Universal Credit

Chris Philp Excerpts

Wednesday 17th October 2018 Commons Chamber

[Margaret Greenwood]

I am taking no more interventions. [Interruption.] Well, I am short of time and many people have applied to speak.

Receiving the letter will also be unsettling when people have been on their existing benefit for a significant period. Of course, some people may miss the letter altogether. Also, they may well struggle to fill the form in on time and to get the necessary advice because, due to this Government’s cuts, the advice agencies are stretched to the limit. There is provision for the deadline to be extended but many people will not be aware of that. The Government have admitted that they do not know how many people overall will need additional support to make a new claim.

The Prime Minister assured us last week that people required to transfer to universal credit would not be worse off because they will receive transitional protection—an additional payment that tops up someone’s universal credit to the same level of the benefits that they were previously receiving. However, that only lasts for two years and could be lost when someone’s circumstances change, which can include such basic life events as moving in with a partner or separating from them.

If people lose transitional protection, they will find that the support they receive under universal credit is often significantly lower. For example, there is no enhanced disability premium, which is currently claimed by over 1.4 million people, and no severe disability premium, which is claimed by another 500,000 of the most severely disabled people who live alone. There is even a danger that many of the most vulnerable will fall out of the social security system altogether and be left without any income at all. According to the latest figures, almost 30% of universal credit claims started are never completed. Do the Government not care about what happens to these people?

The Government say that universal credit will lend to greater take-up, but not if people cannot make a claim in the first place. People with low literacy skills, a learning disability or no IT access are likely to find it difficult to cope with a complex online system. [Interruption.]

[Chris Philp (Croydon South) (Con)]

Will the hon. Lady give way to give her voice a rest?

[Margaret Greenwood]

This is a really serious matter and the hon. Gentleman would do well to focus on the issue at hand.

If we translate the percentage of claims that are closed before they are completed to the nearly 3 million people the Government want to transfer across, we can see that nearly 1 million people are at risk of falling out of the social security system altogether.

Food banks are reporting that they are running out of food. In August, Department for Work and Pensions officials carried out a study to identify areas where DWP operational practices contributed to a rise in demand for food bank services. I think that any Member of the House will know the answer to that.

--- Later in debate ---

[Ms McVey]

Let me get back to the independent reports, what is happening, and what is being made publicly available. We are learning from the evidence, building on that evidence, and making decisions so that we can improve the system as it goes further. [Hon. Members: “Give way!”] The power to choose who is going to get a question!

[Chris Philp]

Is not the real way to combat poverty to get people off benefits and into work, is not the evidence that people on universal credit are more likely to get back into work than people on the old benefits, and is not that the real test of this system’s success?

[Neil Coyle (Bermondsey and Old Southwark) (Lab)]

Will the Secretary of State give way?

--- Later in debate ---

[Neil Gray]

As ever, my hon. Friend is absolutely right. The Scottish Government have already spent £400 million mitigating the Tory mess on social security. We have used flexibilities on universal credit to make the system better, but we cannot be expected to fill the gaps forever; the change has to happen at source.

[Chris Philp]

Is the hon. Gentleman aware that total spending on benefits relating to disabled people stands at about £50 billion a year and that it has gone up considerably in real terms? Since 2010, spending in total has gone up, not down.

[Neil Gray]

The hon. Gentleman has completely ignored the points I mentioned that have been made by the CPAG and other expert groups. He has completely ignored that. Government Members are deaf to the facts.

There are of course some cheerleaders for the version of universal credit before us. There are those who say nothing needs to be changed, and those whose loyalty makes them blind to reality. They continually say it gets people into work, but the National Audit Office has explicitly said that this claim is absolute patent nonsense. Page 10 of its report states:

“The Department will never be able to measure whether Universal Credit actually leads to 200,000 more people in work, because it cannot isolate the effect of Universal Credit from other economic factors in increasing employment.”

I would love to hear the evidence that directly correlates universal credit alone as the factor in increasing employment.

