Women’s State Pension Age

Chris Stephens Excerpts
Monday 25th March 2024

(3 days, 9 hours ago)

Commons Chamber
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Mel Stride Portrait Mel Stride
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We are considering the findings, which need to be considered in their entirety in order to come to a view.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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I pay tribute to the WASPI campaigners in Glasgow whom I met on International Women’s Day at the Mary Barbour statue, including the great Kathy McDonald, a fantastic constituent. Surely, the Secretary of State accepts that it is unacceptable in 2024 that women continue to experience inequality in lifetime savings. Women would need to work an additional 19 years to have the same pension savings as men. Inequalities in lifetime savings, a gender pension gap and maladministration of state pension age changes: this is a triple whammy for 1950s-born women. When will they get justice and equal treatment?

Mel Stride Portrait Mel Stride
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The hon. Gentleman concludes by asking the same question that has been asked many times. There will be no undue delay. We will look at the issues, including some of the points that he has raised, in the round, looking at the entirety of the report and all its points and conclusions. He will know that we have taken many steps to help to increase the pension amounts received by the women involved, including the auto-enrolment reforms that we have brought forward. In the private pension space, the reforms have shown a dramatic improvement in the level of pension provision for women up and down the country.

State Pension Changes: Women

Chris Stephens Excerpts
Tuesday 12th March 2024

(2 weeks, 2 days ago)

Westminster Hall
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Jim Shannon Portrait Jim Shannon
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I thank the hon. Lady for that intervention. Everybody’s interventions so far have added to the debate and reinforced the issue.

Back when ladies started to work, there were no remunerated childcare schemes and it was not standard practice for ladies to be offered access to work pension schemes.

With all due respect to the Minister, the DWP has fallen down on this matter. The Department admitted in 2009 that direct communication with those affected by increases in the state pension age was limited. In 1995, leaflets explaining the changes were available from the Benefits Agency, but only on request. In other words, if someone wanted to know anything—if they even knew to ask—that is what they should have asked for. The fact is that the DWP has a responsibility.

Some 16 million voluntary letters were issued in the form of automatic pension forecasts projecting state pension entitlements, including to women aged over 50 at the time. Those letters did not include any details of state pension age or mention that it was changing, so those women were not fully notified. That is what this debate is about. When we look back specifically to the years between 1995 and 2000, we are reminded that we lived in a relatively pre-internet world, where information was not so readily available at the click of a button and social media did not exist. In the late 1990s, we had only five TV channels, and 24-hour broadcasting was still a thing of the future.

The DWP survey of 2004 asked working-age adults about awareness of state pension age equalisation. The results showed that, of those who were aware, 47% got their information from TV advertising, 37% were informed by reading a newspaper and only 2%—only 2%—cited the Pension Service as their source of information. The Pension Service had the responsibility, and it failed badly. Some 98% of those who qualified did not even know from the state Pension Service what should have been happening. That is a massive issue, and it has to be addressed. Furthermore, despite the efforts made through television and newspaper advertising, access to what we see now as the most basic avenues of communication was limited for women who were not securely housed or in unstable domestic environments.

WASPI women deserve to be compensated for the injustice they have had to face, and that compensation should be based on the principles of recognition, restitution and reconciliation. We could call them the three Rs—it is almost like going back to school—but here they apply to the WASPI women and pensions.

The first principle of compensation is recognition, and quite clearly there is a lot to do. The Government should acknowledge the harm and suffering caused by the changes to the state pension age, the inadequate communication of those changes and the failure to consult the women concerned for the reasons I have outlined. Recognition is important for restoring the dignity and trust of these women and for validating their experiences and grievances. It is also a precondition of achieving justice and reconciliation, as it shows that the Government are willing to take responsibility and to make amends for their actions. That is what this is about.

To date, there has been resistance to offering a formal apology to the WASPI women, and the Government have argued that the actions that were taken were lawful and reasonable. Let us be quite clear: they were not. That stance has been challenged by the PHSO, which found in 2021 that the Department for Work and Pensions had committed maladministration, as the hon. Member for Denton and Reddish (Andrew Gwynne) referred to in an intervention.

The PHSO also found that, by failing to act quickly enough to inform the women about the changes to their state pension age, the DWP had not given due regard to the impact of the changes on the women’s lives and offered them no adequate support or guidance. The PHSO recommended that the Government should apologise to the women and pay them compensation for the distress and inconvenience caused by the DWP’s maladministration —I use that word because it is the right word; it describes exactly what happened.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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I thank the hon. Gentleman for the speech he has made so far. People have been waiting three years since the report he has just outlined. Does he agree that justice delayed is justice denied and that the Government should, as the hon. Member for North Antrim (Ian Paisley) said, compensate them now and use this Budget to deliver that compensation?

Jim Shannon Portrait Jim Shannon
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I thank the hon. Member for that, and he is right: there is a real onus on Government to reach out and help.

The PHSO also found that the DWP had not given due regard to the impact of the changes on women’s lives and had not offered women adequate support or guidance. It recommended that the Government should apologise to the women and pay them compensation for all those things, including the maladministration. The Government should take positive steps following the PHSO’s findings and recommendations and issue that sincere and public apology to the WASPI women. That would be a significant gesture of respect and remorse and a first step towards repairing the relationship between Government and the women we all represent.

The second principle of compensation is restitution. The Government should restore the affected women to the position they would have been in had the changes to the state pension not occurred, or at least mitigate the negative effects of the changes. Restitution is important for compensating the women for the material and non-material losses they have incurred and for ensuring that they can enjoy a decent and dignified retirement. Wow! How much do we all want to see a decent and dignified retirement? Restitution is also a way to correct the imbalance and inequality caused by the changes and to ensure that the women are not penalised for their sex and their age.

The WASPI women will have different views and demands in terms of what constitutes fair and adequate restitution. Some want a bridging pension or a lump sum payment to cover the gap between their expected and actual state pension age. There really has to be something, and we need to see that coming forward. The restitution that each woman should receive may also depend on their individual circumstances, such as their income, health and caring responsibilities.

--- Later in debate ---
Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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First, I want to say how much of a pleasure it was on Friday to join the WASPI Glasgow women at the Mary Barbour statue, to mark International Women’s Day. The clear message from those women is that they are not going away and nor is this issue.

I want to make three quick points. The first, which other Members have touched on, is about the historical injustices that women born in the 1950s have suffered throughout their lives, whether it is not receiving equal pay—far too many of these women are still fighting for equal pay and looking for compensation for unequal pay in the workplace—or the fact that while going about their lives they could not, for example, hire goods or services, or even get a cheque book, without the express permission of their father or husband, because society at that time decreed that it was a man who was the responsible person. What a quaint and fanciful notion that is! We have to recognise the injustices these women have suffered throughout their lives, and certainly the fact that they were not told that their pension age was changing and that many of them would have to work for an additional five years.

Secondly, it is almost certain that the ombudsman will send this issue back to Parliament to say that Parliament must now decide how to resolve the issue and how to compensate. That much is certain. The Government could have grasped the nettle. They could have recognised that this was coming and that it was time to address this issue, along with the issues of compensation for the infected blood and Post Office cases. They could have done all those things.

That brings me to my third point, which is that justice delayed is justice denied. The longer the Government wait and do not address this issue, the more the price tag will go up. That is an inevitability. We had the announcement of a Budget last week that has £46 billion of unfunded tax cuts, which is £46 billion that could have addressed all three of the issues I have mentioned. When he is on his feet, I hope the Minister will tell us how this Government should resolve this matter, because it should be up to this Parliament to decide it, instead of trying to dump it on the next Parliament.

Gary Streeter Portrait Sir Gary Streeter (in the Chair)
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Thank you, colleagues, for your co-operation; we are now bang on time as we turn to the Front-Bench spokesmen. I call the SNP spokesperson.

Social Security

Chris Stephens Excerpts
Wednesday 31st January 2024

(1 month, 3 weeks ago)

Commons Chamber
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David Linden Portrait David Linden (Glasgow East) (SNP)
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It is a pleasure to follow the hon. Member for Amber Valley (Nigel Mills), a fellow member of the Work and Pensions Committee.

I stand here with a somewhat renewed sense of frustration following the release of the Joseph Rowntree Foundation’s “UK Poverty 2024” report, which I will refer to throughout the course of my contribution. I find myself again speaking in this Parliament against a backdrop of a truly dire situation characterised by destitution. I wonder what more can be said or done to make the British Government realise the true extent of the hardship they have inflicted on people across these islands. The SNP will not oppose the orders for 2024-25, but to keep it plain and simple: the damage has already been done. No amount of uprating will address the long-term consequences of entrenched destitution inflicted on households as a result of the British Government, who, I would argue, have been asleep at the wheel now for 14 years.

Although the Government’s announcement to uprate social security benefits means that shortfalls should not increase any further this year, the orders still fail to undo any of the cumulative impact of years of cuts to social security that households across these islands have endured. While the British Government have been asleep at the wheel, people across the country have been kept awake at night due to the sheer amount of stress and anxiety, wondering how they will feed themselves and their families, and how they can afford—they often cannot afford them—the essentials. We are faced with an horrendous picture, but that is the stark reality of living with this Westminster Government. Young children, school children, pensioners, young adults, those in and out of work—no one is left unscathed when they have the misfortune of interacting with the UK’s social security system.

As the Minister comes back to the Dispatch Box, I am sure full of civil service-inspired lines that do not meet the reality outside Whitehall, we are faced with a cold hard truth from which we cannot escape: people are suffering, and will only continue to suffer as long as this Government refuse to fix the known policy issues, on which I am sure my hon. Friend the Member for Glasgow South West (Chris Stephens) will elaborate.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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We are debating what is supposed to be an adequate payment for social security. The Government’s case is completely weakened, is it not, by the ridiculous system of loans and reductions? My hon. Friend’s constituents in Glasgow East and mine in Glasgow South West are, on average, having their universal credit payments deducted by £60 a month because of this ridiculous system.

David Linden Portrait David Linden
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I pay tribute to my hon. Friend, who is an assiduous questioner of the Government through Work and Pensions questions on the issue of debt and deductions. He is right to cite the figures in Glasgow, which are well known—local citizens advice bureaux all over our constituencies refer to them—but of course, we are not the only Members whose constituents are impacted by the debt and deductions policy of this Government, which is often found wanting. If the Minister could touch on debt and deductions when he sums up, that would be helpful.

In a Westminster Hall debate I held three weeks ago on the cost of living crisis, I compared the UK’s social security system, which used to be hailed as a safety net for those who needed it, to something that now resembles nothing more than a frayed rope, unable to bear the weight of the individuals who rely on it as a lifeline. After reading the new report and statistics produced by the Joseph Rowntree Foundation, I have never been more assured in my assessment of the state of the social security policies enforced by this Westminster Government.

The JRF report outlines that more than one in five people in the UK were in poverty in 2021-22. That is 14.4 million people, 4.2 million of whom were children and 2.1 million were pensioners. Just as the statistics from Save the Children and Age Scotland show—I will outline them shortly—the JRF report has to be a wake-up call for this Government, and indeed the Government who may follow, if we are to make any tangible change to the broken system that lies before us. In its report, the graph that illustrates the percentage of people in poverty is broken down into the following categories: in poverty, but not in deep poverty; in deep poverty, but not in very deep poverty; and, in very deep poverty. I must be honest: I find it completely surreal that we have reached a point at which statistical analysis has to be broken down into such categories to illustrate the situation that people are having to endure. It is utterly shameful that such categories even have to exist in one of the richest countries on the planet.

