Oral Answers to Questions

Debbie Abrahams Excerpts

Monday 27th April 2026 Commons Chamber

[Mr Speaker]

I call the Chair of the Work and Pensions Committee.

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

Our declining healthy life expectancy, as underlined in today’s Health Foundation report, is a real worry, but as Professor Sir Michael Marmot has shown, that is no surprise after 14 years of austerity and its impact on our public services. There is the potential for a significant knock-on effect on Department for Work and Pensions spending. What conversations has my right hon. Friend the Secretary of State had with the Health Secretary on this issue, and is it being considered in the Timms review?

[Pat McFadden]

I know that the Chair of the Select Committee cares deeply about health inequalities in this country, which, to be honest with the House, are deep seated and long term. As in many areas of our work, I believe that constructive and productive employment is a big part of the answer in tackling inequality and prosperity issues right around the country.

Pension Schemes Bill

Debbie Abrahams Excerpts

Consideration of Lords amendments
Wednesday 15th April 2026 Commons Chamber

I say again to the Minister, “Listen to the industry, listen to the other place, and listen to us.” There is a strong consensus behind much of the Bill. There is much to like in it, and there is still time to fix it.

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

I must say that I am slightly surprised by the shadow Minister’s speech. I understand that Pensions UK agrees with the asset allocation, and has welcomed the change that has been announced, which is in line with the amounts prescribed in the Mansion House accord. The accusations about the Government stealing pensioners’ money are just scaremongering. [Interruption.] If my hon. Friend the Minister wishes to intervene to point out how ludicrous that is, I am happy to give way to him. This is dangerous scaremongering, and given that the last Government presided over a doubling of pensioner poverty, they should be ashamed of themselves.

I hope that, in his closing remarks, my hon. Friend will make clear where the UK stands on pension providers’ investments in UK assets. It seems that we are quite low in the rankings. Like Canada and Norway, I believe, we are in the 5% range, whereas Sweden and Switzerland are investing 10% in their countries’ investable assets. At the high end, Australia, Hong Kong and Japan are investing 20% or more. [Interruption.] I think it is my turn to speak. Perhaps we should reflect on how we are disadvantaged by that. I will support the Government today, but I hope that my hon. Friend the Minister can clarify those points.

It will not surprise my hon. Friend to hear that I want to briefly mention pre-1997 indexation. I know that it is not covered by the amendments that have been selected today, but it was debated in the other place. I know that he has already done a huge amount on providing indexation, but members of the financial assistance scheme are a very elderly group; they were particularly disadvantaged by the changes that were introduced, and there are fewer and fewer of them. I know it is difficult, given the appalling financial circumstances that this Government inherited and the difficulties that we face internationally, but I hope that when opportunity allows it, my hon. Friend will do the right thing by those FAS members.

[Steve Darling (Torbay) (LD)]

For many people, a pension is their second largest investment, after their home, but we must bear in mind that many others can only dream of having a private pension, as they face the challenges of the cost of living crisis. We Liberal Democrats want to make sure that pensions work effectively for those who invest in them, and there is much to be welcomed in the Bill.

I want to share a personal reflection with the House. My father, who was a lorry driver, feared poverty in his pensionable age, and saved massively because he had seen that poverty with his own father, but sadly he was perhaps not as financially literate as some other people. He kept his savings in shares; then the stock market crashed in 2008, and his savings for his pension were virtually wiped out. With today’s greater safeguards, that might not have happened; there might not have been the mis-selling that he felt had taken place, or the poor advice that he received from advisers. In that regard, the Bill takes significant steps in the right direction.

We Liberal Democrats, however, want to see our economy working well, and that means a lack of state interference, in the form of direction of investment. It is right that the state should encourage investors, suggest where they should go, and have appropriate schemes to guide them, but the idea of direction is anathema to us. We have repeatedly seen what is almost a nervous twitch, whether through the Public Authorities (Fraud, Error and Recovery) Act 2025 or the introduction of facial ID on our streets, as the Government give more and more powers to Ministers, and that disturbs us. We Liberal Democrats plan to vote against the Government amendments relating to Lords amendments 1 and 15 and specifically to mandation, because mandation is the dead hand of Government on growth, particularly when it comes to people’s pensions, and it goes against our free-economy approach.

The Minister may be a reasonable individual—who knows?—but we have spent many hours on this, and the clock is ticking for the Government. In two or three years’ time, we may have a new Government, and we need only look at the other side of the Atlantic to see what democracy can throw up. We could be giving a future Government whose colour we do not know a challenging approach to mandation. Any reassurances that the Minister gives would not be worth the candle then. We fear that going ahead with mandation would be feckless, and dangerous for our pensioners.

Another area, which I know my hon. Friend the Member for Wokingham (Clive Jones) will touch on later, is pension scandals. The Government missed an opportunity to address pension scandals as part of this behemoth of a Bill, but Lords amendment 78, which they are sadly opposing, applies to the AEA Technology pensioners. That is a small step in the right direction to address the injustice that these pensioners have suffered. I remind the House that the Public Accounts Committee drew on a report by the National Audit Office that highlighted that civil servants were poorly advised by the Government on transferring the scheme to the private sector. Many of the AEAT pensioners have significantly lost out financially. I call on the Government to reflect on that and to take a small step in the right direction. We will vote against the Government motion to disagree to Lords amendment 78.

--- Later in debate ---

[Torsten Bell]

I am always ready to engage in exciting debates about pensions. The right hon. Member for Tonbridge (Tom Tugendhat) is right to say that far more Members should be enthused enough to come and talk for as long as possible about pensions. I hope not to speak for two hours, but somewhere close to that, and I thank Members on both sides of the House and from the other place for their thoughtful contributions to an important debate. I will avoid trying the House’s patience by reiterating the reasons why the Government do not think it right to accept amendments that are unnecessary or that undermine policy intent, but I will respond in detail to the important points that hon. Members have made.