--- Later in debate ---

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

I should not really be shocked. I have been an MP for long enough and I have heard the rhetoric from the Government for long enough not to be shocked. I have to say, however, that listening to the Secretary of State today, and the tenor of the interventions and comments we have heard from some Government Members, beggars belief. Their approach is utterly divorced from reality. This programme was supposed to be about so-called compassionate conservatism. If the Government really believed the rhetoric behind the programme when they set it up—that it was about making work pay and all those high ideals—they, and the Secretary of State in particular, would show some humility in their approach to the debate.

Clearly, the Secretary of State has made the political decision to front this out while our constituents are being forced to live in misery and face destitution. That is not compassionate, that is not humane and that is not moral. I urge the Secretary of State to reflect on the attitude she is displaying to the House, our constituents and the country in the way that she is approaching this debate, because it is not acceptable. It flies in the face of the rhetoric the Government themselves use. What they are doing today is unbelievable.

[Chris Philp]

Will the hon. Lady give way?

[Shabana Mahmood]

I will not.

It is not unusual for Government programmes to run into trouble. I am a member of the Public Accounts Committee and it is our bread-and-butter work every week to look at Government programmes that run into difficulties. A Government who cared about a programme —one that is not a vehicle for cuts and is not designed to force people to have less money than the system it is replacing—would actually engage properly and genuinely to learn lessons and make the programme better. Instead, the Government said that talk of cuts was somehow fake news. The Secretary of State then had to admit that people are going to be worse off. We have heard the figures of £200 a month and £2,400 a year being mooted. That is a staggering sum of money to lose every year for the working poor and the vulnerable in our community. We know that the self-employed will potentially be up to £2,500 a year worse off compared with those who are not self-employed under the new system. These are the realities that the Government cannot deny. That is not fake news; that is just the truth.

The Government and the DWP said to the National Audit Office—this was recorded in its most recent report—that the organisations at the coalface of helping our constituents to deal with the troubles they face because of universal credit, whether the Trussell Trust, other people who run food banks or local government, which is now facing much higher levels of rent arrears than previously, are motivated by a desire to lobby for changes rather than accurately reflect what is happening on the ground. That is a disgraceful attitude for the Department to take towards organisations that, yes, may well have a different vision for how they think the social security system should work, but are absolutely telling the truth about the destitution and difficulties our constituents are facing.

I invite the Secretary of State and any of her Ministers to come and spend a day in my constituency office and to see the explosion in our case load that has been created by the roll-out of universal credit. My staff spend most of their time every single day on the phone trying to sort out difficulties arising from universal credit. I shall highlight just two cases we have had recently, the first regarding delayed payments. The Government say they are taking action on that, but I have a constituent who has not received any money since 12 July. He has no money for food, fuel or anything. I invite the Secretary of State to intervene and tell me what I should tell him about where he should get some money to try to survive while his universal credit is being sorted out.

--- Later in debate ---

[Stephen Timms (East Ham) (Lab)]

The right hon. Member for Witham (Priti Patel) is absolutely right to say that change is urgently needed, and I hope that her Front-Bench colleagues will have heard that. Of all the many flaws in universal credit, the worst is the five-week delay between claiming and being entitled to benefit. Ministers can justify this—the Secretary of State had a go at doing so again yesterday—only in the case of people who have just left a monthly paid job and therefore have a month’s salary in the bank. The reality is that a very large number of people do not have a month’s salary in the bank when they make a claim for universal credit. Many are paid weekly or on zero-hours contracts; for all sorts of reasons, many are simply not in the position to have that much money in the bank. I spoke to a claimant on Merseyside at a time when the delay was even longer than it is now. She told me that the jobcentre had sent her away to live on water for six weeks. She reached the point at which she attempted to take her own life. Five weeks without support is not a realistic or acceptable feature of this benefit.

[Chris Philp]

I thank the right hon. Gentleman for raising that important case. Would his constituent not have been eligible to receive an advance payment, had she applied for one? They are now available at 100%.

[Stephen Timms]

She was not told about the availability of an advance payment. They are now being better publicised than when she made her claim, but the problem with advance payments is that people are being plunged into debt right at the start of their claim. For many, it is impossible to get out of debt once the system has forced them on to that slope. The result is that they have to go to food banks. We know that food bank demand rockets when universal credit comes in, because people get behind with their rent and other debts mount. I say to Conservative Members—many of them are fully aware of this—that this is not the way to treat our fellow citizens. Universal credit must be changed to stop this happening.

