Employment and Support Allowance and Universal Credit

Heidi Allen Excerpts

Thursday 17th November 2016 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I do not think I will be taking the full eight minutes, Mr Speaker. I am grateful to the hon. Member for Airdrie and Shotts (Neil Gray) and to colleagues on both sides of the House for securing this important and timely debate.

Any welfare-to-work system needs to satisfy four criteria. First, it should support people and families in their times of need. Secondly, it should provide every assistance to people in moving forward and in getting back into work, where that is a realistic objective for them, taking into account their personal circumstances. Thirdly, there should be an underlying theme that work must pay, so that welfare does not become a lifestyle choice. Fourthly, any system must be affordable to the nation as a whole.

The system we have, which has evolved over many years, has, I am afraid, become incredibly complicated. It would be great if we could start with a clean sheet of paper, but I fear that is not possible, given where we are at present. The Government should be commended for taking on the challenge of seeking to reform the system and for not filing it away in the “too difficult” tray. Credit is also due to them for some of their initiatives in this Parliament and the last Parliament: taking the low-paid out of tax altogether, the introduction of the national living wage and the provision of 30 hours of free childcare.

The question today is whether the proposed changes to universal credit and ESA satisfy the four criteria I outlined. I would just like to make three observations as to whether they do or not. First, I would like to look at whether the changes are properly researched, backed up by evidence and supported by impact assessments.

When the Welfare Reform and Work Bill was going through Parliament in the spring, it was made clear to me that reductions in ESA WRAG would be followed by a full consultation on the package of support measures to help the disabled into work. At that time a White Paper was proposed, and we were assured on the Floor of the House that it would be published before the summer recess. In the event, a Green Paper, which is actually very good, was published at the end of last month, and a consultation will now run until 17 February. I say to the Government that it surely makes sense to digest the outcome of that consultation—to get feedback from non-governmental organisations and other groups that have the detailed first-hand knowledge as to what changes we need—before making any radical changes.

There is a concern, as we heard from the hon. Gentleman, that there has not been a full and proper impact assessment on the proposed changes. It has been suggested that the impact assessments published with the original Welfare Reform and Work Bill may fall short of the Government’s statutory obligation to properly analyse policy, according to the Equality and Human Rights Commission. In its report, “MS: Enough—Make welfare make sense” the MS Society has recommended that the Government undertake a full impact assessment of any changes they make to disability benefits.

There is also a concern that what is emerging is a lottery, with some family types being more adversely affected than others. Research has highlighted that two thirds of single-parent families will be hit particularly hard by the work allowance cut and the delay to childcare support.

I move on to my second issue—support for vulnerable groups. Again, there is concern that particular groups are being unfairly hit, and I have in mind those with fluctuating conditions such as Parkinson’s and MS. There is also a worry that it has not been recognised that not every disabled person is able to work. The all-party group on multiple sclerosis, under the chairmanship of my hon. Friend the Member for North Dorset (Simon Hoare), has just published a report on support for people with MS in the workplace, and I urge the Government to take on board its three recommendations.

It must always be borne in mind that Parkinson’s and MS are degenerative conditions: people do not get better, there is no cure, and the severity of symptoms fluctuates not just from day to day but, very often, from hour to hour. The consultation on the work capability assessment is to be welcomed, but the feedback I receive, such as that from Waveney Suffolk Help in Multiple Sclerosis—an MS support group I will be with tomorrow—is that more needs to be done.

My third issue is the roll-out of universal credit. The full roll-out of universal credit went live in Waveney on 25 May. While I acknowledge the hard work of Jobcentre Plus and DWP staff on the ground, I have to report that it is not going well. Those in my constituency office are spending most of their days addressing very real problems that people face in having nothing to live on, nothing to pay for food, and no money to pay the rent. The DWP is being helpful in addressing these cases, but I have to question whether it is right to make further changes to universal credit at a time when there are major practical problems in its roll-out.

[Heidi Allen (South Cambridgeshire) (Con)]

Is the universal credit that my hon. Friend has in his constituency the full version or the initial straightforward version just for single claimants?

[Peter Aldous]

We have the full version being rolled out at the moment.

I am concerned about research showing that people in areas now on universal credit will, as a result of these changes, be significantly worse off than their neighbours and those in other regions who remain within the tax credit regime. Will the Minister address these concerns? Why should the people I represent in Waveney, and indeed those in other areas where universal credit has been rolled out, be unfairly treated in this way? It is a really unfair postcode lottery.

