Benefit Sanctioning

Debbie Abrahams Excerpts

Tuesday 2nd December 2014 Westminster Hall

[Paul Blomfield]

I thank my hon. Friend for that intervention and for the great work she has done as Chair of the Work and Pensions Committee, along with the other members of the Committee. She is right to highlight the link between benefits sanctioning and payday lending. As she will know, payday lending is a concern to me. With colleagues from all parties in the House, I introduced a private Member’s Bill on high-cost credit.

I have subsequently worked with colleagues on the all-party group on debt and personal finance to push the Financial Conduct Authority to introduce effective regulation of payday lenders, and I am delighted that we have made some progress on that. However, that is only part of the solution. We are dealing with the consequences of poverty—people resorting to payday lenders—but not the causes, and one of the most significant causes is benefit sanctioning. I am therefore pleased that my hon. Friend raised that point.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

I apologise to my hon. Friend for being a little late. Is he aware of the evidence from Oxford university, which shows that one in four JSA claimants who are sanctioned leave JSA and that more than half of them do not get into work? Using sanctions to get people into employment has therefore proved ineffective.

[Paul Blomfield]

I was not aware of that research, so I am doubly grateful to my hon. Friend for her intervention. That makes the point powerfully that the sanctioning regime is failing to achieve its stated intention. Even leaving aside the hardships and all the consequences of sanctioning, we still need to look carefully at the issues I have raised because of the failure of sanctioning to meet its stated objectives.

So far, the Government have resisted calls from the Work and Pensions Committee, Citizens Advice and others for a full review of the sanctioning system. I have commended the work of the Oakley review, but that focused only on the practicalities of the current system. I understand the Select Committee is conducting its own inquiry, which I strongly welcome, and I am sure Citizens Advice and many others will engage fully with it.

Why, however, are the Government refusing to address one fundamental question: is the sanctioning system proving effective at getting people into work, which is its stated intention? Why is there no performance evaluation of the system against that criterion? There is no shame in that, whatever the answer—even if it is that, no, the system is not proving effective. However, we need to know the answer as policy makers; if we do not even ask, we are showing enormous contempt for the people whose lives are being dramatically affected. I hope the Minister will give us a commitment on that today.

--- Later in debate ---

[Steve Baker (Wycombe) (Con)]

One of the things that has troubled me most in my parliamentary career has been when serious allegations have been made about the unintended consequences of benefits reform. In some cases, it is alleged that it has led to people’s deaths.

In the Library brief, I read an article from The Independent about the cases of Mark Wood and David Clapson. Mr Wood died. He had a number of mental health problems and was found starved to death. Apparently, he thought that he deserved only £40 a week, and when a member of his family gave him money, it is alleged that he gave it to charity. Mr Clapson also died. He was a former soldier and a type 1 diabetic. It is said that his benefits were cut. The article says:

“He had no food in his stomach, £3.44 in the bank and no money on his electricity card”,

so he could not run the

“fridge where he kept his insulin.”

Those are appalling cases. The DWP has apparently said of Mr Wood:

“The coroner attributed Mr Wood’s eating disorder and food phobia as the likely cause of his death”

and Mr Clapson had not appealed or applied for a hardship payment. In the system set up to help such people, it may well be that unforeseen circumstances arose that led to the deaths of both those men.

The Government explain that the majority of claimants do not receive a sanction and that vulnerable claimants can receive hardship payments immediately if they are sanctioned. It seems to me that in the cases of both Mr Wood and Mr Clapson, there should have been immediate hardship payments, if not a suspension of the sanction in the first place.

Why do such decisions get made? First, it is because the state is not an instrument of compassion and kindness. In the end, it is an instrument of rule following and coercion. Something is going on in the system when the Minister’s and the Government’s good intent, which I do not doubt for a moment, goes through a set of rules, procedures, structures and bureaucracies that ultimately leads to some edge cases in which people may even die as a result of the system. Why does that happen?

