Universal Credit

David Nuttall Excerpts

Wednesday 19th April 2017 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) on her persistence in securing today’s debate and on delivering an excellent, wide-ranging speech. I associate myself with her remarks about the debt of gratitude we owe to PC Keith Palmer. My thoughts are with his family and friends, and all those who lost their lives or were injured in the attack on 22 March. Today’s debate is really important, and we have heard compelling contributions from many Members, including my hon. Friends the Members for Mitcham and Morden (Siobhain McDonagh) and for West Lancashire (Rosie Cooper) and my right hon. Friend the Member for East Ham (Stephen Timms), who spoke with real authority and insight.

In 2010, the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith), the then Work and Pensions Secretary, announced that universal credit would radically simplify the existing social security system, make work pay and help lift people out of poverty, but the stories we have heard today show that that is simply not the case. Universal credit brings with it a huge range of problems. Its roll-out has been repeatedly delayed. So far, the completion date has been moved back seven times. It was originally set for the end of this year, but the Department is now aiming for March 2022. The roll-out is still mainly restricted to groups whose claims are reasonably straightforward, such as single people without children. However, the Government now intend to speed up the roll-out, and my hon. Friend the Member for Newcastle upon Tyne North described how the introduction of the full digital service is now causing major problems in areas such as her constituency. The former Work and Pensions Minister, Lord Freud, told the Work and Pensions Committee in February that universal credit could take decades to perfect. Does the Minister agree with Lord Freud on that point?

The design of universal credit means that claimants are left for six weeks at the start of their claim without any income while their initial claim is processed. In some areas, the wait is even longer due to delays in dealing with claims. Croydon Council said in January that the average delay is 12 weeks. That can cause people to be in arrears with their rent, leaving them at risk of eviction and turning to food banks. What are the Government going to do to reduce the delays, and will they end the six-week initial wait for payment?

Then there is the Catch-22 that arises when universal credit meets a council’s legal obligations in relation to housing. If councils house people waiting for a payment in temporary accommodation, they are legally obliged to ensure they do not remain there for more than six weeks. However, to claim help with housing costs through universal credit, someone must have lived in a property for at least six weeks. Will the Government reconsider that rule, which does not fit in with councils’ legal obligations?

Once a claim has begun, payments are monthly under universal credit, rather than fortnightly, as with tax credits. That causes some claimants problems with budgeting. There is evidence that private landlords are becoming increasingly reluctant to rent to universal credit claimants because there is no provision for direct housing payments to the landlord except where someone is assessed as being vulnerable or already has two months’ rent arrears. Will the Minister look again at the issue of direct payment of the housing cost element to landlords so all tenants claiming universal credit can choose to do so?

[Mr David Nuttall in the Chair]

An investigation by The Guardian recently revealed widespread evidence that thousands of tenants on universal credit are running up rent arrears because the minimum waiting period for the first payment is just too long. Surveys by housing associations found that up to nine in 10 tenants on universal credit either run up rent arrears or increase the level of pre-existing arrears because many of them are not financially equipped to cope with long waits without any income. In September 2013, a National Audit Office report on universal credit revealed that IT failures had already cost £34 million, and highlighted the

“weak management, ineffective control and poor governance.”

Since November 2014, DWP has been gradually rolling out the full digital service to a limited number of areas as well as the original live service in others. There are differences not just in the way the services are managed and in the kind of claims, but in the rules for claimants between the two versions in relation to childcare costs and assessment periods, for example. Even now, the universal credit IT system is not capable of coping with the two-child limit this April. Families with more than two children who make fresh claims will actually be diverted to tax credits until November 2018. DWP insists on pressing ahead with a policy that is not just morally wrong, because of the way it implicitly treats some children as more important than others, but which the Department cannot even technically implement properly. Will the Government reconsider the two-child policy?

Universal credit poses further challenges. Just as the Government were speeding up the roll-out of UC, they announced plans to close more than one in 10 jobcentres throughout the UK. It is simply not good enough to quote figures about online claims to justify closure plans. Making a claim online can present real difficulties for people who are not confident in using IT or do not have easy access to the internet. DWP admits that it is likely that online claims are sometimes made only with help from jobcentre staff. Sorting out problems that arise is complicated by the requirement that claimants who contact their MP for help also authorise DWP online to release information to the MP. DWP recently said it will not be necessary to do so for MPs, but said nothing about advice agencies and welfare advocates. Will the Minister make it clear that the DWP will release information to advice agencies acting on behalf of a claimant without further online authorisation?

