Pension Credit and Cost of Living Support Grant

Alex Burghart Excerpts

Wednesday 26th October 2022 Westminster Hall

[The Parliamentary Under-Secretary of State for Work and Pensions (Alex Burghart)]

It is a real pleasure to serve under your chairmanship, Mr Dowd. I hope that hon. Members will forgive me; I am losing my voice, but I will try to speak as clearly as I can into the microphone. I thank the hon. Member for Glasgow North East (Anne McLaughlin) for securing this important debate on an important subject. I pay tribute to her campaigning work, because helping people to realise the benefits to which they are entitled helps everybody in society. I know she understands that.

My Department will always welcome opportunities to explain what we are already doing to support pensioners. We know the importance of ensuring that people up and down the country are looked after, post retirement. This topic is particularly pertinent given the recent increase in the cost of living. We are taking this challenge incredibly seriously, which is why we have spent more than £37 billion this year on cost of living support, as well as delivering on the energy price guarantee.

This financial year, total expenditure on benefits for pensioners will be well over £134 billion, which represents about 5.4% of GDP. This high investment ensures that the basis of our safety net for pensioners—the full yearly basic state pension—remains strong. It has brought the British state pension in line with that in other OECD countries. The amount that we provide is higher than it is in countries such as Switzerland, Norway and Germany. One of the major successes of this Government, auto-enrolment, has led to over 10.7 million extra employees paying into a workplace pension, so that they can save for a safe and secure future. The issue is particularly pertinent today, because it is the 10th anniversary of auto-enrolment.

[Matt Rodda]

Would the Minister like to pay tribute to the last Labour Government for designing the policy?

[Alex Burghart]

I certainly pay tribute to the last Labour Government, as well as the Pensions Commission, which had cross-party support, and the support of organisations such as the Centre for Social Justice, which I used to work for. Steve Webb, formerly of the Liberal Democrats, also contributed to that work. It was, however, the coalition Government, led by the Conservatives, and my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith), when he was Secretary of State for Work and Pensions, who made it happen. All that good work has had a demonstrable effect: in 2021, 400,000 fewer pensioners were in absolute poverty than when the Conservatives came to power. That is a remarkable achievement of which we are rightly proud.

To complement the state pension, pension credit—mentioned a number of times in this debate—offers an extra layer of support for people over state pension age and on a low income. Pension credit provides an invaluable top-up to a person’s state pension, ensuring that single pensioners receive a minimum of £182.60 per week and couples receive at least £278.70 per week. Crucially, as other hon. Members have mentioned, pension credit acts as a passport to other help, including for rent, council tax and heating.

A comprehensive benefit package including pension credit is only worth while if claimants access the support. We are aware that, historically, take-up of pension credit has been too low. To increase pension credit awareness, in April we launched a comprehensive paid advertising campaign, including a promotional video fronted by Len Goodman of “Strictly Come Dancing” and my predecessor, my hon. Friend the Member for Hexham (Guy Opperman), who did so much in his five years in the job to improve opportunities for people planning for their pensions and claiming them. That campaign has now been viewed well over a million times. The campaign further focused on encouraging the private sector to help drive up claims and reach those who may be reticent about claiming pension credit.

As the hon. Member for Glasgow North East said, no one should feel ashamed about claiming this money. The reason why we have it is so that people can come forward and take it. We want them to have it. Success for us is 100% of people claiming it. I do not think she was implying that the Government sought to stigmatise people who claim benefits—we absolutely do not. We have created a benefits system that is designed as a safety net to support the most disadvantaged in society, but also to help people who are capable of work to move into work.

[Anne McLaughlin]

To clarify, I was blaming individual politicians and sections of the media for besmirching the character of people in receipt of social security payments. I am not suggesting that the UK Government are doing that. What was the increase in the number of people applying for pension credit after that campaign? What was done in the run-up to the crucial deadline of 19 August, and what will the Government do in the run-up to December, because that is an important incentive for people. It is not enough to have the £324, but it will act as an important incentive.

[Alex Burghart]

I thank the hon. Lady for her clarification. I have not heard any colleagues use that sort of language. I will answer her point in my speech.

We continue to work closely with a whole range of stakeholders, including Age UK, Independent Age and Citizens Advice, which have reach and expertise to identify other practical initiatives that will help encourage eligible pensioners to claim. On 15 June, the DWP had a second pension credit day of action with the media, in which we encouraged the media to reach out to pensioners, their family and friends. Thanks to that day of action, we recorded a 275% increase in claims in the week of 13 June this year, compared with the same week in 2021. The DWP has received unprecedented volumes of new claims for pension credit. Weekly claims tripled between December 2021 and August 2022, so we are seeing a genuine increase in traffic. Obviously, the quoted figures for uptake are about 70%, and the uptake for guarantee credit, which is the main safety net within pension credit, is 73%. Those figures are from 2019-20, before the current days of action and the campaign push, so we very much hope the next set of figures will be some way above that.

Prior to that campaign, the previous Minister for Pensions, my hon. Friend the Member for Hexham, wrote to all MPs to request their support. It has been heartening to hear all the Members who have spoken today give evidence of how they responded to that request. I know there is still work to do. The latest available estimates show that there are still substantial numbers of people who may be eligible for pension credit but are not claiming it. That is why we continue to encourage everyone to reach out to their own networks and use resources such as the pension credit calculator on gov.uk. By working together, cross-party, we can ensure that those eligible for pension credit receive the support they need.

It is particularly important that we encourage those eligible to make a claim because for those above state pension age, eligibility for the means-tested benefits cost of living payments is determined through pension credit entitlement. The £650 cost of living payment will help to ease the pressures that pensioners are currently facing. The payment was designed to target those on low incomes, which is why a household will automatically receive a cost of living payment if they are eligible to receive a pension credit payment during the qualifying period. We did this because we needed to get a big system up and running at high speed. We found it was the quickest and most effective way to deliver support to more than 8 million people on the lowest incomes.

