Benefit Sanctioning

Esther McVey Excerpts

Tuesday 2nd December 2014 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

It is a pleasure to introduce this debate under your chairmanship, Mr Howarth.

During the September recess I organised a community consultation across my constituency. With 63 meetings over three weeks, the consultation raised a wide range of issues. A dominant theme from some of my most vulnerable constituents, and from those in the voluntary, community and faith sector who work with them, was the impact of benefit sanctions. I cite the example of the Cathedral Archer Project, which works with the homeless. The project has been visited by Ministers and is held up as a model of good practice in taking people off the streets and getting them back into society by giving them skills and a home. The project’s work has been fundamentally changed by the response that some of its clients receive when they start—

[The Minister for Employment (Esther McVey)]

I had the same cough.

[Paul Blomfield]

I didn’t catch it from you, Minister.

Some of the project’s clients, in their first home, will suddenly receive a letter that they either cannot read or do not understand, and they will therefore miss an appointment and find themselves sanctioned, out of their home and back on the streets. They go to the jobcentre and are told, “Go along to the Cathedral Archer Project. They will feed you.” That transforms the role of an important local charity from making a strategic intervention to help people off the streets, into homes and into work to just being a crisis centre.

I am pleased to have secured this debate to raise such concerns directly and to make some practical proposals on how the Government can address the issue. Much of what I have to say is based on the work of Sheffield Citizens Advice, which is a great organisation that provides vital support to people across our city, finds solutions and supports people in complex situations. In doing so, it saves public money by averting crisis further down the line. In May, the organisation’s social policy group produced a report on the experience of jobseeker’s allowance sanctions based on the previous 12 months. I am pleased that the report’s author is in Westminster for today’s debate. The Department for Work and Pensions received a copy of the report when it was published, and it has been in correspondence with Sheffield Citizens Advice. I sent a further copy to the Minister before today’s debate so that we can properly consider its recommendations.

I must stress how helpful it is for such evidence to be gathered and presented so clearly by those working directly with the people affected by Government policy, with concrete recommendations about what can be done to improve the system. I hope the Minister will treat that work by people on the front line as seriously as it deserves to be treated. I make it absolutely clear at the outset that neither the report nor my contribution opposes the principle of sanctioning within the benefit system. Applying sanctions to those who are deliberately not seeking work, who are unavailable for work or who have no intention of working can disincentivise such behaviour and, in combination with the right support and training, can help people on the road to getting a job that provides not only an income but self-esteem, purpose, socialisation and accomplishment, but—and it is a very big but—any sanctioning regime has to be humane. The Sheffield Citizens Advice report clearly shows that there is an increasing number of incidents where the system is neither humane nor—this is important—serving its stated purpose of getting more people into work. In fact, the system is having the opposite effect in many cases.

Some of the stories outlined in the report will be all too familiar to hon. Members. I will briefly share the experiences of a couple of my constituents that are not detailed in the report. One constituent prefers to remain anonymous, so I will call her Mary. She was made redundant from a job as a cleaner, so she had to sign on for the first time in her life. She was told by an officer at the jobcentre that her next appointment with a job adviser would be on her signing-on day. She was told that there was no need to come in and sign on in the morning because she could do it when she came in for her 3 pm appointment. That information was wrong: the job adviser appointment was two days before Mary’s signing-on day. We all make mistakes, but it is simply and clearly not right that Mary, who had gone to the jobcentre for help to find a job, was punished for the officer’s mistake. It was an honest mistake, but it was a mistake, and she faced the consequences. Mary had to borrow money to get by, and I am pleased to say that she is now back in work with a cleaning job, but she got there despite the system, not because of it.

Mary understood what she needed to do, but she was wrongly advised. There are plenty of examples in the Sheffield Citizens Advice report of people who are not clear about what is expected of them:

“Alan was given a 4 week sanction for not actively seeking work. Because of his limited literacy/numeracy skills he had been enrolled for an 8 week course in English and Maths. He thought that as he was taking this course he did not need to complete his work search book for that period.”

That was an honest mistake. The report continues:

“Tony is in his mid 50s and is vulnerable because of his learning disabilities and dyslexia. He can’t read or write. Despite the fact that he gets significant support with looking for work from a local Job Club, he was sanctioned for not doing ‘enough’ jobseeking.”

Another constituent, coincidentally also called Tony, thinks he was sanctioned because the activity on his Universal Jobmatch account was considered too low by the jobcentre. I say that he thinks that was the reason for his being sanctioned because he has not yet been notified of the reasons for the sanctioning. Tony is eager to find employment and has completed an IT course through the jobcentre to help him find work online. He does not have access to a computer at home, so he spends much of the day at the central library waiting for his turn on the computer to show activity on Universal Jobmatch. That is in addition to going to workplaces in Sheffield looking for work, but he has been sanctioned. As a result of that sanctioning, he has been referred to the Salvation Army food bank in my constituency.

The question is whether sanctions are the right response to such situations, and not only because of their impact on people. Will they actually bring about the behavioural change that they purport to seek? Might the sanctions hinder, rather than help, the people who are affected?

--- Later in debate ---

[The Minister for Employment (Esther McVey)]

It is a pleasure, Mr Howarth, to serve under your chairmanship. I thank the hon. Member for Sheffield Central (Paul Blomfield) for bringing this important debate to the Chamber. It is important for us to keep a spotlight on the sanctions regime.