Universal credit will place other new demands on staff, who will have to assess whether self-employed people claiming universal credit have a viable business plan, and operate in-work conditionality, which will require people already in work to increase their pay. Will the Minister look again at the model of generalist work coaches that DWP is adopting to assess whether it is appropriate to the new challenges that universal credit will involve?

Staff will also have to deal with an increased number of claimants. As universal credit is based on household income, the partners of somebody claiming universal credit can be invited to attend a jobcentre to discuss work even if the partner has not themselves made a claim. People not in work who claim child tax credits or housing benefit but not jobseeker’s allowance are not required to look for work at present, but they are required to do so under universal credit. Will the Government reconsider their plans for jobcentre closures, which risk chaos as the speed of the roll-out of universal credit is increased?

Alongside the practical problems that the roll-out presents, changes to universal credit since 2010—especially cuts to in-work support—have undermined its capacity to reduce poverty. The Government have refused to listen to criticisms of cuts to the work allowance from Labour and voluntary organisations. Analysis by the Child Poverty Action Group and the Institute for Public Policy Research shows that families with children will be worse off by an average of £960 a year by 2020, compared with the income they could have expected under the original design of universal credit, and single-parent families could lose £2,300 on average. Will the Minister review the impact of work allowance reductions on working families—particularly working single-parent families?

The combination of the delayed roll-out of universal credit, the U-turn on tax credit cuts and the dramatic changes to universal credit work allowances is actually increasing the complexity of our social security system. If two families have exactly the same circumstances but one claims tax credits and the other claims universal credit, they may receive very different rates of social security. It is a genuine postcode lottery, because that is how universal credit has been rolled out.

Given all that, it is little wonder that the Government are now silent about how many people they believe universal credit will lift out of poverty. In 2011, they estimated that it would be 950,000. Two years later, it had fallen to 400,000, and by last year they preferred to keep silent. Will the Minister tell us the DWP’s current assessment?

We are seeing different rates of social security for people on tax credits and universal credit and different rules for people on the live and full digital services. We have even heard that the Office for National Statistics is concerned that the statistics for the claimant count no longer present an accurate picture of the labour market because they include all universal credit claimants. Is it really a simpler system? Our social security system is already struggling to cope with its introduction, even before the jobcentre closures go ahead. Far from lifting people out of poverty, there is growing evidence that universal credit risks impoverishing people waiting for payments and making it more difficult for claimants to find affordable housing. Severe cuts to in-work support mean that it can no longer genuinely claim to improve work incentives. Even the right hon. Member for Chingford and Woodford Green has called for the cuts to be reversed, as they go against the key principles of universal credit.

Really important issues have been raised in this debate about the effect of the Government’s roll-out of universal credit. There is a huge range of issues, such as debt, eviction, the stress and anxiety for some of our most vulnerable citizens, and pressures on DWP staff and the system itself. I ask the Minister to respond clearly to the points raised in this important debate and explain how the Government intend to get a grip on universal credit.

[Mr David Nuttall (in the Chair)]

I remind the Minister that the debate will finish at 4.22 pm, and I ask him to try to leave a couple of minutes for Catherine McKinnell to wind up before that.

Oral Answers to Questions

David Nuttall Excerpts

Monday 27th March 2017 Commons Chamber

[Mr David Nuttall (Bury North) (Con)]

My right hon. Friend is right to note that 96,000 new businesses have been started by jobseekers, but many jobseekers still do not know what help is provided under the universal credit system and the new enterprise allowance. Will he say what his Department is doing to increase awareness of these measures?

[Damian Green]

My hon. Friend makes a good point. Obviously, universal credit is still a relatively new benefit, and many of the self-employed may not be fully aware of the many benefits that arise from it for them specifically. Under UC, self-employed claimants will, for the first time, be offered help to increase their earnings. We will be testing the offer of work coach support to self-employed tax credit claimants. Also, there is an assured level of earnings, but new self-employed claimants will be exempt from this for up to 12 months following their application, which people thinking of setting up their own business will find extremely helpful.

Oral Answers to Questions

David Nuttall Excerpts

Monday 20th February 2017 Commons Chamber

[Damian Green]

If the hon. Lady wishes to contact me directly and urgently about that case, we will take it up.

