Energy Rebates: Highlands and Islands

Debate between Drew Hendry and Jamie Stone

Wednesday 6th March 2024 Westminster Hall

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

I beg to move,

That this House has considered the introduction of energy rebates for Highlands and Islands.

It is a pleasure to serve under your chairmanship, Mr Paisley. Before I start the debate, may I thank the Minister for taking time out to see me prior to this debate? Engaging beforehand is a refreshing departure from how many of her Government colleagues work, so I thank her for the way in which she goes about her business. We will see, of course, whether she can agree to the change that is so desperately needed.

Let us get something straight from the beginning. Energy policy is 100% reserved to the UK Government. I will come later to the actions of the Scottish Government on the cost of living and our attempts to mitigate UK Government harms, but let us be clear that the issue we are discussing today lies squarely at the feet of the UK Government and the regulator Ofgem.

The energy market in its current form is completely broken. Along with colleagues, I have called for urgent changes to the whole system and urgent support for those in need, the reintroduction of a £400 energy bill rebate, for regressive standing charges to be abolished, and for the Chancellor to honour his pledge to open a consultation on the social tariff. Today’s debate, however, is about a specific action for the people of the highlands and islands, who are uniquely disadvantaged, and a workable solution for them. I will underline how the people of the highlands and islands have been neglected by both the regulator and the UK Government, how energy injustice has not levelled up but rapidly increased, why now is the time to fix it and, of course, how the Government can do that.

Part of the problem in preparing for a debate such as this is that the message is so straightforward and the injustice so clear and unarguable that it feels almost surreal. How has the problem been allowed to get to where it is and why has it not already been fixed? Of course, the highlands and islands are largely rural, almost entirely off the gas grid and so rely on higher electricity use, fuel oil and liquefied petroleum gas. It is much more expensive than for the majority across the nations of the UK who are on the gas grid. We have a colder climate, sometimes spectacularly so. As a result, we use more units of electricity and pay more than the UK average, with higher electricity bills just to get through the days. More of our people—around a third—are in fuel poverty and a fifth are in extreme fuel poverty, by far the highest across the nations of the UK. We might think that those facts alone would have spurred any Government with a spare ounce of conscience to look at meaningful interventions to help, but that has not happened.

Fuel poverty is a major driver of actual poverty. When the time comes when you cannot switch the heating on—a lived experience for many—other problems click in. Some people are already barely eating due to the punishing cost of living and simply try to endure the cold. Some go to more extreme measures, as we know, such as self-disconnection. That has depressingly obvious consequences.

As the medical journal The Lancet pointed out, when people can no longer heat their homes their mental health deteriorates significantly. The odds of their reporting depression, anxiety or hypertension increases by around 50%, as does the risk of suicide. Children in cold homes are at increased risk of asthma attacks and respiratory infections. As the temperature drops and the circulation of viruses increases, immunity is impaired. Absolutely avoidable public health dereliction continues while that remains unaddressed. We might think that any Government with the power to do so and any shred of decency would act in those circumstances, but instead things have been allowed to get worse.

We have long been arguing these points, but the kick in the teeth for the people in the highlands and islands is the standing charge for electricity, which is a pernicious beast for those suffering fuel poverty because it applies every single day, warm or cold, whether the heating is on or off. The consumer cannot control it; there are no measures they can take. What have the UK Government allowed Ofgem, the regulator, to do across the highlands and islands? People were already paying 40% more for their standing charge than those living here in London, yet the Government have let Ofgem increase it to 50% more. According to Yourweather.co.uk, the mean daily temperature in London—the warmest city in the UK—is 16°C; in Skye, it is 9°C. How can that be fair? Surely any Government with the power to do something about that and with a shred of decency would do so.

If that were not unfair enough, think about this: the families across the highlands and islands who suffer these unfair charges, which lead to fuel poverty and even extreme fuel poverty—those who are terrified of the envelope containing the bill when they turn their heating on and try to feed and warm their kids—are sitting in the middle of energy wealth that is much, much greater than their needs, and they get none of it paid back to them. They can see the infrastructure all around them. Renewable energy generates at least six times more than the electricity they use—the figure is higher than that, but let us go on the low side. The rest is exported to the grid, only to be sold back to them at the cost I have described. It is immoral.

The UK Government have the power to do something about it and must make amends for that grossly unfair situation. The Minister will say that her hands are tied because Ofgem makes these decisions, and Ofgem will say that its hands are tied because it needs instruction from the Government. I do not believe anybody suffering those conditions in the highlands and islands will take that argument from the Minister when we hear it. Perhaps she will adjust her notes before we get to that point—we will see.