I understand that to Members who are present today I seem frustrated, but that is because I am. The statistics in this report are not just numbers; they are the very reality of people in the communities that I represent, such as Parkhead and Shettleston, and those, such as Mosspark or Cardonald, that are represented by my hon. Friend the Member for Glasgow South West. They are truly harrowing findings.

I want to say something about universal credit, which was also raised by the hon. Member for Wirral South (Alison McGovern). This policy is failing the very people whom it is, in theory, supposed to support: rather than supporting them, it drives destitution and food bank usage. It has been reported that 68% of people referred to a Trussell Trust food bank in Scotland who are in receipt of universal credit have money automatically deducted from their payments to repay debts, such as a DWP advance—a point made by my hon. Friend the Member for Glasgow South West. Moreover, food banks in the Trussell Trust network distributed about 3 million emergency food parcels across the UK in 2022-23, more than 1 million of which were for children.

The Government also refuse to scrap abhorrent policies such as the two-child cap and the associated rape clause. The DWP’s own figures show that in April last year, 1.5 million children were affected by the two-child limit—and I say that in the context of those 1 million children who were in receipt of food parcels. This is in addition to data from Save the Children, which found that 60% of households affected by the two-child cap included at least one adult in paid employment. No doubt the Minister will stand up and say that the two-child cap is about making sure that people get into work, but the fact is that it has an impact on people who are already in work. Punitive sanctions, deductions, the two-child limit and the five-week wait are all defining characteristics that are inherent in this British Government's social security system—policies that have caused, and continue to cause, hardship to so many.

Although I could stand here and generate endless amounts of research and statistics for the Minister, my plea is simple. Social security does not have to be done this way: we do not have to continue down this road of sanctions, deductions, rape clauses and five-week waits. It is an undeniable fact that the Scottish Government cannot make any tangible change to these policies while 85% of welfare expenditure and income-related benefits remains reserved to the Government here in Westminster. For every step forward that the Scottish Government try to make, Westminster drags us back two.

The Scottish Government desperately need the opportunity to create a system, one designed to tackle poverty actively and empower those who interact with the system, without one hand being tied behind their back. When we have had the power to do so, we have introduced game-changing policies, such as the Scottish child payment. Analysis shows that the Scottish child payment could lift up to 50,000 children out of relative poverty in 2023-24, which is because the Scottish Government choose to prioritise that. Child poverty rates in Scotland sit at 24%, which is still far too high, but they should be seen in the context of the 31% rate in England and the 28% rate in Wales. That is likely to be due, at least in part, to the Scottish child payment.

Fundamentally, it is a political choice to lift children out of poverty. If this Westminster Government are unwilling to make that choice, I simply ask them to hand over the reins of power to the Scottish Government, who are more than willing, and certainly ready, to implement a system that will allow people to thrive rather than being punished for their circumstances. Until that happens, the Scottish Government are left fighting an uphill battle against a Westminster social security system that is broken beyond repair. Again, I am left wondering how different things might be if Scotland were able to take all the legislative and fiscal responsibility for these issues through the normal powers of independence.

Whether it is the British Government’s cruel sanctions regime or their refusal to fix known policy failures that only push people further into hardship, we are seeing what will sadly be one of the defining legacies of this Tory Government. As a result, poverty no longer just exists within our society. It is deepening, it is ingrained, and it is causing insurmountable pain to people right across these islands. As we are faced with the reality of more food parcels than ever being delivered through the Trussell Trust networks and shockingly high levels of child poverty, the only conclusion I can draw is that these are all signs of a Government, and indeed a Union, that the people in Scotland must escape if they are to have any hope of a fair and prosperous future.

Pensions

Chris Stephens Excerpts
Wednesday 31st January 2024

(1 month, 3 weeks ago)

Commons Chamber
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David Linden Portrait David Linden (Glasgow East) (SNP)
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When the Minister was making reference to a Netflix series earlier, I did think that the pensions uprating debate would be an unusual backdrop for Netflix and chill. I do not know whether that is the first time “Netflix and chill” has been referred to in Hansard—I am at risk of getting myself into trouble now, so I will move on quickly.

As with the previous order, my party will not oppose this order. In the previous debate I focused my remarks on poverty more broadly. Now I want to speak about the number of pensioners in poverty, which rose between 2020-21 and 2021-22, with pensioners on low incomes among some of the hardest hit by the cost of living crisis. The Joseph Rowntree Foundation’s report, which I cited earlier, revealed that 2.1 million pensioners were living in poverty in the UK in 2021-22, with the poverty rate for single pensioners almost double that of couple pensioners and about one in six pensioners overall living in poverty. I know this is felt acutely in communities such as Carmyle and Sandyhills in Glasgow’s east end.

The reality, according to Age Scotland, is that 9% of over-50s are skipping meals due to financial pressure, and 65% of people aged between 60 and 64 are having to dip into savings to meet unexpected rising costs. I met the Trussell Trust just this morning, and it is certainly seeing a larger number of pensioners using its service than before. This is of course the case for many WASPI women, given that the ombudsman found that there was indeed maladministration in the communication from the Department for Work and Pensions, with the cost of living crisis certainly making matters much worse for women born in the 1950s.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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I am grateful to my hon. Friend for mentioning 1950s-born women such as my constituent Kathy McDonald. Does he not agree that there could have been plenty of time today for us to discuss the plight of those 1950s-born women, and to see what justice and compensation we should be delivering for them?

David Linden Portrait David Linden
- Hansard - - - Excerpts

My hon. Friend is right. I know Kathy McDonald, one of the 1950s women, who is a force of nature and does an incredible service for women born in the 1950s. It is frustrating that we can have these debates about 1950s women, but I am clear that what 1950s women want is not necessarily words from this place, but action from this place. I think that challenge will be put to the two main parties at Westminster as we come towards the election, and I encourage all those 1950s women to press their candidates on the need for fair and fast compensation, as well as for wider action to tackle the unacceptable gender pension gap that is so pervasive.

As Age UK highlights, the state pension is the largest single source of income for most pensioners, so retaining the triple lock is the very bare minimum. I was glad to hear the comments in the previous debate from the hon. Member for Amber Valley (Nigel Mills) on that. The British Government must urgently address the shockingly low state pension levels, as they are already providing a lower state pension than, frankly, most other advanced economies relative to average earnings.

As with the issues we face with the social security system, the only way I can see our bring truly able to protect pensioners and treat older people with the basic dignity and respect they deserve is through the powers of a normal independent nation, where we can both improve state and occupational pensions, and set the state pension at an appropriate level within a Scottish context. That is the most crucial point I want to finish on, because constituents in communities I represent, such as Sandyhills and Carmyle, know one thing: for as long as Scotland remains within this Union, the state pension age will continue to climb and the state pension itself will remain pitifully low, leading to more pensioners being placed in the invidious position of choosing between heating or eating. That says everything people need to know about this Westminster Government, who the people of Scotland did not vote for.

Oral Answers to Questions

Chris Stephens Excerpts
Monday 13th November 2023

(4 months, 2 weeks ago)

Commons Chamber
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Mims Davies Portrait Mims Davies
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I think that is a reminder to continually speak up for opportunities for our young people. The current youth employment rate is 53.9%, up three percentage points since 2010. It has been my absolute mission in this Parliament, over the last four and a half years, to focus on young people, with around 140 new youth hubs to support the complex needs of young people. I humbly suggest that the hon. Member goes and looks at the changes that are happening, to see the difference being made in communities up and down the land. We are not writing young people off; we are making sure that we support them. I went to see a new youth hub only last week, and the work being done on housing and with partners is innovative. It means young people with smiles on their faces and their futures in their hands.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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12. What recent assessment he has made of the adequacy of benefit levels in the context of rises in the cost of living.

Guy Opperman Portrait The Minister for Employment (Guy Opperman)
- Hansard - - - Excerpts

The Government have never spent more on welfare and benefit support than we presently do. From April 2023, we uprated benefits by 10.1% and increased the benefit cap levels by the same amount. That is on top of the cost of living support that has been made to multiple households and individuals to address the rising cost of bills.

Chris Stephens Portrait Chris Stephens
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I thank the Minister for that answer, but he will be aware that the Trussell Trust has warned that food banks are at “breaking point”, as more and more people across the UK are unable to afford the essentials, with new figures showing that 1.5 million emergency food parcels were distributed through the charity’s network between April and September this year. Will the Minister therefore back its joint campaign with the Joseph Rowntree Foundation calling for an essentials guarantee within universal credit, to ensure that the basic rate at least covers life’s essentials and that support can never fall below that level?

Guy Opperman Portrait Guy Opperman
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The hon. Member will be aware that there has been £94 billion of cost of living support over and above the 10.1% increase in benefit rates. That support is over 2022-23 and 2023-24. For example, the winter fuel payment will be paid to the tune of £600 or £500 over the next few weeks.

Universal Credit Deductions

Chris Stephens Excerpts
Wednesday 19th July 2023

(8 months, 1 week ago)

Westminster Hall
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.

Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.

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Maria Miller Portrait Dame Maria Miller (in the Chair)
- Hansard - - - Excerpts

It is a little warm in here today, so if Members want to remove their jackets, that is perfectly allowable.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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I beg to move,

That this House has considered the matter of Universal Credit deductions.

It is a pleasure to see you in the Chair, Dame Maria. This is a matter of considerable interest and concern to me, as it will be to many other Members, each of whom will have busy caseloads from worried or despairing constituents, many of them describing how the universal credit system has worked for them or, more to the point, has abjectly failed to work for them.

In March last year and earlier this month, I questioned the Secretary of State on how many universal credit claims were having deductions taken from them in the most recent month for which data was available in each parliamentary constituency, what was the average size of sums deducted in each constituency, what was the total sum deducted from claims in each constituency, and what proportion of each sum was deducted to repay advance payments. The figures in the Scottish context were quite revealing to me. For example, I learned that in one month alone in 2021, 180,000 households in Scotland had an average of £60 deducted from their social security payments, and that between December 2022 and February 2023, the UK Government deducted £12.1 million a month from 206,000 Scottish households. The number of households affected by deductions and the sums being recouped seem to be increasing.

Those figures were disturbing but maybe not surprising. After all, last year the Work and Pensions Committee, of which I was then a member, published a report on the cost of living, which called on the Department for Work and Pensions to pause the deductions and restore them gradually only as the rate of inflation reduced, or when benefits had been increased to accurately reflect the rise in prices. The Government rejected the report’s recommendations, stating that pausing deductions is not

“necessarily in the claimant’s best interest.”

But claimants know that since then, inflation has remained very high, and the rise in the price of basic foodstuffs for the poorer has been ferocious. It is time to take a broader look at the problems with universal credit deductions. That is why I secured this debate.

Margaret Ferrier Portrait Margaret Ferrier (Rutherglen and Hamilton West) (Ind)
- Hansard - - - Excerpts

I cannot tell my hon. Friend how many times a constituent has contacted me to tell me that, as a result of the universal credit calculation and payment cycle and the fact that their employment paydays are not exactly a month apart, they are trapped in an endless cycle of recalculation and financial hardship. Does he agree that it is clear the current assessment cycle is not fit for purpose?

Chris Stephens Portrait Chris Stephens
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I do agree, and I point my hon. Friend to the written answer I secured, which gives the statistics for every constituency in England, Wales and Scotland. She will see that the rate of deductions is around £60 in her constituency, but she will also notice that the number of households affected by deductions is increasing. She makes an important point about looking at an individual’s pay cycle and whether it is four-weekly or monthly.