[Mr David Nuttall (Bury North) (Con)]

Does my right hon. Friend agree that there is no evidence to suggest that we are going to lose 3 million jobs, as we were so often warned would happen if we left the European Union? Given the recent announcements that thousands of new jobs would be located in this country by the likes of Google and Amazon, does he agree that this country remains a very attractive place in which to do business?

[Damian Green]

It is perfectly clear that this country is an extremely attractive place in which to do business. I am delighted at the number of big companies—particularly in the tech sector, but in others as well—that have decided to move jobs to this country in recent months, and the Government will do all they can to ensure that that economic success continues.

Jobcentre Plus Offices: Closure

David Nuttall Excerpts

Monday 30th January 2017 Commons Chamber

[Caroline Nokes]

I would like to reassure the hon. Gentleman that this is not about anything sinister. This is about us looking at the best use of the DWP estate, value for money for taxpayers, and the unemployment rate, which is down significantly since 2010.

[Mr David Nuttall (Bury North) (Con)]

The staff and users of the Bury Jobcentre Plus office will be delighted that it will remain open, but will my hon. Friend say when her Department next plans to review the number of Jobcentre Plus offices?

[Caroline Nokes]

As I indicated, this review is part of the prime contract established in 1998. It is nearly 20 years old and expires next year. All the proposals are a part of our making the best use of that contract and looking forward to what we need to provide now and in the future.

Oral Answers to Questions

David Nuttall Excerpts

Monday 9th January 2017 Commons Chamber

[Damian Green]

The hon. Gentleman is right that there should be no exploitation of workers, particularly through forced self-employment, but he will have noticed that the Government are on the case, having set up the Matthew Taylor review specifically to explore alternative employment structures and to consider how employment rules need to be altered to keep pace with changes in how people work in the modern economy. If, however, he is characterising the growth of self-employment as harmful to the jobs market, I would disagree. The new enterprise allowance is proving very successful at making sure that people who want to can work for themselves. I am sure that he, like me, welcomes the fact that in his own constituency self-employment is up by 7% since 2015, and that the claimant count in the last year has fallen by 12%.

[Mr David Nuttall (Bury North) (Con)]

Happy new year, Mr Speaker.

Does my right hon. Friend agree that rather than denigrating people who become self-employed, we ought to be celebrating the fact that they are prepared to take a risk that many others are not? Will he make it as easy as possible for them to take on new employees and become employers themselves?

[Damian Green]

I completely agree with my hon. Friend. I have already mentioned the new enterprise allowance, which is designed specifically to help people to stop claiming benefits, set up their own businesses, and then carry on and employ others in a way that I hope everyone on both sides of the House would welcome. This scheme is proving extremely successful. A survey published last year showed that 80% of businesses that started with the new enterprise allowance were still trading, which makes it more than twice as effective as the old jobseeker’s allowance in terms of keeping people off benefits, so it is doing good work.

Benefit Claimants Sanctions (Required Assessment) Bill

David Nuttall Excerpts

2nd reading: House of Commons
Friday 2nd December 2016 Commons Chamber

[Anne McLaughlin]

That is absolutely right and I completely agree. I am glad that my hon. Friend has brought that up again.

The hon. Member for Mid Dorset and North Poole (Michael Tomlinson) has said that Government Members have as much compassion as Opposition Members. I suppose that depends on his definition of compassion. Was the hon. Member for Bury North (Mr Nuttall) compassionate when he said that people were terrified of getting a job? In other words, he was saying that they are lazy and work shy. Then, when we attacked him for saying that, he sniggered.

[Mr Nuttall]

rose—

[Anne McLaughlin]

Let me think: do I want to give way to somebody who speaks about my constituents in that way? No, I do not. My constituents who are out of work are every bit as deserving of a decent life as any Government Member. If they agree with that, they need to ask themselves how valued and respected would they feel if someone stood over them, pointing the finger, tutting away, treating them like naughty schoolchildren and taking away their entire income by way of punishment for minor misdemeanours. Except they cannot imagine that, because most of them—I take the point made by the hon. Member for Bournemouth West (Conor Burns) about being unemployed—have been nowhere near that kind of life. Well, lucky them.

--- Later in debate ---

[Anne McLaughlin]

I agree with everything my constituent says. On the financial argument, let us look at the hidden costs. We do not know how much those hidden costs amount to, but it does not take a genius.

