Scotland (Poverty)

Eilidh Whiteford Excerpts

Wednesday 30th November 2011 Westminster Hall

[Sandra Osborne]

My point is that the cuts have not been made in a fair and even manner, as the Government promised. I will develop that point later.

It is all too evident that the impact will fall disproportionately on vulnerable groups and on those who deliver the services on which those groups depend. Those are not just my views; there has been widespread condemnation from campaigning groups and third-sector organisations in Scotland that the budget and austerity measures will further increase poverty and inequality.

As my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) said, in yesterday’s autumn statement we heard of further measures. The Chancellor announced the expansion of free nursery places for two-year-olds, helping 260,000 children. But, alongside that, he announced that he would be taking more than £1.3 billion a year from families by failing to go ahead with the planned additional £110 rise in child tax credits and by freezing working tax credits.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

I congratulate the hon. Lady on securing today’s debate. This is a very important subject to discuss on St. Andrew’s day. Does the hon. Lady share my concern that the poorest families will suffer a disproportionate impact from these cuts, and that the 20% of the poorest families in Scotland will bear the brunt?

[Sandra Osborne]

That is the whole point of raising this debate today.

All this has happened despite the fact that when the Chancellor announced the rise in tax credits he said that it would support 4 million lower-income families, helping to ensure that there would be no adverse impact on child poverty. As the Minister knows, there is now a law relating to child poverty. The Chancellor has now taken that extra support away from the 4 million families. In its distributional analysis of yesterday’s measures, the Treasury has admitted that, as a result of the decisions taken by the Government, the number of children living in households with incomes below 60% of the median will increase by 100,000 in 2012-13—which will mean more children living in poverty.

--- Later in debate ---

[Sandra Osborne]

I was about to talk about people who are living in fuel poverty who are spending a disproportionate level of already inadequate income on basic energy bills. Almost 1 million households, more than one in three Scots, now struggle to heat their homes. However, the SNP has cut the budget to help tackle fuel poverty by almost a third, down from £70.9 million in 2010-11 to £48 million in 2011-12. Dr Brenda Boardman from Oxford university, previously lauded by First Minister Alex Salmond, has said that Scotland has some of the worst fuel poverty in the UK. She describes the SNP’s cut in the fuel poverty fund as a real slap in the face for the fuel poor.

[Dr Whiteford]

I know that fuel poverty is something that is also taken extremely seriously in my constituency, partly because people do not have access to social tariffs on low incomes. They also often have trouble accessing broadband. But will the hon. Lady accept that the SNP Government have done more than previous Labour Governments ever did to address fuel poverty in Scotland, and are making record levels of investment in their energy assistance package and with other measures?

[Sandra Osborne]

I think that they flatter to deceive. Measures have been cut, including what I have just described. As I say, it is not just from me, it is from a very eminent professional who is an expert in the field. At the end of the day the Scottish Government will decide how to implement the budget in Scotland.

Not surprisingly, poverty means lower levels of mental wellbeing, shorter lifespans and more ill health. Those in the lowest 20% of household incomes, particularly women, are far more likely to suffer from depression, anxiety and attempted suicide, while men living in the most deprived areas have a life expectancy of more than 11 years shorter than those in the 20% least deprived areas of Scotland. The situation in Scotland is very serious. Here I would like to pay tribute to Campbell Christie, the former STUC leader and another truly great Scot, who recently passed away but who chaired the Scottish Commission on Public Services. Its report said:

“Members of the commission have been struck by just how much public spending is skewed by that bottom 20% in terms of poverty, unemployment, health and all the factors that go with it—and how little progress has been made on that bottom 20%.

If you are going to do anything, you should relentlessly target resources at the bottom 20%. That would bring Scotland up overall: it's not just a moral case for social justice; there's a strong economic argument too.”

A recent national survey revealed that six of the 10 worst areas of Britain are on the west coast of Scotland, including areas of Glasgow.

In any debate on poverty, certain key assertions must be made. First, income and material conditions remain the most fundamental determining dimensions of poverty. Political and policy emphasis on non-income dimensions of poverty must not be used to draw attention away from the fundamental causes of poverty—lack of money.

The policy can work. The Labour Government's commitments and policy action that boosted pensions, benefits, tax credits and wages and removed some of the barriers to work have had an impact, with child and pensioner poverty significantly lower than in 1997. Other policy interventions that should be welcomed include a focus on more equal health outcomes and commitment to the idea of a living wage, although when that was put forward in South Ayrshire by Labour, the SNP Tory administration voted it down. We need more investment and income maximisation, statutory commitments to tackle child poverty and improved access to debt solutions.

Labour made huge strides in government, both in Westminster and at Holyrood, to tackle youth unemployment in Scotland. Again, the clock has been turned back. Youth unemployment is rising fast. Behind these figures is a generation of young Scots, rich in talent, full of potential, with a hunger to work. Yesterday’s announcement in the autumn statement was too little, too late. It will be next April before it even kicks in, which has meant two years of inaction, and equates to £121 million a year, a fraction of the £600 million this year alone which Labour would spend on a youth jobs fund through repeating the bank bonus levy.