--- Later in debate ---

[Justin Tomlinson]

I do not recognise this as a cost-cutting exercise, but without knowing all the details, it is difficult to comment. I hope that the ministerial team will look at this, meet the hon. Gentleman and find out whether there are lessons to be learned.

These coaches will also signpost where training is available to enhance people’s hopes of getting into work or progressing in work. Obviously, the traditional job-searching work will be done and, for the first time, these coaches will also provide support for people as they go into work. A lot of people coming off benefits will go into relatively or very low-paid work and will not necessarily have the confidence or skills to push themselves forward to get roles with higher wages. For the first time, these coaches will keep in touch with those people and say, for example, “You have turned up for work for three months; why don’t you now try to go for a supervisor role or increase your hours?”

Crucially, for people with fluctuating health conditions the benefit is in real time, so if people can work fewer hours one week than another, they will have a minimum income. The process goes from there, so if they do more hours, the income increases. This system removes the 16-hour cliff edge that was preventing people from benefiting.

Today’s debate is predominantly about ESA WRAG. Before I comment about that, I pay tribute, as I did yesterday, to the fantastic work of the staff in jobcentres, support groups such the Shaw Trust and Pluss, and the many local charities and national charities that provide support. They do a huge amount of brilliant work and often go unrecognised. ESA has had so many reviews and changes, yet still only 1% of people come off the benefit every month. That cannot be described as doing anything other than failing the people who are on it. A number of speakers highlighted the fact that people are typically on ESA for two years, whereas someone on JSA would expect to get into work much sooner. Bizarrely, people on JSA, who are closer to the jobs market, would get 710 minutes of professional support, whereas those on ESA, who are recognised as further away from the jobs market, would get only 105 minutes of that support. Some of the changes that are being introduced will equalise the position. It is crucial that we identify what people can do, not what they cannot do.

We are all different, and we all have challenges in our lives. Some people have more challenges than others, but most have an opportunity with the right support. The Green Paper is welcome, because it highlights the significance of that “can do” approach. We have to offer personalised and tailored support to give everybody an opportunity. Crucially, the major charities, including Scope, Leonard Cheshire Disability, the Royal National Institute of Blind People, the National Autistic Society and Mencap, as well as many other charities, right down to the smaller ones, will be contributing to the development and delivery of this policy. They will make a big difference.

[Heidi Allen]

I agree that those charities are very welcoming of the new Green Paper, but does my hon. Friend agree that they are still consistent in saying with one voice that the cuts to the ESA WRAG are wrong, and that they are not replaced in the Green Paper?

[Justin Tomlinson]

When I was a Minister, I was challenged on a whole host of issues, and that is what the charities are there to do. I feel that the extra support makes this approach worthwhile because only 1% of people are coming off that benefit. When people on ESA are surveyed, and when we talk to them in our constituencies, we find that the overwhelming majority are desperate to be given an opportunity to work.

--- Later in debate ---

[Kate Green (Stretford and Urmston) (Lab)]

It is a pleasure to follow the hon. Member for North Swindon (Justin Tomlinson). I pay tribute to him for his work and the commitment that he showed when he was the Minister for Disabled People. I congratulate the hon. Member for Airdrie and Shotts (Neil Gray) and thank him for introducing the debate. I also thank the Backbench Business Committee and its Chair for making time for this debate.

I join colleagues in expressing our deep concern about these cuts, which are based on several misconceptions and the effect of which will be cruel and perverse. Everybody wants disabled people and those with long-term health problems who can work to do so, and to have the support to do so. Everyone agrees that those people face additional barriers and may need that additional help.

As we have heard, the Government have published a Green Paper that makes a number of welcome proposals for improving that support for disabled people. I welcome in particular the replacement of the disastrous Work programme with personalised, tailor-made support for disabled people. I welcome the introduction of specialist work coaches, who will support the disability employment advisers in jobcentres, but I regret the fact that the number of disability employment advisers was reduced under the coalition Government. I welcome, too, the introduction of the health and work conversations, although it is a pity that they had to come in several years after the coalition Government prematurely scrapped Labour’s work-focused health-related assessments.

All those additional measures of support are proposed in the Green Paper, but it is none the less surely perverse to cut benefits for disabled people before the support is in place. There is no evidence at all that cutting financial support makes people more likely to move into work. Indeed, investigation by our colleagues in the House of Lords, Lord Low and the Baronesses Meacher and Grey-Thompson, has shown that the opposite is the case. They point out that it becomes more difficult when financial resources are reduced for disabled people to afford training and to undertake volunteering opportunities or work experience that could help them to move towards work. The Centre for Regional Economic and Social Research in 2011 confirmed that cutting benefit for those who are unable to work because of illness does not result in more people moving towards work because it does not address the barriers they face—their health, employer attitudes, availability of suitable jobs, lack of reasonable adjustments or skills gaps—which the Government’s Green Paper acknowledges and seeks to address.