The Scottish Government have been doing what they can to mitigate Westminster policies that increase poverty in the highlands and islands, although they should not have to. They have been paying the bedroom tax, for example, so our people do not have to. They have supported children through the Scottish child payment and put money in place to fund a council tax freeze, but they do not have power over energy: the UK Government do. That is the same UK Government who introduced the two-child limit and the rape clause, cut universal credit by £20 a week, and reduced funding for public services in the last autumn statement by £19 billion, severely restricting devolved government and local authority support.

I started by praising the Minister for her engagement with me prior to the debate, and she told me that she would like some figures, so I have some for her. Northern Scotland, as it is called under Ofgem, pays more for both standing charges and unit rates than the UK average —60.1p and 24.5p respectively. Currently, northern Scotland’s standing charge cost is 59.38p, roughly 50% higher than London. Energy usage in the highlands and islands averages over 4,400 kW per household, compared with about 3,000 kW in London. Some 62% of the properties in the highlands and islands are not connected to the gas grid, resulting in higher heating costs per household. On current rates, April to June 2024, the daily standing charge direct debit single rate for electricity is 61.1p in northern Scotland and 40.79p in London and the daily standing charge’s direct debit multi-rate is 62.25p for northern Scotland and 40.75p for London.

The 2021 rates of fuel poverty are thought to be underestimates because of covid restrictions, and the Commons Library uses 2017 to 2019 aggregates. The highlands and islands region has the highest levels of fuel poverty and extreme fuel poverty in the UK. It is 39.8%—some 5,000 households—in Na h-Eileanan Siar, with 24.3% in extreme poverty; 32.9% of households in the highlands, with 21.5% in extreme poverty; 32.2% of households in Argyll and Bute, with 19% in extreme poverty; 31.6% of households in Moray, with 18.5% in extreme poverty; 30.9% of households in the Shetland Islands, with 22% in extreme poverty; and 30.5% of households in the Orkney Islands, with 22% in extreme poverty.

I expect the Minister will point to the hydro benefit replacement scheme as helping to balance the situation. Knowing that she will have done her research, I think she knows that that is a poor substitute, and an excuse for years of inactivity. A Department for Business, Energy and Industrial Strategy report of 2022 notes that the HBRS

“does not (and never could) provide an efficient or effective way of providing targeted support to specific groups of vulnerable consumers within a region.”

However, in its own unique and inadequate way, it points to a solution, along with another precedent that has come up recently and could be adopted, which I will come to shortly.

The HBRS was established in the 1940s to compensate for the small hydro dams, and it took current form in 2005 under the Energy Act 2004. As it stands, it falls woefully short of the meaningful intervention required. In 2022, the Highlands and Islands Housing Associations affordable warmth group highlighted the £60 per annum discount is only “adding insult to injury” to regional energy costs.

When someone is paying much more than the rest, that does not really make a difference, in an area that is producing much more electricity that it could ever use. In 2022, Scotland was already producing the equivalent of 113% of Scotland’s overall electricity consumption from renewable technologies, a 26 percentage point increase on 2021. As I said earlier, I am certain that figure is on the low side.

The highlands produces enough energy through electricity to power six times more homes than there are in the highlands. The highlands produced a total of 7.2 million MW of energy, with 4 million MW from onshore wind and almost 3 million MW from hydro power. Argyll and Bute produced 1.3 million MW of energy from renewable sources. The Highland Council area comprises only 0.36% of the UK total population, yet the area produces 5.5% of the 49.7 GW UK-installed capacity for renewables, 43% of the UK’s installed hydro capacity and 13% of the UK’s installed onshore wind capacity.

With those regions playing a crucial role in providing the rest of the UK with cheap energy, it is surely only right that they should start to get some benefit from cheaper energy prices, yet they are not. The HBRS could and should be converted into something more meaningful. In his autumn statement, the Chancellor offered the solution. Why not introduce a meaningful rate based on compensating the highlands and islands contributions? He said he would introduce a rebate of up to £1,000 a year for up to 10 years for people living next to planned new energy generation infrastructure. That is very laudable. If it works for those living next to new generation equipment, how about those living among existing generation equipment?

