Welfare Reform Bill

Baroness Lister of Burtersett Excerpts

Wednesday 26th October 2011 Grand Committee

[Baroness Drake]

My Lords, I support the amendment and come back to its detail; my noble friend indicated that it was a probing amendment. This is an opportunity to raise significant issues about in-work conditionality. Where a welfare system has to balance rights and responsibilities, under universal credit those in work will be embraced by an in-work conditionality of some complexity which neither they nor their employers will previously have experienced. From the emerging details of in-work conditionality it is clear that it will give the Government significant discretion over a sizeable section of the workforce, and powers to follow through with sanctions that will affect people's lives very significantly.

This is a novel discretion for three reasons. It will impact on a much greater volume of people; it will impact on existing in-work relationships; and it will require Jobcentre Plus people or any outside providers to engage with large numbers of companies with which they have previously had no engagement.

Setting and enforcing what is a reasonable condition, particularly in terms of increasing hours or requiring people to seek and change their jobs, must be sensitive to a range of factors: for example, local and regional labour markets, and different sectors and their employment practices. If an employer puts their employees on short-term working rather than making them redundant, is that a good thing or will it attract conditionality requirements? How will it be handled? What will happen when people have atypical or variable hours work contracts? Over what period and in what manner will earnings be averaged to assess compliance with income thresholds on conditionality?

In requiring people to work more hours or seek a higher-paid job, it is important to ensure that childcare and conditionality interact fairly. Parental need for confidence in the care of their children needs to be respected. My noble friend Lady Hollis moved in on some detailed concerns in this area. Any casual observation of female labour market statistics will show two peaks of part-time working by women. They coincide with key caring periods. Part-time working in the UK is part of the systemic solution to childcare, particularly for single parents. One cannot look at conditionality on the one hand without looking at the nature and characteristics of childcare in the nation as a whole. How will the sanctions regime be applied? How will it impact on the children of those who are subject to sanctions? How long will people and families be given to adjust to any new requirements and conditions, particularly if they come on top of a period of compulsory redundancy?

What we see from the details coming forward is the micromanagement of the work patterns of potentially millions of people, and the application of wide discretion that will need a considerable set of guidance notes and competences to apply the conditionality. The staff making these in-work conditionality assessments will have no previous experience of doing this. It is a novel area in its scale and complexity. No doubt in answer to my questions the Minister will say what is intended or that the matter is work in progress. It is pretty clear that an awful lot of work is still in progress. I say that not to appear negative but to say that the Bill has the effect of giving the Government considerable discretionary power over people in work.

Parliament needs to be satisfied on three issues: that the capacity and capability to implement the proposed in-work conditionality is there; that there is confidence that the discretion will be applied consistently, fairly and proportionately; and that there is a high level of confidence that there will be no inequalities of treatment or impact in the outcomes of applying that discretion. Because conditionality is now going to be applied to people who believe that they are already making a contribution, they will have to experience a different perception of the contribution they should make in terms of being in work.

I want to pose two questions for the Minister. First, do the Government intend to pilot in-work conditionality before they introduce it nationally? Secondly, would any introduction consequent on those pilots be both gradual and incremental so that experience, knowledge and skill can be built up by those assessing claimants? Thirdly, what will be the reporting to Parliament about the level of confidence that this complex system of in-work conditionality can be applied fairly and proportionately?

[Baroness Lister of Burtersett]

My Lords, I would like briefly to follow up on that because this takes us into largely uncharted waters, so we have to be sure of what it is that we are doing. I was struck by the research report, Perceptions of Welfare Reform and Universal Credit, which states that:

“Many part-time workers were surprised that the Universal Credit proposition addresses them as they tended to perceive that they were already doing their bit and felt a strong sense of entitlement to tax credits”.

I think that they found the idea that conditionality was going to apply to them quite disturbing. There is a real danger here. The Government talk a lot about not wanting an overly oppressive state, but I fear that many workers will experience this as just that.

I have two questions for the Minister. First, my noble friend Lord McKenzie mentioned the equality impact assessment. I understand why the Government are using earnings rather than hours as the threshold—because they want to get away from the in-work/out-of-work distinction—but in doing that, as my noble friend said, someone who can earn more will find it much easier to meet the threshold. We know from all the evidence that men are more likely to be able to do this than women, non-disabled people are more likely to do it than disabled people, and white people are more likely to do it than minority-ethnic people.

[Baroness Hollis of Heigham]

People without children.

[Baroness Lister of Burtersett]

Yes. Is there not an issue here in terms of the equality implications? How does the department see those implications?

Secondly, I know that the Minister likes evidence-based policy-making and of course will be very aware of the research report UK Employment Retention and Advancement Demonstration, which has found that gains are made by providing support for people to advance in work through this programme. It states that,

“the evaluation found that for specific populations, gains can be achieved, even for some of the most disadvantaged job seekers, and that those gains can be sustained over a five-year period. These results suggest that the core elements of ERA offer something to build on in future post-employment interventions”.

