Universal Credit and Working Tax Credits

Angela Eagle Excerpts

Wednesday 15th September 2021 Commons Chamber

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I beg to move,

That this House calls on the Government to cancel its planned cut to Universal Credit and Working Tax Credit which from the end of September 2021 will reduce support for many hard-working families by £1,040 a year.

I reiterate what I said when we had this debate in January: while, understandably, strength of feeling is high when talking about something that affects so many families and households across the country, this should not be a debate with personal abuse or accusations of bad motive. I ask everyone following the debate at home to consider that, too. If we instead took a moment to assess the matter properly and considered not just the impact on the 6 million affected families but what is in the best interests of our economy as we recover from the pandemic and, crucially, what we need as a country to be able to face the inevitable shocks and economic problems that will come our way in the future, we would decide that it would be unconscionable to take this money away.

[Dame Angela Eagle (Wallasey) (Lab)]

In my constituency, £10.5 million will disappear from the spending capacity in our local economy when more than 10,000 people and working families lose access to this benefit. Does my hon. Friend agree that that will have a tremendously bad effect on local spending power?

[Jonathan Reynolds]

My hon. Friend is exactly right. The reduction of £20 a week for 6 million low-income families will be the single biggest overnight cut in the history of the welfare state—bigger even than the cut to unemployment benefit in 1931 that caused the Government of the day to collapse. The scope of the cut, affecting one in 14 British workers, is also unprecedented. For those reasons alone, it is right that we are having this debate and that our constituents know where we stand.

--- Later in debate ---

[Dr Coffey]

I agree. Kickstart has so far given over 69,000 young people a foot in the door as they start their working lives. There are more jobs to be filled and we are working with employers to accelerate the recruitment process in that regard.

We also have a scheme called SWAP—the sector-based work academy programme—where people might consider changing their career. The beauty of SWAP is that it is employer-led. We have helped 64,500 people gain the skills that they need to land a job in a whole range of growing sectors. At the end of the training and work experience, there is a guaranteed job interview.

[Dame Angela Eagle]

Will the Secretary of State give way?

[Dr Coffey]

I will make some progress and then come back to the hon. Lady. We also have the job entry targeted support scheme, which, again, provides tailored support, and 138,000 newly unemployed people have got a leg up that way to make sure that they can try to find sustainable work. The restart scheme has recently started. That will provide intensive help, supporting over 1 million jobseekers who have been out of work for over a year. That is not all, but I will give way to the hon. Lady.

[Dame Angela Eagle]

I thank the Secretary of State for giving way. Will she explain to the House why, if everything is reasonable and as it should be, her six predecessor Conservative Secretaries of State for the Department for Work and Pensions have all come out against this cut?

[Dr Coffey]

I think it is fair to say that in the letter I saw that my six predecessors had signed—they are magnificent people and it is an honour to follow in their footsteps—they were keen to have the extra financial support that has gone into aspects of the welfare system and to help people in that way. It was not specifically about the £20 but about recognising, as has been said today, that there may be better ways of using that financing. I am conscious that the media may have reported that in a slightly different way and I am not going to put anybody on the spot. However, I think they valued the extra money that went in, and I want to continue to support people.

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[Dame Angela Eagle (Wallasey) (Lab)]

On the final night of the Tory party conference, as the Government wine and dine their billionaire donors, the same Ministers have decreed that millions of our fellow citizens will face the biggest cut to social security benefits since the 1930s. On 6 October, the Government will ram through their plan to scrap the £20 uplift to universal credit, at a stroke leaving 6 million households more than £1,000 worse off a year. By next April, 2.5 million will be £1,300 worse off because their national insurance tax contributions will rise by 10%. In Wallasey alone, more than 10,000 households will lose £10.5 million in support. That money provided a vital lifeline to those struggling throughout this pandemic, many of them key workers. This callous Government have made a political choice to withdraw that support. This is money that is currently spent in our local economy but which will disappear overnight.

The Joseph Rowntree Foundation estimates that these cuts threaten to push 750,000 people into poverty and 500,000 further into deep poverty, which is defined as being more than 50% below the poverty line. There are 6,000 children whose parents are reliant on UC in my Wallasey constituency. This callous cut will be the difference between them putting food on the table or not in the coming months.

Analysis by Action for Children found that almost 30% of children in Wallasey already live in poverty after housing costs. In supporting this cut, every Conservative Member is voting in full knowledge of its effects. The Government’s own leaked assessment has described the cut as “catastrophic”.

So egregious is this cut to UC that six of the Secretary of State for Work and Pensions’ Tory predecessors have spoken out against it, yet she has pronounced herself “happy” that it is going ahead, and yesterday she was being either disingenuous or ignorant when she claimed that just a couple of hours of extra work would make up for the cut. We know that is not true, and we know that while 40% of those on the benefit are in work, some claimants cannot work for various reasons ranging from illness to child caring responsibilities.

In Wallasey 36% of people claiming UC are in employment, and nationally one in six working households cannot make ends meet already. The last decade of benefits cuts has left working families worse off than they were 10 years ago. The pandemic uplift has acted as a vital buffer, and now even this is being taken away.

To govern is to choose; the Conservatives have chosen hardship over hope, and poverty over support. As they sip their champagne and hobnob with their millionaire supporters at their conference, we will never let them forget that.

--- Later in debate ---

That this House calls on the Government to cancel its planned cut to Universal Credit and Working Tax Credit which from the end of September 2021 will reduce support for many hard-working families by £1,040 a year.

[Dame Angela Eagle (Wallasey) (Lab)]

On a point of order, Madam Deputy Speaker. Is it not a disgrace that the Government have developed this habit of abstaining completely from Opposition day votes because they do not have the guts to oppose in the Lobby the things that we suggest, and they are frightened of the effect that it will have in their constituencies? It was once the case that when Governments lost Opposition day votes they put into effect the will of the House. This Government are showing such contempt for the House that they cannot even be bothered to take part in these votes. Is that not a disgrace? Is there anything, as a House, that we can do to prevent this despicable behaviour?

[Jim Shannon (Strangford) (DUP)]

Further to that point of order, Madam Deputy Speaker. The House has expressed itself very clearly in saying that there are concerns about the £20 of universal credit being taken away from the people who need it most. That being the case, how can we ensure, legislatively, that we turn that into a victory for the people we represent in this House and for those who want that universal credit money to continue for at least a period of time?