That rebate would redistribute the wealth being generated in the highlands and islands among the communities, enabling them to reap benefits from what is produced there. That would offer several benefits, such as reduced energy costs for those facing higher than average per unit costs, alleviating the financial pressure that that places on households. It would empower communities by allowing them to reap the benefits of what their communities produce, and it would boost economic growth by alleviating the pressure on households from energy costs.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

The hon. Member is making an excellent speech, which strikes a chord with anyone who knows and works for the highlands. There is another benefit, I think. During the pandemic, the recovery of anyone suffering from covid was assisted by being kept warm. I believe that a warm household goes a very long way towards disease prevention. It is arguable that one of the benefits of getting this right would be the health of people in the highlands, which would lead to fewer days off work and greater economic productivity, and that can only be good for the economy of the highlands.

[Drew Hendry]

I thank the hon. Member for his intervention. He will not be surprised to hear that I agree; indeed, I mentioned earlier in my speech that The Lancet has reported on the health outcomes of having a house that is too cold. One of them is the fact that immunity drops, and people’s resistance to picking up infections actually decreases due to those circumstances. There are particular effects on children and their ability to develop. The hon. Member makes the good point that this is an issue of not only lost work days, but lost ability for people to operate in their communities and have a general sense of wellbeing. He was absolutely right to highlight that point, and I thank him for that.

The hon. Member talked about economic growth. As I said, a highland energy rebate would boost economic growth by alleviating the pressure on households from energy costs, allowing them some money to try to get through the cost of living and to spend elsewhere. Let us see some justice for, and amends made to, those suffering in fuel poverty who are generating and exporting power for others across the nations of the UK. The highlands and islands produce almost 6% of UK energy while having about 0.4% of the population. Why do we not benefit further from that? We pay higher than average bills, face higher costs due to the climate and have higher rates of fuel poverty and extreme fuel poverty, yet we live in an energy-rich region.

Even the UK Government’s own report, the BEIS review scheme of 2022, describes how the hydro benefit replacement scheme does not provide efficient or effective support for vulnerable consumers in specific regions. The scheme introduced by the Chancellor that will give rebates to those living near new energy infrastructure up to the tune of £10,000 over 10 years is laudable, so why can a scheme not be put in place for those living near to existing renewable infrastructure? It is time for the people of the highlands and islands to be treated fairly, for fuel poverty to end, and for the contribution of those people to the billions that is generated for the Treasury on their doorsteps to be recognised. It is time for a highland energy rebate.

Finance Bill

Debate between Drew Hendry and Jamie Stone

Report stage
Monday 5th February 2024 Commons Chamber

[Drew Hendry]

Thank you, Mr Speaker. Obviously, it is entirely appropriate to have paused for that statement. I was unaware of the news brought to the Chamber, but it is clearly significant. Our thoughts are with the royal family at this time.

As I was saying, we need consistent policies to help the renewables sector, and we are not seeing that either from the Tory Government, who have run out of ideas, or from the Labour party, which makes promises and then ducks responsibility for what is required.

We would have liked new clause 5 to flesh out the Chancellor’s promise, made in the autumn statement, to take up to £1,000 a year for up to 10 years off the electricity bills of people living near new generation equipment. We have not heard that today, so we do not know what schemes are coming up.

As I intimated earlier, I would have liked to table an amendment on this point: if new clause 5 is applicable to people living next to new generation equipment, what about those who already live among generation equipment in, for example, the highlands and islands? We have the coldest climate in the UK. Most people are off the gas grid, so we have higher average bills than the rest of the UK. We pay the highest standing charge for electricity, 40% more than here in London, and because of UK Government policies, we have the highest level of fuel poverty in the UK, yet we export six times more electricity than we use in the highlands. It would have been entirely appropriate for the Minister to agree to introduce a highland energy rebate, to put some of that contribution back into the pockets of people across the highlands and islands who are struggling because of those conditions.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

The hon. Gentleman is making a very good point that rings true in my constituency, too. Of course, the problem is made more difficult still because of the other costs faced by people living in our constituencies, such as delivery charges and the cost of other services. Even a tube of toothpaste can cost a little more the further away it is from the big urban centres. That makes the problem a lot worse.

UK Shared Prosperity Fund

Debate between Drew Hendry and Jamie Stone

Thursday 5th September 2019 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

I beg to move,

That this House notes with concern that the Government is more than half a year behind its schedule to provide details of post-2020 funding through a UK Shared Prosperity Fund; supports the Joseph Rowntree Foundation’s recommendation that the Fund should at the very least match the £2.4 billion per year currently allocated through the EU structural funds; and calls on the Government to ensure that full details of the fund are published with urgency, that the devolved settlement is respected and that there is no reduction in the levels of funding to devolved governments or their role in distributing funds.