Sanctions have always been part of the benefits system. As Oakley stated, benefits sanctions provide a vital backdrop in the social security system for jobseekers. They are a key element of mutual obligation underpinning both the effectiveness and fairness of the social security system. Sanctions help to ensure that claimants meet requirements designed to help to them to move into work. They are only a last resort as part of a wider agenda to help people to get a job and to move closer to the labour market.

Our approach is not to be tougher for its own sake, but to provide a clearer, more consistent and effective incentive to comply. Where sanctions are, how they are set up within the system and how they work are important. Before dealing with hon. Members’ questions individually and responding to the hon. Member for Sheffield Central, I will provide some context.

When the debate was arranged, I thought we should look at what was happening pre-2010. A system is always subject to changes, which must reflect what is happening, to make it better and support more people into work. When looking back—this probably answers the question from the right hon. Member for East Ham (Stephen Timms)—we must consider how sanctions were issued.

There was widespread inconsistency in decision making, with similar cases being treated differently even within jobcentres. We had to ensure that that did not happen so we focused on how to achieve greater consistency and efficiency throughout the introduction of our quality assurance framework. No targets were set and there are still no targets, but when we see variation, whether higher or lower, in the same jobcentre, we seek to ensure that a certain standard is maintained. We would check what various advisers are doing and whether the person concerned needs extra help and support to provide equality. It cannot be right that one jobseeker is treated differently from a friend, colleague or other jobseeker. That is why we made changes.

I also looked at what was happening in 2010 and there were some startling differences. Between 2004 and 2009—this raises a different question, but it is all part of the sanctions system and the extra help given—only four out of 10 British nationals got jobs, but six out of 10 foreign nationals did. We changed that round because it is key that, as well as sanctions, we provide a system that gives the right training, the right support and the right employability skills. In addition, discipline is necessary to maintain a job. All that must be provided. Since we have done that and fundamentally changed the system, nearly seven out of 10 British nationals are getting jobs. That must be seen in the context of the changes since 2010.

I look at the jobs market and what has happened, and at the various quotes. Since 2010, there has been an increase of nearly 2 million jobs. The Opposition said they thought there would be 1 million fewer jobs, but that is not the case. There are nearly 2 million more jobs and at the same time there are an extra 200,000 vacancies, so there are about 670,000 vacancies at any one time.

We must ask whether we have the right incentives in place to get people into work, and whether we are providing the right training, discipline and employability skills for people to get a job. We must look at the issue in the round. There have been significant changes.

[Ian Lavery]

On the millions of jobs that the Government claim they have created, the Office for National Statistics says that 1.4 million of them involve zero-hours contracts. Does the Minister believe that the Government are encouraging people into long-term employment by offering them contracts under which they might not make even £1 a week?

[Esther McVey]

The Labour party has already been brought to task by the UK Statistics Authority for talking about a significant increase in zero-hours contracts that did not happen. The contracts began in 2000 as the minimum wage was brought in. We know the number of people on them, and for the vast majority they work. When they do not work, we have not allowed exclusive contracts. We are doing something that the previous Government did not do. We want to ensure that people have a good job—not just any old job, but a job they want so that they have a career and progress. We know that three quarters of the jobs created since 2010 are full-time. I hope that answers the question.

The other key issue—for me, probably the most important thing the Government have done—is that fewer children are now growing up in workless households.

[Sheila Gilmore]

Will the Minister give way?

[Esther McVey]

I will not give way. I am setting the scene. I will answer the questions raised, and then I will take some more interventions, but not at the moment.

We know that the best route out of poverty is to have a job and that children born into a household where no one works are three times more likely to be in poverty. This year, we have reduced that number by 390,000. We are talking about poverty, and about support and help for people to get a job and to move forward. The Government have done significantly more than anybody else to support people on their way and into work. That is the background of sanctions and why they exist, and what we must do to meet and match and provide support.

We have introduced the youth contract for young people, with an extra 250,000 extra work experience places, and sector-based work academies. This year, we have seen the biggest fall in youth unemployment—by 250,000—since records began. We are fundamentally turning the lives of those people around, and sanctions are a tiny part of a massive system of support.

[Paul Blomfield]

The Minister is making a wide- ranging contribution, but I am conscious that she is— unintentionally, I am sure—leaving herself insufficient time to answer my specific questions. Will she meet me and Sheffield Citizens Advice to talk about them in more detail?

[Esther McVey]

What I will do first, so that I do not run out of time, is to answer the hon. Gentleman’s questions. He referred to various people who did not want their names given but had reasons why they thought they should not have been sanctioned. In many cases, there will have been good reasons for the sanction, but I would like to know what happened to those people.

The claimant commitment is being rolled out to 900,000 people so that the adviser understands what support people need, what journey they need to go on and their individual circumstances, which might mean that they are more vulnerable than other people and need more exemptions or time off because they can work or search for jobs only within certain time frames. That was the point of the claimant commitment and personalising the approach, which we are doing now.

Oakley rightly raised communications, what we were doing and how we could refine the system further. We know what we have done; we have helped people into work. We know what we have done with the sanctions regime, but how do we make it better, which we need to do constantly?

Oakley made 17 recommendations, all of which we have accepted. They include reviewing letters to claimants to ensure that they understand what is going on; work with experts to ensure that communication is better; and work with local authorities to improve communication on housing benefits, to ensure that people do not have their housing benefit stopped unnecessarily, which can make things worse for people. Those recommendations were implemented immediately unless they required substantial changes to the Work programme, in which case they will be introduced as that programme changes.