[Mr Nuttall]

The hon. Lady has just said that we do not know the costs. Earlier in this debate, the hon. Member for Paisley and Renfrewshire South (Mhairi Black) suggested that the explanatory notes contain figures on the cost of the Bill. I have looked again at those explanatory notes, just in case I had missed it, but it turns out that I had not missed anything. All the notes say is that, in relation to clause 9 on financial provision,

“The Bill will require a money resolution to cover increased expenditure under the Bill.”

There would clearly be increased expenditure. When the hon. Member for Glasgow North East (Anne McLaughlin) talks about the costs, will she explain how much the increased expenditure will be?

[Anne McLaughlin]

If it is in order for me to say so, that is the last time I will let the hon. Gentleman intervene. When there is expenditure, it is about political choices. I choose to support people who are at their lowest, and I choose not to pay £400 million to redecorate Buckingham Palace. As he knows, I was talking about the long-term hidden costs.

State Pension Age: Women

David Nuttall Excerpts

Tuesday 15th November 2016 Westminster Hall

[Ian Blackford]

Absolutely. There has been a gross failure of communication at all levels. Many of us have access to occupational pension schemes. We are members of the House of Commons scheme. We get an annual statement of our pension entitlement. That is what the DWP should have been providing, rather than waiting 17 years before communicating with the women involved.

I am conscious of time and I want to begin to wrap up. Much of what I have been talking about was picked up by the Select Committee report in March this year. It said:

“Well into this decade far too many affected women were unaware of the equalisation of state pension age at 65 legislated for in 1995.”

The National Centre for Social Research stated:

“In 2008, fewer than half...of the women who, at that point, would not be eligible for their state pension until they were 65 were aware of the...change.”

That statement referred to research carried out in 2011. Given that we knew there was a lack of appreciation of the 1995 changes, why pour oil on troubled waters by accelerating the timescales in 2011? That was simply vindictive and cruel. Today, let us correct that. Let us show compassion and deliver fairness to the WASPI women.

I have been dealing with this issue on a UK-wide basis, but I want to briefly touch on Scotland. To put this into context, there are 243,900 WASPI women in Scotland. I would dearly love for us to have responsibility for pensions in Scotland, but we do not. The commitment the SNP has given in supporting the slowdown of the increase in pensionable age is one we would legislate for if we had the powers, but we do not. The powers that Scotland has over social security are limited to 15% of such spending in Scotland. We have limited powers. Section 28 of the Scotland Act 2016 grants exceptions to reserved areas where we can top up payments, but this does not include pensions assistance or payments by reasons of age.

I mention that because the Secretary of State, responding to a question I asked about WASPI mitigation last month, said that the SNP

“now control a Government who have the power to do something about this and put their money where their mouth is.”—[Official Report, 17 October 2016; Vol. 615, c. 580.]

The Secretary of State created the impression that we hold powers in areas where we do not. I sought to be charitable to him in a point of order I raised later that day; rather incredibly, I received a letter from the Secretary of State on the 19th arguing that his statement was correct. Let me be clear: it was not. I then raised a further point of order on the 19th, when the Speaker suggested I apply for a face-to-face debate. I am grateful the Minister is here, but it is unfortunate that the Secretary of State is not. He should be dragged to this House and forced to accept that he cannot blame the Scottish Government when they do not have competency for the failures of this Government, and it must stop.

This is an important matter. We cannot have the UK Government suggesting that the Scottish Government have powers that they do not have. I wish we did have powers over pensions. If we had those powers, we would do the right thing by the WASPI women. Until such time as we have such powers we will push the Government to accept their obligations. This Tory Government have ducked their responsibility to the WASPI women for too long. It is time to face up to reality. Pensions are not a privilege; they are a contract, and the UK Government have broken that contract with the WASPI women.

[Mr David Nuttall (in the Chair)]

I am looking to start the contributions from Front Benchers at 10.30 am, so based on the number of speakers I have been notified of, that will mean about five minutes maximum per speaker. I call Tom Elliott.

--- Later in debate ---

[Mr David Nuttall (in the Chair)]

Before I call the Minister, I ask him gently to allow a couple of minutes at the end, so that Mr Blackford can sum up and wind up the debate.

--- Later in debate ---

[Ian Blackford]

I thank all Members who have spoken in the debate. I have enormous respect for the Minister, as I think he knows, but I must say that I am plain disgusted with the response we have had this morning. To that end, I shall be contending that we have not considered the acceleration of the state pension age for women born in the 1950s.

