Carer’s Allowance
Debate between Chloe Smith and Karl Turner(2 years, 7 months ago)
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Chloe Smith
I am afraid I need to make progress.
The hon. Member for Salford and Eccles (Rebecca Long Bailey) argued that we need to increase the rate of carer’s allowance even further to reflect the current rate of inflation, rather than last September’s rate of CPI. Of course, the Secretary of State undertakes an annual review of benefits and pensions; and CPI in the year to September, as published by the Office for National Statistics, is the latest figure that the Secretary of State can use to allow sufficient time for the needed legislative and operational changes before new rates can be introduced at the start of the new financial year.
Let me turn to the carer’s allowance earnings limit. Right hon. and hon. Members have mentioned the limit throughout the debate and argued that it ought to be increased. Carer’s allowance has an earnings limit, which permits carers to undertake some part-time work if they are able to do so. This recognises the benefits of staying in touch with the workplace, including greater financial independence and social interaction. In many cases, carers are keen to work, so we want to encourage them to combine some paid work with their caring duties, if they wish to do so and wherever possible. That is why we regularly increase the earnings limit.
The limit for those in receipt of carer’s allowance will increase to £132 net earnings a week from this year, which means that the earnings limit will have increased by about a third since 2010. Many of those who are receiving carer’s allowance and doing some work will also be receiving universal credit. In those cases, the 55% taper rate and any applicable work allowance will help to ensure that people are better off in work, which means more generous treatment in universal credit of earnings above the carer’s allowance earnings limit.
Right hon. and hon. Members have mentioned the increases in fuel bills, which I absolutely recognise. The Government acknowledge that people are facing pressures with the cost of living, including rising fuel and heating costs, and Members will know about the measures announced in the spring statement last week, which build on the existing support that the Government provide and will be worth over £22 billion.
A number of schemes are in place to help with heating costs, depending on carers’ circumstances. They include the winter fuel payment, the cold weather payment and the warm home discount. I recognise the argument made by the hon. Members for Salford and Eccles and for Bolton South East about extending the warm home discount to carers. I think they will know that colleagues in the Department for Business, Energy and Industrial Strategy recently consulted on the scheme and announced that automatic rebates will be extended from those getting the guarantee credit in pension credit to include other low-income households whose homes are fuel inefficient.
The hon. Member for Worsley and Eccles South (Barbara Keeley) and others made the point that it is important that carers apply for all the support that might be available to them. Many working-age carers receive means-tested benefits as well as carer’s allowance, and I have already mentioned universal credit. Pensioner carers may be able to receive pension credit, which includes an additional amount for carers. Very importantly, receiving a means-tested benefit can act as a passport to other support, so if carers are not already receiving a means-tested benefit, I encourage them to look at gov.uk or to seek other advice, to see whether they might be entitled to that.
Karl Turner
Will the Minister clarify the percentage increase that was asked about by my right hon. Friend the Member for Hayes and Harlington (John McDonnell)?
Karl Turner
I think there was a mention of 3.1%, but I am not sure if I heard the Minister properly.
Chloe Smith
The hon. Gentleman will recognise that as the September CPI figure. Yes, I can confirm that the figure is 3.1%.
I want to add a point about the personal independence payment. For some households where caring is taking place, it will be highly relevant. It is extremely relevant to the point that several Members have made about the extra costs that disabled people face. That is recognised, and it is exactly what the personal independence payment is for. Again, I encourage carers to ensure that they or their household look at that.
The hon. Members for Kingston upon Hull East and for Worsley and Eccles South raised points about the end of life. I want to make sure that hon. Members are aware that the Government are improving the so-called special rules for terminal illness and end of life. Two statutory instruments have already been laid and primary legislation will follow to ensure that, across five benefits, that when they are in those very challenging circumstances people can get the support they need earlier.
Some hon. Members mentioned disabled or unwell children. I want to make sure that colleagues are aware of the special educational needs and disabilities review that was published yesterday. Low-income families with seriously ill or disabled people will be further supported through £27.3 million of funding next year, which could help pay for equipment, goods or services that those families might not otherwise be able to afford.
