Cost of Living

Debate between Debbie Abrahams and David Linden

Tuesday 5th July 2022 Commons Chamber

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

It is a pleasure to follow the hon. Member for Glasgow South West (Chris Stephens), and I agree with all the points he made, as I did with those raised by the Chair of the Work and Pensions Committee, my right hon. Friend the Member for East Ham (Sir Stephen Timms). I want to focus on a few key things and pick up on the point that my right hon. Friend made about the context of the revised estimates for the Department for Work and Pensions.

We need to recognise—many Opposition Members certainly do—that the cuts associated with the two major reforms to the social security system in the last 12 years have shrunk the contributions that are being made, particularly to working-age people. We know from the Resolution Foundation’s work that by 2022, the spending cuts in the Department for Work and Pensions had reduced support to working-age people by up to 17%, compared with 2010. That is the equivalent of £33 billion.

We know from the data that by 2018, UK social security spending as a percentage of GDP was below both the EU27 and OECD averages. I think my right hon. Friend mentioned that out-of-work support in 1948 was about 25% of average earnings; it is currently less than half that. Even during the pandemic, with the £20-a-week uplift to universal credit, our support was the least generous in the OECD. We like to think that we are a generous country that looks after those who need support, but our support has been the least generous, and that shames us all. The amount of support available to somebody who is out of work is only slightly more than what is recognised as destitution.

In other analysis, the Institute for Fiscal Studies has confirmed that social security and tax changes mean that the poorest 10% of households have lost 11% of their income, equivalent to £1,200 a year. For families with children, it is even worse, with a 20% loss of income amounting to £4,000 a year. The Equality and Human Rights Commission confirmed the IFS’s analysis and exposed the impact of the reforms and cuts on disabled people. For households with at least one disabled adult and a disabled child, average annual cash losses since 2010 are just over £6,500, which is more than 13% of average net income. Disabled lone parents with at least one disabled child have fared even worse, losing almost £3 out of every £10 of income. In cash terms, their average losses are almost £10,000 a year.

The all-party parliamentary group on health in all policies, which I chair, looked at the impact of the Welfare Reform and Work Act 2016 on children and disabled people and found strong evidence of an association with poverty, inequality, homelessness, food security, poor health and premature death directly as a consequence of those welfare reforms and cuts.

[David Linden (Glasgow East) (SNP)]

The hon. Lady hits the nail on the head. She has rightly put the scale of the cuts into context, and there is a point for the Government to reflect on here. They will think, after making cuts, “Well, that’s no longer a problem for DWP,” but in many respects local authorities such as Glasgow City Council have to pick up the burden of the resulting destitution. My local social work office in Easterhouse has to deal with the homelessness, the debt, and all the other issues that ensue from Government policies.

[Debbie Abrahams]

I recognise what the hon. Member says. I visited Glasgow last week—the constituency of my friend the hon. Member for Glasgow South West is there—and it was interesting to see the reforms being introduced there, particularly those for disabled people.

Many hon. Members will not be aware of yesterday’s report from Deaths by Welfare, which provided even more evidence of the impact of the so-called reforms on premature deaths and suicides. It had a timeline that showed when there had been reforms and further cuts, and what they meant in terms of deaths of vulnerable social security claimants. Another recent report shows a detrimental impact on social cohesion. The University of Newcastle quantified that, between 2013 and 2015, for every £100 lost in income per working age adult, motivated hate crimes increased by about 6%. The effects are much wider than the Government recognise.

My second point is about the pandemic. We know that people on the lowest incomes, and particularly those reliant on social security support, were disproportionately and negatively affected by covid. They were more likely to be exposed to the virus and to be infected, and they were more likely to be seriously ill and die. Within that group are disabled people. After adjusting for a range of factors including health, the Office for National Statistics has estimated that disabled people were between 1.3 and 1.6 times more at risk of death from covid. The reasons for those disproportionate deaths must be investigated in the covid public inquiry, but given the context that I have just described—the inadequacy of our social security system—the contribution of the cuts in social security support cannot be ignored.

On the cost of living package and its impact on the DWP spending estimates, of course I welcome the package, but I have just spent the past few minutes describing the context and, much though the Government congratulate themselves on what they are doing, it just about scratches the surface of the cuts that they have made. I must, as others have done, highlight some of the gaps in the package. As support is on a household basis, larger families will not get the same support as smaller families. As the Resolution Foundation suggested, in the light of inflation, a 9.5% uplift to all social security support would have been more progressive than the 3.1% awarded at the beginning of the year, and would have taken us beyond the Chancellor’s stop-start, ad hoc approach.

