Universal Credit Roll-out

Helen Goodman Excerpts

Thursday 16th November 2017 Commons Chamber

[Michael Tomlinson]

The hon. Lady intervened on me during our last debate on this subject. It is always a pleasure to lock horns with her in a constructive fashion. The last time she challenged me, she said, “How about those young people in poverty?” I did not have the figures on poverty to hand at the time but, if the hon. Lady looks at them, she will see that there are 600,000 fewer people—I will check that figure—in absolute poverty this year. Under the old system, for the constituent I mentioned, it did not pay for him to go to work. Under universal credit, the principle should be that work always pays.

[Helen Goodman (Bishop Auckland) (Lab)]

Will the hon. Gentleman give way?

[Michael Tomlinson]

In one moment.

We remember the fiasco of tax credits, with £7.3 billion of overpayments, and we remember the misery that was caused. The hon. Member for Hove referred to the speed with which universal credit has been rolled out. Actually, the lesson to be learned is not to roll out a scheme in a big-bang fashion, as happened with tax credits, when £2.7 billion then had to be clawed back from the poorest and most vulnerable in society. I was a new Member of Parliament in 2015, when people were still feeling the repercussions of that old system.

--- Later in debate ---

[Helen Goodman (Bishop Auckland) (Lab)]

I am pleased to take part in this debate because in my constituency, 10,700 households will be moved on to universal credit. That is 21,000 people, which is almost a quarter of my constituents. On 13 December, those with new claims and changes of circumstance will be moved across to universal credit, and over Christmas many people will face a six-week gap in their income. That is not so much a merry Christmas as a Victorian Christmas that even Scrooge did not think of.

Ministers have banged on about advance payments, but let us look at what that means in practice. Suppose that a single disabled person with a payment of £400 a month takes an advance of £200 to pay their rent. If all goes according to plan they will then have their payments abated, so that their income over the next four and a half months will be £200, £320, £320 and £360. In other words, instead of an income of £1,800 over that period, it will be £1,200. That is not a “wait”; it is a cut, and many will feel that over Christmas it is the cruellest cut.

Seven years ago in my constituency there were no food banks, but after seven years of Tory Government we now have seven food banks. Labour Members have spoken previously about the need to address free school meals, and in my opinion every child in a UC family should receive them. Now, however, to add to the loss of income, during that six-week period children will not receive free school meals either. Ministers talk about preparing people for work, but this is an in-work benefit. In my constituency, 4,500 of the households that are being moved on to universal credit—that is 40%—contain people who are already in work and have jobs.

[Vicky Ford]

My understanding is that if a child received free school meals before, they will continue to receive them. It is only for those who are new to the benefit system that there may be a delay.

[Helen Goodman]

I am sorry to inform the hon. Lady that that is not the case for new claimants and those whose circumstances have changed.

I am alarmed at what is happening to women in low-paid work. Many are trying, with great difficulty, to do their best to balance their need to earn an income with their responsibilities for collecting their children from school and looking after them properly. They might work 20 hours a week to get the right balance, but the Government are now going to employ advisers to harass them to increase their hours. When Labour was in power, we had different rules for single parents from those for other families. It seems to me that the Government are trying not to help lone parents, but to grind them down and grind down their children as well.

[Vicky Ford]

I remember under the Labour Government that single mothers came to me who were unable to continue work because they were better off on benefits. Does the hon. Lady agree that the system of universal credit is to help people move into work, rather than be better off on benefits?

[Helen Goodman]

I am sorry but the hon. Lady is wrong. I took through the statutory instruments on work conditionality myself, and when we left government, people were always £40 a week better off in work than not in work. Those are the facts.

Women fleeing domestic violence are in an even worse situation. When they arrive at the refuge, they have to register their change of address as a change of circumstance, so they will be in the vanguard of those who have a six-week gap in their income. It may even mean that some do not flee violent partners because they are worried about the effect.