[Anne McLaughlin]

I appreciate the Minister taking another intervention—I am doing so to help his throat and give him the chance to have a glass of water. If he is saying, “It was set up quickly because we had to help people as a matter of urgency,” that is good. However, we have now had time to think about it. I have written several times and been campaigning on this, but he has not yet answered the question: will he extend the deadline to 31 March, or will he consider extending it? Will he not say no today? Will he give people a little hope that they might get it? He is making the clear point that it is for households in absolute need. Well, they are still in absolute need—

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[Peter Dowd (in the Chair)]

I appreciate that. Will you respond, Minister?

[Alex Burghart]

Thank you, Mr Dowd. I am grateful to the hon. Member for Glasgow North East for her lengthy intervention, which enabled me to get another bottle of water.

In answer to the hon. Lady’s question, this is a complex system that was set up at pace in order to reach about 8 million people. I understand the point that she is making: if the deadline were extended, more people would have a chance to apply. We are looking into a range of measures to encourage people to take it up before the final deadline. She asked earlier when that deadline would be. I am pleased to tell her that it is 19 December.

The £650 payment has been split into two payments with different qualifying periods to reduce the chance of someone missing out completely. If a household did not receive the first payment of £326 in July, it might still receive the second payment of £324 in November. To qualify for the second cost of living payment, individuals must be entitled to a payment of pension credit for any day in the period 26 August to 25 September 2022.

As pension credit claims can be backdated up to three months, however, if the person is eligible for the three-month period, it is not too late to qualify for the second cost of living payment. We therefore urge people to get their applications in as soon as possible and by no later than 19 December, as I said. That will ensure that, if they are eligible for pension credit for the previous three months, they will also qualify for the second cost of living payment. In that way, we can ensure that those eligible will receive the support they need at the earliest opportunity.

We are not changing the qualifying dates for the second tranche of the cost of living payments for any of the means-tested benefits. The eligibility period must remain consistent, so it is simple to deliver the payments quickly and on a scale to support millions of people on low incomes.

I remind Members that cost of living payments are just one part of the welfare support available to pensioners this winter. A key part of the support that we offer is the energy price guarantee, which will reduce energy bills significantly this winter. Also, owing to the impact of higher energy costs on pensioners, the Government will pay an additional £300 in a pensioner cost of living payment as a top-up to the winter fuel payment. Those payments of £500 or £600 per household will be sent out from mid-November. That is in addition to the cold weather payments, which helped more than 4 million people last year. Also, we must not forget the £150 council tax rebate earlier this year.

Finally, for those who need additional support, we recently extended the household support fund, which will now run until the end of March 2023, bringing total funding for that support to £1.5 billion. In England, that will take the form of an extension to the household support fund, backed by £421 million. The devolved Administrations will receive £79 million through the Barnett formula, with Scotland allocated £41 million of that.

As a Department, we will continue to work to increase take-up of pension credit to ensure that vulnerable pensioners receive the support they need this year and beyond. I am happy to talk to the hon. Member for Glasgow North East about it again in future.

Pensions Dashboards (Prohibition of Indemnification) Bill

Alex Burghart Excerpts

Committee stage
Wednesday 26th October 2022 Public Bill Committees

[The Parliamentary Under-Secretary of State for Work and Pensions (Alex Burghart)]

It is a pleasure to serve under your chairmanship, Mr Sharma. I hope Committee members will forgive me if I keep my remarks relatively short; as they will be able to hear, I am losing my voice. This is my first speech as Minister for Pensions and Growth, and it may be my last. If I survive the day in post, I will have two further speeches to give, and I would like to have the voice to give them.

Luckily, my hon. Friend the Member for Cheadle has said just about everything that there is to say about this excellent and uncontentious Bill, which strengthens the great work that my venerable predecessor, the hon. Member for Hexham, did in his five years in office. It is fair to say that under him and his predecessors, a veritable quiet revolution in pensions has been taking place, to the benefit of tens of millions of people.

The revolution began with auto-enrolment, which, I am pleased to say, celebrates its 10th birthday today. It is difficult to overstate the success of auto-enrolment: it is one of the greatest examples of nudge theory ever seen in public policy. New figures released today show that, in the 10 years that auto-enrolment has been in place, the number of employees participating in workplace pensions has increased from 10.7 million to 20 million, which is an increase of 86%—a truly remarkable achievement. Last year alone, British people saved nearly £115 billion into workplace pensions and pension pots—a 40% increase on where we were before auto-enrolment.

The pensions dashboard is the next step in that revolution. If the first job was to help people to save, the second is to help them to understand what they are saving. We believe that that will create a further nudge of its own, as people understand what they have accumulated in their pots throughout their working life, and what they can expect to have in their retirement. This Government are helping more people to save more so that they can do more in their retirement years. I am very proud to support the latest chapter in that work today.

[Nick Smith]

I congratulate the hon. Member for Cheadle on introducing this important Bill, and I join the Minister in recognising the fantastic success of auto-enrolment, which has changed saving across our country. But I hope the Minister can help me on two points.

First, the hon. Member for Hexham has—for sure—done all the heavy lifting on introducing the pensions dashboard, but when does the Minister anticipate its proper introduction to the marketplace to support pensioners across the country? It is a great idea, but it has been in development for a long time. Secondly, I note that there is no impact assessment or consultation on the introduction of the Bill. I am sure that there are fair reasons for that, but have the FCA and the other regulators involved had any input on the development of the Bill?

[Alex Burghart]

I thank the hon. Gentleman for his intervention. We expect that, during the course of next year, all the requisite data will be pulled together from pension funds and assembled on the dashboard, and that the public will have access to it for the first time in the middle of 2024. As he says, it is major work, and it is important that we get it right. Through the passage of legislation such as this Bill, we will be able to ensure that our pensions system and dashboard are fit for the future. This is a major change, involving a great deal of work by a huge number of outfits, and it will make a major difference to the way people see and participate in the world of pensions.

The hon. Member for Blaenau Gwent had a further question about the FCA. Based on information gathered by sample providers, the regulatory impact assessment considers the costs of all relevant pension schemes and providers in scope of dashboards, connecting to the dashboard digital architecture and supplying pensions information. Although FCA-regulated personal and stakeholder schemes fall outside the scope of Department for Work and Pensions regulation, the Pension Schemes Act 2021 requires the FCA to make corresponding rules covering the requirements of these schemes in relation to pensions dashboards. Therefore, the impact assessment takes into account the costs for both these providers and the occupation scheme trustees.