[Dr Whiteford]

Will the hon. Lady join me in welcoming the initiatives of the Scottish Government to ensure that every 16 to 19-year-old in Scotland who is not in full-time education will have a training place or an apprenticeship or a job?

[Sandra Osborne]

I would very much welcome any measures that are taken in Scotland on youth unemployment, but it does not help when the SNP Government choke off opportunity by cutting funding for the country’s colleges. I attended the graduation ceremony at Ayr college the other week and I was very impressed by the students’ achievements, but the level of cuts that the college was facing—10% this year and 20% over the next two years—was very depressing. There have already been job losses and the college has been told to concentrate on 16 to 19-year-olds. That is fine, except that it takes places away from adult learners.

I received all my education, such as it is, as an adult, and I want young people as they grow older to have cradle-to-grave education, not just between the ages of 16 and 19. That is also needed for the economy.

I refer now to research from the Centre for Regional Economic and Social Research at Sheffield university. It calculates that the headline total of 2.6 million men and women on incapacity benefits is set to be cut by nearly 1 million by 2014. Most of these will be existing claimants who will lose their entitlement. The report shows that, because of the reforms, 600,000 are set to be pushed out of the benefits system altogether, forcing a big increase in reliance on other household members for financial support.

The researchers also show that by far the largest impact will fall on the older industrial areas of the north, Scotland and Wales, where local economies have been struggling for years to cope with job loss and where the prospects of former claimants finding work are weakest. Glasgow looks set to be hit 10 times harder than, for example, Kingston upon Thames. In common with many of my colleagues here, these are just the types of areas that we represent where it has been very difficult to recover from industrial decline in the past. This is not going to help.

--- Later in debate ---

[Ann McKechin]

My right hon. Friend is absolutely correct—that is a point I am about to make. I, too, represent an area that has a university community, and we continually have difficulties about multi-occupancy. Again, the UK Government have completely failed to consider new regulations put in place as a result of legislation that has gone through the Scottish Parliament.

Many local authorities and social landlords have progressively moved away from multi-occupancy lets due to problems with management and its unpopularity with other tenants and communities. In Angus, the difference between the rental level for a one-bedroom home and a shared home rate is £20.77 a week. For people who are unlucky enough to live in rural Aberdeenshire, it is £49.61 a week, because they are sitting in the midst of an oil economy, with rentals to match. Inevitably, people will be pushed into our cities, regardless of where their job is, in a desperate effort to find accommodation.

As I have mentioned, the UK Government have given no thought as to how local communities may feel about the expansion of multi-occupancy housing in their areas. I know from experience in my constituency that there have been examples of the dumping of people in bed-and-breakfast accommodation from other local authority areas, because those areas had no or very few such places available. I can only imagine where all those hundreds of people in north Ayrshire, for example, will have to go—I think that most of them will end up in Glasgow.

[Dr Whiteford]

The hon. Lady is making some important points about the housing situation. Will she reflect on the situation for pensioners who might also be affected by the under-occupancy rules that are coming in and the fact that suitable one-bedroom properties are simply not available, particularly those on a flat level for people with mobility issues?

[Ann McKechin]

The hon. Lady makes a good point. I know that that matter is not currently covered in the regulations proposed by the Government. However, should there be any further expansion, we would be looking at something close to a total collapse of social housing, because of the sheer numbers of people, particularly pensioners, who are living alone in properties with two or more bedrooms.

One change due in 2013 is that housing benefit will be restricted for working-age claimants in the social rented sector to those who are occupying a larger property than their household size. Do the Government know how many will be impacted by that change? Why do I bother to ask them, because they have no desire to find out?

It has been estimated from the family resources survey that Scotland-wide there are approximately 100,000 households in the social rented sector in receipt of housing benefit where the accommodation is currently under-occupied. We do not, however, know how many of those are rented to retired tenants compared with those of working age. Glasgow Housing Association, which is Scotland’s largest social landlord, has estimated that roughly 13% of their entire housing stock will be affected by just that one change alone. That represents thousands of tenants in just one city in our country.

Such a change may occur simply because an adult child leaves home, even if the family still have children of school age. A family may be forced to move out of a property that they have lived in for many years and in some instances to move many miles from the community in which they are settled—or they might fall into rent arrears, or they could just eat less, or they could not heat their home. That is the reality of the real choices that thousands of low-income families will now face.

--- Later in debate ---

[Dame Anne Begg (Aberdeen South) (Lab)]

It will be difficult to follow my two colleagues, who have explained the scourge of poverty in terms of the proportion of people living in poverty in Scotland and the shame that that brings on us as a nation. I congratulate my hon. Friend the Member for Ayr, Carrick and Cumnock (Sandra Osborne) on securing this debate.

I shall confine my comments to a group of people who, by definition, find a much higher proportion of themselves living in poverty—namely, those who are disabled or have a disability. All the problems that, as we have already heard, face families living in poverty tend to be amplified if one of the members of those families happens to have a disability. We know that 21% of families who have one person with a disability living with them are living in poverty compared with 16% of the general population. That figure increases for children: 25% of children living in families with a disabled person live in poverty compared with 18% of children living in families with no one who is disabled.

