DWP: Performance

David Rutley Excerpts

Monday 30th June 2014 Commons Chamber

[Rachel Reeves]

My hon. Friend is absolutely right to say that there is still an awful lot to do to reduce unemployment and ensure that everybody in work is earning enough to be able to support themselves and their families.

Let us now deal with universal credit, the Secretary of State’s pet project and the Prime Minister’s flagship welfare reform. Where are we with that? It was supposed to be the Government’s way of achieving £38 billion of savings over 10 years and £7 billion a year thereafter by reducing fraud and error and by encouraging more people into work. Today, with more than £600 million spent on set-up costs, we should be starting to see the benefits—1 million people should be claiming universal credit now, as part of a roll-out that the Government said would be completed by 2017—but instead we find that £130 million of this expenditure has already been written down or written off and only 6,000 of the simplest cases have so far received the benefit, which is less than 1% of the level it should be at now. Most worryingly of all, we now have no reliable timetable and no Treasury-approved business case to tell us how, when or whether this project will ever be fully operational or deliver value for money.

We have repeatedly called on the Government to come clean about the state of universal credit. The rescue committee, which we appointed to advise on the future of universal credit, has recommended that the books be opened for a warts-and-all review, with the National Audit Office signing off any new business case before it goes forward. But instead of moving on from the culture of secrecy and denial, which has been identified as the biggest fatal flaw besetting universal credit, the Government are instead spending yet more taxpayers’ money fighting freedom of information requests and court cases to try to stop the publication of documents setting out the risks, milestones and state of progress of this multi-billion pound project. They are hiding behind a veil of secrecy that is making universal credit harder, not easier, to deliver.

[David Rutley (Macclesfield) (Con)]

I respect the hon. Lady’s real world experience and the things that she has done in the business world before coming to this place. In that vein, will she not understand that it is vital to roll things out on a test-and-learn basis and not, as the previous Government did with tax credits, on a crash-and-burn basis?

[Rachel Reeves]

What I know from my business experience—I am sure the hon. Gentleman knows it as well—is that writing off and writing down £131 million of expenditure is not good value for money. It is good to test things, but I do not see this Government doing much learning from the mistakes they are making.

The evidence is now clear that the Secretary of State’s record has been a complete car crash.

--- Later in debate ---

[David Rutley (Macclesfield) (Con)]

I was fortunate in the late ’70s and early ’80s to be doing voluntary work in the great cities of Liverpool and Manchester, and I gained a great appreciation for the character and resilience of the people who live in those communities and throughout the north-west. In 1981, when the riots literally exploded on to the street in Toxteth and Moss Side, they brought to the surface the real depth of complexity, and the challenges that those communities were facing. Those challenges were profound and very complex, but what I learned from that experience—I still believe this passionately—is that the way to help people out of poverty is through work. The way to help people out of being disadvantaged and to cope with the challenges in their lives and take care of their families is through work, and having an engaged, stronger community is helped by providing worthwhile work.

That whole experience brought me into politics, shaped my thinking of what I needed to do in my career, and got me involved with wanting to create sustainable jobs in the private sector. One of the most rewarding things in my career has been the creation of hundreds of jobs for people so that they can go on and pay their mortgages, look after their families, and help build their careers by creating more jobs and moving the virtuous circle further forward.

When we consider welfare and welfare reform, the tragedy since those days is that it was such a missed opportunity for people to bring about the reform that obviously needed to happen. Yes, it was challenging and difficult, but too many people ducked the issue and missed the opportunity, and they parked welfare reform into the “too difficult to do” box. In his autobiography, Tony Blair speaks with real regret at not having seized that opportunity early on with his landslide majority in 1997. Even now the right hon. Member for Doncaster North (Edward Miliband) is quoted as saying in November 2010:

“I don’t think we did enough on welfare reform. I agree.”

There have been notable exceptions. As always, the strong contribution from the right hon. Member for Birkenhead (Mr Field) stands out as a beacon to us all as somebody who takes these matters seriously. However, the courageous and honourable approach to welfare reform has been brought about by my right hon. Friend the Secretary of State for Work and Pensions. His pioneering approach has brought the Conservative party and the coalition Government on a journey, and tackled the big issues that have been ducked for so long. They have tackled the fundamental challenges, including through universal credit. Opposition Members have been quick to point out the challenges along the way. Okay, there were teething problems and challenges, but the key is that we have learned from the mistakes of the previous Government, and learned how to roll things out on a phased basis to make them possible.

We have seen progress on the Work programme, which other hon. Members have mentioned. One of the key things is that we are looking to make our approach relevant to the world of work today. Self-employment is not something to be shirked. We should encourage people into it. I am delighted that the new enterprise allowance recognises that. Forty-six thousand people in total have been able to create their own business on the back of that scheme, and 8,600 of them are disabled. That is a refreshing approach when self-employment is clearly becoming such an important trend in employment. The Royal Society for the encouragement of Arts, Manufactures and Commerce predicts that self-employment will be more important than the public sector in due course.

I commend the Government’s approach and will not vote for the motion.