I turn to the detail of the Bill. Clause 1, as my hon. Friend the Member for Cheadle said, will prohibit trustees and managers of occupational personal pension schemes from being reimbursed out of scheme assets in respect of penalties imposed on them for non-compliance with the pension dashboard regulations. That is obviously an important safeguard for pensions savers. It is achieved by amending section 256 of the Pensions Act 2004, under which if a trustee or manager were to be reimbursed or knew or had reasonable grounds to believe they had been so reimbursed, they would be guilty of a criminal offence, unless they had taken all reasonable steps to ensure they were not so reimbursed. We are talking about a serious crime. The provisions will allow for a maximum sentence of up to two years in prison or a fine or both.

Additionally, were any amount to be paid out of a pension scheme’s assets in such a way, the pensions regulator would have the power to issue civil penalties to any trustee or manager who failed to take all reasonable steps to secure compliance. Section 256 of the 2004 Act already prohibits reimbursement of penalties issued under a number of other pieces of pensions legislation, so the proposed amendment to the 2004 Act is a logical change that the Government welcome.

Clause 1 also makes corresponding changes to article 233 of the Pensions (Northern Ireland) Order 2005. As hon. Members know, all aspects of pensions policy are transferred to the Northern Ireland Assembly; however, there is a convention that the pensions legislation made in Northern Ireland stays in lockstep with that of England, Wales and Scotland, to ensure parity across the whole United Kingdom. The usual procedure in the instance of Parliament making provision of a transferred policy area would be to obtain a legislative consent motion from the Northern Ireland Assembly.

However, as hon. Members will be aware, the Assembly has thus far failed to elect a Speaker, so it is not in a position to grant this consent. I am pleased to say that Deirdre Hargey MLA, Minister for Communities in Northern Ireland, has written to the Department for Work and Pensions and confirmed that she would, in principle, be content to seek agreement for the provisions in the Bill to extend to Northern Ireland. That was, however, conditional on the agreement of a functioning Executive, but there will be further opportunity for this issue to be considered by the Assembly if the current impasse in Northern Ireland is resolved before the Bill has completed its journey through Parliament.

Clause 2, as my hon. Friend the Member for Cheadle stated earlier, sets out the standard information needed for all Bills and includes detail of how provisions will come into force and their territorial extent. The Government are committed to protecting pensions savers and agree that the safeguards in the Bill provide a welcome deterrent against rogue trustees or managers exploiting pension assets for which they are responsible. We commend the Bill to the Committee.

[Mary Robinson]

I thank the Minister for his remarks and am pleased his voice held out. I thank all Members here for their support, in particular the Minister, who has had a short time to become familiar with this subject. I also thank the officials for their invaluable support over the past few months. I thank my colleagues for their contributions and for being here to support the Bill.

As my hon. Friend the Member for Erewash said, this is about protecting our financial futures, and it is a very worthy cause. It is important for the up to 52 million people the Bill will cater for. My hon. Friend the Member for Gloucester rightly pays tribute to the former Minister for Pensions, my hon. Friend the Member for Hexham, who has done so much over the years and has been pivotal in everything he has brought to this place.

[Alex Burghart]

I am worried that I did not pay fulsome enough tribute to my predecessor in my speech. Stepping into a large brief such as this is a daunting exercise, but to have handed over to me such a well-ordered series of policies and such a clear sense of direction is a testament to the work he did over five years. As my hon. Friend the Member for Gloucester said earlier, there have probably been no Ministers who have held the brief for so long or have done so much to contribute to this essential part of the way we support citizens in later life.

[Mary Robinson]

I am grateful to the Minister, as I know everyone here will be. He has succinctly echoed all our thoughts. My hon. Friend the Member for Gloucester also said he thought it was the shortest and least contentious of Bills, but I hope it is one of great importance to millions of pension savers. I commend the Bill to the Committee.

Clause 1 accordingly ordered to stand part of the Bill.

Clause 2 ordered to stand part of the Bill.

Bill to be reported, without amendment.

Department for Work and Pensions

Alex Burghart Excerpts

Tuesday 2nd July 2019 Commons Chamber

[Alison McGovern]

My hon. Friend has made his point well. We all know that the DWP is failing because we see it every day, but why is that failure happening? I think it is pretty obvious from the DWP’s policies that it has radically misunderstood poverty. While its aims and objectives in dealing with poverty are all absolutely worthwhile and worthy, they will never get to the root cause of it.

The DWP’s policy paper sets out its next steps for action on poverty. It wants to help through the troubled families programme, and it wants to identify people with complex needs. It talks about addiction, and it talks about education. The problem is that while those are factors in people’s lives that are associated with poverty—of course lower educational achievement is a risk for people who grow up in poverty, and of course addiction is a problem in communities that have less wealth—it is possible to do very well at school and still be poor, and it is possible to be poor and not addicted to anything. It is possible for people to have excellent family relationships, to look after each other and be able to take care of their families, but still to suffer the consequences of low incomes, because the root cause of poverty is not any of those other things; it is not having enough money. What my hon. Friend the Member for Coventry South said about poverty wages was right, and that is why the DWP must change course.

[Alex Burghart (Brentwood and Ongar) (Con)]

The hon. Lady is making a powerful speech, and no one would question some of the things that she has said, but does she not understand that when people suffer from addiction—the terrible pain of addiction— they struggle to get into work, and to earn and look after themselves? Addiction is a root cause of poverty. [Interruption.] Of course it is; don‘t be ridiculous.

[Alison McGovern]

I thank the hon. Gentleman for his intervention, because he has illustrated exactly the point that I am making. I have every sympathy and every empathy with people who suffer from addiction and associated mental health conditions, but those conditions affect everyone in society. They are not solely about people who are poor. Moreover, there are plenty of people who just do not have enough money, and who do not suffer from any of those problems. The point that I am trying to make is that the DWP is failing because it has missed the central point. The cause of poverty is not having enough money, and it is our duty in the House to do something about it.

[Alex Burghart]

rose—

[Alison McGovern]

If the hon. Gentleman really wants to argue with me, then be my guest.

