Universal Credit

Esther McVey Excerpts

Thursday 5th July 2018 Commons Chamber

[Mr Speaker]

Very well. We will let him off this occasion.

[The Secretary of State for Work and Pensions (Ms Esther McVey)]

I had information that the question was on the letter that I received yesterday, so that is obviously where we will be going: the letter that I received yesterday. Opening the letter was a comment about a meeting that the Comptroller and Auditor General had asked to have with me. He had written to me on 27 June. Our Department got back at the end of the week and that meeting will be on Monday. There was possibly an inference from that that I had not accepted a meeting or that there was not going to be one. That was not the case, and it is diarised for Monday.

The next bit was about the information we had received, and accurate up-to-date information being shared with the Department. We agreed that information had been shared up to 6 June, but when we signed off the factual information contained within the report, we raised concerns about the context and conclusions drawn from that information and where we went from there.

That goes on to the impact of the recent changes. We looked at the impact of the changes we brought through: waiting days being abolished on 14 February, the housing benefit run-on on 11 April, and advance payments on 3 January. As I said in my apology yesterday, the impact of those changes is still being felt and the definition therefore cannot be that it has been fully taken into account by the NAO. They also talked about slowing down the process, which we always agreed with. This is about the test and learn process, and we will learn as we go along. That is what we agree with, too. The Comptroller and Auditor General also said in his letter:

“I’m also afraid that your statement in response to my report claiming Universal Credit is working had not been proven.”

That is where we differ on the conclusions. While the NAO had the same factual information either way, we came to very different conclusions because the impact of the changes we brought in at the end of that period is still being felt.

So that is where I would like to leave it—[Interruption.]

[Mr Speaker]

Order.

[Ms McVey]

At the end of the letter it says that

“the Department cannot measure the exact number of additional people in employment ”.

We agree with that. We cannot measure the exact number of people in employment, but we knew that there was a plausible range—which we had had support on—of people going into employment. We also know that employment is increasing. Those were the key pertinent points from the letter, and obviously included with my apology yesterday for the phrasing of the words I got wrong—which I fully accept, which is why I came to the House—I will end that bit of the statement there.

[Frank Field]

We are grateful for the Secretary of State’s apology—again—for one aspect of her behaviour where the Comptroller and Auditor General criticised her for dissembling. There were two others. First, she told the House that the Comptroller and Auditor General had advised her to roll out faster, whereas he told her to pause so that vulnerable claimants would not be hit further. Secondly, that universal credit is working is not proven, as she said, with 40% of claimants finding themselves in financial difficulty, 25% unable to make a claim online, and 20% overall, but two thirds of disabled claimants, not being paid on time and in full, hence the demand of the Comptroller and Auditor General, a big regulator in this country, for her to pause the universal credit programme.

[Ms McVey]

We need to separate two parts of this. One bit is where I came myself to the House to apologise for using the wrong words. I used the words “faster rate” and “speeded up” on the premise that the report had said there was no practical alternative but to continue with universal credit and that there had been a regrettable slowing down. My interpretation of that was incorrect, which is why I came to the House yesterday and apologised for my words. We should separate that from the impact of the changes. I said—and I stand by this—that the impact of the changes could not have been felt because it was still being rolled out and those impacts were still being felt and therefore could not have been taken into account. We need to separate where I used the incorrect words, for which I came to the House to apologise, from the impacts of the changes and therefore the conclusions that can be drawn.

[Helen Whately (Faversham and Mid Kent) (Con)]

While my right hon. Friend has apologised, could she confirm that the Labour party has yet to apologise for its misleading statements—[Interruption.]

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[Ms McVey]

I thank my right hon. Friend for the way he said that. That was my interpretation of what I read throughout the report. I therefore apologised when I checked on the words I had used—my interpretation, not the exact words in the report. I would say, however, on the subject of apologies, that I am more than happy to say, “Can I check on those words? Did I get them right? Did I get them wrong?” I then followed through: “What was the right process?” How did I do it? Nobody asked or told me to come to the House. I actually checked the words and came to the House.

Other people, it is true, have questioned and queried—even the right hon. Member for Birkenhead (Frank Field). Sometimes I think we are blessed in this House that the Opposition never get anything wrong, and other MPs do not get anything wrong. Whereas I am more than happy to come and apologise if I do, it seems that sometimes other people are not so happy to come forward and apologise. Perhaps what I did that was surprising to the House was to come of my volition and apologise for my words that were wrong.

[Margaret Greenwood (Wirral West) (Lab)]

The Secretary of State should be ashamed that she has been forced to come to the House again. Yesterday the Comptroller and Auditor General took the extraordinary step of writing an open letter to her pointing out that she had misrepresented the National Audit Office report on numerous occasions. He did so after she had failed to meet him, and she did not have the courtesy to do so before this point.