The Chair of the Select Committee, my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) asked specifically about what the international evidence on asset allocation tells us. Two things stand out. The first is that the UK defined contribution market has an unusually low allocation to private assets, for example compared with similar schemes in Australia. The second is the point she raised that they have lower home bias—a point also partially raised by the right hon. Member for Tonbridge. Those two are related. We tend to see higher levels of home bias in investments that are in private assets than investments in public assets, for all the obvious reasons to do with the comparative advantage that comes from knowing more about the home market.

I recognise the argument that my hon. Friend the Member for Oldham East and Saddleworth made about the PPF and the FAS. Her powerful campaigning on this issue, including raising it through the Work and Pensions Committee, is one of the reasons why we have acted in a way that previous Governments and Pensions Ministers have not.

[Debbie Abrahams]

Going back to the asset aspect of the debate, I came across some new analysis from the New Financial that shows that over the last 10 years UK equities allocation by DC pensions has fallen from 25% to just 5%. It argues that this has helped create a self-fulfilling doom loop of lower demand, lower valuations and lower performance. It argues that an increase in allocation to UK equities would have delivered performance that was broadly in line with or better than the performance that most pension providers managed to deliver. That makes the Minister’s argument for him, but I wonder if he wants to comment on it?

[Torsten Bell]

I thank the Select Committee Chair for her intervention. The organisation she mentions has been consistently making these cases. In fact, the hon. Member for Wyre Forest (Mark Garnier) has spoken from the Opposition Front Bench about the work of that organisation in these debates, including in a Westminster Hall debate just a few months ago. It is an important thing to think about. Some of it reflects increasing international cross-border investments, but my hon. Friend is right to highlight that we see a lower level of home bias among the UK’s defined contribution schemes.

Universal Credit (Removal of Two Child Limit) Bill

Debbie Abrahams Excerpts

Committee of the whole House
Monday 23rd February 2026 Commons Chamber

[Rebecca Smith]

I thank the hon. Gentleman for his intervention. Of course how we care for the most vulnerable is the mark of our society, but as Conservatives we do not believe that it is simply about trying to lift them up by giving them extra cash. All we are doing is changing the relative poverty measure; we are not suddenly lifting all these people out of poverty because we are giving them more money. We do not know what they are going to spend that money on. What we need to do is spend the money not on sticking plasters, but on putting things in place that actually have a systemic impact. We need to bring people from long-term poverty into a long-term position in which they can afford what they need.

Inflation has soared to nearly twice as high a level as when this Government entered office. Food prices are rising. Utility bills are rising. Even the cost of relaxing at the pub with a beer is rising. We cannot lift children out of poverty by making the whole country poorer, as my hon. Friend the Member for Faversham and Mid Kent (Helen Whately) has argued so persuasively. When inflation rises, spending power falls. The money people earn buys less, because each pound is worth less than before; indeed, the money people receive on benefits is also worth less because of inflation. Families feel it at the checkout, at the petrol station and with every bill that drops through the door.

Inflation not only squeezes families’ budgets, but narrows their choices. With the cost of everyday essentials continuing to climb, many working families are being forced to delay or even abandon plans for another child. Scrapping the two-child cap gives families on benefits a choice that many working households can no longer dream of: the ability to grow their family without facing financial choices.

This unfairness erodes trust in our social contract. The social contract is an implicit agreement between citizens and the state that gives the state its legitimacy. People work and pay their taxes; in return, they trust the state to step in if they fall on hard times. They trust the state to spend their taxes responsibly on their behalf, but the welfare system has become totally lopsided. Over half the households in this country now receive more from the state than they pay into it. Taxpayers are supporting a system larger than themselves. Scrapping the two-child limit will further exacerbate the imbalance.

The problem does not stop there. There is an entire shadow system working alongside universal credit. As I have mentioned, passported benefits are costing the taxpayer £10 billion every single year. They include healthy food cards, discounted broadband and free prescriptions. Together, they distort work incentives, leading to a cliff-edge denial of entitlements when a claimant comes off universal credit. Many parents want to work, but are better off remaining on benefits once they factor in their loss of eligibility for those extra entitlements. Yet again, they have been let down by a system that should be supporting them into work, not trapping them on benefits.

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

Can the shadow Minister remind the Committee of the weekly rate for the standard UC allowance?

[Rebecca Smith]

I am not particularly well today, so the right hon. Lady will forgive me if my memory is foggier than normal. That is why I am wearing my glasses, and it is why I am struggling not to cough throughout this debate. I am happy to have a conversation with her afterwards, but testing me on those sorts of things at this particular time is perhaps not the kindest thing to do.

The two-child limit is about basic fairness to working parents—the very people whose taxes fund our welfare system. They are already making tough decisions about the size of their own families, and we cannot exempt people on benefits from those hard choices. Scrapping the cap is a direct insult to the working families on whom this country relies.

The Government should remember the case that they once made for keeping the cap. When the Prime Minister suspended seven of his own MPs in 2024 for voting to scrap it, he did so on the basis that the policy was simply too expensive. He has now bowed to pressure from his Back Benchers, but nothing has changed—it is still unaffordable. Why are this Government preparing to spend billions by removing the two-child limit, when they cannot even get a grip on rising unemployment? We should be expanding real routes into work, not deepening incentives to remain on benefits.

--- Later in debate ---

[Charlie Maynard (Witney) (LD)]

It has been a very painful path to get to this point, but I simply want to welcome what the Government are bringing in. Reversing the decision on the two-child limit will lift 540,000 children out of absolute poverty, and it is unquestionably the right thing to do—certainly for those children and for their families, but also for our economy, our public services and our society as a whole. Children growing up in poverty face worse educational outcomes, poorer physical and mental health, and fewer opportunities in adulthood. As the hon. Member for Salford (Rebecca Long Bailey) pointed out, this has a huge economic cost on our society, and investing a relatively small amount now for great gains later is very sensible.

