Universal Credit and Jobseeker’s Allowance (Work Search and Work Availability Requirements @0017 Limitations (Amendment) Regulations 2022

Alison McGovern Excerpts

Wednesday 20th April 2022 General Committees

[Alison McGovern (Wirral South) (Lab)]

I beg to move,

That the Committee has considered the Universal Credit and Jobseeker’s Allowance (Work Search and Work Availability Requirements – limitations) (Amendment) Regulations 2022, (S.I. 2022, No. 108).

It is a pleasure to serve under your chairship, Ms Elliott.

The Opposition do not support the statutory instrument. I will say briefly why. This is a simple piece of legislation, but its effect could be widespread and damaging. To summarise, the explanatory memorandum puts it clearly:

“Existing regulations give discretion to allow jobseekers to look for work in their chosen field for up to 13 weeks. This is known as the ‘permitted period’…These Regulations will reduce the maximum permitted period to 4 weeks.”

Before I get to the substance of my argument, I want to make a procedural point, in that the regulations are being introduced under an urgency provision. The Government claim that they are urgent, but it is hard to understand why, when every other aspect of the Government argument about the pandemic is that we have moved beyond that period, yet here the Government are using urgency provisions to make substantial changes to social security arrangements.

The memorandum also explains that the Department is looking to undertake the Social Security Advisory Committee engagement retrospectively. What is the point of asking for advice on something that it has already done? Surely the Government’s credibility turns on asking for advice and being seen to take it seriously, rather than retrospectively. That is why we will vote against the motion on whether we have discussed the regulations. It is evident that the process is being rushed, and does not follow the standard procedure for scrutiny of Government changes to social security.

I do not want to detain everyone for long. I will make three simple objections to what the Government are doing. As I understand it, the Government’s argument is that the best way to help people’s income is to get them into any job in the hope that that might get them a better job at some point down the line. If we were facing a massive unemployment crisis, as this country has faced before—due to an external or internal shock, a huge number of people are out of work—the evidence shows that it is better for people to be in a job, because long periods of unemployment cost workers in the long term. However, that is not the situation that we face. The Government know that and anyone who takes a cursory look at the data knows that. What we have is a vacancy crisis.

The fundamental role of jobcentres in this country is to facilitate Jobmatch. I apologise if I am explaining basics to colleagues, but the idea is that people who need a job go to the jobcentre and are enabled to find a good job that will support them. Forcing people into their less preferred job, however, makes for a worse match between applicants and the occupations that they are seeking to fill. I do not think that employers or people looking for new or better jobs will want that change. In fact, a survey of businesses in the UK found that they do not like it either. Such rule changes mean that they get huge numbers of job applications that are completely inappropriate. People need to be supported to find a job that is going to be a fulfilling and well-paying career, not be told that they must just get any job.

That is what is true about today’s labour market. One in five people in this country is currently working below their skill level. That figure is one in five, 20%, at a time when businesses are crying out for staff. Our problem is not people sitting around doing nothing; our problem is not enough help and support for people to move on and move up in work. We can add to that the 1 million people who have left the labour market since the pandemic. There are complex and different reasons for that. We do not yet understand some of them fully—for example, we do not understand properly the impact of long covid—but what we do know about this country is that it has a huge number of people with onerous caring responsibilities and a large number of people with mental health difficulties. Our attention, through the Department for Work and Pensions, jobcentres and the work of work coaches up and down the country, would be far better directed towards dealing with the actual economic problem that we face, rather than this policy.

That leads me to my second point, which is that this is a waste. We will end up wasting huge amounts of time for work coaches in the DWP. They will end up bringing people in to see them in jobcentres for what may well be relatively short periods of time and offering them no real support, but a huge amount of paperwork. Work coaches could be doing much more substantial and important work to help those people who face the biggest barriers, whether that is because they have suffered a period of long-term unemployment, because they have a disability or because they are a lone parent. That is the true value of the DWP and the work that could be done. There is a massive opportunity cost to this policy.

My final point is this. I have to be honest with the Minister and say that I hear what my constituents say about jobcentres and, although I know the dedicated staff who work in them, the reputation of jobcentres is not what it was. They are not seen always as places where people get help. I said that I would be honest with the Minister, and I am going to be. I think that we can do far more to build the reputation of jobcentres as a place where people can truly get help, where they can move on and move up in work, where they can enhance their skills, where we can support businesses to make the transition that we need towards a more highly skilled labour market and where we can really support people to get a better job, which will pay them more, which will deal with the cost of living crisis. I think that that is the change that people want to see. I think that this approach is completely misjudged for the labour market that we face, and that we will see over time that it has been a waste of effort.