[Alex Burghart]

I very much want to argue with the hon. Lady. The truth is, is it not, that poverty is a result of some of the problems that people face in society. If those problems are removed, people are considerably less likely to be poor, because they are more likely to be able to work. I have met people who have started out in life from a very good position, but have suffered terrible heroin addiction and have consequently been unable to work. The reason those people have no money is that they have suffered from heroin addiction.

[Alison McGovern]

Let me try this another way. The people whom the hon. Gentleman has mentioned who are suffering from addiction deserve our sympathy, empathy and solidarity, and they deserve help, but so does the kid at school who is working hard, who has great teachers, but who goes home and sees his parents struggle. The cause of poverty is a simple thing: it is not having enough money. It is possible for the Government to have brilliant programmes in all other spheres and still fail to deal with the wound in our society that means people turning up at food banks and children who are unable not to be hungry during the holidays because they can no longer rely on free school meals.

I simply say to the hon. Gentleman, “Ask yourself this question: if we had dealt with every addiction problem in our country, would that necessarily solve the problem of poverty if wages were still too low and this Government were still hellbent on taking money, year after year after year, out of the welfare state which is there to support the family of that child who is working hard at school?”

What, then, has to change? We have to reassess the contributory principle as it affects families, and we have to decide that in this country we will ensure that families can make ends meet. That is why I—along with a number of other Members and the former Prime Minister Gordon Brown—have set out over the summer to try to establish the principles of a programme that could enable them to make ends meet.

I believe that the programme should look like this. Step one must be to end the policies that are breaking the principle of Beveridge’s welfare state. We know what they are. The two-child limit means that 800,000 families with three or more children who are currently receiving tax credit are at risk. While the Government say that the two-child policy will save them billions of pounds, we know that every child matters—every child counts for something—and that is why that policy cannot be allowed to continue. If it does, we know from all the evidence and the child poverty forecasts that it will drive up poverty for children in this country living in a household with three children or more. If anybody thinks that somehow knowing that the Government are going to punish the third child in a family will help to guide families as to family size, I simply say they have probably missed the fundamentals of reproduction. We do not hold children responsible for the actions of their parents, and our welfare state should not do that.

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[Alex Burghart (Brentwood and Ongar) (Con)]

It is an honour to have the opportunity to talk in this important estimates day debate. I congratulate the hon. Member for Wirral South (Alison McGovern) on introducing the debate.

Record and rising employment is the central fact of the Government’s economic record. It is sometimes easy to brush over the fact that we now have the highest rate of employment in this country than at any time since the early 1970s. That is not only important on an economic level, although obviously it has wonderful economic benefits for the country, but extremely important on a social level and a personal level, because of the way it benefits families and communities and gives people opportunity and optimism that they otherwise might not have.

For four years before I came to this place, it was very much my privilege to serve as the director of policy at the Centre for Social Justice, which is a think-tank that looks at the root causes of poverty in the UK. That background is what lies behind my exchange with the hon. Member for Wirral South earlier. One can of course say that the root cause of poverty is people not having enough money. It is true that poverty is people not having enough money, but it is unquestionably the case that the reason why some people do not have any money is that they do not have a job in order to earn money, and that the reason why some people—not everybody at all—are unemployed is that something has gone badly wrong in their life, and that thing needs to be corrected with the help of public services, with the support of their family and with their own personal determination. That must always be an absolutely essential part of any welfare policy, which is why it is so important that the significant changes that have been introduced in the Department for Work and Pensions have been coupled to the work of the troubled families programme in the Ministry of Housing, Communities and Local Government. It is by helping people to overcome some of the root causes of poverty that we can help more people to move into the workplace and so help to support themselves and their families.

There is a group of people who are lucky enough and fortunate enough to come from stable homes, to get a decent education and not to suffer from addiction or any such problems, who still find it difficult to make ends meet, which is why it is extraordinarily important that any Government have an economic policy that generates jobs and drives up wages. The Government have been extraordinarily successful, without parallel, in the creation of jobs. Life has undoubtedly been harder in the generation of higher wages, but it feels like in recent months—over the past 15 months, I think—we have turned a corner on that score and, for the first time since the financial crisis in 2008, we are starting to see wages rise above inflation. Ultimately, that is excellent news for people who are moving into the jobs market and for people who are starting off on low salaries.

It must be remembered that none of that success was predicted by commentators before the 2010 general election. I remember in 2009 listening to a Bank of England economist forecast that the incoming Chancellor of the Exchequer would have to deal with unemployment of more than 5 million. In 2011, he repeated that the policies of the Conservative and Liberal Democrat coalition would unquestionably lead to record unemployment and a massive social security problem. That simply did not happen, because of the business-friendly policies that the Government adopted, which increased investment and business growth and saw employment rise in very many parts of the country.

It was a pleasure to sit and listen to the speech by my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke). I do not believe it can be an accident or a coincidence that his constituency has not traditionally had a Conservative MP, yet after seven years of Conservative employment growth in his area, it elected a Conservative. After seven years, following a major economic meltdown under the previous Labour Government, the Conservatives delivered the job growth in his area that Labour had been incapable of doing for the 13 years that it was in power. We see it not just in Middlesbrough, but in a whole range of seats from Mansfield to Stoke-on-Trent. This new era of Conservative representation in parts of the midlands and the north is a result of this policy, which has helped people to find jobs and improve their lives and the lives of their families. This has been termed the British jobs miracle, because unemployment is now at about 3.8% in the UK, compared with 7.5% in the euro area.

[Neil Gray]

I do not doubt that properly paid work is the best route out of poverty, but when will the hon. Gentleman’s so-called jobs miracle extend to children living in poverty? How can he explain what is currently going on when we see that two thirds of all children living in poverty do so in a working household?

[Alex Burghart]

The hon. Gentleman raises a very good point, but, as I have already said, we had a long period of employment, but with little or no wage increases. We have now started to come out of that period. What he will see is that, if wages and wage growth are maintained in the months and years ahead—as I have no doubt that they will be—we will start to see the number of young people in poverty go down. We will see that their parents have more money because they are in work and their wages are rising above inflation. I am sure that he would accept that point.

[Neil Gray]

Will the hon. Gentleman not accept that, while we wait, children remain in poverty? What are his Government doing? They are continuing to cut universal credit, which is supposed to help move these families away from poverty. Why is this continuing to happen? Why do they have to wait all this time for the never-never of jam tomorrow?

