The Secretary of State’s Handling of Universal Credit

Angela Eagle Excerpts

Wednesday 11th July 2018 Commons Chamber

[Neil Gray]

The hon. Gentleman makes some very fair points. We of course know from the recent statistics published by the DWP that 59% of claimants impacted by the two-child policy on tax credits and by universal credit are already in work. These are facts, and the Government should be considering them.

This is not of course the first time that this Government have tried to dismiss evidence placed before them showing the failures of universal credit. When the Trussell Trust said that food bank use was higher in areas where universal credit had been rolled out, UK Ministers described its evidence as “anecdotal”. In actual fact, the evidence came from 425 food banks across these isles, delivering 1.3 million three-day food parcels a year.

This week, the four housing association federations of these isles have called on the UK Government to fix the “fundamentally flawed” universal credit system. With colleagues, I met the Scottish Federation of Housing Associations this morning, and it revealed the scale and linkage of debt with universal credit. It is startling, and it is evidence-based. Ministers have replied that issues with debt were complicated and could not be linked to a single source, in spite of the evidence in front of them saying that nearly three quarters or 73% of tenants on universal credit are in debt, compared with less than a third or 29% of all other tenants.

[Ms Angela Eagle (Wallasey) (Lab)]

Will the hon. Gentleman give way?

[Neil Gray]

I will give way one last time, because I am conscious that others want to speak.

[Ms Eagle]

Does the hon. Gentleman see, as I do, a pattern of reluctance on the part of this Government to collect evidence and information precisely so that they can deny the effects of universal credit, and somehow pretend that the evidence that is accumulating is anecdotal?

[Neil Gray]

The hon. Lady is absolutely right. One of the central tenets of what the NAO called for in its report was that that type of evidence gathering needs to be done.

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[Ms Angela Eagle (Wallasey) (Lab)]

It is hard to overstate the rolling catastrophe that is universal credit and the abject misery and hardship that it represents not only to my constituents but to those of many other right hon. and hon. Members. As page 19 of the NAO report demonstrates, the system is so beleaguered that, while the original plan was for more than 7 million households to be on universal credit by now, the latest figures show that just 660,000 households were on it by the end of last year. The system is already six years late and there is no guarantee that it will ever arrive at the destination originally envisaged, yet the NAO estimates that the system has currently cost £2 billion to implement and is costing an astonishing £699 per claim.

The proper response to the huge problems with universal credit in the Department should be a commitment to improve and an acknowledgement of the undoubted weaknesses and design flaws that have been revealed. We have not had enough of that response. We have had ministerial denial and dissembling. Whatever dubious assertions the Minister may make about the merits of the system in response to today’s debate, the lived experience of my constituents in Wallasey contradicts them. It started to be rolled out in Wallasey in November 2017, and many of my constituents have been struggling ever since. As a result, many families have been placed under increasing pressure and hardship through no fault of their own.

Experience demonstrates that food bank usage increases by 30% in areas where there has been a full service roll-out. In Wirral, the increase was 35% in the first five months of 2018, as more and more families were forced to move on to universal credit. In the first five months of this year, 50,000 three-day emergency food packages were given out, nearly 15,000 going to children. In my constituency, the introduction of universal credit was 13% complete in December 2017, yet almost every day my constituency office receives new cases from people struggling with the system.

I have a constituent who suffers from a condition that leads to episodes of multiple seizures. She was attending a medical assessment as part of her claim when she suffered multiple seizures in front of the doctor. Not only was there a lack of understanding and sympathy about her condition; they refused to accept the medical evidence and what they were witnessing and shockingly told her that she had to come back the next day at 9 am to be re-examined. She has still not had her claim processed and is now frightened to leave the house for fear of being accused of being a benefits cheat.

Claimants are being given insufficient advice and guidance from their jobcentres, and local advocacy services have been decimated. I have constituents who have been sanctioned and have no other income. We know that this is not working. We have to make it work. It is not working at the moment.

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[Jessica Morden (Newport East) (Lab)]

I too want universal credit to work, but yet again the Secretary of State has come to the House, in the face of evidence and feedback from the NAO, CABs, food banks, housing associations, local government and others, and just appears to want to ride it out and brazen it out. That is deeply worrying and disappointing for my constituency because Newport has only had about 10% roll-out so far, and those are the easy cases—new claimants, single people without children, families with no more than two children. Yes, some people will have managed to navigate universal credit, but, as the NAO report says, for a “substantial minority” that is not the case. We need to address the problem as a matter of urgency before the roll-out reaches the more complicated cases. involving moving people from legacy benefits and people with larger families.

During this limited roll-out, we have also seen the problems documented by the NAO report reflected locally, and alarm bells should be heard. There have been problems with the initial claims: for instance, one family were inadvertently moved to universal credit and had to be returned to legacy benefits. It took 99 days for the lost tax credits to be fully recovered. According to the report, one in five claimants do not receive their full payments on time, and on average those claimants have been paid four weeks late. That means that many people do not receive their full payments for eight or nine weeks—and they are often people with no savings on which to rely. Some of my constituents have to resort to using food banks. One local food bank reports giving out 300 extra parcels every month over and above the increase that it anticipated. Other constituents do not want the advance payments because they do not want to go into debt, and are borrowing from loan sharks or from family and friends instead.

I agree with all the points that have been made about the online system, but let me add one more. People who have no individual ID, such as a passport or driving licence, now face a longer wait for an appointment before they can get into the system into which the delay is built. Those are often the most vulnerable people, and that too needs to be addressed.

Advice services such as citizens advice bureaux are seeing more and more people, and Newport CAB tells me that most of the problems involve initial claims. Arrears and debt problems do not just go away, as is shown by the Government’s own full service survey. Housing associations and local authorities are picking up the extra costs. Rent arrears alone are costing housing associations in Wales more than £1 million.

Let me take this opportunity to thank the hard-working DWP staff out there. According to a survey conducted by the Public and Commercial Services Union, 80% felt that there were not enough staff to manage the workload. I know that they are doing their best with the resources that they currently have, and I thank them for what they are trying to do.

[Ms Angela Eagle]

Does my hon. Friend agree that, while DWP staff are remarkably good at the job they do, they must have the tools they need to do that job, and many are frustrated that they do not have them?

[Jessica Morden]

I absolutely agree. I believe that they are doing the best they can with the tools that they have been given, but they need far more resources.

I hope that the Minister who winds up will adopt a more conciliatory tone. It is not enough to say that the delays can be solved by advance payments, or that it is too early to assess the impacts. The evidence is plain to see in our constituencies. The Government have been forced to change parts of this policy, and it is now time for them to pause and listen. If the roll-out speeds up and takes on the more complicated cases, we will, I fear, see only more debt and hardship among those who need the system to help them into work, or to support them if they cannot work.