The concern that I want to get over to the Minister, and to which I hope he will respond, is that those figures are bad enough, but the actions of this Government are about to make matters far worse. Despite the impression given in the tabloids by stories of benefit scroungers and people who have languished on incapacity benefit or disabled benefits for years, employment among disabled people had actually improved over the last 10 years of the Labour Government. The employment gap between those disabled and those non-disabled in 2002 was 36%. By 2010, by the time the Labour party lost power, that gap was down to 29% and all the indicators were that it was improving, so many disabled people were in work. However, it is still the case that anyone with a disability is far less likely to be in work than those who do not have a disability, and therefore dependent on benefits.

What happens to the benefits system? What changes will be made to save the £18 billion that the Government are trying to strip out of the welfare system? Those changes will impact even more directly on those who are the most vulnerable—those who have a disability. What is of concern is not just that individuals and their families will face reduced incomes but, as my right hon. Friend the Member for Stirling (Mrs McGuire) said, the reduction in the money that is available to be spent in those communities and the fact that the communities themselves will become even poorer than they are at the moment.

My hon. Friend the Member for Ayr, Carrick and Cumnock mentioned the report from Sheffield Hallam university, written by Christina Beatty and Steve Fothergill, called “Incapacity Benefit Reform: the local, regional and national impact”. That report makes incredibly interesting reading. It shows not only that there is a concentration of people with disabilities who are living on disability benefits, whether that is incapacity benefit, employment and support allowance or disability allowance, but that it correlates exactly to the areas of high unemployment and the areas of industrial decline. So it comes as no great surprise that, of the top 20 districts where the share of adults claiming incapacity benefit is the highest, three of them are in Scotland. Glasgow comes in at 12.3%, but is followed closely by Inverclyde and West Dunbartonshire. In the bottom 10 districts, of the areas with the least number of people on incapacity benefit not a single one is in Scotland and that in itself acts as a stark reminder that there are areas in Scotland, particularly west central Scotland, that have suffered not just the depression and lack of jobs caused by deindustrialisation but, resulting from that, an increase in the number of people who not only suffer ill health and disability but, as a consequence, are claiming benefit. Any cuts to those benefits will fall particularly heavily on those areas.

The figures in the work that Christina Beatty and Steve Fothergill have done are UK-wide, so we must assume that 10% of those people live in Scotland. Those figures show that, as a result of Government changes already announced, in Scotland alone, 97,000 fewer people will be claiming incapacity benefit. Even more worryingly, 58,000 will be removed from benefits all together. How will that happen? The last Labour Government had already introduced changes to reform incapacity benefit and to move people on to the employment and support allowance. The new Government have speeded up that move and have also cut down on the amount of money to be spent. That is where a great deal of the savings will come from.

[Dr Whiteford]

The hon. Lady’s constituency, like my own, was part of the pilot scheme that trialled the new work capability assessment. My view is that it has not been working and instead has been causing great anxiety and distress to disabled people. More importantly, the successful appeal rate is out of all proportion to any system that is working. Something like 70% of appeals are proving successful, where people have support from advocacy agencies. That system should go back to the drawing board, but I am also concerned that the burden will start falling even more so on unpaid carers and other family members for people who have been taken out of the system. Does the hon. Lady share my concerns on that?

[Dame Anne Begg]

Those concerns are shared by all of us. It has been very difficult to get robust figures about the numbers who are being migrated from incapacity benefit on to employment and support allowance, and how many of them will fall out of the benefits system all together or find themselves on jobseeker’s allowance as an alternative. The early indication from the pilot that took place in both Aberdeen and Burnley would suggest that about 30% of those on incapacity benefit will move to JSA. That one single move is immediately a loss of £20, or slightly more, a week for that family. We do not know whether those figures are robust but we do know that, for new claimants, it is far less than that. Part of the reason why the tabloid press has managed to create the impression that there are lots of people languishing on incapacity benefit or disability benefit who do not deserve it is that they conflate the proportions who are new claimants getting the benefit with those already on the benefit but who have been migrated across. Potentially, 30% will be losing £20 or more a week.

We also know that the Welfare Reform Bill proposes to limit contributory employment and support allowance to one year. In areas such as mine and the one represented by the hon. Member for Banff and Buchan (Dr Whiteford), where it is more likely that people will live in a household with some income, because unemployment is relatively low, so a partner, husband or wife might be working, those people will lose benefits altogether because they will not qualify for the income-related benefit that would replace it. That is why 58,000 are likely to fall out of the benefits system completely. These are people who have paid into the system all their lives. They thought that, when things turned difficult for them, when something happened and they were not able to work anymore, the welfare state would be there for them and national insurance would work as the name suggests—as an insurance that they would get that contributory benefit. This Government have decided that that is not good enough and that this group will qualify only for employment and support allowance for a year. In a year, someone might have managed only to get a diagnosis. They might have only just started their cancer treatment, they might still be getting worse but not be bad enough to be in the support group, with a degenerative neurological condition that has just been diagnosed. After a year, their money will stop if they are in the work-related activity group of ESA.