Let us look at some examples of people affected by deductions. The Trussell Trust tells us that almost half of people referred to food banks in its network are subject to deductions from their benefit payments due to repayment of a benefit advance or a benefit overpayment. We will see that linkage repeatedly during the debate. The Trussell Trust goes on to remind us that

“The five-week wait for Universal Credit means many people have no choice but to take an Advance Payment to manage essential bills like rent and utilities”,

which immediately places them in debt and reduces their income below the standard allowance.

Deductions for overpayments, including tax credit overpayments, often take people by surprise because they are historical or are the result of DWP error. Like other deductions, they can be taken from people automatically at unaffordable rates. The standard allowance of universal credit does not provide enough income to cover the cost of life’s essentials, so any deduction taking people below that already low level will push them further into hardship. Key phrases are advance payments, overpayments that are historical or due to Department for Work and Pensions error, and the cost of living essentials. I will come back to each of those.

We then hear from the Trussell Trust about consequent mental health wellbeing, which is often impaired by people struggling to understand what they owe, and why, and how to access support. The Trussell Trust is not alone in making those observations. The organisation Feeding Britain has

“a vision of a UK where no one goes hungry”.

I should also mention Good Food Scotland, with which I do a lot of work in Glasgow South West.

Jim Shannon Portrait Jim Shannon (Strangford) (DUP)
- Hansard - - - Excerpts

I commend the hon. Gentleman for bringing this matter forward, and I will be making my own contribution to the debate. The Trussell Trust in Newtownards in my constituency was the first in Northern Ireland, and what it has to say about vision reinforces what the hon. Gentleman has said. According to Newtownards Trussell Trust,

“our vision is for a world where food banks, like ours, don’t need to exist.”

That is what we want to see, and I know the hon. Gentleman wants the same.

Chris Stephens Portrait Chris Stephens
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I thank the hon. Gentleman very much for that intervention. As he knows, he has relatives of mine among his constituents in Newtownards. He is absolutely correct about our vision: we all want to see a world in which food banks do not exist. I know he is very supportive of my Food Poverty Strategy Bill, which is a private Member’s Bill that I recommend to all hon. Members.

Feeding Britain has talked to many people who are having to go hungry. In the days leading up to the debate, food banks in Brighton, Derbyshire, Leeds and High Wycombe reported speaking to individuals who all cited deductions as a key reason for referrals to them, and described some harrowing cases. For example, a client in Chichester has some £55 a week to live on after deduction of rent and other deductions for advances and loans from universal credit. The client received no prior warning or notice of the deduction, and even her work coach was unable to explain why the deduction had been made. That client is a lone parent with three children. She is worried that even if the deduction is found to be a mistake, she will be waiting until the next payment to receive the money that was deducted.

Feeding Britain has also told us of a client in Manchester who had £72 deducted for rent arrears. The first he was made aware of that was three days before payment when he accessed his payment statement. Living off the standard universal credit allowance is difficult as it is, but so much being deducted with so little notice makes it almost impossible. The gov.uk website states that universal credit will place a note on the journal when a third-party debt deduction is about to start, but no such information about the debts—how much was owed or how long the client would be paying off the debt—was provided in that example; there was not even a note telling them how further information could be obtained by telephone. The closing comment from the Manchester office was that

“the most efficient aspect of Universal Credit is debt retrieval”.

In the report “UK Poverty 2023: The essential guide to understanding poverty in the UK”, the Joseph Rowntree Foundation highlights that key design features of the social security system, including having to wait five weeks for the first universal credit payment and universal credit being deducted to pay off debts and arrears, directly lead to higher food insecurity and have contributed to the rise in food banks.

The Child Poverty Action Group has shown that across the UK the number of children living in households with debt deductions being taken from their universal credit has risen to more than 2.2 million, making up more than half—53%—of all children in households receiving universal credit. Those families are missing out on an average of £73 a month as a result. Every commentator seems to express similar views on where the system is failing, and there is much commonality on where they think the appropriate solutions lie.

Margaret Ferrier Portrait Margaret Ferrier
- Hansard - - - Excerpts

The use of a predominantly online system has led to many cases being raised with my office. In particular, vulnerable constituents without consistent internet access or phone credit may be unaware that they have been sanctioned until the payment is made because they are not able to access their journal. Have the hon. Member’s constituents experienced that? Does he agree that DWP’s communication needs to be improved?

Chris Stephens Portrait Chris Stephens
- Hansard - -

Yes, I do agree. My hon. Friend is right again about the lack of information in journals. The example I gave of the individual in Manchester is typical of what happens to universal credit claimants who get caught up with deductions and other aspects of the social security system that I want to see resolved. The Government have recognised some of the problems and have reduced the rate of deductions by lowering the cap and extending repayment periods, but that is not enough; significant reductions to already low incomes remain, and there is no affordability assessment to ensure that people can afford the payments.

What action can we take? Research from the Joseph Rowntree Foundation shows that support has eroded over decades, and that universal credit standard allowance is now at its lowest ever level as a proportion of average earnings. Together with the Trussell Trust, it is calling on the Government to implement an essentials guarantee to ensure that the basic rate of universal credit at least covers life’s essentials and that the support can never be pulled below that level.

Rather than offering one-off payments to shore up the incomes of struggling families, the UK Government should reverse the damaging policies impacting on our most vulnerable, including by reinstating the universal credit uplift of £25 a week, removing the benefit cap and the two-child limit, and halting punitive sanctions regime, which the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) outlined. In addition, the Scottish National party recommends that the Government immediately introduce an amnesty on deductions resulting from the Department of Work and Pensions’ own errors. Advance payment loans should be turned into non-repayable grants after a claimant has been deemed eligible, as the Work and Pensions Committee recommended in our report. Too often, we hear that advances are not loans, but if someone is paid money and is expected to pay it back, that is indeed a loan, not an advance.

We are also arguing for the cap on the monthly rate of deduction to be lowered, and for the widespread use of sanctions to be stopped, as there is clear evidence that they do not work. A London School of Economics study found that the impoverishment of larger low-income households has helped few parents to get a job, and is instead pushing families further into poverty and damaging their health.

I said at the start that I will intersperse my contribution with comments, examples and solutions from Scotland, so here are some. Social Security Scotland can take deductions from some benefits—the adult disability payment, the child disability payment and the Scottish child payment—to pay back an overpayment, but when overpayments occur, it engages with clients to discuss their circumstances and agree a payment plan that takes them into account. Its debt management strategy states:

“Where the repayment method is voluntary deductions from benefits, we will mutually agree a value with client as part of Affordability Assessment. Where enforced deductions are applied due to client not engaging with us to agree a payment plan, a maximum deduction of 10% of Scottish Benefit Entitlement will be applied unless the overpayment is due to Fraud, in which case a maximum of 15% will be applied.”

That social security philosophy and those actions work.

The Scottish National party believes that social security is an investment in the people of Scotland and a key part of the Scottish Government’s national mission to tackle child poverty. It continues to do everything it can with the limited powers and fixed budgets it receives from this place. That includes investing £5.2 billion in benefits expenditure in 2023-24, supporting more than 1 million people. I have stated clearly that we need to tackle child poverty. The Scottish Government’s tackling child poverty delivery plan estimates that 90,000 fewer children will live in relative and absolute poverty this year, as a result of the policies of the Scottish Government. However, the Scottish Government should not have to pick up the broken pieces left by this place, or keep using their limited powers and fixed projects to mitigate damaging Conservative party policies.

With every day that this Government fail to fix the known problems of universal credit and the social security system, and fail to use their reserve powers to tackle the rising cost of living adequately, they demonstrate that independence is the only way for Scotland to boost incomes and build a fairer society. The rest of the United Kingdom needs to fix its broken social security system; Scotland is already determined to do so.

Maria Miller Portrait Dame Maria Miller (in the Chair)
- Hansard - - - Excerpts

I remind Members that they need to be here for the full debate if they are going to take part. I was also going to ask Members to bob if they want to take part; I thank Members for doing that. I call Jim Shannon.

Jim Shannon Portrait Jim Shannon (Strangford) (DUP)
- Hansard - - - Excerpts

My goodness! Thank you, Dame Maria. That threw me off. It is a pleasure to serve under your chairship for the second day running. It has come to the point when you and I are in Westminster Hall almost as much as each other. Well, maybe that is an exaggeration. It is also a pleasure to follow the hon. Member for Glasgow South West (Chris Stephens), who rightly brought forward this topic. We met on the Terrace this morning and he said, “Jim, will you come and do your bit?” and I said, “Does the Pope have red socks? Absolutely, I will be there. There is no doubt about it.” I am here to endorse what he said. A person from the food bank wrote me a letter, and I will quote the best part of it. He illustrates very well what happens, and why it is important.

I can well remember the fear at the outset of universal credit—the fear that people would be worse off, and that families would struggle. Boy, do they struggle. I am sorry to say that, but they do, because I witness it every day. I witnessed it on Friday in my office, with a person who had the same problem with universal credit. We were able to sort it, by the way. I find it incredibly hard to understand how universal credit works, and I am far from stupid. Once through the technical details and the machinations of the whole thing, one has to ask, “How on earth does anybody follow this?”.

For some, this fear has become a real struggle, and the deductions from an already sub-par universal credit is enough to push some families over the edge. I have seen that in my constituency office. My staff have a continuously good relationship with the social security offices round the corner. I have to put on record that they are brilliant. The number of problems that they have sorted out when my staff speak to them illustrates that they have grasped how the system works and how to get through it, but the ordinary person cannot do that. I have struggled to understand it as well.

It should be remembered that those who are unemployed or unable to work have a set rate that remains pretty stable. However, self-employed people have different work weeks, and the flexibility that universal credit was supposed to offer has resulted in deductions from overpayments. The hon. Member for Glasgow South West mentioned that, and I endorse it. The deductions are so hard to work out that families are left not even understanding how they owe money. It is incomprehensible.

The Minister understands. I am no different from anybody else here. Whenever we approach the Minister and explain the issues, he always tries to respond in a positive fashion. I appreciate that, and want to put that on record, because it is good to have a Minister who really wants to do things and help out. We are all working in our constituencies, advocating for our constituents, and we know well the issues that the hon. Member for Glasgow South West outlined.

I was contacted last week by the phenomenal manager of the local food bank, a man with the largest heart for helping families and vulnerable individuals. I want to read out his comments, as time permits. My speech is his letter to me, because it illustrates the issue really well. The hon. Member for Glasgow South West has friends and relatives in Newtownards. I know them—and think they vote DUP, by the way, so maybe they are not nationalists.

Chris Stephens Portrait Chris Stephens
- Hansard - -

Not a chance.

Jim Shannon Portrait Jim Shannon
- Hansard - - - Excerpts

I think they do; he does not know them as well as I do. The letter states:

“As a food bank operating in Newtownards, we are writing to you to raise our concerns about rising numbers of people in our community who are needing to turn to food banks, like ours, because they cannot afford the essentials we all need to survive.”

These are his words: “This is not right”. I say amen to that.

“In the last financial year we saw a 30% increase in clients coming to the Newtownards Foodbank compared to the previous year. We are aware that our summer has started really busily with an average of 24 different families attending each week since June in what is normally our quieter spell.

Many attendees are struggling with the inability to feed there families and provide fuel for their house needs. A significant proportion are actually working but their outgoings outstrip their income. Those on benefits clearly don’t get enough to match their basic needs.