My concern is that the cost of living will not just be an issue this year; it will carry on—and what will the Government do then? We need principles that ensure that all social security support is uplifted to account for inflation.

As my friend the hon. Member for Glasgow South West mentioned, there are huge issues with deductions. We asked the Secretary of State about that last week. The Joseph Rowntree Foundation, StepChange and many other charities have pointed out that 4.6 million households are in arrears on at least one bill, so what is handed out with one hand will be clawed back by another. I join those charities and hon. Members in their calls to reduce the amount that can be deducted from the universal credit standard allowance; it is now 25%. I would like it to be less than 15%. When the deductions are for debts to Government—figures indicate that the Government are the largest debt collector—it would only be reasonable to reduce it to 5%.

My final point is that given the cuts in spending and the culture in the Department, our social security system does not provide the safety net that everybody thinks it does. I really like the approach being introduced in Scotland, which is not about people proving that they are entitled to support; there is trust. We should try to make that the basis of the culture in England as well.

Benefit Cap

Debate between Debbie Abrahams and David Linden

Tuesday 1st March 2022 Commons Chamber

[David Linden]

Absolutely, and I pay tribute to my hon. Friend on that, because he presented a 10-minute rule Bill on this issue in the Chamber last week. I know it affects his constituents and those of my hon. Friend the Member for Argyll and Bute (Brendan O'Hara). In a lot of these rural constituencies, people are off-grid, and it means they will have increased energy costs. Having some sort of arbitrary benefit cap in place will not help them, so I ask those on the Treasury Bench to reflect on the Bill of my hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey and to bring forward the opportunity for it to get its Second Reading and for him to give his constituents a voice.

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

The hon. Member is making a very strong case. He is absolutely right to focus on the benefit cap and the impact that has on 180,000-odd households. Does he agree that it needs to be looked at in the context of the £34 billion a year that has been taken out of support for working-age families? Do we also need to be considering the adequacy overall of social security support?

[David Linden]

Yes, my fundamental position is that we need a root-and-branch review of the social security system. That safety net that is supposed to exist for some of the most marginalised and vulnerable people in our communities is a safety net that has more holes than a clarinet at the moment. I gently make a point to the hon. Member and her party. Yes, we need that real reform of social security—not the reform that we have from the Government, where basically the lion is in charge of the abattoir—where we look at ensuring that we give as much support to people as possible. That is why I would like to see the next Labour manifesto commit to abolishing the welfare cap. I was disappointed that Labour MPs were not able to join us in the Lobby on that, but I am sure that the hon. Member will be making that point to the right hon. and learned Member for Holborn and St Pancras (Keir Starmer).

With the cost of living crisis already impacting on thousands of families in Glasgow East, alongside the continuing financial effect of the pandemic, Brexit and now the regressive hike in national insurance, I have to ask the Minister: when will this Tory Government realise that all they are doing is pushing more and more people into poverty? The benefit cap disproportionately impacts single parents, placing an additional burden on families who already face challenges. Based on the latest Department for Work and Pensions figures for August 2021, across the UK six in 10 households that have had their benefit capped are single-parent families.

Cost of Living and Food Insecurity

Debate between Debbie Abrahams and David Linden

Tuesday 8th February 2022 Commons Chamber

[Victoria Prentis]

If I may finish my remarks, I will.

There are many pressures on household budgets, the two top ones being broadly, usually, housing costs and fuel costs. There is very little give normally; there are very few other sources available to help families with those two important pressures. Food, as I am just outlining, is often a smaller part of the household expenditure pot. Because there are sometimes food charities to help with expenditure, it is a part where other help can be sourced. If I may, I will make some progress.

The average household has spent between 10% and 12% on food, so that is relatively low. Compared with EU countries, for example, it is the lowest. There has been a gradual decrease in expenditure as a percentage both for the lowest 20% by income and for all households. Back in the 1950s, the spend on food would have been about a third of income.

Of course, we work hard alongside other Departments in Government—for example, the Department for Work and Pensions, which is responsible for the welfare system and supporting those with particular challenges in their lives at any point. During the pandemic, we put in place a £170 million covid winter grant scheme, with 80% earmarked to provide support with food and bills. I chaired the food to the vulnerable ministerial taskforce, which was set up in spring 2020, and we put in place support for the most vulnerable individuals.

[David Linden]

Will the Minister give way?

[Debbie Abrahams]

Will the Minister give way?