Ministers have said, particularly during proceedings last year on the Welfare Reform and Work Act 2016, that an additional £30 a week of benefit disincentivises disabled people from working. There is no evidence at all for that. Indeed, as the hon. Member for Airdrie and Shotts pointed out, removing the £30 of additional support creates perverse incentives. If someone leaves the ESA to try to find work and they find that it does not work for them, after April 2017, when they reapply for benefit, they will be treated as a new claimant. They will not be able to retain the protection of the additional £30, which existing claimants will retain. Other people are likely to move from the ESA WRAG into the support group, where they will not be expected to look for work at all.

The proposals fail to recognise the nature and purpose of ESA for those in the WRAG. It is an income replacement benefit, in recognition of the fact that those in the WRAG have undergone a work capability assessment that has found that they are currently not fit for work. Employers, in many cases, would not have them in the workplace. Those employers would say that it was not safe to do so. In such circumstances, by definition, an individual cannot derive income from earnings, hence the need for the income replacement benefit. As we have heard several times this afternoon, because of the longer journey to return to work that people with disabilities and health conditions experience, there is a need for additional financial support and a higher rate of benefit.

I would like to say little bit about the support in universal credit for those with limited capability for work. Those people are set to lose out even if they are in work. At the moment, the limited capability for work element and the additional support through the disabled person’s work allowance in universal credit are roughly comparable to the support in tax credits for disabled people working 16 hours a week. If those in work on universal credit lose additional support, they will be substantially worse off than those on tax credits. That is surely a perverse outcome of these cuts that Ministers will want to address.

All such perverse outcomes might have been avoided and the policy improved if an equalities impact assessment had been properly carried out at the time of parliamentary proceedings on the legislation. As we have heard, the Equality and Human Rights Commission offered help with such an assessment and set out a methodology for carrying it out. Regrettably, that suggestion was rejected by the then Government.

[Heidi Allen]

Did the EHRC not offer to do that assessment for free? I seem to remember that it did, such was its wish to contribute.

[Kate Green]

I do not know whether the EHRC offered to do the assessment at no cost, but it certainly set out a substantial and detailed methodology by which the assessment could be carried out. Further, when the Government produced their own rather thin analysis, the EHRC was very clear that it was unsupported by evidence and that it was insufficient.

We now have the Green Paper, which has some welcome proposals and a welcome ambition to halve the disability employment gap, although as my right hon. Friend the Member for East Ham (Stephen Timms) pointed out, we do not know when that goal is to be reached. I hope that the Minister will consider the suggestion, which I think the hon. Member for North Swindon supports, that we should consider more than one measure of success in assessing disability employment.

I must tell the Minister that, for all the good in the Green Paper, her proposals will be seriously undermined if she proceeds with the current cut before the proposals have had a chance to take effect. There is no justification for making sick and disabled people poorer. It will not help them to recover, and it will not help them to find work. Disability charities, Opposition MPs and, indeed, MPs from the Minister’s own party have all expressed their deep disquiet about the proposals. It is not too late to think again, to call a pause on this cut and to ensure that disabled people receive the financial support to enable them both to maintain a decent standard and quality of living and, where they can, to have the wherewithal to look for work, prepare for work and take the steps on the journey back to work that so many of them are desperate to make.

[Heidi Allen (South Cambridgeshire) (Con)]

As all speakers have done so far today, I thank the hon. Member for Airdrie and Shotts (Neil Gray) for bringing this debate to the House. I am glad that Members on both sides of the House are contributing to this debate, which is such an important one.

When I look back at my first year as an MP, I cannot think of a vote that has been so regretted by my colleagues on the Government Benches. I remember the pressure we all felt at the end of February, when the ESA WRAG element of welfare reform was being batted between this House and the Lords. I remember the feeling of desperation when this House sent it back. I abstained in the vote as a plea to the Government to rethink their decision, knowing the Lords would have one more opportunity to convince the Government, too. The Lords stuck to its guns and sent it back one more time, and I remember the relief when it did.

As a new MP, I was still trying to understand how the relationship between the two Houses worked, but I was exhilarated that the House of Lords was willing us on and watching and nudging us like a parent, hoping we would finally do the right thing. However, that sense of optimism was short-lived, as we failed in this House on the Bill’s final return. So few of us on the Government side voted with the Lords on its amendment, because many believed a White Paper was imminent and would describe what alternative support would be made available, and there was a promise of some £l00 million. However, the White Paper never came and the money never came, and I know that some of my colleagues have regretted their vote ever since.

