Department for Work and Pensions

Alison McGovern Excerpts

Tuesday 4th July 2023 Commons Chamber

[Alison McGovern (Wirral South) (Lab)]

This has been a good, important and timely debate. I congratulate my right hon. Friend the Member for East Ham (Sir Stephen Timms), the Chair of the Work and Pensions Committee, on bringing the debate to the Floor of the House. He rightly opened it by placing in context the size of the Department and its central place at the heart of economic policy, and discussed the work of his Committee, which has been substantial, on looking into some of the Department’s very significant flaws. Given the economic situation the country now faces, the work of the Committee has never been more important. As he mentioned, it has published very important and significant reviews, and some of the recommendations have been adopted by the Government, so I applaud him for securing the debate. My hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams), in her usual way, explained the manner in which poverty harms people not just in their financial life but in every single aspect of their life. The Government would do well to listen to her.

I want to make some brief remarks—with an emphasis on brief—as many good points have already been made and I will not be repeating them all. I want to get to the heart of the points that have been discussed, in particular on universal credit. I have been in this House long enough to remember the country before universal credit, so I am able to compare and contrast the system we had before with the one we have now. I offer this reflection based on that experience.

On its introduction, universal credit was claimed to be a kind of cure-all which would release everyone from the so-called trap of poverty. I did not think that that was going to be true when it was introduced and I do not think it is true now. The Department for Work and Pensions, in its spending and policy choices, has to be far more than just universal credit and social security, important though they are. As much as the pensions side of the Department is a huge part of its spending and very important, it must also be the department for dignity: the dignity of work and the dignity of well-functioning, decent social protection. Those two areas of policy must work hand in hand to ensure that the ups and downs of life do not upend life chances when unfortunate things happen. We should be using good work and social protection to help people to move on and move up in life. The Chair of the Select Committee and other Members have provided a good survey of what is happening in the Department at the moment. I would argue that on both work and social protection it is failing.

On work, to put it simply, we have fewer people in work now than before the pandemic. That cannot be a success. We have businesses crying out for staff, yet, unlike in other countries, our employment rate has not recovered from the pandemic. That is a huge failure. Pay, the money in people’s pockets, has been stagnant for the past decade. We think about the promises made about universal credit and all the Department does, so what questions has the Minister asked about that? What research has he commissioned to get underneath why pay is so stagnant? We have had reviews of in-work progression. The Government have claimed that they want to tackle our productivity crisis. What research and evidence has the DWP actually published to show, despite the claims made about universal credit supporting people to escape the so-called poverty trap that Conservative Members felt previous Governments had created, why we have had such stagnant levels of pay?

It is arguable that the Department’s policy choices might have exacerbated the labour market crisis, so I ask the Minister again: what policies does he have now, today, to help people escape low-paid work? For all the Government have talked about the possibilities of universal credit, why has it delivered so very little in terms of the money in people’s pockets and their chances of getting on? Has universal credit really delivered all that was promised? On all those areas—work incentives, the chances families have to do better, pay progression and supporting employers to get the skilled staff they need—I look at all the Department does and I have many questions about the disappearance of that promised success.

We have had a series of failed employment schemes. Kickstart failed to deliver what it was said it would deliver. We heard from Members about restart and the work and health programme, and all we do not know about what they are doing. Looking at the labour market and everything that the Bank of England has said about the consequences for our economy of the state of the labour market, does the Minister really believe that the DWP is helping, or is it a hindrance? I would love to hear him talk about published evidence that the Department’s policies are actually helping.

Finally on work, one major challenge for our economy is the imbalanced labour market. Businesses in many towns across the country are crying out for staff, yet we have an unemployment challenge. Some towns and cities have areas where unemployment is twice the national average. How can that be right in a country that has such a need for staff? Does the Minister really believe that his Department’s spending and policy choices are helping? Work should be the way that all of us achieve our hopes and ambitions. I just wish the Department was able to live up to those ambitions.

As many people have said, social security should be the backstop that puts a floor beneath families, yet at almost every step over the past decade the Conservative Government have made that harder. At every turn, the political turbulence they have created has had an economic cost for our country as a whole, and for families up and down the country. The inflation we now face makes life harder for everybody, but not equally. If we look at the money families must now find to put food on the table and pay their bills, we know that the choices made by the Tories have made life harder for those who were already finding it tough. Their failings on energy have made life much harder, in particular for people with disabilities who pay significant extra costs. It is a well-evidenced phenomenon that people who face illness or disability have significant challenges with the rising cost of energy. The Conservative Government have never taken their needs into account enough. I agree with comments made by both my colleagues on the Select Committee that the relationship between the Department and people with disabilities is not nearly good enough to achieve what we would wish for them.

The evidence of failure is all around us, whether it is the open doors of food banks or the closed doors of businesses who have been unable to survive this crisis of inflation and staff shortages. On the housing crisis, I would bet anything—I am not a betting woman, but I would none the less bet anything—that almost every Member has seen a rise in their housing case load. Even those with a relatively low case load have seen it rise in relation to the recent housing crisis.

One fact above all shines out of the Department’s accounts: rising ill health, which is having economic consequences for all of us and disastrous consequences for people who are trying to earn money to keep their family housed and fed. Over the past decade or more, the Tories have been not just not up to the challenge; they have actively made it worse.