While the cost of living crisis and the pandemic have placed additional pressures on incomes, this year’s rise is part of a longer-term trend in levels of need. Support has eroded over decades and the basic rate (‘standard allowance’) of universal credit is now at its lowest ever level as a proportion of average earnings. Alarmingly, the number of parcels provided this year is more than double the amount distributed five years ago.”

I will say that again, because that is an important line:

“Alarmingly, the number of parcels provided this year is more than double the amount distributed five years ago.

No one should be forced to turn to a food bank because they cannot afford essentials, including food. We provide immediate support to people in our community when they are struggling the most, but our vision is for a world where food banks, like ours, don’t need to exist.”

I said that in an intervention on the hon. Member for Glasgow South West. That is his vision, mine, the vision of every Opposition Member and, I hope, of the Minister. The letter also says:

“Research by the Trussell Trust shows that inadequate social security is the main driver of food bank need and there is a known link between issues with the benefits system and food bank use. This can and must change.

Alongside the Trussell Trust, we are calling for our social security system to Guarantee Our Essentials by making sure that the basic rate of Universal Credit is at least enough to afford the essentials we all need, such as food, energy and basic household goods – and that deductions can never pull people below this level.”

He asks me:

“Will you support the principle that, at a minimum, Universal Credit should always protect people from going without the essentials?”

That is Richard’s letter to me this week. I will say on the record that I fully support what he said.

--- Later in debate ---
David Linden Portrait David Linden (Glasgow East) (SNP)
- Hansard - - - Excerpts

It is a pleasure to serve under your chairmanship, Dame Maria. I thank my very good friend, my hon. Friend the Member for Glasgow South West (Chris Stephens), for securing this timely debate. I say “timely” because it is almost a year to the day since I raised a similar issue in the Chamber. With that in mind, it is incredibly worrying that the situation outlined today has not improved. Instead, it has continued to spiral out of control, thanks to the British Government’s inaction.

I have listened with great interest to the contributions made this morning. Given the announcements this week, there is no better time to stress the damage that has been caused by this fatally flawed universal credit system. Last week, Citizens Advice published new data showing that families are operating in negative budgets, which means that their income no longer meets the basic costs of covering food, energy and housing. According to its latest analysis, two in 10 households have £100 or less after paying for monthly essentials, and of the 40,000 people who Citizens Advice sees with debt problems, over half cannot be helped, as they have already cut back so much on the bare essentials.

This all comes as a result of an austerity agenda pursued by the British Government—a Government who refuse to make the necessary change to universal credit deduction rules, despite households facing severe financial destitution and uncertainty. As we have heard today, the impact of deductions is significant and all the more pertinent to our constituents as they continue to be gripped by the cost of living crisis.

As my hon. Friend the Member for Glasgow South West said, the average Scottish household has had £59 deducted from their universal credit. In a cost of living crisis where every single penny counts, that is the difference between putting food on the table and having to go hungry. As he outlined, the deductions affect almost half of Scottish households on universal credit, with the DWP clawing back around £12 million a month. Nearly half of those deductions are to pay back universal credit advance payments because struggling households cannot wait five weeks for their first payment. This is a system that is fundamentally flawed.

It is therefore no surprise that since January this year, 60% of universal credit claimants whom citizens advice bureaux have helped with deductions have also required help accessing food bank or emergency charitable support. Trussell Trust data indicates that people with deductions were around twice as likely to go without food, toiletries and utilities as those on universal credit without deductions, and over two thirds of people in Scotland who were referred to food banks in the Trussell Trust network in receipt of universal credit were facing a deduction.

Furthermore, the latest statistics from Citizens Advice show that, of the 84% of people who had their benefits deducted, 43% have had to borrow money to cover the essentials. In addition, the Child Poverty Action Group reported that more than 2.2 million children are living in households with debt deductions from their universal credit. I know from speaking to constituents in Parkhead, Shettleston and Tollcross that the uncertainty of how much a deduction is or when it will be taken causes significant and, most importantly, unnecessary hardship for claimants.

In their reports, charities refers to universal credit deductions as “wiping out people’s finances” and

“trapping them in a spiral of debt”.

“Trapping” and “spiralling” are words that I would never wish to associate with a social security system, yet the system that this Conservative Government have designed and presided over continues to push individuals into a never-ending cycle of debt and financial insecurity. As a number of Members have stressed, the British Government are subjecting vulnerable people to heinous deductions that push them into further debt and destitution. Debt, in and of itself, has a profound impact on the cost of living, and that is only exacerbated by this broken system, which is forcing people to make impossible choices that amount to their being unable to even meet the most basic needs.

When the root cause of the issue is poor system design, it is astounding that the Government continually refuse to make the necessary changes to rules around deductions. We are faced with a British Government in denial, who do not believe

“that pausing deductions by default is necessarily in the claimant’s best interest.”

What is it about being unable to afford basic food, buy household essentials or heat their home that is in the claimant’s best interests? People are already diverting limited resources towards debt repayments and that is only compounded by unexpected deductions.

Despite continued and constrained resources, the Scottish Government are doing what they can to mitigate the impact of this broken system, but the root cause undeniably starts here in Westminster. We know the Government can make solutions and immediate changes today that would make a huge difference to those struggling the most and make our constituents’ lives somewhat more manageable, as so many continue to face impossible household budget decisions. Those changes need to be made sooner rather than later, as millions face food insecurity, soaring debt and unnecessary hardship.

Chris Stephens Portrait Chris Stephens
- Hansard - -

My hon. Friend is making an excellent speech. We must ask the Minister to consider the need for some discussion between claimants and the DWP, particularly where the DWP’s own errors are causing the deduction. Does my hon. Friend agree that there needs to be a discussion about an affordability assessment between the claimant and DWP in future?

David Linden Portrait David Linden
- Hansard - - - Excerpts

I thank my hon. Friend for his intervention. When the permanent secretary of the DWP gave evidence to the Work and Pensions Committee, I raised the issue of the recovery of some of the payments. The permanent secretary acknowledged at the time that despite the heavy-handed wording in the DWP’s letter, there was scope for a discussion between claimants and the Department. The fact that the Department has not been willing to amend the text of that rather hard-hitting letter makes the point.

We have a broken social security system that is perpetuated by the UK Government. Moreover, I say to the shadow Minister, the hon. Member for Reading East (Matt Rodda), that there is no point in his party winning the election and coming into Government but continuing the policies of this Government. He and his party should be thoroughly ashamed of being thirled to a two-child policy and an associated rape clause that is the very opposite of what the Labour party should stand for. The hon. Members for Birkenhead (Mick Whitley), for Leicester East (Claudia Webbe) and for Liverpool, West Derby (Ian Byrne) are good socialists who are appalled by the policy. If the hon. Member for Reading East wants to stand up and take the opportunity to apologise for his party pursuing a policy that is tantamount to social engineering, I will be happy to hear that. If he does not do so, my constituents will conclude that the only way to ensure we do not have disgraceful social security policies is with the powers of independence, because this lot clearly have nothing different to say.

--- Later in debate ---
Guy Opperman Portrait Guy Opperman
- Hansard - - - Excerpts

I certainly will do that, and I will also have a look at the individual letters that apply in those particular circumstances. All such letters, as the hon. Gentleman will know having done the pensions job for five long, lovely years, are kept under review, and there is the opportunity to do that.

The hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) is no longer in her place—I know she has to be elsewhere—but she raised in particular the issue of access to a journal for those who do not have the internet. Again, we need to make it clear that, obviously, an individual claimant can attend a jobcentre, which has computers that claimants can use to access their universal credit claim and their individual journal, or they can speak to a member of staff who can support them through the process.

Chris Stephens Portrait Chris Stephens
- Hansard - -

Will the Minister give way?

Guy Opperman Portrait Guy Opperman
- Hansard - - - Excerpts

Bear with me. I might give way, but I am going to keep trying to make progress. The hon. Gentleman had 20 minutes and will have more time soon.

Much criticism was made of DWP staff, particularly by the hon. Member for Leicester East. She used various expressions that I utterly reject. I will not dignify them by repeating them, but I want to make it utterly clear that I am proud to work with the 25,000 men and women who work in our 700-plus jobcentres up and down the country. They do a fantastic job in trying to assist everybody. When she impugns the individual character of DWP staff, I am afraid she is utterly wrong. She should reflect on that and visit her local jobcentre.

--- Later in debate ---
Chris Stephens Portrait Chris Stephens
- Hansard - -

I think the Minister said I had 20 minutes to sum up, but you might have something to say about that, Dame Maria. I thank the hon. Members for Strangford (Jim Shannon), for East Londonderry (Mr Campbell), for Rutherglen and Hamilton West (Margaret Ferrier), for Birkenhead (Mick Whitley), for Arfon (Hywel Williams)—as I was reminded by him, he has a sophisticated electorate, given its electoral history—for Liverpool, West Derby (Ian Byrne) and for Leicester East (Claudia Webbe). I also thank the Front Bench spokesmen.

I thank the Minister for his kind words in referring to me as his good friend—that will probably get me deselected during the summer when I seek to secure selection again. I also thank him for mentioning the great Frank Field. Frank was at an event in Parliament this week, alongside Feeding Britain and Good Food Scotland, and he told me that he agrees with me on universal credit deductions. I hope the Minister will take that on board.

In reply to the Minister, it starts with a five-week wait, and the Government will really have to deal with this situation whereby we are handing out loans. They are not advances; they are loans. I ask the Government to look at how quickly they can pay a benefit as soon as someone hits the eligibility criteria.

As the hon. Member for Reading East (Matt Rodda) says, the real issue is the scale and the number of deductions now taking place. Like others, I ask the Minister to look at what happens when there is a departmental error. The Department really needs to look at the information that has been provided on the online journal and have that discussion. My hon. Friend the Member for Glasgow East (David Linden), who is a good friend—that will not get him deselected—rightly said that the Minister said he would look at the communication. That also needs to be about the information given to claimants, and I ask him to look at that and come back to us. Affordability assessments should be standard practice.

The Minister did not address the crucial point: since the Government have eased the deductions and made their changes, there has been a cost of living crisis. That is why we are asking him and the Government to look again at easing the rate of deductions, which we think will help the situation.

Every single Member has spoken about food poverty and has given examples of how deductions are causing it. I am on a crusade—a mission—to end food poverty across these islands, which is why I have introduced a private Member’s Bill to that end. One way to end food poverty is to address the universal credit deduction situation. I hope that the Minister will do that during the summer, because if he does not, we will be coming back and having another debate.

Question put and agreed to.

Resolved,

That this House has considered the matter of Universal Credit deductions.

Department for Work and Pensions

Chris Stephens Excerpts
Tuesday 4th July 2023

(8 months, 4 weeks ago)

Commons Chamber
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David Linden Portrait David Linden (Glasgow East) (SNP)
- Hansard - - - Excerpts

May I start, as others have, by sending my thanks to the Chair of our Select Committee, the right hon. Member for East Ham (Sir Stephen Timms), for securing today’s debate and for setting the scene so well? The debate takes place against the backdrop of an ongoing Westminster-made cost of living crisis that affects the livelihoods and lives of people across Scotland and these islands. The harsh, yet inescapable reality is that people in Scotland can no longer afford to pay the price for the economic mismanagement of a Westminster Government they did not elect. Indeed, we have not voted by majority for the Conservatives since 1955.

