Universal Credit Sanctions

Damian Hinds Excerpts

Monday 4th December 2017 Commons Chamber

[The Minister for Employment (Damian Hinds)]

Time is a little short, but I will seek to address as much of what the hon. Member for Oldham West and Royton (Jim McMahon) raised as possible. I congratulate him on securing this important debate.

I will start by going over some of the principles of why we have conditionality and of how the system we have specifically designed in universal credit supports claimants in meeting conditionality. The hon. Gentleman went over some of the history of our benefit support system and, yes, the system is there to provide a safety net, but it is also a well-understood and long-standing principle that individuals must meet certain conditions to receive certain benefits.

It is possible, of course, to argue for a system of out-of-work support that does not have conditionality—something like a universal basic income—but that is not, to the best of my knowledge, the policy of the official Opposition or of other Opposition parties in this House. That would be a completely different debate.

Conditionality has been a long-standing feature of welfare benefit entitlements in this country, and the scope and scale of it has evolved over time. The introduction of jobseeker’s allowance in 1996 intensified the monitoring of unemployed claimants’ job seeking behaviour, and the incoming Labour Government of 1997 adopted what was called a work-first and work-for-all approach that embraced JSA’s monitoring of claimants’ job search activities, backed up by benefits sanctions in cases of non-compliance. Universal Credit is specifically designed so that work coaches engage with and support people early in their claim, and then throughout, to give them advice and support, and not to lose contact with them. With the introduction of the claimant commitment, it is clear to claimants what is expected of them. Through it, they commit to undertake certain actions, such as attending interviews, applying for jobs and apprenticeships, or going on training, in exchange for receiving benefits.

[Ruth George]

Does the Minister believe it is correct that a single parent of a 13-year-old child should have to sign up to a claimant commitment to seek work for 35 hours a week when they have a child to look after in the school holidays?

[Damian Hinds]

The claimant commitment is agreed between the claimant and the work coach, and it is based on the claimant’s particular circumstances. So where a mother is taking young children to school and back, the time she would have available to work and for work search would be restricted by that. Where someone has caring responsibilities for a spouse, parent or disabled child, that will also change the amount of time they have available. The point is that this is to be a tailored system that responds to and reflects the individual’s circumstances. The individual and the work coach between them agree what is reasonable, and the claimant then commits to it. As I was saying, work coaches have the flexibility to personalise the requirements—I have pretty much covered what I was about to say in that paragraph in responding to the hon. Lady.

Work coaches can also remove all work-related requirements where it is not reasonable to expect claimants to be able to comply, or suspend them temporarily, such as when someone needs time to find a home. We are constantly reviewing our guidance and ensuring that work coaches understand the importance of getting the right levels of conditionality in place, based on a claimant’s individual circumstances. Indeed, when a work coach takes up the role for the first time, they go through a minimum of five weeks of classroom-based learning, after which they consolidate that learning back in their jobcentre. This training covers conditionality and setting appropriate commitments for the specific circumstances of the claimant. Additionally, when a jobcentre goes live with the universal credit full service, existing work coaches there go through three weeks of classroom learning, which also includes how to apply conditionality and agree reasonable commitments. Similarly, work coaches can refer to extensive guidance on how to support claimants with disabilities and complex needs.

It is right that there is a system in place to encourage claimants to meet their requirements and, as a result, move closer to work. As such, if a claimant does not meet the requirements they have agreed to in their claimant commitment, they are referred to a decision maker to determine whether a sanction is appropriate. We take a number of steps to make sure our decisions are fair: the decision maker invites those referred for a sanction to explain why they failed to meet their requirements; and we take the claimant’s individual circumstances into account, including any health conditions or disabilities, and any evidence of good reason, before making a decision to apply a sanction.

Evidence from trials where there was no conditionality for the first 13 weeks showed a significant increase in the length of time spent on benefit. That was due mainly to people taking longer to find work. In addition, more than seven tenths of UC claimants said the potential for sanctions made them more likely to look for work or take steps to prepare for work.

A report from the OECD in 2013 also noted that the UK’s

“long tradition of activation policies to promote the effective reintegration into employment of working age benefit recipients helped limit the rise in unemployment, even during the global and financial crisis”.

When a claimant disagrees with a sanction, they can ask for the decision to be reconsidered. Following that, if necessary, they can appeal against the decision to an independent tribunal. Ultimately, where a sanction is applied, it can only deduct an amount equal to the claimant’s personal element of universal credit—that is, their standard allowance. It does not apply to the additional amounts they may receive in respect of having children, to cover housing costs or to help with the costs of disability.

We have a well-established system of hardship payments and, in universal credit, claimants are able to apply for a hardship payment from the time their payments are reduced through a sanction. Nevertheless, most claimants do what is expected of them and are not sanctioned. The latest published statistics show that at March 2017, 6.9% of people on universal credit had a deduction taken from their standard allowance as a result of a sanction.

The rate in universal credit is higher than the sanction rate for jobseeker’s allowance, but the two are not directly comparable. In UC, if a claimant fails to attend a work-focused interview without good reason they can be sanctioned, whereas if a claimant on JSA fails to attend a work-focused interview, after five days without making contact they would have their claim terminated. In the November statistics release, about two in every 10 adverse sanction decisions are for failing to attend, whereas under UC it is about seven in every 10. To repeat, it cannot be inferred from that that more people are not attending. Rather, it means that non-attendance is often treated differently because UC is a very different benefit that covers not just the individual element, but support for children, housing costs and other elements.

Universal credit is designed to support claimants in a holistic way, ensuring that we help them find or progress in work, while ensuring that they continue to receive help with their housing costs and other benefits. In universal credit, we are more likely to temporarily reduce benefit, for example where there is a complete loss of claimant contact, while we try everything possible to contact the individual. In jobseeker’s allowance—