--- Later in debate ---

[Chris Philp (Croydon South) (Con)]

My right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) is one of the most decent and compassionate men I have ever met, and the slurs we have just heard on his motivation are completely unacceptable and have no place in a calm and civilised debate. Some Labour Members, such as the right hon. Member for East Ham (Stephen Timms), have set an extremely fine example as to how these matters can be debated in a calm and proper way—I always listen carefully to what he has to say, because his speeches are always thoughtful and well delivered.

Let us remind ourselves of why universal credit was introduced in the first place. The previous system was broken and was not fit for purpose because there were in effect marginal taxation rates of over 90% in many cases, and there were cliff edges—at 16 hours of work, for example—that meant that people who worked more hours were worse off. People came to us, their Members of Parliament, and said, “We are not going to work any more hours, because there will be less money in our pocket afterwards.” That is clearly a completely unacceptable situation, which is why this reform, in principle, is so necessary.

We have heard today about individual errors in the system, which are obviously very regrettable and Ministers will want to correct them, but let us not forget that almost 6 million people are in receipt of these benefits—either the old ones or the new ones—and, when we are handing out 6 million payments a month, there are bound to be occasional individual errors. Let us not confuse those very regrettable individual errors with a more systemic issue.

Some systemic issues were identified during the roll-out of universal credit, and steps have been taken in the past six or nine months to address some of those issues.

[Michael Tomlinson]

My hon. Friend has mentioned two categories: systemic problems and individual problems. Surely people with individual problems should go to the Department or to their local Jobcentre Plus and say, “Please address this. Something has gone wrong.” In the case of systemic problems, we should adopt the Government’s approach of testing and learning to adapt and change the system.

[Chris Philp]

My hon. Friend is absolutely right, as always. Where there have been systemic issues, measures have been taken to address them. One example is that housing benefit now gets paid for another two weeks after the change to address some of the issues with rent arrears that Members have properly raised. Secondly, claimants can now get a 100% advance, which addresses the point raised by the right hon. Member for East Ham. The seven-day wait has also been eliminated.

The Minister will also want to think about fine-tuning the period when calculating eligibility. A person who receives their last salary payment, particularly if it is quite a large salary payment, towards the end of their last month in employment may not be eligible to receive a universal credit payment in the following month because their final salary payment counts towards the calculation. I have such a constituency case, and the dates need to be fine-tuned and studied a little more carefully. I would be happy to sit down with the Minister to go through the particulars of the case, which is quite technical and complicated, if it would assist him in his work.

Croydon South has the joint highest proportion of claimants who have been moved across to universal credit, at 43%. Only two or three other constituencies in the country have such a high rate, so we have quite a good base of evidence in my constituency. The SNP Front Bencher said that we should take with a pinch of salt what Conservative Members say—

[Neil Gray]

A lorry load of salt.

[Chris Philp]

He said we should take with a lorry load of salt what Conservative Members say about how UC operates in their constituencies. That was of course a slur on the integrity of Conservative Members, but I contacted my caseworker during this debate to ascertain the facts. In Croydon, about 4,000 people are currently in receipt of UC, because 43% have migrated; that is my estimate and so it may not be exactly right, but the figure is probably somewhere in the region of 4,000. In the past six months there have been 21 cases where someone has contacted me as their constituency MP, some of which were to do with eligibility questions, such as where the person lives. I would say that 21 individual cases out of about 4,000 is not an excessive number of queries, but when they are raised I know that Ministers will look to deal with them.

Opposition Members have suggested that this is about cuts, but I respectfully remind them again that benefits paid to people who are disabled have gone up to £54 billion in total—that is a substantial real-terms increase. This is not about cuts, as more money is going into disability benefits now than at any time in history. I shall conclude by saying that a measure of compassion, and of Government success in policy and welfare, is not how much money we spend on aggregate, but how many people we get out of poverty and into prosperity, and that is done through work.

[Several hon. Members rose—]