I thank the Backbench Business Committee for allowing us the opportunity to bring this matter to the Chamber today. Scottish communities stand to lose millions of pounds from Brexit. Communities, charities and other organisations have been waiting for years to find out what funding will be available. There is also a threat to devolution. Long-term planning has been abandoned to Brexit.

We need clarity about the details of the so-called shared prosperity fund. We need to know whether the devolution settlement will be protected. Currently, until 2020, communities and charities can access funding worth £2.4 billion a year. Work by the Conference of Peripheral and Maritime Regions—the CPMR—shows that, for 2021-27, the UK would have received €13 billion in regional development funding. For Scotland, failure to replace that would mean a loss of €840 million. For the highlands and islands alone, that would be €130 million. It is therefore vital that that money is replaced.

That funding has underpinned further education, youth employment, smart cities, connectivity for islands and communities, small and medium-sized enterprises, apprenticeships, regeneration, innovation, productivity, social inclusion and much more. In Scotland, it has supported projects and development in West Lothian, the Orkney isles, Ayrshire, Fife, Argyll and Bute, Midlothian, East Lothian, Perth and Kinross, Aberdeenshire, West Dunbartonshire, Stirling, Western Isles, Inverclyde, Clackmannanshire, Moray, Shetland, Edinburgh, Dumfries and Galloway, Renfrewshire, Glasgow, Dundee and more.

In the highlands and islands, we would be hard pushed to find any town or village, let alone our city of Inverness, that has not had investment since we joined the European Community in the 1970s. Indeed, two specific and unavoidable icons stand testament to that. The Kessock bridge was built through Europe before devolution because Westminster ignored the highlands for decades.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

When the hon. Gentleman and I drive around the highlands, we cannot help but notice the signs with the stars on them on new bits of road that say that the development was funded by the EU. Without that funding, those roads would probably not have been built and transport across our vast constituencies would have been difficult for our constituents. Replacing the funding is essential. Notwithstanding the fact that the Minister has met me several times, tried to do his level best and knows the area, I am bound to say that we seem no further forward, which my constituents find not just frustrating but deeply worrying.

[Drew Hendry]

It is absolutely true that the money has had a massive impact on the infrastructure of the highlands and it must be replaced.

Scottish Economy

Debate between Drew Hendry and Jamie Stone

Wednesday 27th June 2018 Westminster Hall

[Christine Jardine]

rose—

[Jamie Stone]

rose—

[Drew Hendry]

I will not give way just now. We are short of time.

Scotland has strong economic fundamentals. We heard nothing about its vast natural resources, the innovation there, or the talent of our people. Scotland has the most inward investment of anywhere in the UK outside London.

--- Later in debate ---

[Drew Hendry]

In that case I will keep going; thank you very much for allowing me to do that.

[Jamie Stone]

I would not want the hon. Gentleman to misunderstand me. I do not decry the efforts being made by Highlands and Islands Enterprise. However, anyone who thinks that despite its best efforts it is more than a poor shadow of what went before, in the Highlands and Islands Development Board, is in dreamland. Surely hon. Members agree with me about that.

[Drew Hendry]

I disagree, and so do many businesses that I interact with in the highlands on a daily basis.

Production efficiency in the oil sector has risen for the fifth consecutive year, reaching 74% in 2017, demonstrating sustained efficiency improvements and maximising the economic recovery. Oil & Gas UK’s “Business Outlook for 2018” shows growth in investment and a further 5% increase in the forecast production for that year. Recent industry announcements about BP’s successful working discoveries in the Capercaillie and Achmelvich wells and Shell’s redevelopment of the Penguins field demonstrate the investment potential that the UK fields still hold. Over the next decade our oil and gas sector can capitalise on the decommissioning market, which is forecast to reach £17 billion; but that is only if the right decisions on investment are made.

European Union Citizenship

Debate between Drew Hendry and Jamie Stone

Wednesday 7th March 2018 Commons Chamber

[Drew Hendry]

Absolutely, although I would say that the UK Government have it within their gift to ensure, certainly on the issue of European citizenship, that we remain a part of that project.