[Dr Tania Mathias (Twickenham) (Con)]

My hon. Friend is making some very important points. Does she agree that Members who supported, as I did, the Government changes to the ESA in March did so on the absolute understanding that there would, in parallel, be appropriate support for people getting into work? Although the Green Paper is laudable, it will not be implemented in time, and therefore the ESA changes have to be delayed.

[Heidi Allen]

Absolutely. I could not have put it more succinctly myself. It was because of that promise and guarantee that Members opted to support the Government, but, unfortunately, that has not yet been fulfilled.

Most heartbreakingly of all, the Lords was not asking for much. It was not so naive as not to accept that the ESA system needed reform, as it so clearly does. The announcement from our new Secretary of State that the whole work capability assessment process will be reviewed is very welcome. I sense this is a precious opportunity, and our disability charities, which have been invited to do so, are poised and eager to contribute to the review. I know that we will do better. I am confident that my Government will do better. The Green Paper is the first step in this process, and charities have welcomed it. With charities, as well as organisations such the Conservative Disability Group, for which I am the parliamentary link, the expertise exists to help us. I am so encouraged by the opportunities that lie ahead, and I sense transformation is possible.

However, my discomfort—this was expressed by the Lords when we last debated this issue—is about having agreed the proposals for new support before we took away the extra £30 per week for those in the ESA WRAG, individuals recovering from significant illness who are slowly transitioning to work. The Government’s argument was that the WRAG support was not doing its job, with individuals sometimes on it for up to two years. The Government concluded there was some perverse financial incentive for people to stay in that group. I say now, as I said at the time, that the fact that people are stuck in the group says more about the failure of DWP processes than about claimants’ active choices. People in that group do not have an easy time. They must demonstrate an appetite to transition towards work, and they can be sanctioned if they do not do so. I still maintain that anyone who has beaten a significant illness is desperate to get back to normal and to get their life back.

The Lords back in February and March, many of us in this House then and many of us today are just asking for a pause. What harm could it possibly do to the Government’s plans or reputation if we were to pause these cuts until an alternative support plan was agreed? Moreover, I passionately believe that it is the sensible and moral thing to do. Would we still be having this debate, would it still be the first thing on the lips of every health and disability charity and would MPs still talk of their regret if we had made the right decision last time around?

I have a guiding principle in life: we should always listen to the loudest voice in our head. We may choose to ignore it, or try and drown it out with distractions and alternative arguments, but we know it is there. In fact, we can sometimes see it when we look in the mirror. I think that we all know what that voice is saying: let us just pause these cuts. The £30—I repeat, £30—represents 29% of the weekly income of some 500,000 people, which is big money for relatively few people. Let us just pause. The risk of damage is high, and the financial cost of pausing is low.

What kind of Government do we want to be? If we want to be a unity Government, rallying and rejoining the nation after the splits caused by Brexit, how will we explain such a vision to two cancer sufferers—I picture them sitting side by side in hospital to have chemotherapy —who are receiving different levels of welfare support, because one was a claimant pre-April 2017 and one became a claimant just afterwards? If we are saying that we will continue to make the payment to those already on it, that must mean we acknowledge that the benefit has some value.

The Green Paper talks about the flexible support fund, which is promising, but it is only £15 million for 2017-18 and 2018-19. The Green Paper suggests that it could be used to buy mentoring or additional support, so could some of it be used to give direct financial support to claimants as well? If ESA WRAG is not the answer, perhaps a boosted support fund, consistently applied by well-trained jobcentre work coaches to provide additional financial support where needed, could be an acceptable alternative. I am open to such a suggestion, and I suspect my colleagues the Opposition Benches would be, too.

If we get the work allowance rates in universal credit right, we could support those transitioning back to work in that way, rather than their facing a cliff edge of having the £30 withdrawn the moment they enter work. That scenario would most definitely keep people away from the workplace, as they would be worried about losing money if they suffered a temporary, but debilitating, health relapse. As I keep saying, the work allowances in universal credit hold the key: because we can set them individually for every type of claimant, universal credit could offer the ultimate flexibility for the disabled and those recovering from poor health. It would offer them reactive, flexible and unwavering support on their entire journey in and out of work. However, for this group of vulnerable claimants, the work allowances need to be higher.