[Alex Burghart]

I do not believe that it is correct to say that the Government are taking money out of universal credit. I am sure the hon. Gentleman remembers the previous Budget when a considerable amount of additional money was put into universal credit. I think that he is, perhaps, slightly out of date on that score.

[Alison McGovern]

The hon. Gentleman has obviously missed the fact that working age benefits have been frozen for four years. That is a real terms cut. Will he just explain to the hon. Member for Glasgow Central (Alison Thewliss), who talked about a single parent with three children who simply cannot put any more hours a day into her working life, how, if benefits stay frozen, people are supposed to see their incomes rise and their children lifted out of poverty?

[Alex Burghart]

The hon. Lady makes a very good point about the benefits freeze. That is something to which I intend to return at the end of my remarks. It is unquestionably the case that the benefits freeze has hit people—and hit some people very hard. She is aware of why the benefits freeze was needed: it was needed because of the disastrous condition in which her party left this country’s finances when it left office in 2010.

The DWP is playing its role in helping people back to work and helping them to find, sustain and progress in work. If Members talk to work coaches across the country, they will find that those coaches now have the tools and a service at their disposal to help them to form a working relationship with the people they are seeking to help. They understand that people who come into the jobcentre are, effectively, in work to find work. The agreement of claimant commitments between the jobseeker and the jobcentre creates an environment in which both the work coaches and the people with whom they are working can get results. No one who has spoken to work coaches across the country can doubt in any way that this has been substantial improvement.

Universal credit, as it is rolled out and improved, is helping to make work pay. It has overcome the terrible problems of the 16-hour cut-off that was raised by my hon. Friend the Member for Copeland (Trudy Harrison). It has helped to overcome these crazy marginal tax rates that popped up at different points in the system. Obviously, it is being rolled out in a test and learn environment. As it is tested, so DWP has learned, which means that a range of improvements have been made.

As a member of the Work and Pensions Committee, under the chairmanship of the right hon. Member for Birkenhead (Frank Field), who is no longer in his place, I was particularly pleased that we managed to work with the Government to scrap the seven waiting days, to ensure that people received their money sooner, to see advances of up to 100% on full monthly payments to claimants, and to develop the landlord portal to make it much easier for housing benefit to be sent to landlords and so on and so forth. These are important changes, but I have no doubt that there are still additional beneficial changes to be made. There is further to go—much further to go.

The hon. Member for Wirral South mentioned the benefit freeze. I very much hope that, in the comprehensive spending review at the end of this year, the benefits freeze is ended and the headroom that the Chancellor has built up is put to good use.

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[The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)]

It is a pleasure to respond to a vital discussion of how the Department for Work and Pensions supports the 22 million people who rely on our services.

We have heard a huge number of valuable contributions, including those of the hon. Member for Wirral South (Alison McGovern)—whom I congratulate on opening the debate—and my hon. Friend the Member for Copeland (Trudy Harrison), the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), my hon. Friend the Member for Truro and Falmouth (Sarah Newton), the hon. Member for Ellesmere Port and Neston (Justin Madders), my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke), the hon. Member for Glasgow Central (Alison Thewliss), my hon. Friend the Member for Brentwood and Ongar (Alex Burghart), the hon. Member for High Peak (Ruth George), and my hon. Friend the Member for Bexhill and Battle (Huw Merriman). Later in my speech, I will respond to some of the key points that have been raised.

I have been in my post for three months, and over that time my key focus has been on supporting the most vulnerable in our society. No one in the Government wants to see poverty rising, and, while the latest “Households below average income” statistics, from 2017-18, do not reflect the £1.7 billion-a-year cash boost for our welfare system that was announced in the Budget, the Secretary of State and I recognise that there is more to do.

We know that children in households in which no one works are about five times more likely to be in poverty than those in households in which all adults work. We are committed to helping lone parents into jobs that are flexible in relation to their caring responsibilities, and more than 1.2 million are now in work. To help parents into work, the Government spend £6 billion on childcare each year. We are able to do that because we have doubled the number of free childcare hours to 30 a week for nearly 400,000 working parents of three and four-year-olds; introduced tax-free childcare which is worth up to £2,000 per child per year; and made changes in the flexible support fund to help people to pay up-front childcare costs. However, we recognise that we need to continue our work in this area. That is why the Secretary of State and I have publicly committed ourselves to tackling poverty, and child poverty in particular.

As we get closer to the spending review discussions, my ministerial colleagues and I are reviewing our bids, in collaboration with other Departments, to ensure that those who can work do work, and that those who cannot are supported. I can confirm that there are no plans to extend, or maintain, the benefit freeze after March 2020.

[Alex Burghart]

I thank the Minister for the commitments that he has just made. Will he also tell us what more the Government can do to ensure that vulnerable claimants can have access to universal credit?

[Will Quince]

My hon. Friend has made a very good point. We know that about 20% of people seek help when claiming universal credit. That is why we introduced the Help to Claim service, working with Citizens Advice and Citizens Advice Scotland. However, I am acutely aware that a number of vulnerable groups in my portfolio—care leavers, prison leavers, survivors of domestic abuse, and those who are homeless or sleeping rough—need extra support, and the Secretary of State and I are carefully considering a number of further options ahead of potential spending review bids.

Households Below Average Income Statistics

Alex Burghart Excerpts

Thursday 28th March 2019 Commons Chamber

[Alex Burghart (Brentwood and Ongar) (Con)]

Does the Secretary of State agree that growing up in a workless household is one of the most damaging factors for a child’s life chances? Consequently, will she commit to investing more in universal support to help people with difficulties to overcome them and move into long-term employment?

[Amber Rudd]

My hon. Friend is absolutely right. Households with nobody in work are much more likely to be in poverty, and they are a bad role model for everybody else. It is important to ensure that we engage successfully with households so that everybody has the opportunity of getting a job. There are now 665,000 fewer children in workless households since 2010.

Supporting Disabled People to Work

Alex Burghart Excerpts

Thursday 28th March 2019 Commons Chamber

[Justin Tomlinson]

I thank the hon. Lady for taking the time to pay tribute to the frontline staff in jobcentres, who do a huge amount of work to support disabled claimants. That often goes unnoticed, but it makes a real difference to those claimants. A record number of people received support from Access to Work last year, and I welcome the 13% increase, but we will continue to step up our efforts to ensure that businesses—particularly small businesses, which provide 40% of employment opportunities—are aware that both financial support and advice are available to unlock the potential of disabled staff.