In May, CPI was still at 8.7%. Prices are still soaring and the cost of living under Westminster control is still far too high for many families who were already struggling to get by after 13 long, brutal years of Tory cuts, Brexit and economic mismanagement. We know that inflation disproportionately impacts lower-income groups such as single parents, who spend a relatively high proportion of their income on food and fuel. Indeed, new Trussell Trust research shows that families are going hungry as a result of the Westminster-made cost of living crisis, with one in seven people in the UK facing hunger in the last year due to a lack of money. Ministers often tell us that the reasons for food bank usage are complex. It is not complex—it is because people do not have enough money.

The Joseph Rowntree Foundation’s latest cost of living tracker found that 5.7 million low-income households are having to cut down or skip meals because they do not have enough money for food, while the number going without items such as food, heating and basic toiletries has remained at about 7 million for more than a year—all of that in the sixth largest economy in the world.

The average interest rate for a two-year fixed-term mortgage has risen to 6%. The Resolution Foundation has said that average annual mortgage repayments are set to rise by £2,900 for those renewing next year. In short, that is the eye-watering Westminster mortgage premium that Scots are paying for the pleasure of a Tory Government they did not elect.

What is more, analysis by the consumer group Which? shows that the prices of popular family meals have risen by 27% in the last year. The Irish and French Governments have reached agreements with major supermarket retailers to reduce food prices, while the Tory Government are sitting on their hands. It is those low-income families I represent in Parkhead, Shettleston and Baillieston who are paying the price for the sheer intransigence of Conservative Ministers here in London. Even at this late hour in the cost of living crisis, I urge the British Government to use all the powers at their disposal to tackle that crisis on the scale that is required. That does mean that they will have to be bold and radical, and the same is true of the pro-Brexit Labour party.

I turn specifically to universal credit, which is obviously the main focus of the debate. In short, the British Government’s continual refusal to fix the extensive and known-about problems with universal credit is unacceptable, and it is without doubt subjecting some of the most vulnerable people in our communities to additional and unnecessary hardship. With the three main parties in this place now agreeing on the principles of universal credit, there is an opportunity, so we should put our heads together to look at what we can do to fix it.

I will start with the level of universal credit. JRF research shows that support has eroded over decades and that the basic rate of universal credit is now at its lowest level as a proportion of average earnings. Indeed, the JRF’s latest cost of living tracker warns that about nine in 10 low-income households on UC have gone without at least one essential for the third survey in over a year.

For most people referred to food banks in the Trussell Trust network, the design and delivery of the social security system are major contributors to their inability to afford the essentials. The majority of people—indeed, some 89%—referred to food banks in the Trussell Trust network receive a means-tested benefit such as universal credit, but that did not provide them with enough to cover the cost of the essentials. As the right hon. Member for East Ham said, JRF and the Trussell Trust are together calling on Ministers to implement that essentials guarantee to ensure that, at a minimum, the basic rate of universal credit covers life’s essentials and that support can never be pulled below that level.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
- Hansard - -

Is not another problem the insane part of the system where people pay back money because of advances and the level of deductions—more than £60 a month is being deducted from my hon. Friend’s constituents’ and my constituents’ universal credit? That envelops that cycle of poverty.

David Linden Portrait David Linden
- Hansard - - - Excerpts

I am grateful to my hon. Friend for putting that point on the record. He was my predecessor on the Select Committee and follows this work well. I will come to debt and deductions, because that is one of the big issues raised in the evidence that the Select Committee receives, certainly by the stakeholders that we meet. He is spot-on to draw attention to the £60 from each of our constituents that is paid back to the Government when it could be spent in our local economies.

New CPAG research finds that the digital aspects of universal credit routinely lead to wrong amounts being awarded to claimants—often those who are most vulnerable—and to breaches of rule of law principles. That is why I have repeatedly called on the Government to reverse their cuts to universal credit and working tax credits. Let us not forget that this was the biggest overnight cut to welfare in 70 years, inflicting hardship on people who were already struggling. To have done that as we came out of the teeth of the pandemic was particularly cruel.

Rather than offering one-off payments to shore up struggling families’ incomes, the DWP should reverse the damaging policies that are impacting on the most vulnerable people. It should reinstate the UC uplift at £25 per week and, of course, extend it to legacy benefits. Let us not forget the 2.5 million disabled people, so ably advocated for by the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), who were cruelly left behind without that uplift during the pandemic. The Government also need to remove the benefit cap and the two-child limit with its associated rape clause. They also need to halt the punitive sanctions regime so that all households are lifted out of poverty now and in future.

I turn to the benefit cap. As the Poverty Alliance points out, the cap’s design means that those who require the highest level of support from the benefit system are the most likely to be affected. That is simply unjust. Based on the latest departmental figures, 114,000 UK households have had their benefit capped and 86% of those are families with children. The benefit cap disproportionately impacts lone-parent families, the majority of whom are women—a point made by the hon. Member for North East Fife (Wendy Chamberlain) —as well as larger and ethnic minority families.

The same is true of the two-child limit. Thousands of families with children will be pushed into poverty because Ministers on the Treasury Bench refuse to scrap the two-child limit on child tax credits and universal credit. A new London School of Economics study found that the policy’s impoverishment of larger low-income households has helped few parents get a job. Instead, its main function has been to push families further into poverty and to damage their mental health.

I wonder why Ministers are so furled to the two-child limit. The vast majority of them are actually quite embarrassed by it, and that is before we get to the associated rape clause, or as the Government like to call it, the “non-consensual sex exemption”. When this Government go around lecturing people about the values of global Britain, I am pretty sure they do not tell folk that the state will only support the first two children in the family, but if someone can prove that their child was born as a result of rape, that is okay.

In-work Poverty

Chris Stephens Excerpts
Wednesday 28th June 2023

(9 months ago)

Westminster Hall
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Tanmanjeet Singh Dhesi Portrait Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
- Hansard - - - Excerpts

I beg to move,

That this House has considered in-work poverty.

It is a pleasure to serve under your chairmanship once again, Sir George. I am grateful to have secured this important debate on the scandal that is in-work poverty. Such a debate should not be needed in the 21st century in one of the wealthiest nations in the world, and yet here we are. I hope the debate will explore why so many people face unacceptable levels of poverty not when they are out of work, but while they are working and earning a living.

“If you work hard, you can earn a decent wage, buy a house and raise a family”—that is the promise the Government made to the country in their last election manifesto when they stated:

“We will help people and families throughout their lives by bringing down the cost of living and making sure that work always pays.”

I do not think it is controversial to say that I agree with that. People who work hard should be able to earn a decent wage, afford a home and raise a family. A job that pays, a home of their own and a family they can support are not great gifts bestowed by a generous Government; they are key indicators of a healthy and functioning society. They are our modest expectations and reasonable aspirations, and any half-competent Government should be expected to deliver them. Cruelly, over the past 13 years, this Conservative Government have not only failed to do their job and deliver for the British people; they have also, systematically, through either incompetence or intention—probably both—prevented millions across the UK from getting on in life, trapping them in an inescapable cycle of poverty and hardship.

Data from the Department for Work and Pensions shows that one in five people in the UK were in relative poverty in 2021-22. It is clear that working does not preclude a family or an individual from poverty. After housing costs, 71% of children and 57% of working-age adults who are in poverty are in poverty. In-work poverty has increased by a shocking 1.5 million people since the Conservatives took office in 2010. There are three overarching reasons why things have become so bad: earnings, housing and the cost of living. On each, the Government have taken a bad situation and made it much worse.

Wages today are at the same level as in 2005. That is the longest period of stagnation in terms of earnings in nearly 200 years. Public services have been cut to the bone, and many public sector workers have seen their pay significantly eroded by years of below-inflation rises. At the same time, there has been an explosion in the gig economy and other insecure work—a damning indictment of the Tories’ economic and political choices, which have forced ever more people to rely on the benefits system.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
- Hansard - -

I congratulate the hon. Gentleman on securing the debate. He mentions the gig economy. Three of the reasons for in-work poverty are insecure work and zero-hours contracts, bogus self-employment and low wages. The Government made promises in response to the Taylor review eight years ago, but we are still waiting for that employment Bill. Does he agree that we need that employment Bill now?

Tanmanjeet Singh Dhesi Portrait Mr Dhesi
- Hansard - - - Excerpts

I could not agree more. I remember standing in this very place after I had managed to secure a debate on the Taylor review of modern working practices. In fact, some of the same Members who are here today also took part in that debate, during which we asked for the employment Bill to be introduced. It is shocking that only seven of the 53 agreed areas of legislation were enacted. Such intransigence is what leads to more in-work poverty.

For 13 years, successive Conservative Governments have sought to undermine social security in our country. Universal credit is not protecting working families from poverty. More than a third of children and working age adults in working families in receipt of universal credit are still in poverty after housing costs.

Ms Clarke, one of my constituents in Slough, is a nurse who supported the most vulnerable during the covid-19 pandemic. She is struggling to pay for the loans that she took out for her training and has to claim universal credit. For that, she must take annual leave to attend her appointments at the jobcentre. How is any of that fair or right? She is a nurse and a single mother without the support she clearly requires.

Budget Resolutions and Economic Situation

Chris Stephens Excerpts
Thursday 16th March 2023

(1 year ago)

Commons Chamber
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Mel Stride Portrait The Secretary of State for Work and Pensions (Mel Stride)
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This Budget and the measures it sets out for providing additional support and encouragement for millions of people to re-engage with the labour market spoke to the very heart of our Conservative principles of compassion, of incentive, of self-reliance and of collective responsibility. Above all, it spoke to that age- old truth that work matters: that work is the source not just of income or paying the bills, and not just of supporting businesses or growth, but of something arguably greater still—of individual pride, of self-worth, of better health, and of making a fundamental contribution to the whole of society. That is the Conservative way.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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The Secretary of State talks about compassionate Conservatism; does he believe the measures in the Budget will increase or decrease sanctions over the next 12 months?

Mel Stride Portrait Mel Stride
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Our policy and rules around sanctions have not been changed by the Budget, but it is important that where somebody can work and is offered support to work and decides to take benefits and not engage with the system, sanctions can under certain circumstances be appropriate. That is not to say that sometimes people will not have perfectly reasonable reasons for not engaging with the jobcentre, in which case no sanction will be applied. The hon. Gentleman seems so often to be suggesting that there is no scope or role for sanctions whatsoever within our benefit system, and that is not going to help the very people we are out to support.

This Budget will help break down the barriers stopping people moving into work or progressing within it, and it is most particularly a Budget for those who face the greatest employment challenges. It is a Budget for disabled people and those with health conditions, with new and extended employment support, better integration of work and health services, and, through our health and disability White Paper, the biggest reform to the health and disability benefits system for a decade. It is a Budget for older workers, with the removal of disincentives in the pensions tax system, and with more help to retrain and reskill and more tools to help people plan for the future.

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Mel Stride Portrait Mel Stride
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The right hon. Gentleman will know that hitherto we have indeed focused on a gap. The Department will come forward with something to say on that in the not-too-distant future, and he will have to wait until that point to know the exact kind of target, although I recognise that the current measure has value.

The measures we have set out in the Budget and in our health and disability White Paper will help to remove barriers, so that disabled people have the same opportunity as anybody else to thrive in work. Some 20% of those who have been assessed through the work and capability assessment as having limited capability to work and to look for work say that they want a job at some point in the future, but one of the barriers to work is the health and disability benefits system itself. For too many disabled people, the system feels like it focuses on what they cannot do, rather than what they can do.