This change will be worth up to £5,000 per year for each of the more than 500 families in my constituency who have been impacted by the cap. I have had heartbreaking emails from and surgeries with constituents impacted by this cap, as I am sure we all have. They have had to skip meals to ensure their children do not go without, because each month their money simply does not stretch far enough. Our food banks help enormously, but relying on them is obviously not the solution.

Too many children and families have been trapped in poverty because of the previous decision to impose the cap and this Government’s stubborn decision to keep it until now. I wish this change had happened a year ago, which would have saved a lot of trouble and stress for families and children involved, as well as for a few Members in this Chamber. I commend the Labour MPs who lost the Whip for fighting to end this policy for their courage. I am sure that their voices and actions have played a large part in the Government now bringing forward this Bill.

However, the Bill is very narrow in scope, and we should recognise that it is only one step towards tackling child poverty. There is much more we need to do, as highlighted by new clause 3, tabled by my hon. Friend the Member for Torbay (Steve Darling). Ministers will no doubt have seen the report published by the Joseph Rowntree Foundation that, while welcoming the decision to lift the cap, warned that progress on tackling child poverty as a result of removing the two-child benefit cap is likely to stall after April—two months away—unless it is supported by further follow-up measures. The headline from that report was that the number of people living in very deep poverty is at the highest level in more than 30 years, based on 2023-24 figures.

The Government must now make it an absolute priority to address that, which is why we are calling on them to look at the much wider issues of overall levels of child poverty, destitution and deep poverty among households with children, as well as at educational outcomes and physical and mental health outcomes for children in households affected by poverty. They need to thoroughly assess those a year after the passage of this Bill and report back to the House on its impact.

[Debbie Abrahams]

Is the hon. Member aware of the tackling child poverty strategy and the inquiry by the Education Committee and Work and Pensions Committee looking at just that, as well as at the data the Education Secretary published before Christmas?

[Charlie Maynard]

Yes, I am. I congratulate the Chair and members of the Work and Pensions Committee on doing all that good work; many thanks to them.

Assessing the wider issues may encourage the Government to take steps beyond this welcome but narrow Bill to support children and their families who are struggling to get by from week to week. Those include auto-enrolment of all those eligible for free school meals, so that children are automatically considered eligible when their parents apply for relevant benefits or financial support, and giving people the ability to juggle caring responsibilities alongside work without falling into hardship by increasing the value of carer benefits, particularly for those on low incomes.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

New clause 4, in my name and the names of many hon. Members, echoes new clauses 1 and 3. I take reference from points made by the hon. Member for Strangford (Jim Shannon); when we came together to discuss the two-child limit and this Bill, the House was filled largely with compassion, because we had the view that we just could not stand by and watch so many of our children living in poverty. That is why we welcome the Bill and have campaigned for it for so long.

We were building an element of consensus across a large part of the House, but the problem that we have, as has been pointed out by my hon. Friends the Members for Salford (Rebecca Long Bailey) and for York Central (Rachael Maskell) and the hon. Member for Brighton Pavilion (Siân Berry) is that a good Bill is being ruined—or damaged, anyway—by avoiding the issue of the overall benefit cap. As it is impossible for Back Benchers to move amendments that will incur Government expenditure, we could not move an amendment to abolish the overall cap, so through the amendments we have tabled we are simply saying to the Government, “Please acknowledge that the abolition of the two-child limit leaves a large number of our children in poverty.”

My hon. Friend the Member for York Central has said that 141,000 children are affected by the overall cap, but from the last estimate the figure is about 150,000, and there are 50,000 families who gain nothing as a result of the Bill, which is excellent but does not go far enough. Another 30,000 families only get some partial benefit. All these amendments say to the Government, “Because we cannot move an amendment tonight that will scrap the cap, at least consult on the implications of this Bill and those it leaves behind.”

New clause 4 lists a number of the organisations that we depend on for the analysis of poverty and the discussion of the implications. The amendments are not revolutionary; they are straightforward. They ask the Government to please tell us what their next steps are, because they must include the tackling of the overall cap. I welcome the reviews that are going on, but meanwhile time is ticking over. It took us a year to arrive at the final conclusion on the two-child limit, and there could be another year of all those children still living in poverty.

[Debbie Abrahams]

The response to my right hon. Friend will be that everything that is being asked for—the outcomes that he would like—are in the terms of reference and will be addressed within the Education Committee’s child poverty strategy inquiry.

[John McDonnell]

That is why I urge Ministers to act swiftly in response to that review. I believe that all logic will drive these reviews to recommend the elimination of the overall cap, once and for all. I hope we will get something from the Minister tonight—some form of words that acknowledges the seriousness and urgency of the issue. I hope the reviews will report swiftly, so that we can, almost consensually, get legislation on this issue though this House incredibly speedily.

I am sorry that the Opposition spokesperson, the hon. Member for South West Devon (Rebecca Smith), is not very well, and I hope that when she recovers, she will discover compassion, because that is not what we heard tonight. We need to understand the genesis of the overall cap and the two-child limit. It goes back to the financial crisis of 2008-09. Our financial sector operated like a casino. We came to a financial crisis, and when George Osborne became Chancellor in 2010, he decided that it was about not the deregulation of our financial sector but Government overspending—it never was—so he introduced a policy of austerity, which targeted the most vulnerable. He targeted—

Pensions and Social Security

Debbie Abrahams Excerpts

Tuesday 10th February 2026 Commons Chamber

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

I am pleased to follow the shadow Minister. I would like to challenge several things she said, but I will pick up on just a couple.

First, one of the hon. Lady’s opening statements was that hard-working people who get up at dawn and go out to work do not approve of this increase in support. I gently point out to the hon. Lady that most people in receipt of social security support are working, but they are in the low-paid jobs that were presided over by previous Conservative Administrations.

Secondly, the hon. Lady spoke of her concerns about young people. Yes, absolutely, nearly 1 million young people are not in education, employment or training and that concerns us all, but we must all look at the evidence and at the underlying causes of that. She might not have heard me say last week—I have said it a few times—that evidence from the UK Millenium cohort study suggests that half of that population have experienced childhood poverty and adversity in their young years, under the former Conservative Government, and that is the driver. People are five times more likely not to be in education, employment or training if they have experienced that long childhood of poverty and adversity—I do not think the shadow Minister would claim that that has not happened.

