Oral Answers to Questions

Damian Hinds Excerpts

Monday 9th October 2017 Commons Chamber

[Stephen McPartland (Stevenage) (Con)]

13. Whether he has plans to reduce the taper rate for universal credit claimants.

[The Minister for Employment (Damian Hinds)]

We have already made the taper rate more generous by reducing it from 65% to 63% in April this year, which means that recipients can keep more of every pound they earn.

[Stephen McPartland]

A taper rate of 63p in the pound is, in effect, a tax rate of 63% on net income. Surely the Minister accepts that that is a punitive rate and a barrier to work.

[Damian Hinds]

This all has to be seen in the context of our reducing the benefit withdrawal rates and making it more attractive to go into work. Of course I understand the attraction of reducing the taper rate, which is why we have done it, but there is also always a trade-off with costs; reducing the rate from 65% to 63%, as we have done, carries a cost—an investment in the system of £1.8 billion.

[Lucy Powell (Manchester Central) (Lab/Co-op)]

Is not the whole point of a pilot to test a system and then change it before it is rolled out further? Many of my constituents are in the universal credit pilot scheme. Given my caseload from them, I was horrified today to receive letters about all the rest of the jobcentres in my constituency getting universal credit roll-out. This needs to be looked at, along with the taper and many other issues, before it is rolled out further.

[Damian Hinds]

In days of yore, such big changes used to be done via a big Gantt chart on the wall and then one day things going live. That is not how universal credit has been designed or rolled out; it is a very gradual process and has been being rolled out since 2013. The full service is now in more than 100 jobcentres, and we continue to update, evolve and improve it at every turn.

[Mr Speaker]

If the hon. Member for Thirsk and Malton (Kevin Hollinrake), who has a similar inquiry at Question 17, were standing, I would call him, but if he is not, I will not—

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[Damian Hinds]

Although most people these days are paid monthly, quite a lot of people are still paid weekly. When people move into a new job, they could then be getting paid weekly or monthly. There are two important things to mention here: advances, which have been extensively discussed during today’s questions, and the personal budgeting supports we offer to people to help them deal with changes in their cash flow.

[Laura Pidcock (North West Durham) (Lab)]

Universal credit claimants must wait a minimum of six weeks for their first payment, which does not reflect the world of work. Advance payments are not a remedy for that, because they are a loan, entrenching poverty and debt. Is the Department really going to ignore the unanimous plea from support and advice agencies to pause this roll-out?

[Damian Hinds]

It would be wrong to pause the roll-out, because that would mean fewer people would have the benefit of universal credit, more people would be stuck on 16-hour jobs and fewer people would be able to claim the higher rate of childcare reimbursement. Universal credit is working; we know that people are getting into work quicker and that, once they are there, they can see clearly that working more will always pay.

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

15. If he will take steps to ensure that people applying for personal independence payments are seen by a specialist at their initial assessment.

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[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

19. What recent comparative assessment he has made of rates of unemployment in the UK and in other European countries.

[The Minister for Employment (Damian Hinds)]

The UK has the joint fourth lowest unemployment rate in the European Union. At 4.3%, UK unemployment is the lowest in 42 years. It is 3.3 percentage points below the EU 28 average and half that of the euro area.

[Daniel Kawczynski]

Our unemployment rates continue to fall faster than the EU mean. How is universal credit helping that?

[Damian Hinds]

Universal credit is an absolutely integral part of our overall approach to employment. It not only simplifies the system but makes it easier for people to go into work, because they do not have to think about whether subsequently they might have to restart their benefit claim. Once people are in work, it means that they can make progress more easily because there are none of the cliff edges of the old system.

[Tom Pursglove (Corby) (Con)]

T2. If he will make a statement on his departmental responsibilities.

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[Philip Davies (Shipley) (Con)]

T5. The Secretary of State has already made it clear that, when the jobcentre closes in Shipley, outreach work will still be carried out by the jobcentre in the constituency. Can he confirm what he has in mind, when the specific proposals will be announced and what consultation will be carried out in the local community to ensure that they meet the needs of my constituents?

[The Minister for Employment (Damian Hinds)]

Outreach is a vital front-facing service to claimants across a whole range of employability and related services. Of course it needs to be tailored to the needs of each area. The DWP is looking at partnerships with organisations in my hon. Friend’s constituency, including with the local authority. Throughout the course of that, we will be working with his constituents, and we will be happy to work with him, to ensure that those needs are met following the closure of the Shipley office.

[Rachael Maskell (York Central) (Lab/Co-op)]

On 12 July, universal credit was rolled out in York. Many of the families affected also receive free school meals and therefore had a devastating time of food poverty over the summer. Will the Minister learn lessons from the pilot scheme and ensure that universal credit is not rolled out in advance of school holidays?

[Stephen McPartland (Stevenage) (Con)]

T6. The higher rate of tax is 45% on gross income and the effective rate of tax on universal credit claimants is 63%. How can the Minister justify that?

[Damian Hinds]

I return to what I said earlier: with universal credit, we are improving the incentives to work. This has to be seen in the context of the previous system, where far more people would face considerably higher marginal withdrawal rates. This important reform means that people can always see that they are better off going into work and, once there, they can see that they are better off always progressing in work.

[Stephanie Peacock (Barnsley East) (Lab)]

I find the Minister’s previous response surprising because a response to a recent written question showed that about two thirds of decisions against awarding PIP and ESA in Barnsley East are eventually overturned on appeal, with these appeals taking an average of 15 weeks to be decided. Does the Minister believe that it is acceptable to make my constituents who are eligible for vital financial assistance wait nearly four extra months?

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[John Cryer (Leyton and Wanstead) (Lab)]

I would invite the Employment Minister to visit my local jobcentre, but he is busy circumventing his own criteria to shut it down. In view of the problems with universal credit, why does he not revisit those decisions, keep jobcentres open and stop forcing some of the most vulnerable people to travel for hours just to get the benefits that they are entitled to?

[Damian Hinds]

We had an estate that was underutilised. As the Secretary of State said, coming to the end of the large contract that covered very much of the estate, there was an opportunity—indeed, a requirement—to review all our needs to ensure that we had the best possible estate for the future. We had clear criteria for determining which of those sites should be open to public consultation. Where those criteria were met, of course there was a consultation.

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[Dan Jarvis (Barnsley Central) (Lab)]

Are levels of child poverty falling or rising?

[Damian Hinds]

When one compares rates of poverty with those before the change of Government in 2010, we see that none of the four main measures has worsened and, in fact, three have improved.

[Eleanor Smith (Wolverhampton South West) (Lab)]

As of November 2016, youth unemployment in my constituency of Wolverhampton South West was 27%. Now, we are due to have the roll-out in December and this will see the enforcement of the youth obligation. What steps has the Minister taken to ensure that young people who reside in constituencies such as mine are provided with support into employment, while the transition to the full UC service is implemented?

[Damian Hinds]

I had the pleasure of visiting Wolverhampton just last week and had the opportunity to speak to my colleagues in jobcentres in the area about youth unemployment. Of course, the figure for young people who have left full-time education and are unemployed has dropped below 5% for the first time since that data series began. As we know about the scarring effect of any period out of work for a young person, we continue to work hard through things such as work experience and sector-based work academies, and that is showing great success.

[Several hon. Members rose—]