The NAO report is damning of the Government’s flagship social security policy, but, instead of responding to its findings, the Secretary of State misled the House over them. The report said that universal credit is not meeting the aims set for it, and that currently there is no evidence that it ever will. Why and how did the Secretary of State come to say falsely—on two separate occasions in Parliament—that the report had said that the roll-out of universal credit should be speeded up, that the report was out of date as it did not take account of changes made by the Government in the Budget, and that universal credit was working? How can these statements be inadvertent slips of the tongue?

In response to a point of order, the Secretary of State said that she had

“meant to say that the NAO had said that there was no practical alternative to continuing with universal credit.”—[Official Report, 4 July 2018; Vol. 644, c. 321.]

That is quite different from saying that it should be speeded up. In fact, the report states clearly that the Government should

“ensure that the programme does not expand before business-as-usual operations can cope with higher claimant volumes”.

Has the Secretary of State ever read the NAO report? If she has, how can she have drawn the conclusions that she has?

The Secretary of State has failed to apologise in relation to the other two key points made by the Comptroller and Auditor General in his letter. Will she now do so? If she misread the report so badly, this brings into question her competence and her judgment. If she read the report and chose to misrepresent its findings, she has clearly broken the ministerial code. Either way, she should resign.

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[Ms McVey]

Let me start from the top again. I did not fail to meet the Comptroller and Auditor General. As I have said, the letter came in on 27 June, which was last Wednesday; our office got back to him at the end of the week, and I am seeing him on Monday. So that was not correct.

As I have said, I came to the House and apologised for my interpretation of what was there and the words that I had used. My right hon. Friend the Member for New Forest West (Sir Desmond Swayne), who is no longer in the Chamber, referred to how something could be interpreted.

As I also explained, we agreed on the factual information all the way through, but it is a question of how you interpret that information, with the judgments, the summaries and the context. It was on that basis that we said, “We do not agree. We do not agree on how the findings come out together.” As I said, the effects of the significant changes that the Government had introduced this year cannot have been fully taken into account, because they are still being rolled out.

[Alex Burghart (Brentwood and Ongar) (Con)]

I thank the Secretary of State for her apology. Like a number of other Members, I was very disappointed that the NAO report did not take account of the changes that the Department brought in on the basis of the recommendations made by the Select Committee. Will the Secretary of State confirm that she will continue to adapt and improve universal credit as new ideas and new evidence emerge?

[Ms McVey]

My hon. Friend is right. That is one of the key points, because this is one of the biggest changes in benefits. We always said that the slow roll-out would reflect the changes needed. Even within the last couple of weeks, I have made significant changes yet again. Whether they involved kinship carers, 18 to 21-year-olds and housing benefit or severe disability premiums, I made those changes after listening to people. Again, the impacts will not have taken effect yet because they are still being rolled out.

I agree that sometimes we have to do a “mea culpa”, hands up, as I did yesterday. I had the wrong words, I apologised to the House, and the apology was accepted by the House. Equally, I am more than happy and prepared when colleagues on either side of the House say, “Could you look at this? Can we look at it a bit more? Could you change this?”, and have made significant changes to this policy since I became Secretary of State.

[Alison Thewliss (Glasgow Central) (SNP)]

The Secretary of State appears to be willing to mislead Parliament and to get into a fight with the National Audit Office in order to protect her failing universal credit policy, but what she and none of her colleagues will admit is that the NAO report blows a hole as wide as the Clyde through everything the Tories have been saying on universal credit. The NAO felt forced into writing an open letter to put this matter straight, and I understand that this is Sir Amyas Morse’s first such letter in over a decade in service. This is an absolutely shameful state of affairs. We can all accept honest error, but the Comptroller and Auditor General points out in his letter that a number of the statements that the Secretary of State has made are without evidence, are not correct and are not proven.

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[Mr Speaker]

Thank you. [Interruption.] Order. I am a little disconcerted to see the SNP Front-Bench spokesman gesticulating at me as if to say, “What’s going on?” Forgive me, but I did say to the House very clearly that—[Interruption.] Order. It is no good shaking your head, I say to the hon. Lady, who is an extremely dextrous and committed Member of this House. She had a minute; she consumed her minute and I then move on. That is the right thing to do.

[Ms McVey]

We looked at the business case and looked through the conclusions, and for the £2 billion invested, there will be a £34 billion benefit to the UK economy over the next 10 years. We also foresee an increase in employment of 200,000. We believe that that is within the plausible range.