It is also a pleasure to follow my right hon. Friend the Minister. I give the pensions and social security uprating orders my wholehearted support. The uprating is absolutely the right thing to do, and I will expand on exactly why. This year’s uprating, confirmed last November by the Secretary of State, will see inflation-linked benefits and tax credits rise by 3.8% this April, which is the level of inflation as measured by the consumer prices index in September 2025. As a result of the Universal Credit Act 2025—some people did not support that, but I did once we got rid of the bits I had concerns about—we increased the universal credit standard allowance. That is important, as it means an additional 2.3% for the standard allowance, which equates to an increase in the standard allowance for a single claimant over 25 from £400.14 to £424.90 per calendar month.

[Andy McDonald (Middlesbrough and Thornaby East) (Lab)]

I am sure my hon. Friend will be aware of today’s Resolution Foundation report that shows how increases in income have significantly slowed over the past 20 years, particularly for those on low incomes, as shown by the basic rate of UC, which has fallen by 9% in real terms since 2010. Does she think there is merit in proposals from the Joseph Rowntree Foundation for an independent advisory process to inform universal credit rates, ensuring that the standard allowance reflects the real cost of essentials and the inflation experienced by those living on lower incomes?

[Debbie Abrahams]

My hon. Friend may not know this, but the Minister and I were on the Work and Pensions Committee when the Joseph Rowntree Foundation and the Trussell Trust presented the case for the essentials. I think there is overwhelming support for such measures, but it is a question of how we do it in a sustainable way. If I may go on and develop my argument a little, he will see that I am moving in his direction.

As we have heard, the new state pension will also increase by 4.8% in April to £241.30 per week, which is in line with the annual increase in the average wage earnings index from last May to September. Briefly, I will explain why it is important that the increase in UC should be above CPI and inflation. Although state support for working-age people and pensioners was fairly similar when annual uprating was first introduced in 1972, the uprating or increase in working-age social security support such as UC in line with inflation has not always happened. In the last 15 years, social security support for working-aged people increased by only 1% between 2013 and 2016, and it was frozen between 2016 and 2020. If anyone wants to look at the changes to inflation over the past 15 years, it makes interesting reading, particularly in 2022-23 and 2023-24, and the increase was far below inflation. As a result, since 2012 benefit levels for working-aged people and their families have lost 8.8% of their value.

The UK’s social protection levels are among the least generous in the OECD. In 2021, the New Economics Foundation estimated that the actual loss in cash terms was equivalent to £14 billion. It also estimated that if spending had been maintained, there would have been 1.5 million fewer people living in poverty. People are often surprised to hear that over the last 20 years or so, the amount of DWP spending as a percentage of GDP—that is acknowledged as the only way we can fairly compare spending—has changed very little: it was 10% in 2005 and 11% in 2025, with the slight increase being accounted for by an increase in spending on pensioners. I think we would all agree that that is the right thing to do. What is alarming is that although poverty levels have been stabilised and will start coming down this year as a result of, for example, the removal of the two-child limit for social security support and the increase in the living wage, the depth of poverty is increasing.

[Graham Leadbitter]

Many things can be done to tackle child poverty. One thing the Scottish Government have done, which has massive backing from the third sector, is introduce a universal child payment. Does the hon. Lady agree that that is potentially the way forward?

[Debbie Abrahams]

I am familiar with the child payment, but I need to understand it in the context of what else is happening in Scotland. I am aware of it, and I think it is an interesting way for Scotland to try to address the issue. We had a meeting with the Children and Young People’s Commissioner Scotland and were impressed with what she was doing, but I will reserve judgment until I understand it a little more in the round.

Only last week, the Joseph Rowntree Foundation published new analysis:

“In 2021-24, the average person in poverty had an income 29% below the poverty line, with the gap up from 23% in 1994-97”.

If we use equivalised figures, that means that couples without children are living on less than £12,500 a year, and couples with two children under 14 get about £17,500 a year. Social security is complex, but looking at deep poverty, as my right hon. Friend the Minister is doing, is important. If we are to avoid the appalling situation with NEETs that we have inherited, that is what we need to do.

Of the 14.2 million people living in poverty identified in JRF’s most recent poverty analysis, 6 million are in severe and persistent poverty, and more than half are disabled or live in a disabled household. Although I recognise the significant moves that this Government have made to address the inadequacy of working-age social security support to tackle the poverty and cost of living crisis that people are experiencing, I personally think we need to be a bit bolder.

As I said last week, I want to see us be clearer about our vision and values, which define what our social security system is for. It is 80 years since the National Insurance Act 1946, which was introduced in response to the Beveridge report and the outcomes and appalling circumstances after the second world war. I believe we need a new social contract that the British people can buy into and that spells out how all the elements of a comprehensive 21st century welfare state work together to deliver for them.

Our social security system, like our NHS, should be there for all of us in our time of need. It should protect us from poverty if we lose our jobs, are born with or acquire health conditions or disabilities, and when we grow old. It should also be there for us if and when we need extra support, become carers and, sadly, lose a loved one, but it cannot work in isolation; it needs to be considered in conjunction with our health and social care, education and skills, and business and employment systems in particular, but there are more.

Without a fit and healthy working-age population, a skilled workforce and a fair employment system providing quality, well-remunerated jobs, our economic productivity is known to fall, and our welfare system as a whole then comes under threat. As an example, Health Equity North’s “Health for Wealth” report shows that improving the health of the north to the same level as the rest of the country would add an extra £18.4 billion to the economy through enhanced productivity while reducing demand on the NHS.

Last year, the Work and Pensions Committee commissioned Health Equity North to report on what income could be generated through increasing returns to work for people in receipt of universal credit by just 5%. Its estimates show that that would yield an extra £20 billion over the life of this Parliament, with a return on investment of between £5.21 and £6.63 for every £1 of employment support invested. That is the way that we will reduce DWP spending and increase growth.