[Alex Burghart (Brentwood and Ongar) (Con)]

Will the Minister build on the point that he has just made, and congratulate all the businesses—such as Brentwood Community Print in my constituency—which, entirely off their own bat, go out and provide work for people with disabilities, and help them to rebuild their lives and find a way forward?

[Justin Tomlinson]

I am delighted to pay tribute to Brentwood Community Print. It has recognised that it can benefit from being an innovative business in terms of recruitment, and I hope that many other businesses will look and learn the lessons that it has set out.

Department for Education

Alex Burghart Excerpts

Tuesday 26th February 2019 Commons Chamber

[Alex Burghart (Brentwood and Ongar) (Con)]

It is an honour to be able to speak in this estimates day debate. I congratulate the hon. Member for High Peak (Ruth George) on starting us off. It was a pleasure, for the first part of this Parliament, to serve on the Work and Pensions Committee with her, the right hon. Member for Birkenhead (Frank Field), and the hon. Members for South Cambridgeshire (Heidi Allen), for Glasgow South West (Chris Stephens) and for Bermondsey and Old Southwark (Neil Coyle).

I will turn to some of the work we did together on the Committee in a moment. Before I do so, I want to return to the absolutely essential point that must always frame the current debate on benefits. A few years ago, before I entered this place, I was lucky enough to be the director of policy at the Centre for Social Justice, which looks at the root causes of poverty in the UK. One of the things that our research showed time and again, and that the research of my predecessors had shown, was and is that there is a human cost to worklessness that sits alongside the financial cost. The effect of being out of work for an individual, for a family and for large numbers of people in a given community is substantial. It affects people’s self-worth, mental health, and family stability. In itself, alongside the monetary troubles that they have, it affects their resilience.

That is why I am so proud of the fact that it is under a Conservative Government that we now see record employment, and that under this Government we are finally starting to see wages rise. This makes an enormous difference to individuals, families and their communities. It is very difficult to put a monetary value on that, but very easy to see the value of it when we meet those individuals and families and go into those communities. It is a great legacy, because we now have 637,000 more children growing up in working households than we did in 2010. The long-term effect on those young people’s future lives is enormous, because we know the cost and effect of children growing up in workless households, in entrenched worklessness. This is a real achievement.

Sitting alongside that, we have the welfare reforms that the Government have been bringing in since 2010, which are nothing short of revolutionary. I think that everyone across the House agrees on their aims. Everyone agrees on where we would like to be—that is, with a welfare system that actively assists, encourages and helps people to get into work, to sustain work, to take more work, and to become more self-reliant in order to be able to provide more easily for their families and for themselves. There is no doubt that universal credit is the mechanism to do that. There is also no doubt that this is a system in evolution.

I have been pleased, with the Select Committee and as a Tory Back Bencher, to work alongside the Government in helping a number of reforms to come through, such as the improvement in the taper rate and the improvement in work allowances. It was very good to see the Joseph Rowntree Foundation publish on 20 February a report showing that 3.9 million families on universal credit will be better off as a result of the changes made at the November Budget last year. This is a sign of real improvement starting to make a difference to the lives of people it was intended to help. Similarly, the new Secretary of State has said that she will seek to increase the number of people who are getting direct payments to their landlords and support to main carers. That is very welcome. I would certainly like the additional surplus that this excellent Chancellor has created to go towards hopefully ending the benefit freeze as soon as possible, allowing investment in universal support, and reducing further the waiting times.

Universal Credit: Managed Migration

Alex Burghart Excerpts

Tuesday 8th January 2019 Commons Chamber

[Alok Sharma]

The hon. Lady takes a great deal of interest in this area, so she will have seen the regulations that are currently before the House. If I may repeat myself, we have committed to holding a debate on any affirmative regulations, we have said we will meet our commitment to those in receipt of severe disability premium, and we have said we will ensure that the regulations are in place so we can start the test phase in July 2019.

[Alex Burghart (Brentwood and Ongar) (Con)]

In Brentwood, the roll-out of universal credit has been very successful thus far. I congratulate the Government on their use of test and learn to ensure that universal credit learns lessons that previous benefit systems did not. Will the Minister commit to sharing with the House the details of the pilot of 10,000? When does he expect to be able to do that?

[Alok Sharma]

My hon. Friend is very knowledgeable about these matters, as a former member of the Select Committee on Work and Pensions. We are in the process of designing the pilot. As I have said very clearly, we are having discussions with key stakeholders to make sure we get it right. Clearly, there will be plenty of opportunity in the future to debate it. Let me be very clear that we will, at the end of that phase, set out how it went.

State Pension: Women born in the 1950s

Alex Burghart Excerpts

Thursday 22nd November 2018 Westminster Hall

[Alex Burghart (Brentwood and Ongar) (Con)]

It is a pleasure to serve under your chairmanship, Mr Bone. I do not wish to make lengthy remarks. This is a very important debate, and I congratulate the hon. Member for North Ayrshire and Arran (Patricia Gibson) on securing it. Brentwood and Ongar is the most beautiful constituency in the world, but North Ayrshire and Arran has a chance of being called the second best.

This issue has affected a number of women in my constituency since I was elected last year. I very much understand what they have been through, but I would like to set out my thinking on the subject in the context of how we have arrived where we have.

In 1995, the then Government decided to equalise the state pension age for men and women to address long-standing inequality. That change was part of a wider social trend towards gender equality, but was also a decision that arose partly from European law and equality law cases relating to occupational pension provision. The last Labour Government, between 1997 and 2010, continued the policy and additionally determined that a state pension age of 65 could not be sustained for very much longer. That was the thinking that led to the Pensions Act 2007, which raised the state pension age to 66, 67 and then 68.