Let me move on to the position for Scotland and Wales. Hon. Members have asked why the Administrations differ in their approach. The UK Government’s focus is to support those carers most in need through universal credit. In Scotland, as mentioned by the hon. Members for North East Fife (Wendy Chamberlain) and for Glasgow East, additional amounts are paid to carers by the Scottish Government through their carer’s allowance supplement, using their powers under devolution and their own resources. That is done regardless of the carer’s means. We think it is a better approach to focus extra support on carers on the lowest incomes, and I have already mentioned how that is done through universal credit.
I acknowledge the desire of the hon. Member for Cynon Valley to expand devolved powers in Wales, as well. I do not have time to engage fully with that point today, but I understand the arguments she makes and I look forward to responding to the Welsh Affairs Committee’s report.
The hon. Member for North East Fife mentioned how unpaid carers had been supported during the pandemic and spoke about the policy on lateral flow tests. I want to ensure that she is aware that my Department worked with the NHS and Public Health England to share data so that unpaid carers had priority access to vaccines. It was very important for different parts of Government to work together to do such things for the benefit of those who needed the vaccinations the most at that time. I will ensure that Ministers in the Department of Health and Social Care are aware of the points raised by the hon. Lady about lateral flow tests.
I will draw my remarks to a conclusion to leave enough time for the hon. Member for Kingston upon Hull East to close his debate. We all agree that society relies on unpaid carers in many ways. They are appreciated and deeply important in their households. We recognise the challenges they face and we are helping carers with the rises in the cost of living, reforming social care and helping carers to stay in work. We are spending record amounts on the carer’s allowance and providing unpaid carers with the help and support that they need and deserve. I am grateful for the range of points that have been made today, all of which will be very helpful in examining how we need to go forward. I hope that the contributions made today will help carers to know that we in this Chamber are thinking of them. Thank you for your chairmanship, Ms Bardell.
Oral Answers to Questions
Debate between Chloe Smith and Karl Turner(11 years, 8 months ago)
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Miss Smith
The McKay commission report deals with some of the questions the hon. Gentleman raises. As I have said, they are serious questions, and it will take time to ensure that we respond appropriately. We will do just that.
Karl Turner (Kingston upon Hull East) (Lab)
3. What the Government’s political and constitutional reform priorities are up to 2015.
Living Standards
Debate between Chloe Smith and Karl Turner(12 years, 8 months ago)
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The Economic Secretary to the Treasury (Miss Chloe Smith)
I thank hon. Members for their contributions to what has, on the whole, been an insightful debate. We have heard from the hon. Member for Bristol West (Stephen Williams), my right hon. Friend the Member for Wokingham (Mr Redwood), my hon. Friends the Members for Witham (Priti Patel), for Mid Norfolk (George Freeman) and for Halesowen and Rowley Regis (James Morris), the hon. Member for East Antrim (Sammy Wilson) and, indeed, my fellow by-election winners, the hon. Members for Oldham East and Saddleworth (Debbie Abrahams) and for Inverclyde (Mr McKenzie), whom I very much welcome to this House.
I note that today’s motion is deficient, in that it gives the wrong date for the Budget—I wonder whether that reflects the Opposition’s grasp of detail when they want to spend and borrow an extra £12 billion. It is no surprise that they do not wish to talk about how to bring the deficit “down”, as mentioned in the third line of their motion. They also said nothing about lone parents. Do they not care about the single mums and dads? No, there was not a word for them and the fairness of their already having to work 16 hours a week.
As the House is well aware, we all face tough economic conditions as we recover from the disastrous economic legacy left to us by the previous Government.
Miss Smith
No, I shall not, because we have had plenty of time to hear from Labour Members. I must press on. We all know that, in these tough times, families across the UK are tightening their belts, managing pay freezes or worse, and coping with ongoing economic uncertainty. Many families are confronting falling living standards because of the dire economic situation we inherited. The Opposition want to keep on spending and keep piling on the debt, but we refuse to burden our children and mortgage the country’s future with their profligacy.