I look forward to seeing how the “Get Britain Working” and “Keep Britain Working” programmes, such as Connect to Work and the vanguards, are expanded. They are fantastic examples of how we can proceed. I was so impressed when I met organisations delivering Connect to Work. The Work and Pensions Committee had a session last week with Sir Charlie Mayfield and small businesses to see how they could be involved in that, and I hope that we can expand and build on this work.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

--- Later in debate ---

[Debbie Abrahams]

My right hon. Friend is absolutely right about those two figures. The fact is that more than half of the current NEET cohort—52.9%—have experienced not just child poverty, but family adversity. That is the five times more likely figure.

[Sir Stephen Timms]

It is an interesting paper, and I very much welcome research along those lines, as I know my hon. Friend does. She is right to make the point that spending on social security is not rocketing. It is not out of control as one sometimes reads, but is between 10% and 11% of GDP. Working-age benefits are 4% to 5% and pretty consistent. It is not changing rapidly at the moment. She makes an interesting point, as did my hon. Friend the Member for Poole (Neil Duncan-Jordan), about the current depth of poverty. That is an important part of the picture that we need to address in our work.

I agree with my hon. Friend the Member for Oldham East and Saddleworth that the social security system has an important job to do. We cannot just freeze it for a year and under-uprate it for another year, because that inflicts harm. We have seen that harm inflicted and the consequences of it. She is also right that we need a properly functioning health service again. We also need support for good employment. I was pleased to hear from her and the hon. Member for Torbay (Steve Darling) that the Work and Pensions Committee has been listening to Sir Charlie Mayfield and his excellent “Keep Britain Working” review, from which he is continuing to develop work.

The hon. Member for Torbay rightly referred to the practice of shuffling people off the books. Too often, people have run into a health problem in the course of their work, had to take time off and then, by accident really, lost touch with work and the workplace and become unemployed and inactive. If there had just been a bit of flexibility and a bit of continuing communication, that outcome could have been avoided. I welcome the work that Sir Charlie Mayfield is doing with more than 100 vanguard employers looking at how best to put those lessons into practice.

The hon. Member for Torbay also referred to the carer’s allowance overpayments scandal. We appointed Liz Sayce OBE to conduct an independent review of how overpayments occurred, how affected carers could be supported and how to prevent future problems with overpayments arising. The review made 40 recommendations, and the Government have accepted or partially accepted 38 of them. We have taken action to raise the earnings limit in carer’s allowance by the largest amount it has ever increased by. In future, we will uprate the earnings threshold annually in line with the increase in the national living wage, so that accidental exceeding of the earnings threshold will be less common.

The hon. Member for Torbay also drew attention to the difficulties with the current cliff edge arrangements for the carer’s allowance earnings threshold. In the 2024 Budget, the Chancellor announced that we were considering the introduction of an earnings taper to replace that cliff edge, and we may well conclude that that would do a better job.

I do not think I ever expected there to be a Labour Member of Parliament for Poole, but I am delighted that my hon. Friend was successful in being elected to that role, and long may he serve there. He was right to highlight the continuing scale of the challenge of pensioner poverty. If we look at the record of the former Labour Government, we see that there were dramatic reductions in both child poverty and pensioner poverty. In respect of child poverty, those reductions were reversed under the coalition and the Conservative Government, and towards the end of the term of the Conservative Government the number of pensioners in poverty was rising again, but it rose much less dramatically than the number of children growing up below the poverty line. Our priority has therefore been to tackle child poverty, and that is the reason for the strategy that we have published and the changes to universal credit that we debated in the House last week.

However, I recognise that there are continuing challenges for pensioners as well. The Government are increasing the basic state pension and the full rate of the new state pension, in line with earnings growth, by 4.8%, meeting our commitment to the triple lock. We are increasing the pension credit standard minimum guarantee in line with earnings, by 4.8%, to support pensioners on the lowest incomes. We are increasing benefits to meet additional disability needs and carers’ benefits, in line with prices, by 3.8%. We are increasing a number of working-age benefits, statutory payments and disability benefits in line with prices by the same amount, 3.8%. The Guaranteed Minimum Pensions Increase Order requires formerly contracted out occupational pension schemes to pay an increase of 3% on GMP—for the reasons I gave earlier—in payment earned between April 1988 and April 1997, to give a measure of protection against inflation for those pensioners which is paid for by their scheme.

I commend both orders to the House.

Question put and agreed to,

Resolved,

That the draft Guaranteed Minimum Pensions Increase Order 2026, which was laid before this House on 12 January, be approved.

Social Security

Resolved,

That the draft Social Security Benefits Up-rating Order 2026, which was laid before this House on 12 January, be approved. —(Sir Stephen Timms.)

Universal Credit (Removal of Two Child Limit) Bill

Debbie Abrahams Excerpts

2nd reading & Money resolution
Tuesday 3rd February 2026 Commons Chamber

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

Of the measures brought forward in this Government’s Budget last year, the abolition of the two-child limit is the one that most fills me with hope and more than a little pride, so I thank the Government for listening to so many of us who raised this issue as a concern.

As my right hon. Friend the Secretary of State has reminded us, child poverty is not just about children going hungry once in a while, or not being able to buy the designer trainers they want. For every 1% increase in child poverty, more babies die before their first birthday. In fact, this causal link has been quantified, and it amounts to 5.8 additional deaths per 100,000 live births. A baby born into a poor family is five times more likely to die than a baby born into a wealthy one. I ask Opposition Members to consider that when they make their interventions and speeches.

If such children are lucky enough to survive their first year, they will be more likely to suffer poor physical and mental ill health and more likely to end up as an emergency hospital admission. The impacts on their neurological development as they grow are profound. How the brain makes its neural connections changes because of the stress and adversity that children go through. In turn, that affects behaviour, cognitive development and achievements in school. These disadvantages continue into adolescence and adulthood, so every aspect of children’s lives is affected.