It is very important to understand the feeling in Scotland, which I know is shared by many people in Wales. I would like to quote from a leader in the Sunday Herald, which I think is particularly poignant:

“Scotland has been an outward looking European nation since the late middle ages. From the 16th century, Scots merchants, academics and soldiers spread far and wide in the continent establishing communities in countries like Poland, Sweden and the Low Countries. As a poor nation on Europe’s periphery it was Scotland’s lot to export its people, and the flow continued apace during the British Empire. But intellectual and commercial trade was very much two way. It is no accident that so many European words have entered the Scottish language, such as the Swedish ‘braw’, Dutch ‘kirk’, German ‘ken’, French ‘dour’. Our very language testifies to Scotland’s European connections.”

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

I wonder if the hon. Gentleman would care to add to his list: soiree, meaning an evening out; gigot, meaning a leg of lamb; and ashet, on which we cut our lamb and which comes from assiette in French?

[Drew Hendry]

Yes, I would indeed. It is a list to which I could, if I had the time and perhaps the patience of Mr Deputy Speaker, add many more words that highlight that connection. [Interruption.] I am being encouraged to go for it, Mr Deputy Speaker, but I will move on.

That is the kind of place Scotland is and the kind of Scotland we want to live in. Our European identity and our shared values with the EU are very much at the heart of that. It is important to reflect that, during the referendum on the EU, 62% voted to remain in the EU and there was a majority to remain in all Scottish local authority areas, yet European Scots face not only the economic and social impacts of Brexit, but losing their European identity. A colleague of mine in the European Parliament, Alyn Smith, said:

“So what does Scotland have right now? Scotland has been an integral part of the EU for almost 50 years, a status that we now face losing. We are represented at every stage of the EU’s activities. The recreation, in 1999, of the Scottish Parliament and the formation of a Scottish Government gave Scotland a far stronger voice within the EU, and has allowed the people of Scotland to find Scottish solutions for Scottish problems and design a society that reflects our needs. This has led to Scotland showing how very European it really is. We stand alongside the rest of Northern Europe by not privatising healthcare, encouraging the development of renewable energy and not charging our citizens for higher education.”

--- Later in debate ---

[Drew Hendry]

My hon. Friend makes a very good point. I know that he shares my concerns about the unrealistic, counter-productive, one-size-fits-all net migration target that overlooks the incredible value of migrant people to our isles and the different economic needs of the highlands and islands, and of Scotland as a whole.

Over the next 10 years, 90% of Scotland’s population growth is projected to come from migration. This is especially vital for the highlands. Migration has created cultural and diverse communities that have tied us together, populated by many European Scots, solidifying our European identity. Twenty-one languages are spoken by pupils, for example, at Central Primary School in Inverness, such is the diversity of families settling in the highlands. European citizenship, whether it is our own or that of European citizens who are here, is very important for the economy—tourism accounts for 20% of the economy—as well as many other sectors. I could mention food processing, renewables, life sciences and so on, but I will not pause on those.

[Jamie Stone]

In addition to what the hon. Gentleman says about migration to our country, Scotland, the historical emigration of Scots was a curse on the highlands for many years, but European investment in infrastructure, via schemes such as objective 1, helped halt—and indeed reverse—that, meaning that classmates of mine and younger generations stayed in the highlands, rather than seeking their fortunes outwith the beloved land they came from.

[Hon. Members]

Hear, hear!

Disabled People and Economic Growth

Debate between Drew Hendry and Jamie Stone

Thursday 22nd February 2018 Commons Chamber

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

As another Member with a four-barrelled constituency name, I, too, congratulate my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Dr Cameron) on bringing this debate to the Chamber. I commend the hon. Member for Strangford (Jim Shannon) for also attempting to pronounce her constituency; he did very well indeed. We heard from my hon. Friend a speech that was rich in detail, understanding and empathy. She really, truly understands the subject. I fully commend her for this very positively titled debate about the role of disabled people in economic growth. It is somewhat scandalous that we have not had the opportunity to debate this before, but that wrong has been righted today.

We in the SNP know that disabled people continue to make a fantastic contribution to our economy. All the words that we have heard here today show our empathy and the joint approach that we are taking to these issues, but comments that come from the Government themselves can do a lot of harm. Our approach to disabled people—the approach we have taken today—is in stark contrast to the UK Government’s Chancellor, who recently said that he thinks that disabled people are reducing productivity.

