Universal Credit

Debate between Eilidh Whiteford and Helen Goodman

Wednesday 6th March 2013 Commons Chamber

[Helen Goodman (Bishop Auckland) (Lab)]

I am pleased to have the opportunity to speak in this estimates day debate on universal credit, and to follow the hon. Member for Leeds North West (Greg Mulholland). I am grateful to my hon. Friend the Member for Aberdeen South (Dame Anne Begg) for ensuring that we had this debate, as it is a really significant one that affects millions of our fellow citizens.

I shall concentrate entirely on the issue of online applications, in respect of which I think the Government are heading for some really big problems. The Department for Work and Pensions has been far too sanguine about the extraordinarily ambitious target to get 80% of people online by 2017. Shelter, in looking at the issue, says that it is

“not convinced that half of our current face-to-face service users could fully transfer to our digital services”.

I am convinced that the DWP will not be able to transfer them in the way suggested by the Minister. Let me explain to him why I take this view.

First, according to Booz & Company, which did a report for Go ON UK, 10.8 million people in this country do not use the internet. The D-E social group has the lowest percentage of households accessing the internet, with more than 40% of them unable to do so. According to Go ON UK, the group brought together by the industry to promote online skills, more than 16 million people lack basic online skills. They might have used the internet at some point, but they do not know how to do all the different things necessary to fill out an online form.

It is often assumed that it is simply older people who do not use the internet. In an interesting study in the Journal of Direct, Data and Digital Marketing Practice, however, Dick Stroud has conducted a thorough and forensic exploration of who these people are. I urge the Minister and his officials to look at this opinion piece published last year. It shows that, of the digitally excluded, 1.2 million people are young and excluded—in their early 20s and earning less than £10,000 a year. Another excluded group of 1.5 million people who earn less than £20,000 range in age from about 25 to 50. Then we have a group of 2.2 million people in late middle age who are uncertain, but open to persuasion that going online would be a good idea. These are large numbers of people, and they are precisely the people who will be making applications for universal credit. The crossover between the digitally excluded and the universal credit applicant is absolutely huge.

Furthermore, the Minister should converse with his colleagues in the Department for Culture, Media and Sport. Ofcom has reported today that 10% of the population—2.6 million households—cannot access broadband speeds above 2 megabits per second, and those are mainly in the countryside. The picture of the digitally excluded shows not people scattered evenly throughout the community, but people concentrated in particular socio-economic groups and geographical areas.

[Dr Whiteford]

The hon. Lady is making a very astute point. Some of my constituents do not have access to the internet, and those who do so often end up paying significantly more for it because of their geographical position. However, it is low-income families, wherever they live, who find it hardest to justify an internet connection in their homes, and at a time when libraries are being closed in areas of all kinds, it is increasingly difficult for those with low incomes to go online.

[Helen Goodman]

The hon. Lady echoes precisely my own thoughts. I urge the Minister to make a plan, and to look at the geography. He might then begin to be in a position to make a more accurate assessment of the problems that the Department will face, and to develop a more effective strategy for dealing with them than the Government seem to have at present.

Of course there are questions to be asked about whether the Government’s IT system will be up to scratch—we all remember the problems that arose with child support and tax credits—but the question in this instance relates to the capabilities of the population, and that is the other issue that the Government are completely ignoring. The last Labour Government spent more than £400 million on digital inclusion. Between 1999 and 2003, £396 million from the capital modernisation fund and the New Opportunities Fund was spent on enabling people to go online, and in our latter years in government we invested £30 million over three years in UK online centres, which enabled a further 1 million people to do so.

If 5 million or 10 million more people need to be enabled to go online, the Government ought to consider investing serious resources in a digital inclusion programme, but the DWP is spending £1.5 million, as are the Department for Business, Innovation and Skills and the NHS. There are 5 million or 10 million people whom we need to help, and we have a budget of £4 million—just for 2013-14; it does not cover later years. Given the rate at which this seems to work, that will help about 125,000 people. The level of resources and the extent of the focus on the problem are not remotely commensurate with the scale of it.

I am glad that today is an estimates day, because I want to ask the Minister about the motion on the Order Paper. How much of the £507 million “for current purposes” will be spent on extra support in jobcentres to help people who are not skilled, and how much of the £97.5 million “for capital purposes” will be spent on the computers that will be in the jobcentres to help people who do not have computers at home? I have tabled a number of written questions to DWP Ministers, but I have not had any clear answers. The Minister of State, Department for Work and Pensions, the hon. Member for Fareham (Mr Hoban), merely said that his

“survey of working age benefit and tax credit recipients found that 78% already use the internet.”—[Official Report, 29 November 2012; Vol. 554, c. 491W.]

There is clearly a mismatch between what the Minister is being told by his officials and what people in the technology sector are saying. I have also written to the Minister’s noble Friend Lord Freud asking about the Government’s strategy, but I have still not received a reply.

If we are to help those who are digitally excluded, we need to think about why they are excluded. Is it because, like 2.5 million households in the countryside, they cannot get broadband, or is because they are “self-excluding”? According to the surveys that have been conducted, about 50% of people say that they are not interested. Perhaps Ministers think that their “digital by default” programme will enable them to make people interested and to motivate them. I can hardly think of a worse learning environment than someone facing the stressful situation of their family’s income depending on whether they succeed or fail in the test. I can hardly conceive of a worse way of motivating people. People learn best when they are relaxed and are enjoying themselves in a friendly, warm environment. That is not what Ministers are doing. They are going to put extremely vulnerable people under this pressure.

Another issue is cost. Some 25% of people who do not use the internet say that is because of the cost. Half of them say it is because of the cost of access. As the hon. Member for Banff and Buchan (Dr Whiteford) said, an internet connection costs between £3 and £5 a week. People on jobseeker’s allowance and employment and support allowance will be receiving a benefit of £71.70, and after the bedroom tax they will be left with £23 a week; we know that because it is what our constituents tell us. The Minister is looking puzzled. That is what they will be left with once the cost of all their utilities has been stripped out. Based on what my constituents tell me utilities cost them, I have taken away £20 for heating, £10 for electricity, £6 for water rates and £4 for bus fare. That leaves them with £23. I have not included any money for a mobile phone or telephone connection or for a television licence. They also have to pay for things like washing-up liquid, loo paper and perhaps a pair of shoes once a year—a pair of trainers from Sport Direct.

These people will be forced to live on tiny amounts of money once the bedroom tax is introduced. If someone’s food budget is £18 a week, which is what my constituents are facing, I submit they will not want to spend £5 a week on an internet connection, as that would not be compatible with their way of life. There is also the cost of equipment. The cheapest equipment people can get costs £150. Ministers are therefore setting up a lot of people to fail. This is not a reasonable way to treat them.

I urge the Minister to look again at this. Exactly where across the country does he think the problem is going to arise? Will he publish a strategy? What kit is he putting into jobcentres? How much time is he expecting his staff to be offering people to support them? As Members have made clear, filling in one of these forms will take at least half an hour. In my constituency about 3,000 people will be eligible for universal credit. Although it is being phased in so that things will not happen all at once, if we say half of them can manage on the new system but the other half cannot, we will end up in a couple of years with 1,500 people needing help. If the Minister has put three computers into the local jobcentre and they are all operating for 50 hours a week, which would be an amazing feat, it would take 10 weeks for all those people to get their online applications made. The resources Ministers seem to be putting into this are not commensurate with the number of people who are going to need help.

I urge the Minister to look again at this. The Government are heading for a very significant train crash and, unfortunately, those on board the train will be the most vulnerable people in the community.