We are rightly concerned about the number of young people who are not in education, employment or training, and nearly 1 million 16 to 24-year-olds are NEETs. We must look at the evidence for why that is, not just jump to conclusions for political expediency. There is strong evidence from the UK millennium cohort study that persistent exposure to poverty and childhood adversity, including poor parental mental health, means that such people are five times more likely to be NEET. It is estimated that more than half—nearly 53%—of current NEET cases are attributable to persistent exposure to poverty and childhood adversity. It is not because young people fancy a duvet day, and I really think it is disgraceful that such phrases are repeated in the media. This pattern goes on right through adolescence and young adulthood, and it affects people’s earning capacity, as we have heard.

When in government, the Conservatives were warned repeatedly. I was a shadow Work and Pensions Minister, and I represented the Labour party during the passage of the original legislation, so I know they had repeated warnings. I chaired an all-party parliamentary group that raised the issue, and we engaged with the Faculty of Public Health, which did an impact analysis to identify the harms that would take place. We also did a retrospective analysis to show the damage the policy was having. That legislation introduced not only the two-child limit and the benefit cap, but the benefit freeze—we must not forget the benefit freeze—and the harms those policies have caused to the lives of children, who are now our young adults, are absolutely shameful.

[Amanda Hack (North West Leicestershire) (Lab)]

This issue is one of the things we have looked at in the Work and Pensions Committee, and the evidence is quite clear that we must remove the two-child benefit cap and enable long-term investment in our young people. Those young people in poverty suffer extraordinarily, and we need to give them better life chances.

[Debbie Abrahams]

Absolutely; my hon. Friend is a wonderful member of the Select Committee, and I thank her for that. In particular, she is very active on our joint inquiry with the Education Committee.

In the space of the 15 years between 2010 and when we were elected in 2024, child poverty escalated from 3.9 million children, or 29%, to 4.3 million, or 31%. To go back to the calculation at the beginning of my speech, the impact on families that have been bereaved as a consequence of the unfortunate position they found themselves in financially should not be underestimated. Like many of us, I have constituents who have grown up under the clouds and chains of austerity, while clinging on to the hope that things could get better. That hope is why we are here on these Labour Benches, and we know how important what we are now doing is in rebuilding trust with the people who invested their vote in us and trusted us to deliver for them.

I cannot thank the Government enough for doing this, but as has been said, it is a down payment and there needs to be more. We can overturn the horrors of the last 15 years. We have done so in the past, and we can again. We have prepared the ground for a better Britain, and this year we will start to see children and their families flourish, but I recognise that this is only the first step. We are lifting 450,000 to 500,000 children out of poverty, which is fantastic, but that is only about 10% of all the children living in poverty, and we need to have our eyes on the remaining 90%. This is an important first step, but we must say that it is only the first step.

The Chair of the Education Committee, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), and I are looking forward to exploring just how we can do more. As I have previously said, we need to be thinking beyond individual departmental budgets. Tackling child poverty needs a whole-system Government approach, which includes how we budget and how the Office for Budget Responsibility scores Budgets. We need to use evidence much better in our policy planning. Our impact analyses are very narrow, and do not reflect how people experience poverty and the impacts that that has not just on the DWP, but on other Departments. That needs to change.

Finally, when unequivocal evidence is presented to us—some of the evidence is only just emerging; the UK millennium cohort study that I mentioned came on stream only in the last six or seven months—it is right that we respond to it. That is a strength, not a weakness, and it demonstrates humility and integrity. Poverty and inequality are not inevitable; they are political choices driven by values, and when the evidence changes, so should our decisions.

[Several hon. Members rose—]

--- Later in debate ---

[Dr Neil Shastri-Hurst (Solihull West and Shirley) (Con)]

At its heart, this debate is about choices, and the choice before us today is whether we believe that compassion is best expressed through limitless expenditure or through a system that is fair, responsible and worthy of the people who fund it. We in this House all share the same objective: we want every child—[Interruption.] Well, I hope we do, because we want every child in every corner of this country to have hope and opportunity in their future. If we are truly honest, a good society is measured not by how much it spends, but by how wisely it spends, and that is where the Bill does not meet the test before it.

[Debbie Abrahams]

Will the hon. Gentleman give way?

[Dr Shastri-Hurst]

I will make some progress.

I will start with a real-life experience from my own constituency. Some months ago, I met a couple at a community event, both of whom were in work and clearly raising their children with a great deal of pride and care. They spoke to me with a quiet determination about the sacrifices they were forced to make: no foreign holidays, no luxuries, often working long hours and, of course, careful budgeting of the household income. Their message was that they did not expect the state to intervene on their behalf; they were not asking for anything special. Instead, they were merely asking for fairness, and fairness is what is at stake today.

The two-child limit rests on the simple principle that the welfare system should reflect the real choices faced by working families up and down the country. Across the United Kingdom, parents weigh responsibility against aspiration every day, asking themselves whether they can provide, whether they can sustain and whether they can provide their children with security.

[Debbie Abrahams]

The hon. Gentleman just spoke of whether or not the expenditure was wise. He also spoke about choices. I do not know whether he heard my speech, but children who are born into poor families are five times—five times—more likely to die just because they are poor than children in families with a little more income. Is it fair to a child if they die just because they were born into a poor family? I cannot understand the hon. Gentleman’s logic.

[Dr Shastri-Hurst]

I thank the hon. Lady for her intervention, but this is about choices. We come to this place to make choices about how we spend taxpayers’ money to ensure that it is fair across the board. We can all bring moving individual stories, but there is the reality of how we support Government expenditure across the board so that it is fair and equitable and ensures that families up and down the country are having to make similar choices every single day.

What this Bill tells the country is that choices no longer matter. It tells the taxpayer that restraint is optional. It tells Government that limits are now outdated. The Government say that the Bill will reduce child poverty—I understand that, and I respect that intention—but poverty is not conquered by cheque books alone. It is conquered by work, education, stability and ambition. It is conquered when families are supported to stand tall instead of being encouraged to lean forever.