Under the stewardship of the former Member for Thornbury and Yate, an excellent Pensions Minister, the coalition Government introduced additional reforms in the Pensions Act 2011, which brought in a number of highly important reforms—not least auto-enrolment, which has benefited many people across all of our constituencies—and sought to address a growing imbalance. As my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), who was then Secretary of State, said at the time:

“Back in 1926, when the state pension age was first set, there were nine people of working age for every pensioner. The ratio is now 3:1 and is set to fall closer to 2:1 by the latter half of the 21st century. Some of these changes can be put down to the retirement of the baby boomers, but it is also driven by consistent increases in life expectancy. The facts are stark: life expectancy at 65 has increased by more than 10 years since the 1920s, when the state pension age was first set. The first five of those years were added between 1920 and 1990. What is really interesting is that the next five were added in just 20 years, from 1990 to 2010.”—[Official Report, 20 June 2011; Vol. 530, c. 45.]

[Sandy Martin (Ipswich) (Lab)]

My predecessor as MP for Ipswich is reported to have characterised the demands of the WASPI women as “intergenerational theft”. Will the hon. Gentleman dissociate himself from that comment?

[Alex Burghart]

I feel that the hon. Gentleman has achieved his purpose by putting such a claim on record. I am not aware of his predecessor having made such remarks and I am not aware of the context, so he will forgive me if I do not comment on them, although I am sure that he did not really make that intervention to get my response.

[Chris Elmore]

Although a potted history of where the state pension has come from and why changes have been introduced under whichever Government is interesting, the debate is not about that; it is about the fact that the Government have taken an archaic view and are essentially punishing women born in the 1950s, who have already faced discrimination through maternity laws, previous pension changes and national insurance changes. The debate is not about a potted history of why we are where we are. It is about some sort of redress for those women, who have already faced unnecessary burdens throughout their working lives. I am not trying to suggest that the hon. Gentleman is trying to move the agenda on, but the debate is not about why we have they pensions that we do. It is about the fact that the Government are accelerating the change and not giving any redress to the women affected, who quite frankly deserve it.

[Alex Burghart]

I thank the hon. Gentleman for his lengthy intervention. I am making my own speech and will make my points in the way that I wish to make them, although I am grateful to him for telling me how I should speak.

The major demographic change needed to be addressed. A girl born in 1951 was expected to live to 81, and a boy to 77. By this year, the Office for National Statistics cohort figures showed an increase of more than 10 years for newborn girls and more than 12 years for boys, to 92 and 89 respectively.

[Grahame Morris (Easington) (Lab)]

The hon. Member for North Ayrshire and Arran (Patricia Gibson), who secured the debate, has indicated that it is not about life expectancy. With due respect, can I mention an issue raised with me by my county council, which is healthy active life expectancy? In many of the constituencies that Opposition Members represent, healthy active life expectancy is considerably shorter than elsewhere. It is 10 years shorter in County Durham than in parts of the south and south-east. Surely we should be relieving the burden on women who are subject to such discrimination and injustice.

[Alex Burghart]

The hon. Gentleman makes a genuinely interesting point about healthy life expectancy, the figures on which should feature more largely in the debate than they often do. I acknowledge that point.

When Lloyd George first brought in the state pension in the Old Age Pensions Act 1908, it was at 70, when life expectancy was considerably lower.

[Graham Stringer (Blackley and Broughton) (Lab)]

I have no reason to doubt the hon. Gentleman’s statistics, but is it not just as interesting that the country is now three times as rich as it was when these ladies were born in the 1950s? When there have been other mistakes or crises in the economy, the Government have found money to bail out the bankers. If one compares the equity of this case to that, does the hon. Gentleman not think the Government should change their mind?

[Alex Burghart]

Presenting the case in the way that the hon. Gentleman does is slightly misrepresentative, because the cost of not bailing out the banks would have been extraordinarily high and would have seen businesses all over the country go bankrupt and people go out of work. It would have damaged their lives and would have become a cost to the state. I simply cannot see things in the binary way that he sets them out.

In 1942, William Beveridge wrote about the purpose of his pensions proposals, saying that

“giving to each individual an incentive to continue at work so long as he can, in place of retiring, is a necessary attempt to lighten the burden that will otherwise fall on the British community, through the large and growing proportion of people at the higher ages”.

Under the last Labour Government, it was acknowledged that we must not reach a position where women would be expected to spend 40% of their adult lives in retirement—that proportion is due to increase continually. No Government could have sustained that without dramatically curtailing services for younger people. On top of those demographic concerns, the Pensions Act 2011 had to deal with the circumstances that were dictated by the great financial crisis of 2008.

[Sir Peter Bottomley]

My hon. Friend talks about the introduction in 1908 of the state pension age of 70, but he could have told us that it was reduced to 65 in 1925, and that the inequality of the earlier retirement age for women was introduced, I think, in 1940. I am not arguing with him; I am trying just to set the scene.

[Alex Burghart]

I am grateful for my hon. Friend’s scene setting. Forgive me if I skipped a sentence earlier— I should have said that the retirement age of 65 was introduced in the Contributory Pensions Act 1925, so I am grateful to have been put right.

The Pensions Act 2011 dealt with the circumstances of 2008 and was introduced in the context of the emergency Budget brought forward by the then Chancellor in 2010, which offered the triple lock. To remind Members, that guarantees, each and every year, a rise in the basic state pension in line with earnings, prices or a 2.5% increase, whichever is the greatest. That policy meant that between April 2010 and April 2016, the value of the state pension rose by more than 22%, compared with growth in earnings of about 7.5% and growth in prices of 12%. Pensioners saw their incomes rise at almost double the pace of the average worker in that period. In 2018-19, the state pension is more than £1,450 a year higher than it was in 2010.

We know that the triple lock will be in place for the duration of this Parliament. For people reaching state pension age after April 2016, a new pension has been introduced at a single flat rate of £159.55 a week, which also has been triple-locked. All the women affected by the 2011 state pension age changes will draw their state pension under the new system.

[Mhairi Black (Paisley and Renfrewshire South) (SNP)]

I am quite confused. It is lovely to hear all this information about what happens when people retire, but we are debating the issue of those women being left in limbo, where they are expected just to fend for themselves.

[Alex Burghart]

I appreciate the hon. Lady’s point, which I am coming to.

