Jobseeker’s Allowance (Sanctions)

Esther McVey Excerpts

Thursday 18th December 2014 Commons Chamber

[The Minister for Employment (Esther McVey)]

As this is the last parliamentary business before the Christmas recess, I want to start by wishing you Mr Deputy Speaker, the right hon. Member for East Ham (Stephen Timms) and all other Members and parliamentary staff a merry Christmas and happy new year. I also thank the right hon. Gentleman for securing this debate in order to bring closure to the matter and give him the clarification he seeks.

Sanctions are not a tool to save money, nor were they ever designed with that purpose in mind. In fact, sanctions play a vital role in supporting the conditionality of a regime. They encourage claimants to comply with the requirements that are designed to help them move into or prepare for work. Sanctions have always been a part of the benefit system since they were first designed and introduced. Successive UK Governments have applied sanctions.

There is a link between entitlement to benefits and engagement with the labour market. As Matt Oakley said in his review:

“Benefit sanctions provide a vital backdrop in the social security system for jobseekers”

and are a

“key element of the mutual obligation that underpins both the effectiveness and fairness of the social security system”.

We know that, internationally, most developed economies use sanctions. As the OECD said recently:

“There seems little reason to doubt that, especially in countries with high levels of benefit coverage of the non-employed working-age population, the success of activation policies in relation to unemployment is critical to achieving high employment rates.”

To go back to the right hon. Gentleman’s parliamentary question, the response made it clear why we cannot estimate, and have never estimated, the amount of benefit withheld because of a sanction. The Department does not make an estimate of the amount of benefit withheld as a result of benefit sanctions. Sanctions are designed to ensure claimants comply with their requirements to move off benefits and into work.

The answer of 25 March 2013 on social security benefits—Official Report, column 986W—made it clear that it is not possible robustly to estimate the actual amounts withheld, as we do not know what would have happened in the absence of sanctions. For example, some claimants who leave benefits during a sanction may do so irrespective of the application of the sanction, while others may do so because of the sanction.

As the right hon. Gentleman has pointed out, we provided some data in the response to the parliamentary question. The Department wrongly interpreted the question to mean the maximum amount of benefit that claimants would have received had they remained on benefits for the length of the sanction, rather than to mean a total. It is impossible to calculate such a total, and trying to do so would lead to the Department handing out inaccurate information.

It must be noted that the original response clearly set out the reasons why that is the case. Let me run through them. First, the data provided were for the maximum amount that claimants would have received, and should not be interpreted as absolute. In fact, we made it clear that the figures were “overestimates”.

Secondly, the data could not take into account claimants who had left benefits during a sanction, such as those who might have moved off benefits and gone into a job or education, or moved on to another benefit. As we know, employment is now at record levels—up nearly 600,000 over the past year—so many people are moving off benefits and going into work. The rate at which people are doing so is now faster: nearly 80% of them have moved off benefits within six months.

Thirdly, the calculation does not net the figures for hardship payments. It is not possible to take into account the hardship payments that would have been received, which puts up to 80% of the benefits back into payment.

Fourthly, the amount of benefits withheld is not readily available for JSA-varied sanctions. During the period covered in the parliamentary question—2009 to 2012—the sanctions system changed, which resulted in more fixed level sanctions so that claimants could be clearer about the consequences of not meeting the requirements designed to help them into work.

It was therefore clear that the information handed out was not right, and that such a total could not be provided. That came to light when follow-up questions were asked, including in the other place. We do not routinely collect information of benefits withheld because of a sanction that has been imposed, or of benefits that would have been claimed had someone not lost their entitlement. We therefore cannot produce the figures without making a number of assumptions and judgments about people’s behaviour, and any resulting figures would be very misleading.

[Stephen Timms]

All I am really asking for is an update of the table provided on 25 March 2013. I take the point that such a table would need a caveat attached to it and that people would need to be told that it is not what it might at first appear to be, but if we just had an updated version, the House would be happy.