Having listened to disabled people, the White Paper that we published at Budget yesterday sets out how we will fundamentally rewire the benefits system, changing it from a system that can often leave people feeling that moving towards work is too risky and that they might not be able to return to benefits if that work does not work out. I want to give people the confidence to try work without the worry that they will not be able to access benefits again promptly if a job does not last. Under our new approach, people will have the confidence that they will receive support for as long as it is needed. Our reforms will also provide additional support to those disabled and long-term sick who request it.

These reforms have been years in the making and follow the Green Paper that we published in July 2021. We have engaged widely on these changes, including with disability charities and disabled people’s organisations, as well as with disabled people themselves who have been through the current process and understand how and why it needs to change. Just as we have taken a measured approach to developing this way forward, so we will operationalise this approach with care.

Chris Stephens Portrait Chris Stephens
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The Secretary of State is being generous in giving way. A number of disabled charities are sceptical about the package that he is putting together because of the severe delays to the Access to Work scheme, which are blocking people from going into employment. How does he plan to tackle that in the coming year?

Mel Stride Portrait Mel Stride
- Hansard - - - Excerpts

As I just suggested, we will take a measured and appropriate approach to the delivery of a fundamental reform of how these benefits will work. It will involve primary legislation, most likely in the next Session next year, and it will be rolled out some time after that. There will be plenty of time to ensure that we have thorough engagement with stakeholders, disabled people and those who represent them, to ensure that we get exactly those matters right.

In addition, our new Work Well partnerships programme —delivered through the health system—will pilot a new model for delivering integrated work and health support in local areas, providing employment-based targeted health support to prevent people from falling out of work or to enable a return to work quickly. For those who need more intensive help, there will be universal support. We will work directly with employers to quickly match people with jobs and provide up to 12 months of personalised place and train support. This approach means that after helping someone into work, we will stay with them to ensure that they remain in employment.

We are also investing to expand the additional one-to-one support that work coaches are already providing to disabled claimants in one third of jobcentres. From the spring, we will start to make this extra support more widely available, so that it is in place across the entire jobcentre network by 2024. We will also work with the occupational health sector and employers to reform the market and improve access to quality occupational health services. That will include testing financial incentive and support models to help small and medium-sized businesses and the self-employed overcome barriers to occupational health services.

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Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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First, I refer the House to my declaration in the Register of Members’ Financial Interests, as I will be making some remarks about public sector pay.

In this House a couple of years ago, I made a comparison that the Government were rather like those wicked characters the Warleggans in the period drama “Poldark”. I did not quite realise that that was a premonition on my part, because once again we have a Budget that benefits the rich on the backs of the very poor. The real issue here is what the Budget does not say and the huge disappointment it was.

Ministers confirmed this week that they are reneging on the promise given to me three years ago to publish the Department for Work and Pensions review of the factors driving food bank usage. The Chancellor referred repeatedly in his speech to the Prime Minister’s ambitions and objectives. One thing that the Chancellor did not mention was the Prime Minister’s stated wish to eliminate the need for food banks. Why no mention? Why no review? Why no costed plan to deliver on that particular ambition? The most vulnerable yet again are being failed by the Government and by the state. What possible reason or reasons can there be for not publishing what should be vital research to address the very factors that cause too many of our citizens across these islands to turn to food aid provision? Is it because the very factors that do so are the responsibility of the Government?

As we have been reminded by the leader of the Public and Commercial Services Union, of which I am the parliamentary chair, more than 40,000 civil servants—people on the Government’s own payroll—are having to resort to food aid provision. We know that many of those relying on it are people who have received a sanction from the Department for Work and Pensions, but we also know that some who are using it actually work for the Department, and are themselves responsible for and employed in delivering benefits to the poorest. Yet the Budget tells us in no uncertain terms that more people, not fewer, will be sanctioned. It is hard to reach any conclusion other than that the failure by Ministers to publish the Department’s own research on food bank use is due to decisions made by Ministers past and, I regret to say, present.

We had an exchange with the Secretary of State about sanctions, during which he said that there were some circumstances in which they were appropriate. However, we know from the Government’s own figures that the number of sanctions has skyrocketed in the last year. In response to recent written parliamentary questions, the Department has said it “would incur disproportionate cost”—yes, the answer to a written question contains the words “disproportionate cost”; I know that some Members will find that unusual—to find out how many children were living in households where a sanction had been applied, how many people living in sanctioned households were receiving hardship payments, how many people with a sanction had a medical condition, or how many people had been in hospital or attending a medical appointment when they were deemed to have failed to comply and were therefore sanctioned.

Patricia Gibson Portrait Patricia Gibson (North Ayrshire and Arran) (SNP)
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My hon. Friend is talking about the impact and the scale of sanctions. Does he agree that the people who are sanctioned are pushed further and further into poverty, which goes against the Government’s own stated objective of getting people into work? The further into poverty people are, the more difficult it is for them to enter the workplace.

Chris Stephens Portrait Chris Stephens
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That is exactly what happens. What is also happening is that people who receive sanctions then miss out on cost of living payments, so they incur not just one punishment but a double punishment—and that, too, is pushing people into poverty.

Mel Stride Portrait Mel Stride
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I have enormous respect for the hon. Gentleman, as he knows, but I genuinely wish to clarify one point. Is he at least saying that there are some circumstances in which a sanction is appropriate?

Chris Stephens Portrait Chris Stephens
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I will come on to that point, and yes, I will say that; but how can be it be humane to proceed with a ramping up of sanctions without knowing the basic facts, when Members are asking questions about, for example, how many children are living in households where a sanction has been applied? Does the Secretary of State not accept that with more people at risk of being sanctioned, now is the right time to roll out the yellow card benefit warning system for which many of us have been arguing, to ensure that misfortune does not lead to people being left destitute?

There are some things that the Secretary of State could do before sanctions are applied, and I believe that such a warning system is one of them and would help people into work. The Department did consider it, and we thought, when I was a member of the Work and Pensions Committee, that it was heading in that direction, but then it changed course. Perhaps the Secretary of State will want to look at the issue again. I would encourage him to look at the great work done by the Committee in this regard, and particularly at its suggestion that the yellow card system would be appropriate.

The fact remains that the measures in the Budget require those who are struggling on low incomes to jump through extra hoops, such as attending jobcentres even when they are working in what we all agree are vital roles, for example as teaching assistants or care workers. The earnings threshold has more than doubled in the space of just a year. This puts hundreds of thousands more people at risk of benefits sanctions, although we know sanctions do not work ethically, practically or economically. The Chancellor needs to understand that, no matter what he is promising for the future, far too many people are struggling to survive now.

There remains a large degree of scepticism about the employment support package, which the Secretary of State talked about today and the Chancellor referred to yesterday. Some believe that tighter sanctions will likely be a disaster for people on universal credit, and they will not help people into work, as my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) said. The Federation of Small Businesses has said that the proposals to help people with poor health to get back to work are “ill-designed” and poorly thought out, and some “won’t happen for years”. Those with health conditions and disability have been let down by a Government who have ignored employers’ views on what can best help. The FSB continued:

“Small measures on subsidising occupational health are welcome but not the big bang needed.

“Measures on the over 50s are token efforts at best…The principle of what’s announced on childcare is positive—but this Government’s Achilles heel is in delivery”.

So, as the FSB says, we will believe it when we see it.

The Royal National Institute of Blind People has said:

“For those of working age, employment should be a route to coping with rising costs. “

But it remains of the view that urgent action is needed

“to fix the Access to Work scheme—a scheme where, right now, thousands of people are facing severe delays of many months to get the support and equipment they need to do their jobs”.

I hope that the Secretary of State will note its comments, because Access to Work is clearly not helping enough people and the delays are preventing people from getting into work.

Not everyone is convinced that the childcare reforms will help get people into work. Even if the money is there to pay for childcare, there is no workforce—the pay is very bad—to deliver it. The UC changes in the administrative earnings threshold will mean more Department for Work and Pensions staff caught up in in-work conditionality, as well as swathes of extra work for staff in jobcentres. There was no mention in the Budget about whether there are any extra staff to deliver what we believe will be huge amounts of additional work. The Secretary of State is saying that there will be, so while he is answering that question, perhaps he can say what pay rise he is going to give DWP staff as well. They took industrial action yesterday. [Interruption.] I am chair of the Public and Commercial Services Union parliamentary group, but my union is Unison, of which I am a proud member. I think that answers the question from the Exchequer Secretary. I would have thought he would have done his research to have known that. Perhaps there is a very real need for civil service pay to be addressed, and I will come on to that later.

Another issue that has not been tackled is deductions. One measure that would have cost the Government very little but could have resulted in many fewer people needing to use food banks would have been to ease significantly the rate of deductions from UC. Better still would have been to waive deductions resulting from official error, or to introduce a one-off amnesty on deductions. Why no action on that, the single biggest factor affecting people going to food banks? Despite almost half of all households on UC now facing a deduction, during the last six-month period, ending January 2023, just 14 cases were fully waived and a further five were partially waived. So will the Secretary of State revise the guidance to ensure every household subject to a deduction is automatically informed of their right to request a waiver?

On public sector pay, the Budget offered nothing. As the Prime Minister sorts out his swimming pool heating, it is incredible that public swimming pools were the only public services mentioned for support in the Budget speech. Although the pension cap cut might help our NHS to retain doctors, the measure could have been limited to medicine or the NHS, rather than being a lifetime tax cut for the wealthy. The only mention, without actually announcing more money, was that cutting public sector debt would lead to more money for public services. Public sector pay bodies have noted that only a 3.5% pay rise is affordable under current Treasury allocation; as the IFS said, that is a political choice. The TUC has said that the lack of support for public services and for public pay is the “elephant in the room”. The Budget goes nowhere near a high-wage, high-skills economy.

With strikes all over the country, it is striking that the Budget said nothing about them. Public transport, public health and even public sector TV hosts are on strike, but the Government seem to prefer to fight a culture war over Gary Lineker than pay attention to ensuring that our public services have the funds they need.

The Government are again scrambling to fix the economic problems of their own making. Yesterday’s Budget is a huge disappointment to people, businesses and charities left paying for the UK Government’s mistakes. They created a crash a few months ago—there is selective amnesia about that—and they have not yet said sorry for it. There is, however, one thing on which I agree with the Chancellor, who said:

“Independence is always better than dependence.”—[Official Report, 15 March 2023; Vol. 729, c. 844.]

We could not have put that better ourselves.

None Portrait Several hon. Members rose—
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James Cartlidge Portrait James Cartlidge
- Hansard - - - Excerpts

The quote says,

“doing away with the cap”.

The removal of the cap is a tax measure that applies to all people who qualify for it. There is a really important point that Opposition Members probably want to listen to: there is a real danger in making up policy as one goes along. To be clear, our tax change will come in immediately, or as soon as we can possibly do it—it will come in on 6 April—but it is our view that a specific scheme for the NHS would take up to a year to put in place. Were we to bring forward an NHS-only scheme, the Department of Health and Social Care would have to consult on that scheme and then respond to the consultation. Only after that could it start to develop the scheme, because it could not predetermine the consultation. After that, the Department would have to transfer eligible people into the scheme. All that assumes that there would not be legal challenges from those who would argue that such a scheme should apply to other key people in the public sector, such as headteachers, senior police officers and senior people in the Ministry of Defence who might think that they too work hard in our public services. The Labour party has made it up as it has gone along. The fact is that Labour has U-turned from a perfectly sensible policy back to being ridden with the politics of envy, which we have heard from every single Opposition Member today.