In Bishop Auckland, huge preparations are being made for the roll-out of universal credit. The council and housing associations are employing more people—unlike, I am sorry to say, the jobcentres, which should be employing more people. One housing association is increasing its provisions for bad debt fourfold. Money that would have gone to building new homes is now going to deal with this Government-induced crisis in the housing system.

Three months ago I asked to attend one of the digital courses to see how people are supported by jobcentres. That is a major issue in my constituency because we have very bad broadband in the rural areas, and high levels of digital exclusion. Ministers must bear in mind that 5 million people in this country have never sent an email, and those are predominantly people on low incomes—the very people affected by this change to universal credit. We raised that point with Ministers five years ago, and it still has not been sorted out. Some single men who have already made a claim told me that people are timed out after 45 minutes if they cannot complete the claim, but it is difficult to complete in that time because there is no written guidance to tell people what documents they have to produce and scan in.

I am not saying that the problems with this system are only administrative because there are fundamental problems with universal credit, the first of which being that George Osborne took £3.5 billion out of the system. The Government refuse to recognise that people need these payments, and because of that refusal, rates are too low, payment gaps too long, and tapers too high. Let us pause and fix the system.

[Several hon. Members rose—]

--- Later in debate ---

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

I am pleased to contribute to this debate—I have been looking at proto-plans for universal credit that go back about five years, and it is a pleasure to work with the right hon. Member for Birkenhead (Frank Field), who is also a friend, on the Work and Pensions Committee.

Let us go back to where this all began and the reason why, in principle, we have cross-party agreement on universal credit. The previous system was not good enough. It was set up with good intentions, and it was a way of trying to take people out of poverty by giving them handouts. However, the way it was set up meant that many people were discouraged from taking on more work, which inhibited their ability to move on in life, improve their situations, and support their family. Universal credit was born out of that realisation, and from a desire to build a welfare system that would slowly remove benefits as people moved into work, and actively encourage people to take more hours and be better off.

We also want to create a system in which the world of life out of work mirrors the world of life in work. That means that people are in work to find work, and there is an expectation that they will look for work and sign a contract to that effect—the claimant commitment. It means that benefits will be paid on a monthly basis, so that when people move into work and monthly employment, they will be ready for that. I am afraid I cannot accept the argument that some people will never be able to cope on monthly payments. I feel that is extremely insulting to many people.

[Helen Goodman]

indicated dissent.

[Alex Burghart]

I disagree with the hon. Lady. It is.

We now have a system coming into being—

[Helen Goodman]

indicated dissent.

[Alex Burghart]

The hon. Lady can shake her head, but it is true. It is insulting to people to say that they will never be able to cope on monthly payments. I challenge her to have that conversation with the many people who are looking for work, because they would be insulted by it. [Interruption.] It is unfortunate that she laughs at that because it is true. [Interruption.] Look, this is a very insulting way of carrying on.

[Helen Goodman]

Anybody can manage on a monthly payment of £2,000, but managing on a monthly payment of £500 is rather more difficult.

[Alex Burghart]

The hon. Lady will recognise that there are lots of people who do manage to do that. [Interruption.] I have had enough of this Opposition.

I am delighted to say that under the universal credit system there is personal budgeting support. No one on the Opposition Benches has referred to it, but it offers money advice to help people with a four-week payment and offers alternative payment arrangements so they can have their money paid direct to their landlord. I am very sorry to hear that the hon. Member for Stretford and Urmston (Kate Green) found that that was not working well in her jobcentre. I have spoken to people in my jobcentre and I was pleased to see that they were completely on top of how the system worked.

Within universal credit, of course, there are a lot of problems, which have been talked about today and on other days, emanating from the long wait people experience when coming into the system. At the start of the process, far too many people have been waiting for far too long. The Select Committee report has drawn on that. Since the first roll-out phase, however, a number of improvements have been made thanks to the test and learn system. The landlord portal was very favourably received by people who gave evidence to the Committee, saying it would greatly help. We have also recently seen the initial evidence interview, the once and done process, which means that more information can be brought into the system straight away. These measures are all making improvements. I say to Opposition Members that we cannot learn unless we test.