In what way is the department building on this? To me, it seems that it is going down the in-work conditionality route instead of developing the support provided in this programme.

--- Later in debate ---

[Lord Freud]

My Lords, without wishing to go against normal procedure, it might be valuable if I came in straightaway to say where I stand on this, because it might enable us to move the debate on if noble Lords know what I am saying before rather than afterwards.

I recognise the valuable job that families and friends, kinship carers, do and I recognise the difficult circumstances that they face. I had a recent meeting with kinship care organisations to understand their priorities. I am absolutely convinced that this is a key area and am currently looking closely at ensuring that this group is treated appropriately under the universal credit. There is ongoing work, in which I am deeply involved, on how they should be treated for conditionality purposes; and, indeed, there are other areas where we can talk to other departments. What the noble Baroness, Lady Drake, said resonates with me.

Formally, there are safeguards and flexibilities for this group, and, as a minimum, family-and-friends carers are covered by the same safeguards as any other parent under universal credit; with the normal limitations against imposing full-time search and availability requirements on the carers of younger children and so on. Where the work-related requirements apply, the work-related advisers have broad discretion. However, there are circumstances where it is not reasonable to expect a person to meet even a limited work search or availability requirement. Among other things, advisers will have the scope to temporarily lift the requirements for any period when a child’s needs are such that the claimant must be able to provide full-time care. The point where the older child first moves into a household can often be a very difficult period of adjustment. There is a problem, which is not directly in the hands of DWP, with holding on to a job. That is a matter of concern, especially where you have advice, often from social workers, that the job must go. The noble Baroness, Lady Drake, gave one such example. The least that will happen is that we will look at easements on a case-by-case basis, given the difficulty of having blanket rules. However, we recognise that clarity of treatment and a clear legislative exemption could be of value. As I said, I am actively considering this area, and if further legislation is required, we already have scope to make regulations, as necessary.

Given the ongoing thought that we are giving to this area, I will ask the noble Baroness to withdraw her amendment. I have jumped in early so that any other noble Lords who want to discuss this area know where I am coming from, rather than trying to convince me where I should be coming from. I suspect that I will just say, “Yes, yes, yes”, to a lot of what people are going to say, so other things would be useful.

[Baroness Lister of Burtersett]

I very much welcome the positive response of the Minister and the fact that he has clearly been talking with kinship carers and thinking about how to address the issues raised by the amendment tabled by my noble friend Lady Drake.

I just press him on his final point about doing this on a case-by-case basis. One of the recurrent themes of our discussions is the extension of discretion. I understand the value of discretion, but as the noble Lord himself has acknowledged, it does not provide the clarity of treatment that something in legislation would do. I get the sense that there may be something in future in regulations. I cannot speak on behalf of my noble friend but it would be valuable if there could be a firm commitment before the Bill leaves this House, even if it is not in the Bill, that it will be in regulation. I will not say all that I was going to say because the noble Lord clearly does not need convincing of the importance of this issue. It is one that I have become aware of only fairly recently, partly at the all-Peers meeting where a member of a kinship carers’ association spoke to us. I was very struck by their case in the way that the Minister has clearly been.

I also want to mention, if only to get it on the record, that I was at a conference at the Law Society at the weekend on economic and social human rights. A presentation was made there by the Poverty Truth Commission from Scotland. Some of its members are people with experience of poverty, some of whom are kinship carers. I was struck that it said one of the key issues was kinship care. I will not quote as much as I was going to, but the commission states:

“Kinship carers have been supporting each other and struggling for recognition and justice for many years”.

Recognition is very important for people living in poverty. This is something I have become aware of through my work on the Commission on Poverty, Participation and Power, which also involved people with experience of poverty. The kind of amendment that my noble friend proposes would have both symbolic and practical significance. It would provide that recognition that simply saying, “We will look at it on a case-by-case basis”, would not do. Having said that, for once I can hear the ministerial nuances and I know when to say thank you very much.

[Baroness Sherlock]

My Lords, I have two brief points to make. I was delighted to hear the warmth of the Minister’s response. If he is thinking about this area, perhaps I could punt two thoughts at him. First, I can see that he will be concerned that there may be a range of other circumstances that may appear similar on the face of it, where there is a disruption to the circumstance of an older child, perhaps moving house, and therefore there might be some wish to have that taken into account; for example, a family break-up where the children are suddenly moving to a different house and although the children are of school age, the disruption to the household might make the parent feel that they should stay at home; or the formation of a step-family where there is some significant upheaval in the household which might put a parent who might normally want to go out to work in that situation. If the Minister is thinking, perhaps he can think about those issues as well.

The reason he might want to think that this is a different case is that the grandparents or the other kinship carers have a choice: they do not have to take these children on.

The danger must be that they have to do so unless they have absolute assurances. That is the distinction, which is why I think there is a particularly compelling case for a legislative requirement.