[Esther McVey]

I appreciate what the right hon. Gentleman says, but if we want the Department to provide robust and reliable information which is not misleading, then such an update cannot be given. He says that he just wants a good answer, but such an answer would not be a good one. Surely nobody would want information to be given out to people who might be misled. As we know, all those caveats are seldom, if ever, applied, and such information would be incorrect. After the further questions, and having examined what was first handed out, the Department decided that the information provided was wrong, inaccurate and misleading.

The answer stated that it was important to focus on why there is a sanctions system. It is about making sure that people understand what is required of them, making sure that decisions are timely and correct, and protecting the most vulnerable. Fundamentally, sanctions cannot be seen in isolation. They are part of a broader system of support that includes financial support, training in employment skills and getting people into work. Because of that extra training and support, and because of the claimant commitment that we have introduced to make the system tailor-made for the individual, so that they know what sanction they would get and, at the same time, what support they would get, we have seen record-breaking results in getting people into work, the biggest fall in youth unemployment since records began, the biggest fall in long-term unemployment since 1998 and record rates of women getting into work. All that is part of a system. What we were aiming to do, and what we have done, is to get nearly 2 million extra people into work.

[Stephen Timms]

On a point of order, Mr Deputy Speaker. Can you advise me whether it is in order for the Minister to say that she is not going to answer a question because she thinks that the answer would be misleading? Surely it is for Members of the House to determine what information they want and for Ministers to provide that information.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

The responsibility to answer a question lies with the Minister. The right hon. Member for East Ham (Stephen Timms) has been tenacious in holding the Minister to account. That is the role of Members: to hold Ministers and Departments to account. I am sure that that will continue if he does not get the answer today.

[Esther McVey]

I appreciate that, Mr Deputy Speaker. That is why we are having this debate today. It is not me who is—

[John McDonnell (Hayes and Harlington) (Lab)]

Further to that point of order, Mr Deputy Speaker. As I understand it, what the Minister has said is that an answer that was given to my right hon. Friend the Member for East Ham (Stephen Timms) two years ago—

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[Mr Deputy Speaker]

What we need to do is to get to the end of the debate. The point is well made and it has been taken on board.

[Esther McVey]

I do not have my glasses on at the moment. It is John McDonnell on the Opposition Benches, is it not? [Interruption.] It is. I thought that perhaps the hon. Gentleman was standing up to pass comment on something else, now that it is Christmas—the time when people should be able to stand up and apologise—or, as he said he would in front of the House, to invite me for a cup of tea—

[John McDonnell]

Will the Minister give way?

[Esther McVey]

Hang on a second. Let me finish what I am saying. For what he was reported to have either said or repeated, I say for every woman I know who has been affected by violence; for every woman I know who has actually lived by violence, I believe that what—

[John McDonnell]

On a point of order, Mr Deputy Speaker.

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[Mr Deputy Speaker]

We are not going to get into that. It is Christmas, and this is the final debate before the recess, so we ought to take on board where we are and be careful about the comments that are made.

[Esther McVey]

Thank you, Mr Deputy Speaker. As the hon. Gentleman said that he would make a phone call to speak to me about this matter, I await the phone call—

[John McDonnell]

On a point of order, Mr Deputy Speaker. If you check the record, you will see that a point of order was raised by another Member, not the Minister, and I offered that Member the opportunity to come for a cup of tea with me on the advice of Madam Deputy Speaker. I offered no phone calls to the Minister, whom I would not wish to meet and who was awarded the Scrooge of the year award in her own constituency last week.

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[Mr Deputy Speaker]

I do not want this debate to deteriorate any further. It is an important debate, and I want us to stick to the facts. I do not want any more personal attacks on either side of the Chamber. I want to move forward.

[Esther McVey]

As I said to the right hon. Member for East Ham, the point is not whether I was withholding the information. The Department looked at the information that had been handed out and felt that it was not robust. It was not comfortable handing it out because it was neither reliable nor accurate, and that was why the subsequent answers were given in a series of letters and parliamentary answers. I have given the exact reply that has been deemed correct, because we obviously want the Department and the House to give out accurate information.

Question put and agreed to.