Turning to some of the speeches, my right hon. Friend the Member for Norwich North (Chloe Smith) made an excellent contribution. She speaks with great expertise and passion on the matter of getting the disabled into work. She made the very important point that that is not just for the Government and that we also need to talk about the role that employers can play. I hope she will be pleased to hear that in the build-up to the Budget I, along with my hon. Friend the Minister for Employment and the small business Minister—my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake)—engaged directly with employer groups and worked with them to come up with some of the Budget’s proposals, particularly the extension of the occupational health subsidy pilot, the returneeship policy and boot camps for over-50s. Those are very positive measures.

The hon. Member for Glasgow South West (Chris Stephens) said that all the measures we have taken are on the backs of the poor, while the hon. Member for Jarrow (Kate Osborne) and other Opposition Members said that we have let down those on the lowest incomes. I remind the House that this year it is possible, for the first time, to earn £1,000 a month without having to pay any income tax or national insurance. We have doubled the personal income tax allowance since 2010, and in the last year we have increased benefits in line with inflation. On energy support, this financial year we have given a £650 cost of living payment to those on benefits, and in the financial year to come it will be £900. Those are not the actions of a Government turning their back on the poor. This is a Government taking difficult decisions to balance the books of this country, but in a compassionate way that helps those who have the least.

Chris Stephens Portrait Chris Stephens
- Hansard - -

If the Government are doing so much for the poor, can the Minister tell us why in-work poverty is on the rise and why 40,000 civil servants, who work for this Government, are having to use food banks?

James Cartlidge Portrait James Cartlidge
- Hansard - - - Excerpts

The key statistic is that since 2010 we have cut unemployment by 1.2 million. We have near record lows in unemployment and almost record highs in employment. Of course, we want to go further.

I am glad that the Chairman of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), welcomed some of the Budget’s measures, particularly the important increase in the universal credit childcare cap and aspects of the White Paper. I am sure he is looking forward to engaging in detail with my right hon. Friend the Work and Pensions Secretary, who is sitting next to me.

My right hon. Friend the Member for Chipping Barnet (Theresa Villiers) was absolutely right to say that the Prime Minister has set these targets and that this year we are making fantastic progress on three of them. Inflation is set to more than halve this year. That is not a minor detail. Inflation—driven, after all, by Putin’s invasion of Ukraine—has been the biggest reason why there have been problems with growth in countries all around the world. She also made very important points about the extension of the energy price guarantee. Yes, inflation is falling, but that shows that we continue to take steps to support people with the cost of living. We know that those pressures have not completely gone away. The elevated prices of food and other products in our shops have all come from that surge in energy prices. That is why we have extended the energy price guarantee and continued the freeze on fuel duty and the 5p tax cut on petrol and diesel for motorists.

The hon. Members for Eltham (Clive Efford) and for Easington (Grahame Morris) both put forward some very interesting proposals, which I hope have been noted by shadow Front Benchers, for a range of new wealth taxes to undermine the competitiveness of the UK. If there has been a theme among Opposition Members today, it has been a return to the politics of envy and of undermining aspiration and competitiveness.

My hon. Friend the Member for South Dorset (Richard Drax) made an excellent point. We may exchange views on which taxes we should take action on, but he reminded us of the reason why we have had to take those difficult decisions. It is because of huge external factors that Opposition Members do not like to talk about. They include a pandemic, followed, literally, on 24 February, the day on which the pandemic regulations ceased, by Putin’s invasion of Ukraine. It has been an extraordinarily challenging time, requiring us to put in place £390 billion of additional support. We can debate whether it should have happened, but it did happen and, as my hon. Friend the Member for Thurrock (Jackie Doyle-Price) has said, that has consequences for taxes and we have had to take those difficult decisions.

I also agree with the very important point made by my hon. Friend the Member for South Dorset about energy security. He is absolutely right. We are proud of the huge progress that we have made in reducing our emissions, at a faster rate than any other G7 country. Last year, 40% of our electricity was from renewables. The figure in the United States was just 20%. Yes, we welcome the steps that the US is taking through the Inflation Reduction Act 2022, but no one should be under any illusion that we are not making huge steps forward ourselves. However, we must always remember the role of energy security, which is why my hon. Friend the Member for South Dorset is right that, rather than turning our back on the North sea as others have suggested, we should be maximising the UK’s domestic supplies of energy. That is why I hope that colleagues will welcome the steps that we are taking in respect of small modular reactors. There was also the important announcement, which was welcomed by several Opposition Members, including the hon. Members for Preston (Sir Mark Hendrick) and for Stockton North (Alex Cunningham), of £20 billion investment in carbon capture and storage.

I am delighted that my hon. Friend the Member for Milton Keynes South (Iain Stewart), the Chair of the Transport Committee, welcomed the news on East West Rail, which we have had exchanges on in previous Treasury questions. He is absolutely right about the central role that new infrastructure plays in driving growth and connectivity, and I hope that the announcement brings great benefit to his constituents.

Labour Market Activity

Chris Stephens Excerpts
Tuesday 28th February 2023

(1 year ago)

Commons Chamber
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Jonathan Ashworth Portrait Jonathan Ashworth
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They have been articulate and fantastic champions. I always praise my fellow MPs from Leicester. The Government need to take this agenda seriously, because we know that increasing numbers of women in their 50s are being forced out of the labour market but would stay in work if given the right flexible options.

We also need to tackle the barriers in the social security system that prevent people from moving into work. People should not be trapped on welfare, abandoned to going nowhere. That brings me to childcare. We know that childcare can make the difference between a parent rejoining the workforce and staying at home to look after their children. For some parents, childcare may not be available where they live, but for many parents—particularly those on the lowest incomes—childcare costs can be an insurmountable barrier to work. That should not be the case.

A lack of childcare, or a lack of support paying for it, should not stand in the way of a parent returning to work, yet low-income families often have that choice taken away from them. The design of the universal credit system means that childcare costs are based on payment in arrears, but as childcare usually needs to be paid up front, in advance, parents often have to choose between taking on debt or turning down work. It is pushing more families into debt. The Government’s answer is that people can go to their work coach and ask for a flexible support fund grant, but it should not be the case that a poorly understood and difficult handout scheme administered by the DWP is there to address the failings in the DWP’s own policy. We need to fix this.

Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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Will the right hon. Gentleman give way?

Jonathan Ashworth Portrait Jonathan Ashworth
- Hansard - - - Excerpts

I will give way to my hon. Friend—the hon. Member.

Chris Stephens Portrait Chris Stephens
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I will take hon. Friend. There is another problem, which is that lone parents face the choice of working reduced hours, because if they increase their hours they will lose out on state support.

Jonathan Ashworth Portrait Jonathan Ashworth
- Hansard - - - Excerpts

Absolutely. It beggars belief that people are being trapped out of work because of the current system. It needs fundamental reform.

Part of the problem is the way in which the amount of childcare that can be reimbursed has been capped. A family in 2009 who received working tax credit and needed full-time childcare of 50 hours a week would have been reimbursed for 38 of those hours. Today, the same family on universal credit would be reimbursed for only 27 of those hours—at a time when we want to support more parents into work. Fixing childcare not only is the right thing to do, but will help the economy. The Centre for Progressive Policy has said that if women had access to adequate childcare services, they would generate up to £28 billion for the economy. Why are Ministers not fixing it?

Finally, the social security system should support, not hinder, people’s journey into work, but too often the system disincentivises work and makes even trying it too much of a risk. The work capability assessment acts as a barrier for people and the assessments can be arduous, lengthy and stressful. Many people with ill health simply do not want to risk going through that process again if they move into work and something goes wrong. Instead, we should guarantee that people in that position, who move into employment with the help of employment support, can return to the benefits that they were on without the need for another lengthy assessment process.

This is a plan to get people back to work, but where is the Government’s plan? They spin that they are working on something, but they cannot even tell us whether their existing policies are making a difference. I have been asking them about those policies and this is what they have told me. When I asked how much funding was allocated to each jobcentre, I was told:

“The information requested is not available.”

When I asked if they could tell us how many people had secured a job at the end of taking part in sector-based work academy programmes, I was told:

“This information is not available.”

When I asked how many people got jobs after taking part in the DWP’s mentoring circles, I was told that the information “is not collated”.

When I asked how many times people on universal credit have been asked to meet a work coach, I was told:

“No such specific assessment has been made.”

When I asked how many universal credit claimants were undertaking training or education that counted towards their work-related requirements, I was told:

“The requested information is not held.”

When I asked how many universal credit claimants were employed as carers, I was told:

“The requested information is not held.”

When I asked what the average amount of time is between receiving jobseeker’s allowance and receiving a job offer, I was told:

“The information requested is not…available.”

When I asked how many people stopped receiving employment and support allowance as a result of gaining employment, I was told:

“The information requested is not…available.”

When I asked how much money from the flexible support fund has been used to assist jobseekers with the cost of childcare, I was told

“The information is not available”.

When I asked how many individuals were awarded payments for childcare from the flexible support fund, I was told that the information requested is not available.

This lot are supposed to be getting people back to work, but a plan for jobs is not available. That is probably why the Secretary of State—the shadow shadow Secretary of State—now copies our welfare reform plans. We propose welfare reforms to benefits, and two days’ later we read in The Times that he is adopting them. We call for deeper links between health and employment services, and a week or so later he copies us. We put forward reforms to get the over-50s back into work, and a few weeks’ later he nicks them. I even went to the shop where I get my suits from—this is absolutely true—and the people said that he had recently been in there.

People say that imitation is the sincerest form of flattery, so why does the copycat Secretary of State not move out of the road and let us take over? Let us get Britain back to work, because Labour is winning the battle of ideas. I commend our motion to the House.

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Mel Stride Portrait Mel Stride
- Hansard - - - Excerpts

My right hon. Friend is absolutely right, and that is why we have stood up important programmes, such as sector-based work programmes, and it is why skills and apprenticeships are so important—[Interruption] —as are skills bootcamps, as an hon. Friend reminds me.

This motion is wrong on unemployment and employment, but it is also wrong on economic inactivity, because while it is true that economic inactivity rose during the pandemic, it is also true that, with the notable exception of the United States, in most countries it has gone back down to broadly where it was before the pandemic. That has not happened in the UK. It is not true to say that working-age inactivity rates have not been on a long-term decline. They have in this country, and the trajectory has been downwards. The level of economic inactivity in the UK is lower than in the United States, France and Italy. It is below the EU average, and it is below the average of OECD countries.

While there has been some softening in recent months on the level of economic inactivity in the United Kingdom, I accept that there is a lot more work to be done, which is why the Prime Minister has asked me to work across Government to review how we approach these issues, particularly in respect of disability, the long-term sick and those who are over 50 and have retired early.

Before I come to those cohorts, let me state clearly what lies at the heart of this Government’s success on unemployment and employment: the key Conservative belief that we should make work pay. The universal credit roll-out has been a huge success, despite the fact that the Leader of the Opposition suggested as recently as 2021 that it should be scrapped. We have enhanced universal credit by improving the taper, dropping it from 63% to 55%. We have increased the work allowance by £500. In terms of making work pay, for the very lowest paid we will be increasing the national living wage by 9.7% this April. We have stood up a number of important programmes that have helped to encourage people into work, among them Restart and our youth offer.

Chris Stephens Portrait Chris Stephens
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The Secretary of State says that the route out of poverty is work and making work pay, but the example I gave to the shadow Minister is one that came up when I was on the Work and Pensions Committee, of a lone parent not taking additional hours because they would lose state support. What are the Government proposing to fix those sorts of issues?