For far too long, politics has fallen into the trap of believing that every social problem has a fiscal solution—if only we spend more money, subsidise a little more or borrow more—but history teaches us a much harder lesson. A society that confuses help with dependency does not liberate the poor, but simply imprisons them.

The Bill will cost approximately £3 billion a year, which will be paid not by abstractions, but by people—by the nurse working a night shift, the self-employed plumber, the shop worker who is saving for a deposit or the small business owner who is keeping three other people in employment. Those people are entitled to ask whether this is fair. Is it fair that they have to calculate every single pound while the state abandons calculation altogether? I simply do not believe it is.

Oral Answers to Questions

Debbie Abrahams Excerpts

Monday 26th January 2026 Commons Chamber

[Mr Speaker]

I call the Chair of the Work and Pensions Committee.

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

15. What assessment he has made of the adequacy of his Department's progress on implementing the recommendations of the “Keep Britain Working” review.

[The Secretary of State for Work and Pensions (Pat McFadden)]

Last week I met Sir Charlie Mayfield, author of the “Keep Britain Working” report, to discuss progress. He reported that more than 100 employers are now onboard to act as vanguards, including British Airways, Sainsbury’s, Holland and Barrett, and a number of smaller employers. The aim is to develop a healthy life cycle of work throughout people’s careers. We are also setting up the health information and data unit that Sir Charlie recommended in his report.

[Debbie Abrahams]

As my right hon. Friend knows, Sir Charlie made a number of recommendations, including providing evidence of returns on investments that would incentivise more businesses to take part in preventive measures to ensure that their workers remain healthy and in work. Given the excellent network of academic centres across the UK, how will the proposed workplace health intelligence unit harness their expertise, and ensure that we are reducing health inequalities that also dampen productivity and economic growth?

[Pat McFadden]

My hon. Friend raises a number of issues. As I said, we are setting up the unit that Sir Charlie recommended, and I very much hope that it will work with academic expertise across the country. Her initial point about this being a win-win for employers is important, because if an employer lets someone go, they lose that experience and have to go through the effort of hiring somebody new and training them up. It is a worthwhile experience to try to help someone stay in work if they have a decline in their health over a period of time. That is good for the employee, and for the employer.

Oral Answers to Questions

Debbie Abrahams Excerpts

Monday 8th December 2025 Commons Chamber

[Mr Speaker]

I call the Chair of the Select Committee.

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

I warmly welcome the child poverty strategy published last week, and I congratulate past and present ministerial teams on all they have done on that strategy. Can my right hon. Friend give details on when he expects to publish the targets, the detailed metrics and the monitoring and review framework? Those are essential if we are to reduce child poverty.

[Pat McFadden]

I thank the Chair of the Select Committee for her question. We estimate that the measure will lift 450,000 children out of relative poverty, and 550,000 for the strategy as a whole. She is absolutely right to say that, having published the strategy, we will bring forward the legislation and monitor its impact right across Government and well beyond the boundaries of the DWP.

Pension Schemes Bill

Debbie Abrahams Excerpts

Report stage
Wednesday 3rd December 2025 Commons Chamber

[Sir Roger Gale (Herne Bay and Sandwich) (Con)]

There is clearly a great deal of good in the Pension Schemes Bill; that is why it went through Committee relatively easily. I do not wish to be a dog in the manger about that, but instead to recognise the good in the Bill. I shall focus on the issues raised in new clauses 22 and 24.

I do not pretend to be expert in these matters, but I do know injustice when I see it. As you know, Madam Deputy Speaker, I fought for many years for the uprating of frozen pensions for ex-pat citizens overseas. That is a shame from which the reputation of this country will take a long time to recover, and I fear that we are about to endorse yet another such shame.

There is absolutely no doubt in most people’s minds that the Pensions Act 1995 was flawed. This issue is an unintended consequence that was not foreseen. That it has taken this long to get to grips with it is wrong, but we now have the opportunity to set things right. The hon. Member for Llanelli (Dame Nia Griffith), in an excellent speech, set out the stall very clearly indeed. I have huge sympathy with her new clause. Were it to be called, I would vote for it without any question.

The right hon. Lady made it very plain—it is indeed very plain—that there is no suggestion that any redress should be retrospective; there is no question of any vast back payments to those whose pensions have been affected. I listened carefully to what the Minister said about retrospection—by the way, I agree that retrospective legislation normally ends in tears—but the proposed measure is not retrospective in that sense.

We come to how to get this right. It seems to me that the Government’s proposals are hugely complicated—unnecessarily so—and do not actually do the job. New clause 24, tabled by Opposition Front Benchers, who I know have put a lot of effort into trying to get this right, gives a get-out in the form of a lack of surplus, which I believe would enable those companies that have neglected their duties until now to carry on neglecting their duties. For that reason, my personal preference is for new clause 22.

I represent the remains of the Pfizer empire in Sandwich. Not entirely surprisingly, I have therefore a significant number—one is a significant number, by the way—of constituents who were affected by the pre-1997 section in the 1995 Act. I find it quite appalling that companies of size and international importance that have been named today—including Pfizer in my own constituency, which is a good employer—should have put themselves in the position that they are in when in some cases, for up to 25 years, pensioners have not been rewarded in the manner to which I believe them to be entitled. As I say, for my money, Pfizer is an excellent company. It does good work and is a good employer, but somewhere along the line, in the back office—probably in the United States—a decision was taken not to uprate pensions. That is quite simply wrong.

While I understand that the Minister comes to this issue with a reasonably open mind and a good heart, I do not think that his proposal does the job and I am not certain that the Opposition Front-Bench amendment does the job. I believe that new clause 22, in the name of the hon. Member for Llanelli, would do the job. I hope that further and very serious consideration will be given to adopting that resolution.