The other question is why people working within the system allow these things to happen in front of them. I have observed that people with the least are often the most generous, and those who are the closest to human suffering usually feel the most for the people they see suffering, so why do these things happen? I am afraid that I found myself turning to the Milgram experiment, which gave a psychological explanation of why people obey authority. It is just a fact—this has been shown repeatedly—that people will obey the rules far beyond their personal morality regarding the consequences. I ask the Government to think about how the incentives for staff could be changed to allow their personal morality to flourish in the system, so that the small minority of cases that are clearly illogical and wrong never arise.

It has been pointed out that the vast majority of decisions are correct. In the 12 months to June 2014, decision makers considered 1.76 million JSA cases and imposed 850,000 sanctions or disentitlements, but fewer than 15% of those decisions were changed on reconsideration or appeal. Some 15% were changed after review and fewer than 1% after appeal, and that was often because the claimant brought forward new evidence. The problem I am most concerned about is how in the tiny minority of cases where a different decision really ought to have been made, it was not made.

[Debbie Abrahams]

The hon. Gentleman is making an interesting speech. He might not be aware of the Select Committee inquiry and the report we published earlier this year that clearly showed that the pressure on Jobcentre Plus advisers to get claimants off-flow—off the books—was such that it was distorting what should happen. He mentioned the rules in society, but the rules and culture being set up within the Department contribute to those tragic cases.

[Steve Baker]

I am grateful to the hon. Lady, because I was not aware of the report. I will be sure to dig it out after the debate and have a good look at it.

My point is that I do not doubt the Government’s good intent or that the overwhelming majority of the people working in the system do an extremely difficult job that is demanding both on their skills and talents and on their emotions; but I have to ask why it is that in a tiny minority of cases things go so badly wrong. The hon. Lady made a good point about the systems that are put in place. How do people end up feeling incentivised to sanction people whom they otherwise might not sanction? Why do they not notice that someone has a mental illness such as a food phobia and feel able to refer them to help elsewhere? How can that possibly be? I am absolutely convinced that every Member of this House believes not only that we should have an ultimate social safety net, but that there is one there that should be and largely is effective.

I will finish my speech with some obvious suggestions for the Government, which I feel sure they will have considered. First, it is obvious that everything should be clearly communicated to people, taking into account issues such as those the hon. Member for Sheffield Central (Paul Blomfield) mentioned, where someone cannot read. It is obvious that a person cannot be expected to comply with rules that have not been explained to them. The rules should be explained simply and people’s understanding of them confirmed. It is not enough sometimes just to send a letter—if people cannot cope with life, they will not open their correspondence. Secondly, how can we expand the capacity of individual members of staff to exercise their personal moral judgment in cases, so that we do not end up with a type 1 diabetic with no money to pay for the electricity to keep the fridge on for his insulin? I suggest that all staff should have a duty to inform claimants of their right to appeal and to apply for hardship payments.

I am absolutely sure that the Government intend to drive people into work, and that is right. If people can work, they should work; it is good for them and it is good for society. I am also absolutely sure that the Government intend to bring hope to people who are without it. I just hope very much that we can deal with all the issues around the edges and set up a system of welfare that works for everyone, all the time.

--- Later in debate ---

[Paul Maynard]

I agree entirely. One of my caseworkers also works part-time at the local citizens advice bureau; her experience in the one role helps her in the other, and vice-versa.

What is not made sufficiently clear to all claimants of jobseeker’s allowance is that participation in any activity to get claimants closer to the workplace, whether computer or other skills training, does not invalidate the obligation to continue job-seeking activities. That is often the golden thread running through so many of the sanction cases that come across my desk. That central and essential point is somehow lost on people and, given that it is so central, I urge the DWP to make it much clearer.

What might be driving the ESA issue in particular, which the hon. Member for Edinburgh East mentioned, is the lack of freedom that Work programme providers have not to refer an infringement on for a further decision. That seems to be building into the system an accelerator of the number of referrals on potential sanctions. I urge the Minister to look at how we can build more flexibility into the system so that Work programme providers may choose not to refer if they deem that the claimant has a good reason.

I was struck by the reference of the hon. Member for Sheffield Central to the number of increasing incidents. We can all argue over the figures—some people cite 4.5 million—and I am sure that we will argue about them in the Select Committee, but the essential point to me is that any change in the welfare state or in any particular benefit inevitably creates confusion for those who have to administer the system and for those seeking to navigate it as claimants.