Social Security (Up-rating of Benefits) Bill

Debate between Debbie Abrahams and David Linden

Committee stage & 3rd reading
Monday 20th September 2021 Commons Chamber

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

I rise to speak to new clause 1 in my name and on behalf of my colleagues.

New clause 1 compels the Secretary of State to assess the impact of the Bill on poverty, inequality and, subsequently, our health. In particular, I request that a report be laid before the House within six months of the passing of the Act, and that the effects of the provisions in the Act on socioeconomic inequalities and population groups with protected characteristics as defined by the Equality Act 2010 are considered.

We have heard a lot in recent months—it seems like many years—about levelling up and building back better. We even heard from the Prime Minister himself that he supports Professor Sir Michael Marmot’s call to build back fairer. To do that, however, we need the Government to be able to assess whether their policies will actually do that. We heard, in the Work and Pensions Committee, that that is difficult to do. I argue very strongly that that is not the case and I know there are many others who would argue similarly.

The House will recall that, in February 2020, Sir Michael published his review of health equity in England 10 years after his initial study. In it, he revealed that instead of narrowing, health inequalities, including how long we are going to live and how long we will live in good health, have actually got worse. Most significantly, his analysis showed that, unlike the majority of other high income countries, our life expectancy was flatlining. For the poorest 10% of the country it was declining and women were particularly badly affected. We heard earlier that 2 million pensioners live in relative poverty today; among women of state pension age it is one in five. For women of colour, the figure is even higher. Black and Asian pensioners are also twice as likely to be living in poverty as white pensioners.

Sir Michael also emphasised that it is predominantly the socioeconomic conditions that people are exposed to, not the NHS, that will determine their health status and how long they live. Analysing the abundant evidence available, he attributed the shorter lives of people in poorer areas, including in parts of my constituency in Oldham and in the north-west as a whole, to the disproportional Government cuts to local public services, including cuts in social security support that they have experienced since 2010.

And then the pandemic hit. As a former public health consultant, I can say this with absolute certainty: it was always a question of when, not if there was going to be a pandemic. The lack of pandemic preparedness, going back to the Cygnus report and before, as well as the woeful pandemic management, laid bare the pre-pandemic structural inequalities that are rife across the country.

Many believe that the structural inequalities driven by the Government cuts that I have referred to, including social security cuts, will be found responsible for the UK’s high and unequal covid death toll, with the fifth worst covid mortality rate in the world and the worst in the EU. In an early analysis of the reasons for that, Sir Michael’s Covid review last December summarised four key pre-pandemic factors.

The first was pre-existing and widening inequalities in social and economic conditions, particularly in power, money and resources; Sir Michael stated that those inequalities in life had led to inequalities in health. The second was our governance and political culture, not just before the pandemic but during it, which he described as divisive, damaging social cohesion and de-emphasising the importance of the common good. The third was Government austerity over the last 10-plus years; he referred particularly to cuts to social security and local authority budgets, including in adult and children’s social care, public health and education. The final factor was our pre-existing poor and declining health.

Sir Michael makes a number of recommendations to build back fairer, including increasing the adequacy of social security spending. Our focus in this debate has been on state pensions, but the cuts of £36 billion to working-age social security support over the past 11 years and the impact that they will have on increasing poverty rates—including as a result of the universal credit cut that we are expecting—must not be underestimated.

Improving our health and wellbeing must be a priority for this Government and an outcome of all our policies, including our economic and public spending and social security. My new clause is about ensuring that the Secretary of State recognises that and publishes a review of the impact of social security spending on poverty, inequality and, ultimately, our health. Given that the Prime Minister and Health Secretary have already stated that they support Sir Michael’s recommendations and that this is a means to implement levelling up, I hope that the Secretary of State will adopt my new clause in the Bill.

[David Linden]

I do not seek to detain the Committee for long, not least because I spoke on Second Reading and because there are only two amendments before us.

In speaking to my new clause 2, which stands in my name and that of my hon. Friends, I also offer support to new clause 1, which stands in the name of the hon. Member for Oldham East and Saddleworth (Debbie Abrahams). In truth, the two new clauses, although worded differently, seek to do much the same thing: hold the Tory Government’s feet to the fire, not simply allow them to stick their head in the sand when it comes to pensioner poverty.

I bitterly regret that the Bill got a Second Reading, particularly with the help of Scottish Tory MPs, but as the Bill will soon be an Act, it is now incumbent on us to ensure that at least Ministers fully understand the sheer impact of such bad legislation on our constituents and the consequences of this Government’s ditching yet another manifesto pledge to pensioners about the triple lock.