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[The Parliamentary Under-Secretary of State for Work and Pensions (Mims Davies)]

It is a pleasure to serve under your chairmanship, Ms Elliott, and to have the opportunity to discuss the regulations in detail.

The regulations are part of an innovative intervention that we have at the Department for Work and Pensions: the Way to Work campaign. Let me explain why they were introduced. They are important to the Government’s ambition to build back better and move more people into work. The hon. Member for Wirral South raises concern about the urgency of those interventions. As the UK Employment Minister for the last three years, I have met employers who are desperately keen to fill vacancies with the talent that they have down the road. I think it is right that we step up and deliver. As regards our engagement with the SSAC, we continue to work and engage with it.

This has been an incredibly challenging year for everyone, especially those whose career or sector has been specifically impacted by the pandemic. We at DWP have been conscious of the damaging effect of being out of the labour market for a prolonged period of time. That is exactly why we introduced the Way to Work campaign. It is a specific drive to help 500,000 people into new jobs by the summer. The Government know how to introduce labour market interventions that really work. I am incredibly proud of the plan for jobs and the other interventions. Kickstart has offered us the opportunity to build on the success of job matching, disrupting the way people are recruited and making sure that it is quicker and much easier for people to get into work.

[Alison McGovern]

Will the Minister give way?

[Mims Davies]

I will make some progress. We at the DWP have monitored the labour market incredibly closely throughout the pandemic and put in that package of interventions through the plan for jobs to protect livelihoods and, above all, boost employment. The labour market context, which we cannot take for granted, absolutely illustrates the impact of the positive measures that we have put in place. It created a staggeringly positive effect.

In fact, unemployment levels are at 3.8%, and—despite the pandemic—they have not been lower since 1974, which was, it pleases me to say, before I was born, just about. The combination of the end of plan B covid measures and almost 1.3 million vacancies meant the scope that jobcentres had at the same time to return to full face-to-face activity presented us a unique opportunity to address the shortages and critical vacancies in particular sectors and help the labour market to grow faster. People who may have been waiting for their chance before the pandemic would have faced another two years of being held back had we not acted. To address that, we developed the Way to Work campaign, including the key policy objective secured by the regulations, working across Government ahead of the Prime Minister’s announcement on 26 January. The DWP has used the strength of the jobs market—I repeat, there are 1.3 million vacancies—to build on kickstart. It has meant we can work directly in our open jobcentres with employers to get claimants into those vacancies quicker, as well as strengthening our core support for jobseekers so that they can progress sooner.

Two things have happened in the labour market during the pandemic: people have wanted to transition and try new things, and in some sectors they have stepped up and helped in times of need. I make no apologies for any job, better job, career. The longer a person is out of the labour market, the harder it is for them to move forward, and it is absolutely right that we give people the chance to step back in, grow their confidence, and move on from there.

[Alison McGovern]

There are many surveys out there and a lot of information from businesses that say they do not support the Government’s approach for the reasons I mentioned. If the Minister can provide the Committee with some evidence that businesses support it, I invite her to do so. When the Minister mentions 500,000 people, is she talking about the 1 million people who have left the labour market? Unless we have an offer for those people, we will not get anywhere near dealing with the vacancies crisis.

[Mims Davies]

The hon. Lady makes an important point about the evidence and why employers want more people to apply for their jobs who normally would have ruled themselves out. On labour market figures day last Tuesday, I was at a job fair at one of our 190-plus new jobcentres, just outside Gatwick airport. They have 5,000 vacancies at the jobcentre there, and I spoke to representatives of Gatwick airport and local supply chains who were delighted to be meeting claimants who were looking to change and move into the sector, to help reinvigorate and bring back tourism and aviation. Those people had perhaps done different things before the pandemic, or were looking to progress and do something else. I can give the hon. Lady plenty of examples of employers, going beyond surveys. This is about real people—it is beyond statistics. It is about jobs, livelihoods, and real people progressing.

The right hon. Member for Hayes and Harlington was wondering why this is suddenly an issue. According to my records, he has not been to his local jobcentre since 2017, so perhaps if he popped down to that jobcentre and spoke to the work coaches, he would see it in action.

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[Mims Davies]

I thank my hon. Friend, because that is exactly what the initiative is about; that is our total intent.

The hon. Member for Glasgow South West mentioned the Select Committee session this morning. The regulations are absolutely about tailored support for the right opportunity down the road. They are meant to help people to become more self-reliant and to enjoy the improvements in their wellbeing from being in work and all that it has to offer. In doing that, claimants can take the next step of building a more secure future and being more prosperous and, of course, they are helping our economy to recover.

The effects of the regulations are that jobseekers with a strong work history and who are capable of work will be expected to search more widely for suitable jobs earlier in their claim.