I would like to quote my hon. Friend, not from her speech today but from an excellent article she wrote recently:

“The answer is simple, invest in improving the pathways to work. Invest in disabled entrepreneurs, improve reasonable adjustment guidelines and encourage businesses to diversify their workforce. Create incentives rather than enforce sanctions. If the £108 million spent by the Government to deny disabled people the benefits they are entitled to was redirected to creating an apprenticeship schemes, entrepreneurship and training opportunities for example, then perhaps the narrative of people with disabilities could change.”

Those are very wise words.

I am most grateful to Scope for the briefing that it has sent along for this debate. Scope says of the Chancellor’s comments:

“We found the Chancellor’s statements before the Treasury Select Committee…on the negative impact of disabled employees on UK productivity levels to be entirely untrue and unacceptable.”

It underlines a fact that was brought out by my hon. Friend, saying:

“In fact, a 10-percentage point rise in the employment rate amongst disabled people would increase GDP by £45 billion by 2030 and result in a £12 billion gain to the Exchequer.”

I hope that the Minister, who I know to be a thoughtful person, will reflect on the Chancellor’s remarks and take the opportunity today to distance herself from them.

There is a real opportunity to make a positive impact on tackling the disability employment gap in the economy, delivering the reforms needed to support more people to enter, remain and advance in work, but progress up until now has been slow. Government and employers need to do more if we are to harness the economic benefits that an increased disabled employment rate will bring. Tackling the disability employment gap would mean, as I have said, that economic growth and productivity would increase.

Employing disabled people is an opportunity for employers, delivering significant benefits to business and the economy. It is important to underline the calls from the all-party parliamentary group on disability. They are all relevant, but I mention especially tailored and targeted support for self-employed disabled people from such bodies as the Business Bank, funding for reasonable adjustments for disabled recipients of tech start-up support from Innovate UK, and bringing forward requirements for sectors to plan for recruitment.

It is also vital to recognise the additional challenges that are faced by disabled people. My hon. Friend talked about the high numbers of applications required simply to get a job interview, let alone a job. She said that we cannot afford to sit and wait. Throughout this debate, we have heard many people agreeing on the need for action, and that is what disabled people now want to see.

[Jamie Stone]

The hon. Gentleman rightly mentions the challenges and difficulties that disabled people face. One of those, depending on the form of disability, is that the fatigue element as the day progresses can be quite critical to the person. It would be best if employment opportunities could be tailored with specific reference to this fatigue, which can kick in after two or three hours of concentrated work.

[Drew Hendry]

I thank the hon. Gentleman for his intervention. It is important to take into account the size and scale of the challenges people face, to make sure we are able to take full advantage.

As my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow said, the UK already has a skills shortage, and the Brexit exodus of skilled labour means that the opportunity of training and apprenticeships must be embraced. As we have heard, the Government at the moment are not going far enough. Specialist advice services on self-employment are required, and we need to avoid stereotypes in these debates and the action that follows.

The additional challenges for disabled people also come down to hard cash and the extra costs that they have to cope with. New research from Scope shows that on average, disabled people have to find an additional £750 per month related to their condition, on top of any social security payments designed to meet those costs. The financial penalty locks disabled people out of being able to make a positive contribution to the economy. They need practical help, and the Government can help now. For example, the Government can help with motability, an issue that my hon. Friend is keen to bring up. Many people have seen their ability to move around or take part in employment and the economy hampered by motability issues.

It also comes down to the issue of PIP assessments. I was interested to hear from the hon. Member for Hitchin and Harpenden (Bim Afolami) and agree with him that more money should be spent on disability payments. There should be more social security to support disabled people, particularly given their disadvantage. The recent Work and Pensions Committee report on claimant experiences of PIP and ESA assessments presented clear evidence that the assessments are failing a substantial minority of claimants, with claimant stories highlighting clear errors made in assessments, crucial information being omitted and assessors lacking knowledge and expertise. It is not just about putting more money into the system; it is about making the system work for disabled people, which too often it does not at the moment.

Universal Credit: Private Rented Sector

Debate between Drew Hendry and Jamie Stone

Tuesday 9th January 2018 Westminster Hall

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

It is a pleasure to serve under your chairmanship once again, Mr Gray. I congratulate the hon. Member for Eastbourne (Stephen Lloyd) on securing this important debate. It is vital that universal credit failures and the opportunities to fix them are highlighted to the Government at every opportunity, in the hope that they might listen.

