It is the duty of the self-employed person to understand that the law applies to them, and liability will not be based on a subjective understanding.
Stephen Timms
That is the point that troubles me most and I do not really understand that answer. The old position was that one was subject to the law, so the position was clear. Under the regulations, a person will be subject to the law if they pose a risk to someone else. I do not understand how somebody can make a sound assessment of whether, as a self-employed person, they pose a risk to somebody else.
Justin Tomlinson
Businesses have to make such decisions day after day. For example, they have to decide if they are subject to VAT conditions if they are in an industry in which certain products are VAT-able and others are not. A self-employed bookkeeper working at home who does not invite the public into their home would clearly be exempt according to the guidelines. If someone is coming into contact with the public and doing work that might pose a risk, they will be covered. That is why the guidelines will be produced, and self-employed people will make a judgment. It is estimated that approximately 1 million people will still be subject to health and safety law as they fall into those high-risk activities listed on the schedule.
Question put and agreed to.