Mel Stride Portrait Mel Stride
- Hansard - - - Excerpts

I think the main point—I do not know the specific example to which the hon. Gentleman refers—is that under UC the whole driving principle is that work always pays. As someone gets into work, the benefit is tapered away, but none the less work always pays. That is why we are looking, in part at least, at these very low levels of unemployment and very high levels of paid employment.

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Chris Stephens Portrait Chris Stephens (Glasgow South West) (SNP)
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Thank you, Madam Deputy Speaker. I will try to be concise in my remarks to allow as many Members in as possible. The SNP will be supporting the motion.

We heard from the Secretary of State some of the old buzz phrases—I had my bingo card ready—such as “work is the best route out of poverty” and so on. I, too, am waiting for him to answer the questions from the right hon. Member for Leicester South (Jonathan Ashworth). We will see if the Minister’s response gives me those. I want to make a number of points, some of which were touched on by the Secretary of State.

I and a number of hon. Members have a real concerns about the ways the Government are trying to force people into work and to force them to increase their hours. There are also concerns about the current sanctions regime. We have had Westminster Hall debates fairly recently, to which the Minister responded. The number of sanctions being issued is spiralling. My understanding is that the only time there is a reduction in the number of sanctions is when DWP staff are taking industrial action. Those who face being sanctioned should not have to wait for industrial action in order not to be scared of getting a sanction.

I agree with the Secretary of State about the great role that DWP staff are undertaking. I hope he will consider that and offer them a decent pay rise. Even in his own Department there are an alarming number of staff who, in a survey with their trade union, indicate that they have to use food banks. That is a ridiculous situation. It is also ridiculous that DWP staff themselves are saying they cannot take on additional hours because they would then lose the benefits they are being paid by the state. I hope Ministers will listen on that point. During the Work and Pensions Committee inquiry into childcare costs—I was a member of the Committee until fairly recently—there were examples of lone parents who had to stick to the number of hours they worked. They were unable to increase their hours because that would have meant they lost universal credit payments and other benefits. That should not be happening.

On the very real concerns about the sanctions regime, it is deeply concerning that people not only get sanctioned but lose their associated cost of living payments. That only puts people into more poverty and should not happen. There is very clear evidence that sanctions do not work. The Institute for Fiscal Studies—not necessarily a friend of the SNP; it is often quoted by Conservative Members—said in a recent report that the sanctions policy currently produces

“fiscal savings indistinguishable from zero”,

yet we are still subjecting people to untold anxiety and harm.

The Secretary of State touched on the pilot. There are a number of questions that I hope Ministers can answer regarding the concerns about the pilot. The DWP—I nearly said the DUP; I’ve made that mistake before—is now starting a pilot that forces thousands of UC claimants into compulsory attendance at jobcentres 10 times over a two-week period. If someone has been a claimant for 13 weeks and fails to attend, they could be sanctioned and risk losing their benefits. That would plunge often very vulnerable people deeper into poverty. I understand that the jobcentre innovation pilot is to be introduced in 60 jobcentres, with the potential to impact thousands of claimants.

The Department has been clear that there are no extra staff to deliver the additional work, which means that yet more pressure will be heaped on the overworked, underpaid and highly stressed civil servants working in the jobcentres. The Public and Commercial Services Union believes that that will increase the risk of poverty and make claiming benefits more difficult. Martin Cavanagh, the PCS DWP group president, said:

“Our members will see through this pilot for what it is – a government hellbent on making it more difficult for people to claim benefits and which will increase the risk of poverty for those customers who fall foul of this pilot. Asking more customers to travel more often into jobcentres does nothing to help our staff or their workloads and does nothing to help the customers find the work that they need.”

It is important that Ministers respond to those concerns from the Public and Commercial Services Union.

Disability employment increased during the pandemic, but it now seems to be reducing. I think that one of the reasons is that during the pandemic people were able to utilise technology to work from home. As we have eased out of the pandemic, we have seen a massive move to force people back into offices, factories and all those places. When the Government look at disability employment, I would like them to incentivise employers to help workers work from home, because that would certainly help and be of benefit to those with disabilities. That comes up time and again when the Work and Pensions Committee looks at those issues, and I hope that Ministers will look seriously at it.

Rising insecure work and in-work poverty need to be tackled. I am concerned when I hear Ministers justifying sanctions in cases where people refuse zero-hours contracts. Zero-hours contracts do not suit everyone. I hope that the Department will look at that again. If someone refuses a zero-hours contract job, it is because it does not suit them; it does not suit everyone to be in that position. We have waited over six years for the Government to introduce an Employment Bill to address the issues around insecure work, such as people in insecure contracts being texted by their employer and being told that the first one who arrives at work gets the shift. That is the sort of practice that I hope Government Ministers will condemn, and I hope that they are working with colleagues to eliminate such practices, because they are wrong and are increasing insecure work and in-work poverty.

I hope that Ministers will liaise on some of those important issues. We need to look at how to be a fair work nation with fair work policies, so that people will be attracted back into the workplace. I hope that Ministers will look at and respond to my points. I will leave it there to allow other Members to speak.

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Jerome Mayhew Portrait Jerome Mayhew (Broadland) (Con)
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I am glad to have the opportunity to speak in this debate, not only because it highlights the Government’s proud record of increasing labour market activity, but because it raises the fundamental problem with Labour’s political philosophy: its historical and financial handcuffing to the union movement.

Unions are undoubtedly a good thing. In the early 19th century, if they had not been formed, they should have been. At a time of social immobility, they dealt with a huge and important social injustice: the dislocation between the bargaining power of the master and that of the servant—we just have to use the language of the time to make the case that there was a huge imbalance in bargaining position and therefore a need for unions. Times have changed, however. Nowadays, information on pay and opportunities is universal: I could go online today and look at employment opportunities in Bogotá as well as those in Bridgend. At a time of full functional employment, which is what we benefit from at the moment, other options for staff are available as well as combined bargaining.

The role of unions has moved away from the proud position in which they began. They are now more focused on the rights and privileges of members. In some cases, although not all, they are focused on things like the defence of anti-competitive Spanish practices or the prevention of increases in productivity and of modern work practices unless they are linked to increases in pay. All those things harm the economy.

It is perfectly rational, of course. If I were a London tube driver, would I join the union? Of course I would! Through union control, its members have got salaries of between £55,000 and £60,000 a year and 43 days of holiday. But does that help the economy? Is it good for society as a whole? No.

Chris Stephens Portrait Chris Stephens
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I thank the hon. Gentleman for giving way, but—with as much respect as I can muster—I say to him that it is not a bad thing that trade union-organised workplaces have higher pay than non-unionised workplaces. Surely the fact that people have more money means that they can spend money in the economy and help the private sector.

Jerome Mayhew Portrait Jerome Mayhew
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I thank the hon. Gentleman for that intervention. The question is: at what cost does this come and who pays the price? It is the young, the unemployed and the old who are outside the club of unionisation. They are the ones who pay the price, and the evidence is in the data.

It is an extraordinary fact that every Labour Government in history have ended up destroying employment, leaving more people out of work than when they came into power. The figures hide the real cost of Labour being in hock to the unions. I mean “in hock” literally: since 2010, it has received £142 million. That is excluding individual contributions to Opposition right hon. and hon. Members, and not even mentioning the hon. Member for Brent North (Barry Gardiner), so actually the number is a lot higher.

Raising employment barriers skews what would otherwise be a much more sensible employment policy for the Opposition. The costs are paid by those outside the club. Look at youth employment. In 2010, Labour left office with youth unemployment at about 20%. Right now, even after a global pandemic, youth unemployment is at 11.3%—almost half. Look at the long-term unemployed. In the 2000s, as we have already heard, Labour left about 1.4 million people unemployed for longer than 12 months. Today, the figure is 270,000, roughly a quarter of the number under the terrible record of Labour. Look at the people who are harder to employ—those, perhaps, with disabilities. Under this Government, there are 1.3 million more people with disabilities in employment than before 2016. That is the proud record of this Government. This Government do not pontificate about pay and employment; they get on with creating a dynamic labour market, supporting those most in need, not the union paymasters.

We have created a labour market not just by removing barriers to employment, but by having a benefits system that always makes work pay: the universal credit system, the destruction of which the right hon. Member for Islington North (Jeremy Corbyn) made the key plank of his 2019 election manifesto. Labour Members all fought the last election on the basis that they wanted to get rid of universal credit, and the right hon. and learned Member for Holborn and St Pancras (Keir Starmer) continued that policy. In October 2020, when he was already leader of the Labour party, he said that “in the long term” universal credit needed to be replaced

“because… it traps people in poverty.”

However, given what we have heard from the hon. Member opposite, that now appears to be Labour policy.

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Chris Stephens Portrait Chris Stephens
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It is also bad employers, and they should be tackled too.

Andrew Gwynne Portrait Andrew Gwynne
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The hon. Gentleman is absolutely right. What is reckless for the economy is a disastrous mini-Budget which has left millions of householders with mortgage rates higher than they would otherwise have been that are locked in for the future, as well as higher inflation and spiralling energy costs as a consequence. That is the real impact of this Conservative Government on the economy.

In the north-west today, there are 57,000 more people who are economically inactive between the ages of 50 and 64 than there were in 2020. We hear a lot from this Government about growing the economy, but there seems to be no appreciation of the fact that, unless we get people back to work, the economy will remain stagnant. I represent brilliant, talented and hard-working people who are effectively being shut out of accessing the labour market because of long-term sickness or because the support just is not there to get them through the door.

Denton and Reddish straddles two local authorities, Tameside and Stockport, so I see two of everything. Sadly, that means I have seen two almost identical rises in the economic inactivity of my constituents since 2019. In Stockport, we have seen a 2.1% rise, and in Tameside, that figure sits at 1.7%. Across both local authorities, there are over 12,500 people currently claiming universal credit because they cannot access a job that pays sufficiently. Let us be clear: these are not people who have decided that work is not for them and have dropped off the grid—these are people who want to contribute but are finding that the door is locked.

Let us take long covid as an example. I speak with personal experience on this subject, because I suffered from, and indeed still have some of the symptoms of, long covid after my first bout of covid in 2020, and it is of great interest to me in my other role as shadow public health Minister. We know that there are around 2 million people living with this condition in the United Kingdom—that is 3% of the population—but there has been no meaningful effort from central Government to ensure that reasonable adjustments are being made in the workplace, and it can be done. Mr Speaker and those in the Speaker’s Office accommodated me. I found that bobbing up and down was exhausting and basically wiped me out, and a simple, reasonable adjustment was for me to hold up the Order Paper so that I could be called to speak. For everybody else, however, it is business as usual, with long covid sufferers being forced to navigate a system that has not adapted to their needs.

The Government have failed to provide specialist help for those with long-term ill health, to invest in upskilling or to target employment support at hard-to-reach groups. Instead, they have outsourced large sums of money to deliver schemes such as kickstart and restart, which are massively under-delivering. They are obsessed with slogans, but not bothered about whether they deliver on their promises. In the last 13 years, regional inequalities have widened, health inequalities have soared and our economy has flatlined. Despite that, Government Ministers still parrot the phrase “levelling up” without an ounce of shame or self-awareness. We can do much better.

Labour’s plan will devolve employment support, overhaul work capability assessments and provide targeted help for the over-50s and those with long-term ill health, which would be truly transformative for the people I represent. My constituents are tired of warm words with little substance. It is time for the Government to move out of the way and let Labour get on with the job of breaking down the barriers to opportunity and getting our economy firing on all cylinders again.