[Alison McGovern]

rose—

[Mims Davies]

I think this point is important for people to understand, so let me just reiterate it. The effects of the regulations will be that jobseekers with a strong work history and who are capable of work will be expected to search more widely for suitable available jobs earlier in their claim because of the shortening of the permitted period. The permitted period is the time in which claimants can narrow their work search within their usual sector. I must add that this is not applicable to all claimants who make a new claim. These regulations reduce the permitted period from 13 weeks to four weeks. We believe that reducing the permitted period could aid claimants’ chances of finding work more quickly and seeing more options that are available to them sooner.

[Alison McGovern]

I thank the Minister for giving way; she is being very generous. There is clearly a disagreement about what the evidence may or may not show about the efficacy of the policy, so will the Minister be good enough to make public or put in the Library of the House of Commons the analysis that supports that?

[Mims Davies]

I will write to the hon. Lady with further details covering some of that, but I would like to reiterate something about the history of the permitted period. Perhaps this will help her. The permitted period was formulated as a policy as part of the Social Security Act 1989 and was originally set at 13 weeks, which was considered reasonable in the context of the labour market at that time. The end of the permitted period is not a deadline to move into work. It marks the point where a claimant needs to agree commitments that will help them to seize the record opportunities in the current labour market. Good work coaches tailor their ask of their claimants, listen to their needs and give them advice about how they can transition and take up more roles, by listening and engaging. This is not about putting people into jobs that are not right for them.

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[Mims Davies]

There is a fundamental misunderstanding on the Opposition Benches about what our work coaches do and how we are helping people to progress and move forward. The hon. Member for Wirral South made some comments earlier about jobcentres and our work coaches—

[Alison McGovern]

No.

[Mims Davies]

I can say that the feedback consistently is that they are a continually positive place to be. It is important that when people make comments—including about jobcentres wanting to sanction people more and being negative places to be—they do it from a position of understanding their strength.

At the heart of the debate is the perception that we are just trying to sanction people more. The reality is completely the opposite. We are trying to get people into work quicker.

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[Mims Davies]

I do not think I have ever spoken about the reluctance of our claimants to be tenacious and open-minded and to move forward. In fact, that is what the relationship that we build among work coaches, local employers and sector-based work academies, and our approach that we have developed through the plan for jobs, has really brought out. Given the transitions and opportunities and our 50-plus choices and 50-plus champions, I often remind people that the latter part of their careers, when they have great choices, can be the most fulfilling of their working lives. In fact, that is 25% of a working life. The hon. Member for Wirral South mentioned those who fall into economic inactivity, which is something we are focused on.

[Alison McGovern]

indicated dissent.

[Mims Davies]

I think the hon. Lady spoke about people leaving the labour market—that is the point I was making.

With regard to the regulations, it is important to mention the evaluation, which will help the Committee, and then I will conclude. We will reflect on the evidence and what the Way to Work campaign has brought forward. The evidence shows that, as we have discussed, how hard it is to secure a job is often based on how long it takes to return to the labour market. With Way to Work, we are giving new claimants more time with their work coach and making sure that we bring local employers into the jobcentres with sectors and opportunities that perhaps people would never have found otherwise. That will help more claimants move into work quicker, and we will be routinely reassessing the impact of the changes on universal credit claimants more generally.

It is important to reiterate that we know that the longer people are out of employment, the harder it is, so intensive support sooner from DWP is what this is about. It will mean that claimants who are expected to broaden their job search will take advantage of the additional vacancies out there. To be clear, we do not expect claimants to move into work that is not right for them. The Committee should be clear on that. Our work coaches are specifically trained to direct claimants to suitable opportunities, where they are appropriate and tailored to their personal needs and circumstances.

Given my comments, I trust the Committee understands both the need for the change in the regulations and why we felt it important to deliver at pace, as we heard from my hon. Friend the Member for Bracknell. The change is designed to build on the success of our plan for jobs. I hope I have reassured the Committee about the measures. We are committed to seeing the jobs filled quickly for progression in every community. People can succeed by working with us at DWP to find their next career at any age or any stage.

[Alison McGovern]

I will keep it exceedingly snappy and make just two points in closing.

First, anecdote is one thing; evidence and analysis about the economy, and about the labour market and how it works, is a completely different thing. I look forward to seeing the full analysis of why the DWP thinks this is going to work.

Secondly, the Minister said that I said that work coaches were no good. The opposite is the truth. I have sat alongside work coaches and spoken to them about the things they are doing, and I think that work coaches up and down this country are, by and large, fantastic people who do a great job. The problem with the DWP is not work coaches; it is what is going on on Whitehall and policies like this.