People want evidence, and we can give evidence about the changes this Government have brought through when we talk about getting people into work. We know we have got over 3.2 million people into work and we know we have got 600,000 disabled people into work in the last few years. At the time, we heard the assertions from Opposition Members. Labour said that 1 million more people would be unemployed if we pursued our policies—our changes to benefit and what else we did. That was never proved to be the case, yet I have never asked Labour to apologise for its misleading figures.

[Several hon. Members rose—]

[Maggie Throup (Erewash) (Con)]

Jobcentre staff across my constituency where universal credit has already been fully rolled out inform me that claimants are more likely to get into work as a result of being on universal credit. Is that a trend across the country, because that would mean it is really good that we are rolling it out, at whatever speed that might be?

[Ms McVey]

That is what is coming out from the data we are gathering about what real people are saying about how universal credit impacts on their lives. My hon. Friend is right to say that people are getting into work faster, staying in work longer, and looking for work. For those in work, the data shows that on average people are earning an extra £600 a year. Those are the positive effects of this benefit change.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

I am staggered and disappointed that in answer to the urgent question we have a Secretary of State who is still arguing over the detail of a report. This is an important constitutional issue. The National Audit Office is the independent watchdog of Government spending. In this case, the Secretary of State has come to the House twice and there has been an unprecedented letter from the Comptroller and Auditor General. I have had two letters from the permanent secretary adding information on what was an agreed report on 8 June. Just for the record, will the Secretary of State declare clearly in the House today that she has full confidence in the National Audit Office and the Comptroller and Auditor General?

[Ms McVey]

What I would say is: they do their job. He came forward—[Interruption.] We need to separate this out. We said that we shared information. We agreed on that factual information. What we said is that we had made significant changes at the latter end of that period when information was collected, and therefore the impact of that could not have been felt. Obviously, I am meeting the Comptroller and Auditor General next week. That is what is important.

[James Morris (Halesowen and Rowley Regis) (Con)]

I commend the Secretary of State’s work in the Department—she has shown a great commitment to improving the lives of people across the country. Does she agree that the Department’s decision to take an incremental approach to the development of universal credit is exactly the right approach, and that we must cut through all this political nonsense and focus on the delivery of universal credit?

[Ms McVey]

My hon. Friend makes a good point. Like most other people here, I came into politics to help people into work, probably because when I grew up in Liverpool in the ’80s it was a difficult place to grow up and lots of people were not in work. To be in this position of being able to help people to get a job is what I want. It is disconcerting and upsetting that people sometimes, just for the sheer sake of opposing, want to change good measures that are helping over 3.2 million people into work. Those are the facts; that is what we know. Conservative Members are trying to improve people’s lives.

[David Hanson (Delyn) (Lab)]

At Monday’s Question Time, I asked the Secretary of State two questions. On Question 5, when I asked whether she would accept the National Audit Office report’s recommendation that universal credit should not be rolled out further, she said:

“The NAO made clear quite the opposite”.—[Official Report, 2 July 2018; Vol. 644, c. 8.]

It did not. At topical questions, I asked her to reconsider. I quoted the NAO report, but she stuck to her position. On both occasions, she told the House something that she knew was not correct. Will she apologise to me and to the House, and will she accept the NAO’s recommendation that the roll-out should be stopped now?

[Ms McVey]

When I answered the right hon. Gentleman’s questions, I said that the National Audit Office had said that there was no practical alternative to continuing with universal credit—that was how I answered. I will pay the right hon. Gentleman a compliment. It was due to his persistence that after I left the House I went back and said, “I’ve used these words.” I know that this is about the impact, and I know that what I said was substantially correct, but I wanted to double check. So I double checked whether I had used the wrong words, and it was after that that I made the apology, because my interpretation, although it was right, was not based on the exact words. That is what I came to apologise for. However, I stand by the fact that the impact of our changes could not have been felt and, as the NAO said, there is no practical alternative but to continue through and the slowness with which this has gone is regrettable.

[Mary Robinson (Cheadle) (Con)]

When I visited Stockport jobcentre and met its work coaches, I found an enthusiastic group of people who are keen to make a difference to people’s lives. Will the Secretary of State join me in congratulating them and all jobcentre workers across the country who are so enthusiastic about transforming lives and making a difference?

[Ms McVey]

Everybody wants to improve people’s lives. That is what we are all here to do, and that is what our work coaches do day in, day out. I hope that you will bear with me, Mr Speaker, if I refer to a letter I received. A lone parent wrote saying, “I was frightened to go into the jobcentre from what I had heard. Eight years ago, I was in the jobcentre, and the system did not work for me, so I was relieved and happy that I now have a job. Universal credit is working.” Since then, I have been collecting all those letters, because so many people—claimants and work coaches—are saying that this system is so much better than the one before.