The hon. Gentleman spoke eloquently about the problems with payments to claimants, which we raised with the UK Government when the Highland Council was a pilot area in 2013. [Interruption.] I hear my former council colleague, the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone), agreeing from a sedentary position. This is a cross-party issue, which I will come back to later. The hon. Member for Eastbourne also spoke about the problem with ideologues. I agree that there has been a continued failure to listen. I hope that that will change and that we will get a more positive response from the Minister about actions that could be taken. I will give some examples later on.

[Jamie Stone]

I return to my vast and remote mode. One of the warnings that the hon. Gentleman and I and others put to the Government was that the sheer rurality, distance and sparsity of population would present a special challenge when trying to get private landlords to let property.

[Drew Hendry]

I agree.

The hon. Member for Batley and Spen (Tracy Brabin) spoke eloquently about the issues that she has witnessed. She talked about universal credit being rolled out, glitches and all. I would go further—we are seeing more than glitches in the roll-out of universal credit. I have witnessed it for nearly five years. These are systemic issues. She mentioned that no child should have to experience these effects, which is absolutely right. This is about the people and their families who are affected in their homes. That hits home the hardest when people come to us with the personal stories of suffering they are enduring. That is when we understand why the Government have to listen and do something about it.

The hon. Lady also talked about the pressures on housing stock and the need to support the private rented sector, saying that 66% of private renters have no savings. That is true and is reflected in my experience, albeit anecdotally. People do not have the ability to inject their own cash into the system because they do not have any cash—it does not exist.

The hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie) mentioned that there are problems that need to be fixed. I welcome the fact that we are hearing that around the Chamber. There is a consensus that these serious issues are hurting people.

The hon. Member for Caithness, Sutherland and Easter Ross talked about rent arrears for councils. Again, I refer to what happened in the Highland Council as a result of this problem.

The hon. Member for Edinburgh West (Christine Jardine) has not yet seen the roll-out in her constituency but is aware that a cold wind is coming. Those of us who have experienced it in our constituencies have seen the devastation that it leaves in its wake.

The hon. Member for Strangford (Jim Shannon) made an important point about the price differential between council housing association and private lettings. He asked who pays the difference. If, as we heard earlier, most people do not have private income to fall back on, who does pay the difference? He also made a telling point about the decrease in the already low number of private landlords willing to rent to universal credit claimants, which is backed up in many other pieces of evidence from around the nations of the UK.

Since Inverness was chosen in 2013 as a pilot area for universal credit, we have lived with the problems of a highly dysfunctional system. Originally, the Highland Council engaged with great hope. There was and remains support for simplifying the social security regime. There were too many benefits in the past and it was too confusing. In local and national politics of all colours, people got behind the idea of a system with a lot less bureaucracy and hassle for claimants. If only that had been the outcome. Instead, universal credit in its current form has gradually shown itself to be a failure. Worse, its continued roll-out has had a devastating impact on claimants—not just the unemployed, but working people, single parents, the disabled and even the dying—particularly through the toxic legacy of debt and rent arrears.

The hon. Member for Eastbourne described universal credit as a car crash. It is, and its corrosive effect is not restricted to claimants. Landlords in both the public and the private sector feel a knock-on effect, which squeezes incomes, reduces the supply of rented properties for claimants and chokes investment in new building. We in the Scottish National party have called continuously for the roll-out to be halted and fixed. Like those in Northern Ireland, we will use the very limited powers we have to try to mitigate the impact, as we have done with other matters over the past few years, and inject a little fairness and dignity into the system. However, it remains almost entirely a UK-reserved issue and needs to be dealt with.

I have been a noisy witness in the nearly five years since the pilot, when I was leader of the Highland Council. We have tried every approach to get the Tory Government to listen. I was joined by the political voices on the council—regardless of political colour, if any—to highlight the misery that was gradually unfolding before our eyes. We set out the alternatives, asked for changes and relayed the experiences, the frustrations and the inevitable wider impact that the roll-out would have if it was continued without fixing the problems, yet our voices were not listened to, and now we are seeing the pattern repeating itself wherever universal credit is deployed.

The hon. Member for Eastbourne mentioned the public sector. As a result of universal credit, the Highland Council has seen rent arrears rocketing to around £2 million —a signal of the misery, but also a noose around the neck of investment in housing. Vital resources are being drained from the council as it picks up the cost of the universal credit failure.

According to a recent report by the Residential Landlords Association, universal credit is now the main reason for private sector landlords seeking to evict tenants. We have heard a lot of statistics this morning, but 29% of landlords have evicted a tenant for universal credit rent arrears and now only 13% of landlords say that they are willing to rent to universal credit claimants at all. According to the RLA, more than 73% of landlords are unlikely to rent homes to someone claiming universal credit, because they are worried that they will not be able to pay.