Whether it is a bigger flexible support fund or work allowances in universal credit set at the right level specifically to help those with disabilities or long-term health conditions, let us talk about these options and see whether they hold the answer. We are so close now. With the Green Paper, a new Secretary of State, a new Prime Minister and a new Government, we have a priceless opportunity to build a system that supports and realises the aspirations of people with disabilities and health conditions. That is clearly this Government’s proud and right mission, so let us not waste it by retrospectively fitting policies to savings targets that were agreed in a completely different era.

--- Later in debate ---

[Patricia Gibson]

I welcome all progress in this area, but that does not detract from the commitment made by the previous Prime Minister, which I believe everyone would have supported. Progress is always to be welcomed, but we have not gone far enough and we should still work towards that commitment.

In practical terms, £30 each week will be cut from those with long-term health conditions or disabilities, and as we have repeatedly heard today, this will happen before the work and health programme Green Paper can be considered or implemented. The fact is that reducing sick and disabled people’s financial support to jobseekers’ levels is counter-productive since those in the ESA WRAG will have very low incomes for a long time, because disabled people are much more likely to be out of work for longer. It is extremely important that the Government proceed by using an evidence-based approach, instead of rushing into cuts that will have the opposite outcome from what they and everyone else want.

The Government say that they want to help disabled people into work, but under the limited capability for work element of universal credit, disabled people in work and those looking for work will be negatively affected. Those in work but on low pay will be particularly hard hit. How on earth can that be consistent with the aim of halving the disability employment gap? The truth is that helping disabled people into work means supporting them, and doing so effectively. The proposed measures will push them further and further away from the workplace. Scope claims that a loss of financial support for disabled people will have a detrimental impact on their health and wellbeing, pushing them further away from the workplace. It will also strip away necessary support from those already in work, making it harder for them to retain their place in the world of work.

Some 492,180 disabled people across the UK are reliant—I repeat the word “reliant”, because that is so important—on ESA WRAG. According to the third sector, these people will struggle to live independently and will be pushed further and further into isolation, poverty, hardship and debt. Research by Scope discovered that 49% of disabled people use credit cards or loans to pay for everyday essential items such as clothes or food.

We should spare a thought today for people who are living with conditions such as Parkinson’s. We know that those with fluctuating conditions are not well served when they are placed in the WRAG, because the work capability assessment does not and cannot accurately capture the reality of living with such a condition. That means that ESA claimants with Parkinson’s will be placed in the impossible and demoralising position of being told they are fit for work or should be getting back to work. They are often placed in the WRAG rather than the more appropriate support group.

[Heidi Allen]

Does the hon. Lady therefore welcome, as I do, the fact that the Government will take a completely fresh look at the whole way in which the work capability assessments are carried out, so that we can put people into the right support group—or not, as the case may be?

[Patricia Gibson]

If any part of the social security system needs a fresh look, that would be my first choice, although there is an embarrassment of riches to choose from. At present, people are not well served by work capability assessments.

We have heard protestations today and in the past that no one who is currently receiving ESA and no one with the most severe disabilities will be affected by the forthcoming changes, but they have been categorically refuted by organisations such as the Scottish Association for Mental Health, which has pointed out that those who are currently receiving ESA may well be affected by the changes if they have been claiming the benefit and move into work before they are well enough. They may also be affected if they need to seek support again. People are likely to be deterred from trying out new jobs if the possible outcome is reduced benefit after a short period of employment.

SAMH’s report also points out that 98% of its service users said that their mental health had suffered as a result of welfare reforms. People are already very frightened and worried. Ironically—I want Ministers to reflect on this, because we are trying to build consensus across the House today—the Government’s policies are literally making those who are coping with the daily challenges of a disability ill or, at best, less well. How can that make those in the group that is targeted by these measures more work-ready? In fact, such measures will prolong or exacerbate existing health conditions. Protecting the sick and disabled should be above budget savings. If it is not, what does that say about the kind of society that we are trying to create? What does it say about Government priorities?

I know that there is concern about this issue on both sides of the House. I urge the Minister to note what has been said by Action on Hearing Loss, Capability Scotland, Disability Agenda Scotland, Guide Dogs, the Motor Neurone Disease Association, Parkinson’s UK and a range of members of the Disability Benefits Consortium, and to do the right thing. I urge the Government to use next week’s autumn statement to pause these cuts until appropriate alternative measures to implement the commitment to halve the disability gap have been fully considered, and to do all that they can to secure support for current and future claimants so that sick and disabled people are supported adequately when they are able to work, and also when they are unable to do so.

I urge the Minister to respond positively today, and to remove the shadow that hangs over the lives and futures of too many people throughout the United Kingdom as they fear the future and what the Government appear to be seeking to do. I urge her to do the right thing, and to respond to the debate with compassion and understanding.