The Pensions Act 2011 sped up the equalisation of women’s state pension age and required men and women’s state pension age to be raised to 66 by 2020. During the passage of that Act, the Government spent £1.1 billion—we might dispute the amount—on capping the maximum increase that any woman would see in her state pension age at 18 months, relative to the timetable set out in the Pensions Act 1995. Having heard the stories and spoken to some of the women involved, I know that this has been a hard transition and has caused difficulties and distress for many of them.

[Martin Whitfield (East Lothian) (Lab)]

On the point of equalisation, will the hon. Gentleman give way?

[Alex Burghart]

Yes, I will.

[Mr Peter Bone (in the Chair)]

Order. Before the hon. Gentleman gives way, let me say that I am grateful to him for making brief remarks, which have gone on for more than 12 minutes.

--- Later in debate ---

[Martin Whitfield]

I am grateful to the hon. Gentleman for giving way. He has given his analysis of the equalisation, but does he find it ironic that the women who were told that they had to work for an additional 18 months were given only five years to sort out that problem, but the men who were asked to work an additional 12 months were given seven years to plan for that change?

[Alex Burghart]

The hon. Gentleman makes a good point. Having spoken to women in my constituency, I understand the stress and difficulty that this change has caused. However, is clear that any attempt to reverse the policy would be extraordinarily expensive.

[Dr Drew]

Will the hon. Gentleman give way?

[Alex Burghart]

I look to you, Chair, to know whether I am entitled to take any more interventions.

[Mr Peter Bone (in the Chair)]

The hon. Gentleman is entitled to go on for as long as he wants, but I would prefer him not to.

[Alex Burghart]

That makes two of us, Mr Bone.

The hon. Member for North Ayrshire and Arran did not talk much about the cost of reversing Government policy, which is a shame. I understand that the SNP has costed the reversal of the Pensions Act 2011 at £8 billion, but other experts see that as a vast underestimate. It would actually cost the taxpayer £30 billion or more. There is no doubt that the Scotland Act 2016 gives the Scottish Government the powers that they need to address the issue.

[Patricia Gibson]

I am really disappointed that we have a speech from somebody who clearly has not read the Scotland Act 2016 and has just lifted the headline from the Daily Mail or whatever it is that he reads. There is no power in that Act to mitigate yet more Tory cuts. We already mitigate Tory cuts to the tune of tens of millions of pounds. Even if we wanted to, under section 28 of the Act—the hon. Gentleman can look it up—we do not have the power. Once again, I urge him to stick to the focus of this debate. He says that I did not talk about money, but I talked about what it has saved the Treasury. Let us spend that money on these women.

[Alex Burghart]

The focus of the debate is compensation for the women involved. It is a fact that the Scottish Government could do more than they are doing.

[Ross Thomson (Aberdeen South) (Con)]

I want this issue to be addressed at UK level—that is absolutely right—but devolution across the UK means that different choices can be taken by those who are in power. It is not just section 28 that gives the Scottish Government the powers to act. Section 26 allows them to make short-term payments to people who need them to

“avoid a risk to the well-being of an individual.”

I genuinely believe that the Scottish Government should act where they can, and they should not play politics with this issue.

[Alex Burghart]

I am sure we all agree that that was a very interesting intervention. Once again, the SNP wants all the power and none of the responsibility. The Labour party has made multiple suggestions about how it would address the situation, and many Opposition Members seek the full compensation package of £70 billion. They proposed in their manifesto to keep the state pension age at 66, which reversed the Labour decision of 2007. It would cost at least £250 billion more than the Government’s preferred timetable, and that is not covered by the party’s 2017 manifesto.

In addition, I understand that there are particular legal difficulties in reintroducing a different retirement age for men and women. Unquestionably, any amendment to the current legislation that introduced a new inequality would be challenged. This is an unsatisfactory situation. I admire the very good campaign that the WASPI campaigners have put together. Having met them, I know that they are principled people who wish to see policy change for entirely understandable reasons. However, I see the cost of change as absolutely prohibitive, and I see no solution from either Opposition party.

Oral Answers to Questions

Alex Burghart Excerpts

Monday 19th November 2018 Commons Chamber

[Amber Rudd]

We are not stopping, ceasing or pausing the system, but we always make sure that we change it where it needs to be changed, to ensure that it operates in people’s best interests.

[Alex Burghart (Brentwood and Ongar) (Con)]

I am delighted to welcome the new Secretary of State to her place, and I thank the old Secretary of State—[Hon. Members: “Former!”] My apologies—I thank the former Secretary of State for all she did, not least in acquiring the additional money for universal credit. I am delighted to say that we now have record disability employment in this country. Will the Minister confirm that the Department will continue to work on giving assistive technology to disabled people to help them to find work?

[Sarah Newton]

I thank my hon. Friend for that question about a really important matter. It is great to see the use of the tech fund in access to work. We are always working on this, and on Wednesday we should have a really good announcement to make on expenditure through the challenge fund, which will enable even further use of technology to support people into work.

Employment and Support Allowance Underpayments

Alex Burghart Excerpts

Thursday 18th October 2018 Commons Chamber

[Sarah Newton]

The permanent secretary has been discussing with the Public Accounts Committee and the National Audit Office the very substance of the hon. Gentleman’s question about strengthening procedures within the Department to make sure that this does not happen again. The National Audit Office made a series of recommendations to the Department about strengthening procedures within the Department which the permanent secretary has accepted and which are now in place. For example, if members of staff or stakeholders raise concerns about something going wrong or some unintended consequences with regard to the administration of benefits, they are referred to a committee in the Department and those matters are properly considered. We have much wider and deeper stakeholder engagement. It is particularly important now, as we move forward in designing the new benefit of universal credit, that stakeholders work with disabled people themselves—who are obviously experts on their own condition—and with us to shape those processes to make sure that we absolutely get them right. I am absolutely determined to make sure that that is the case.

[Alex Burghart (Brentwood and Ongar) (Con)]

I welcome the Minister’s apology and the comments she has made about system learning—that is extremely important. How long does she envisage it will take before everyone affected is repaid the money they are owed?

[Sarah Newton]

We are working as fast as we possibly can, and we confidently expect everyone to be paid by the end of next year. As I say, we prioritised the people who we think are most likely to have been affected by the underpayments so that they can have their money fastest. We have regularly updated the House. We released the statistics yesterday so that the House could be fully apprised of the situation, and I will continue to do that.