[Ms Angela Eagle (Wallasey) (Lab)]

I suspect that the Secretary of State decided that she had to come to the House to apologise when she received the unprecedented open letter from the Comptroller and Auditor General pointing out that she had used—let us say—not correct assertions on three occasions about a report that her own officials had agreed. Will she now finally admit that she has got things very wrong on this, actually accept the National Audit Office’s conclusions, and show some respect to the NAO?

[Ms McVey]

If I may correct the hon. Lady, it was not to do with the letter. She incorrectly says that I came after the letter, but I asked whether I had got anything wrong and I checked things out myself. Nobody asked me or told me to come to House; I came here of my own volition. What I do not agree with—we stand by this—are the conclusions of the report in its entirety.

[Mr Philip Hollobone (Kettering) (Con)]

Will my right hon. Friend confirm that universal credit simplifies the benefits system, helps to get more people back into work, and better targets financial help at those people who need it?

[Ms McVey]

I am happy to provide clarification: universal credit does simplify the system. It also provides the individual with more help to get a job. We know that people are getting into work quicker, staying in jobs longer, looking for work for longer and, on average, increasing their income at the end of the year by £600. That is what it is about: helping people to get on in life.

[Several hon. Members rose—]

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[Stephen Lloyd (Eastbourne) (LD)]

That is always a challenge, Mr Speaker, but I will try.

Regrettably, I believe that the Secretary of State gave only a partial apology, because she did not take account of the fact that her own Department confirmed to the NAO on 6 June that its report was based on the most accurate and up-to-date information, yet the other day she indicated that the NAO report could be out of date. I think that that is unacceptable.

[Ms McVey]

Again, if I may correct the hon. Gentleman, we had agreed that that information was coming forward. What we have said is that the changes this Government have made were done in January, February and April, and therefore those changes could not be taken fully into account—those impacts are still being felt—because the period of checking was from last year to April of this year.

[Chris Green (Bolton West) (Con)]

Like my right hon. Friend, I grew up in Liverpool in the 1980s and have a particular sensitivity to the problems caused by unemployment. Both the jobcentres that serve my constituents are fully supportive of the roll-out of universal credit, so will she maintain her focus on rolling out universal credit as the best way to help people into work and to help people in work?

[Ms McVey]

I did not know my hon. Friend also spent his formative years in Liverpool. There are so many Conservative Members who spent their formative years and grew up in Liverpool. [Interruption.] I smile because there are so many of us even in this Department.

My hon. Friend is quite right. This is what we are about: getting more people into work, which we have done—and significantly so. Now we are reaching out to help even more people, significantly so.

[Stephen Timms (East Ham) (Lab)]

For eight years Parliament’s only reliable information about the status of universal credit has come from the National Audit Office. Ministers have consistently responded with denials and cover-up statements that, as the Secretary of State has acknowledged this week, were simply untrue. Might her apology herald a new openness about the very real problems with the universal credit project?

[Ms McVey]

I thank the right hon. Gentleman for mentioning my openness and the fact that I was willing, by myself, to come and apologise for using the wrong words. People who know me will always say about me that I am open, that I am straight and that I say it as it is, which I will do. Equally, if we need to make more changes, which I have done from the moment I got here—I did not seek leave to appeal to the Court of Appeal because I did not feel it would have been right; and I looked at the position of kinship carers and did not think it was right, so we changed it, as we did for the 18-to-21 group—I am more than happy to change things when we can, if we can.

[James Heappey (Wells) (Con)]

The NAO report notes that jobcentre staff have said that universal credit systems have “improved significantly” since they were first introduced. Will my right hon. Friend join me in thanking Sedgemoor District Council and other councils among the first tranche to adopt universal credit for the quality of the feedback they have given, which has allowed those improvements to be delivered?

[Ms McVey]

I thank my hon. Friend, because nobody can do this in isolation or by themselves. We need the local councils to be on board, we need the housing associations to be on board and we need MPs to be on board—we need everybody supporting the most vulnerable. I thank him for that comment, and he is quite correct.

[Chris Stephens (Glasgow South West) (SNP)]

Does the Secretary of State agree with the National Audit Office that universal credit is moving people into debt and that the first debt is rent arrears? Claimants are not getting their rent paid and housing providers find out that a person is on universal credit only when they are in arrears. Is that not a reason why universal credit should be paused?

[Ms McVey]

Some of the key changes that were done during this year were the advances to provide extra support if people were in need of extra money and the two-week run-on in housing benefit. So we learnt, changed and adapted. Those things have been brought in, but only this year. Therefore, again, their impacts cannot have been felt. But we listened, we learnt, we altered and we have done.

[Several hon. Members rose—]