The Scottish Federation of Housing Associations says that those problems are putting more pressure on public housing; that the administration of universal credit falls short of what its own service standard should be; and that the schedules that associations receive are beset with errors. The federation’s survey found that the standard of communications between the DWP and landlords was erratic, and made worse by the absence of implicit consent in the universal credit full service roll-out. Arrears are much higher among people on universal credit. The federation says that the shortcomings need to be fixed and that a pause is therefore required.

The DWP has not allowed implicit consent, except through MPs. That hamstrings organisations such as citizens advice bureaux and housing associations, meaning that they cannot effectively help claimants to get their entitlements to retain tenancies. The reliance on explicit consent is impractical, especially in rural areas.

There is a growing worry that the design and the benefits of universal credit are not fit for purpose. It should be the objective of any good enterprise, especially a Government, to listen to the experiences of people affected, especially those delivering a service and those who have been asked to partner and make the required adjustments, but neither I nor anybody else in the highlands have witnessed such a willingness to adapt. The problem has spread to other areas. Landlord after landlord, housing association after housing association, council after council, support group after support group and charity after charity have echoed the calls we have made. Every day, new and more troubling examples of hardship and suffering are exposed. Debt and rent arrears mean long-term damage and lasting harm to communities.

Universal credit, in its current form, is designed to create debt by default—it is constructed that way. What kind of Government create the situation where people and families are turned into debtors, with no hope of escape other than eviction, bankruptcy or both? As the hon. Member for Eastbourne pointed out, some welcome changes were made by the Chancellor in his Budget. However, the Chancellor said in his November Budget speech that he wanted to avoid debt for the Government

“not for some ideological reason but because excessive debt undermines our economic security, leaving us vulnerable”—[Official Report, 22 November 2017; Vol. 631, c. 1048.]

He went on to talk about vulnerability to financial shocks. Well, people are facing financial shocks now because of the shambolic handling of universal credit. It should be halted; the messages should be taken on board; and it should be fixed.

Universal Credit Project Assessment Reviews

Debate between Drew Hendry and Jamie Stone

Tuesday 5th December 2017 Commons Chamber

[Jamie Stone]

Will the hon. Gentleman give way?

[Drew Hendry]

I will do so very briefly, because there is not much time and I want to make these points.

[Jamie Stone]

Once upon a time, the hon. Gentleman and I served on the Highland Council. Does he agree that one of the unwanted side effects of all this was the impact on the council’s budget? He and I had to put money aside to advise constituents about their problems, and that cut into the vital services that we were trying to deliver.

[Drew Hendry]

Indeed it did, and that is one of the manifest problems that I was going to come to. Universal credit is fuelling debt by default, leading some people to be evicted from their homes and placing others under stress due to the threat of eviction. Here is a list of the problems. There are delays, missed payments, poor communication, wrong payments, incorrect deductions, people left without money, people who do not know what is happening, and people who cannot work their way through the system. Universal credit hits the working, the low waged, the self-employed and the disabled, as well as those who are seeking work. At the universal credit summit that we held, we heard all those problems and more.

In the limited time that I have left, I want to make a few more points. The CAB-Macmillan partnership said, of people with terminal illness:

“We’ve not seen anybody fast-tracked through for an earlier payment. In fact we have seen people who are terminally ill dying before their Universal Credit is processed”.

How is that for a problem with universal credit? I have got pages of the stuff here, and I could, if I had the time, give lots more evidence about why universal credit is failing.

This debate is about the information, however. The project assessment reviews are detailed assessments of the implementation of universal credit. As has been said, the Information Commissioner’s Office

“finds that the balance of the public interest supports disclosure of the requested information.”

I pay tribute to John Slater for his tenacity. He deserves the right to access this information. The least the Government can do is to publish the information, but so far they have failed to do so. The justification for why publication is not in the public interest is beyond me, if the Government are so confident about it. The ICO notes that

“the reports provide a much greater insight than any information already available about the UCP, there are strong arguments for transparency and accountability for a programme which may affect 11 million UK citizens and process billions of pounds, which has had numerous reported failings in its governance.”

It is about time that people got the full story about universal credit. I can tell hon and right hon. Members whose constituencies have not experienced a lengthy period of universal credit that they will be glad to get that information before universal credit hits their constituents.