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

I rise in support of the Government’s new clauses, particularly those that relate to the pre-1997 pensionable service indexation where scheme rules allow. That will mean that pensioners whose pension schemes became insolvent through no fault of their own and that have failed to keep pace with inflation will have that rectified. As I mentioned yesterday in my speech on the Budget, that will benefit more than 250,000 Pension Protection Fund and financial assistance scheme members.

I pay particular credit to the Pension Action Group, the PAG. It was formed in 2003 following the collapse of the Allied Steel and Wire pension scheme, which left thousands of workers without employment or their promised occupational pension. They are not covered by the Pension Protection Fund, which was introduced by the Pensions Act 2004 for members of defined benefit schemes whose employer went bust after 6 April 2005. The Pensions Action Group campaigned first for the financial assistance scheme to be set up for members of schemes that went bust, then for improvements to FAS benefits to bring them into line with those of PPF members.

In the last Parliament, members of the Pensions Action Group gave evidence to the Work and Pensions Committee on the hardship experienced due to the policy of not indexing pre-1997 benefits. As a relatively new Select Committee Chair, I remember hearing from them at a separate meeting, and it was so moving. Within weeks, unfortunately, different members were dying because of their age. Benefits were not going to their families, and they were not going to have the benefits that we see rightly being given to this group.

FAS members did most of their service before 1997, and most were in schemes that provided for indexation on all members’ pensionable service. Non-indexation of FAS compensation meant that the average award—about £2,700—was progressively lower than the amount expected from the original pension schemes. Terry Monk told the Committee that

“people should get what they paid for—end of story.”

Richard Nicholl said that

“people paid extra effectively, for full indexation…it is only fair that it goes to those who have paid for it.”

I pay credit to the Deprived Pensioners Association, which gave evidence to the Committee about the impact of the non-indexation of pre-1997 on PPF members. Having heard their evidence, the Committee recommended that the Government legislate to allow both compensation schemes, FAS and PPF, to provide indexation on pre-1997 benefits where scheme rules allowed.

I am incredibly grateful to the Pensions Minister for listening and to the Secretary of State for Work and Pensions, who came to the Committee a couple of weeks ago and listened to concerns from members, including the hon. Member for Torbay (Steve Darling). What has happened is right, and I reiterate my thanks.

[Manuela Perteghella (Stratford-on-Avon) (LD)]

I rise to speak to two new clauses that stand in my name. The first is new clause 3, which concerns the use of the special rules for end of life form to ease the burden on people with a terminal illness seeking support from the Pension Protection Fund or the financial assistance scheme; the second is new clause 19, which deals with fossil fuels and climate risk. Those issues are very different in nature, but they share a common thread: both seek to improve the governance, fairness and long-term resilience of our pension system. I will also speak in support of new clause 11, as it seeks to remedy HSBC’s unjust clawback policy that the Midland Clawback Campaign has been fighting against.

New clause 3 concerns terminal illness and the use of the special rules for end of life form, or SR1. This amendment was born out of the experience of one of my constituents, Nigel. Nigel was diagnosed with incurable stage 4 pancreatic cancer. He told me about the issues he faced in providing several forms, applications and other bits of paper to providers just to demonstrate eligibility and his terminal illness. He told me his story and about the hurdles he encountered following his diagnosis, at what was a very stressful time.

Pensions

Debbie Abrahams Excerpts

Tuesday 11th November 2025 Commons Chamber

[Pat McFadden]

I am grateful to the hon. Member for at least some of his response. I cannot pre-empt the conclusion of the process that I set out in my statement, because I want it to be undertaken fairly and transparently. I have to say to him that his own Government had many years to consider the matter and did not come to a conclusion, so I take his comments urging us to go more quickly with a little pinch of salt.

The hon. Member referred to pensioners. We said that we would maintain the triple lock, and we have kept to that commitment. That will mean an increase of some £1,900 a year in the basic state pension over the course of this Parliament. We remain committed to the publication of the action plan to which he referred.

He is right that the previous Minister for Pensions met the WASPI campaigners, but he was a little more coy about the last time a Conservative Minister met the WASPI campaigners. Perhaps a Conservative Member can tell us when that was? I believe it was many years before that and that our Minister was the first to meet the WASPI campaigners for some time.

Finally, on the broader economic record, he failed to join me in welcoming the UK having the fastest growth in the G7 for the first half of this year.

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

I thank my right hon. Friend for his statement—I appreciate its technical nature. Clearly, it is a concern that this evidence was not made available to our right hon. Friend the Member for Leicester West (Liz Kendall) last year and I know that he will investigate that. I appreciate that he will not be able to give a specific date as to when he may be able to decide what this evidence means for his final conclusions, but is he able to give a timeframe for when he will be able to report back to the House?

[Pat McFadden]

I am grateful to the Chair of the Work and Pensions Committee for her question; I know that she has taken a long and keen interest in the matter. On timescales, when people hear this statement, I appreciate that they will want to know when the conclusion will happen, but it is right and proper that I look at all the available evidence. As I said in the statement, I have asked the Department if there is any other survey evidence or other kinds of evidence that should be brought to my attention. With that proviso, I can assure my hon. Friend that I will come to a conclusion and report to the House as soon as possible.

Oral Answers to Questions

Debbie Abrahams Excerpts

Monday 27th October 2025 Commons Chamber

[Mr Speaker]

I call the Chair of the Work and Pensions Committee.

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

Health Equity North recently produced an analysis for the Select Committee that revealed that getting just 5% of people with disabilities or health conditions into employment would yield cost savings of over £12 billion. What progress is being made with employers to enable sick and disabled people who want to work, and are able to do so, to get into employment?

[Sir Stephen Timms]

My hon. Friend raises an important point. I agree with her about the tremendous value, for the people who benefit and for the economy more widely, of opening up opportunities in employment in the way that she described. That is exactly what the Keep Britain Working review, led by Sir Charlie Mayfield, is looking at. I am looking forward to Sir Charlie’s report, and I am sure my hon. Friend will find it interesting. I expect it to be published quite soon.