Tackling the deficit is the vital precondition for a sustainable recovery, underpinning private sector confidence to support growth and job creation. It is right and fair that we tackle the deficit now, as a foundation for prosperity. It is because of our decisiveness that we have secured record low gilt yields, which feeds through to record low and stable interest rates that make a real difference to families paying their mortgages and to refinancing business loans right across the country.
If we are going to discuss a squeeze on living standards, let us talk about what a rise in market interest rates would mean for families across the UK. It would force taxpayers to find an extra £21 billion in debt interest payments; it would increase the cost of business loans by £7 billion; and it would add £10 billion to mortgage bills every year, or an extra £1,000 for the average family—and that with just a 1% rise. Let me remind the House that when we took office, our rates were tracking those of the likes of Spain and Italy, but now they are close to those of Germany. That is because of the tough decisions we have taken.
Miss Smith
No, I shall not, as I have already said.
According to the shadow Chancellor, who, as ever, cannot be quiet, low interest rates are a sign of trouble. He would rather have higher interest rates, a bigger squeeze on families and an even bigger fall in living standards.
The simple truth is that the Opposition have no credible response to the economic challenges that this country faces, which is why we must never return the keys to those who crashed the car. It is we who have the answers to tackling the deficit and securing our prosperity. I know that for many families, however, these are tough times. That is why we have taken substantial steps to protect living standards and to ensure we support our poorest and most vulnerable families. That is why we secured the largest ever cash rise in the basic pension and why we uprated working age benefits by 5.2%, protecting the real incomes of the poorest. We are taking the same approach as we reform our welfare system, targeting support where it is needed most.
Tackling the deficit in a fair way means that we have to ensure that tax credits are targeted at our poorest and most vulnerable families, unlike the path taken by the previous Government, who spent more than £150 billion on tax credits and let nine out of 10 families be eligible for them. That is a staggering, untargeted and unsustainable level of spending and it is right and fair that we should reform it.
Let me turn to the working tax credit. It is not fair that a couple with children can claim the credit if one partner works 16 hours, whereas a lone parent has to pull in the same time on their own. Increasing the working hour requirements for a couple is entirely fair. It is right that they should put in more hours than a lone parent before receiving the working tax credit. That also creates a clear work incentive signal, which many Members have sought in this debate, to potential second earners who could benefit from tax credits if they moved into work or increased their hours—and hours are available. Let me answer this one. In the quarter to January, there were 11,000 vacancies across the economy, meaning that 1 million people moved into work. That paves the way for the principles of universal credit because work must pay.[Official Report, 6 March 2012, Vol. 541, c. 9MC.]
At the same time, we are right to reform child benefit to target it towards those families who need it the most, rather than millionaires. I fully understand that it is a vital income boost, but it comes at a substantial cost to the Exchequer, including more than £2 billion a year in payments to higher rate taxpayers. It is right that we should refocus resources where we need them most, and that means taking the tough decision to withdraw child benefit from families with a higher rate taxpayer, because it is simply not fair that working parents on low incomes should subsidise child benefit for millionaires.
None of these points ignores the fact that across the board, we know that this will be a tough year for households. That is why we have gone even further to support families and businesses across the country, limiting the increases to Transport for London and regulated rail fares and funding South West Water to enable it to cut bills by £50 a year for households that face the highest water bills in the country. We are helping pensioners, setting aside an extra £675 million for local authorities in England that freeze or reduce their council tax, deferring the fuel duty increase that was due to take effect on 1 January to August this year and cancelling the further increase for August. As a result, tax on petrol will be a full 10p lower than it would have been under the shadow Chancellor’s plans, meaning families with the average family car will save £144.
As we fix the failures of the past and repair our economy, we are committed to supporting families across the country. It is a tough challenge to ensure and secure our economic stability and to lay the foundations for sustainable growth, but in our determination to do so and to restore the economic prosperity of this country, we will put fairness at the heart of our recovery. We are protecting living standards for the poorest and most vulnerable families by lifting millions out of tax, taking steps to reduce the cost of living and refocusing welfare on those who need it most. Yes, that means that those on the highest income will bear the heaviest burden as we pull together to tackle the deficit, but it is right that those who can contribute the most should do so. A fair and sustainable recovery demands leadership, and that is what this Government are providing.
Question put.