We have seen tremendous changes in the benefits system in recent years—new benefits coming in and new requirements being placed on claimants, none more so than the claimant commitment—and that has required a great degree of comprehension on the part of many of those applying for JSA. Many have none the less found the new document off-putting. Yes, it is certainly personalised, but it is still a matter of putting ticks in boxes as they apply to the individual, so the personalisation is a little limited. It still requires a variety of boxes to be ticked, rather than being built around the needs of an individual. That still creates problems.

I am also struck by the number of people making the journey over to my office from the jobcentre who say, “I have been sanctioned”, when on investigation no sanction is officially part of the story. To me, that was an anecdotal impression—that people said that they were being sanctioned, but were not being sanctioned—so I was intrigued to read in the Oakley report that DWP research had found that 28% of JSA claimants had said that they had been sanctioned in some way, shape or form. Once the case load was reviewed, it turned out that only 11% of claimants had been sanctioned.

I am not saying that those individuals were in any way seeking to misrepresent what had occurred. Once again, benefit claims can be complex, and the amount that one receives each week can change according to a wide range of factors, such as social fund repayments, late payment of bills or the Child Support Agency—the list is endless.

[Debbie Abrahams]

Will the hon. Gentleman give way?

[Paul Maynard]

I am conscious that I am taking a lot of time, so I would like to get through my comments rather than give way. I do apologise.

What interests me is that sanctions appear to be becoming a shorthand for a wider range of issues in the welfare system, all of which undoubtedly need to be addressed. Meanwhile, the issue of conditionality is almost getting a worse name for itself than it should be. Conditionality is not always responsible for all the problems that individual claimants are bringing forward and identifying. We need to drill down to what exactly is occurring.

We obviously have the endless debate about whether Jobcentre Plus employees are expected to hit particular sanction levels. I try to take a pragmatic view. If I am managing a process and I have an outlier branch of my network that is producing figures that I do not recognise, I will of course investigate. I specifically asked my Jobcentre Plus advisers in Blackpool whether that was occurring, and I was assured that it was not. I can only take their word for it, but I understand such concerns. I suggest to those concerned that entering into a potential sanctioning process can often bring out some of those underlying problems—[Interruption.] Was it something I said? I see that the hon. Members for Makerfield (Yvonne Fovargue) and for Oldham East and Saddleworth (Debbie Abrahams) are leaving the Chamber.

On the underlying problems, one gentleman who came to my office had not completed any of his back-to-work activity, but he was then found to be functionally illiterate at the last-but-one stage before he was due to be sanctioned. The sanction was not applied and his literacy issues were then dealt with; Jobcentre Plus employees can use discretion and can already get to the bottom of what is causing some of the problems. I revert to the underlying point of Mr Oakley’s report, which is that the system is not fundamentally broken. He states that quite explicitly. Improvements can certainly be made but, as a system, conditionality is not fundamentally broken.

The hon. Member for Oldham East and Saddleworth made a point about the sizeable numbers exiting JSA totally. I hope that the Select Committee will investigate that important issue, because one of the challenges in Blackpool has been to estimate the size of the black economy. The suspicion is that many people, who until the introduction of the new claimant commitment were able to maintain their job-seeking activity while working in the black economy, could no longer juggle both balls and therefore voluntarily chose to exit JSA. It is a persuasive narrative and I would like the Committee to investigate the extent to which it holds true. Does it depend on the size of the black economy in any particular local economy? What estimates have been made? That is another important issue to be drilled down into.

I want to ensure that other people can speak, so my final point is that, as we have all been saying, conditionality has to be part of any functioning welfare system, but it must be done in such a way that it is also seen to be humane. The Litchfield review of the work capability assessment was always careful to make the point that there is such a thing as institutional justice. People will accept an adverse decision if they have confidence in the process that they have gone through and feel that they have been given a fair opportunity to have their say. The fact that institutional justice is part of the welfare state is an important factor in making it work in the interests not only of those claiming, but of those funding and administering it.