This is not acceptable, because we are now looking at a cliff edge. As I explained, there is an increase in pensionable age of three months for every month that passes. The Minister talked about a leaflet—a leaflet!—that went to the women concerned. We now know that a woman born in 1953 was given just over one year’s notice in 2012 that her pension age was going to increase to July 2017. We now know that a woman born in September 1954 found out in February 2012 that, rather than retiring in 2014, she would be retiring in 2020. Where is the fairness? Where is the notice from this Government?

I have heard various figures from the Government, but this is the first time the House has been told about that £14 billion. The Minister should come with me and I will take him through the Institute for Public Policy Research model. I stand fully behind the £7.9 billion. To hear him dispute that figure is disingenuous, to say the least. The Government have failed to accept responsibility for the WASPI women. The Minister should hang his head in shame. The Government must act, and we will continue to push them.

Question put,

That this House has considered acceleration of the state pension age for women born in the 1950s.

The Chair’s opinion as to the decision of the Question was challenged.

Question not decided (Standing Order No. 10(13)).

[Mr David Nuttall (in the Chair)]

The fact that the Question is not decided shall be reported to the House. It is possible for the Question to be put to the House subsequently for a decision without further debate.

[Ian Blackford]

On a point of order, Mr Nuttall. Given that this debate was granted by the Backbench Business Committee, I understand that it is open to any Member to take this to the Committee and ask its members to push for a vote on the matter in the House. The Government must and will be held to account.

[Mr David Nuttall (in the Chair)]

As Mr Blackford will be aware, that is not a point of order for me. He is aware of the rules relating to access to the Backbench Business Committee, as all Members are.

Could Members who are not taking part in the next debate leave quietly and quickly, so we can make progress?

Oral Answers to Questions

David Nuttall Excerpts

Monday 17th October 2016 Commons Chamber

[Damian Green]

I am grateful to the hon. Gentleman for bringing up that individual case. Obviously, if he wants to send details, I will look at them. Clearly, each case has to be assessed on its merits, so I cannot give any blanket commitments at the Dispatch Box, but I will certainly look at the individual case.

[Mr David Nuttall (Bury North) (Con)]

Does my hon. Friend agree that with more powers over health and social care being devolved to local government, it makes sense to at least consider transferring the administration and responsibility for attendance allowance to them too?

[Penny Mordaunt]

This was part of the consultation on business rate retention and is being considered at the moment.

Oral Answers to Questions

David Nuttall Excerpts

Monday 11th July 2016 Commons Chamber

[Mr Speaker]

Michelle Thomson—not here.

[Mr David Nuttall (Bury North) (Con)]

Does my right hon. Friend agree that one of the most important policy developments is the fact that, once we have left the EU, decisions by his Department relating to eligibility for benefits will no longer be at risk of being overturned by the European Court of Justice?

[Stephen Crabb]

My hon. Friend is absolutely right: there will be that freedom in the future, but there are more options we can develop right now, even while we are still in the EU, for further ensuring that we have a fair benefits system that does not act as an unnatural draw for more migrants. We want people to come here, work and bring their talents, but we do not want the benefits system inflating those migration numbers.

State Pension Age

David Nuttall Excerpts

Wednesday 2nd March 2016 Commons Chamber

[Mr Duncan Smith]

I am sorry that the hon. Lady takes that view. We have rising life expectancy. We have people earning more in jobs. We have more people in work. We have more people saving, and preparing for their retirement, than ever before. We have a pension coming in that means they will not get means-tested. I have to say that I am optimistic on those grounds. I do not, however, blame her for being pessimistic because if I was sitting on the Labour Benches today, I would be really pessimistic.

[Mr David Nuttall (Bury North) (Con)]

Will my right hon. Friend reassure my constituents approaching retirement age that the headlines splashed across this morning’s papers—in one case, saying that people will be required to work until they are 81—have no basis in fact whatever, given that this is just the start of the review and that no conclusions have been made, let alone agreed by the House?

[Mr Duncan Smith]

I agree with my hon. Friend. The reality is that this independent review will look at all of that. The papers have to make their own decisions—I will not be critical of them—but I would simply say that they cannot extrapolate from the announcement of a statutory independent review and say that it will somehow have certain implications for the retirement age going forward. All I would say is that it is necessary to get the balance right between people who are paying for those who have retired and people who have retired and are saving. It is the job of the Government to get that right, and I hoped it would be approached more consensually across the Floor of the House.