Oral Answers to Questions

Iain Duncan Smith Excerpts

Monday 18th October 2010 Commons Chamber

[Andrea Leadsom (South Northamptonshire) (Con)]

8. What recent assessment he has made of the adequacy of the support provided to jobseekers by Jobcentre Plus.

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

I am aware that my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) has a huge interest in job clubs and has done a lot in her local area. I know that is appreciated.

There are 741 jobcentres, 35 contact centres and 78 main benefit delivery centres that process claims, investigate fraud and deal with inquiries. A full assessment of Jobcentre Plus services for 2009-10 was included in the annual report and accounts published on 26 July 2010. It was generally very positive. Jobcentre Plus has gone through a lot of difficulties over the past year and a half, but has done so really well. It is worth reminding ourselves that Jobcentre Plus helps 75% of claimants leave jobseeker’s allowance within approximately six months.

[Rehman Chishti]

A carpenter from my constituency, Mr Pay, was told by Jobcentre Plus that delivering thousands of leaflets and advertising his services in the local media did not constitute actively seeking work and his jobseeker’s allowance was withheld. What assurances can my right hon. Friend give me that that will not happen again?

[Mr Duncan Smith]

I understand that the Minister of State, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling), has intervened in the case and is busy sorting it out with the jobcentre to make sure that the rules change so that we never see a repeat of it.

[Andrea Leadsom]

My right hon. Friend kindly mentioned the job clubs that I started in South Northamptonshire. They do excellent work, largely through volunteers, with a bit of support from the local council. I should be grateful if my right hon. Friend told us what plans he has to support the work of those job clubs as they make the transition to work clubs.

[Mr Duncan Smith]

As my right hon. Friend the Minister has made clear endlessly, it is critical in the whole Work programme process, which includes the element of work clubs, that we work on the basis of our understanding of previous information to bring people together and make sure that their shared experience can help them overcome some of the barriers. That is a critical component. That shared experience, as my hon. Friend and many other hon. Friends in the Chamber will know, can help people through the difficulties, so that they do not repeat the same mistakes. It will be an essential part of their work experience.

[Miss Anne Begg (Aberdeen South) (Lab)]

The Secretary of State is already aware that there will be a lot of pressure on Jobcentre Plus in Aberdeen and Aberdeenshire over coming months, because the Work programme—even with the best will in the world—will not be in place until next summer, and in the meantime there will be the migration from incapacity benefit to the employment and support allowance. On the Government’s figures, at least 200 people will end up back on jobseeker’s allowance, with perhaps another 400 needing the work-related activity element. The Minister has already announced £50,000, but, apart from that, what extra resources will be put into Aberdeen and Aberdeenshire to make sure that the excellent workers in Jobcentre Plus are able to give the specialist help that my constituents and others round about so richly deserve?

[Mr Duncan Smith]

We are, of course, aware of that, and the hon. Lady has, I think, discussed the matter with my right hon. Friend the Minister of State. As things stand, we think that the money that has been made available will be sufficient to cover the gap period, of which we are fully aware, so that nobody suffers a loss until they have gone through the system and had a chance to get on to the Work programme. We will, of course, keep the matter under review, and if there is an issue I guarantee the hon. Lady that we will make sure that it will not mean that people are penalised.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

In the same vein, may I ask the Secretary of State what he is doing to measure the adequacy and effectiveness of private job agencies such as FourstaR Employment and Skills Ltd, which has a Government contract to help unemployed people in my constituency to find work?

[Mr Duncan Smith]

The greatest form of measurement that we can use is that which will apply to the Work programme, whereby bodies will essentially be paid by results. In other words, if they do not get people back to work, they will not receive the money that will allow them to make any kind of profit at all. The best way of measuring them is to pay them when they are successful, and not, as happened with one scheme under the last Government, before they are successful.

[Tony Baldry (Banbury) (Con)]

4. What support his Department plans to make available to people on incapacity benefit to enable them to take up employment.

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[Mr Marcus Jones (Nuneaton) (Con)]

7. What steps he is taking to increase the proportion of benefit fraud detected.

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

Total fraud—benefits and tax credits, involving my Department and the Treasury—stands at £5.2 billion. Total welfare fraud stands at £1.5 billion, involving £1 billion in benefits and about £500 million on tax credits. My Department performs about 500,000 data matches per year, and under the new strategy we will use more private sector data matching to try to catch fraudsters and to stop errors. We will recruit more than 200 new anti-fraud officers to sanction about 10,000 fraudsters every year, and there will be a new three strikes regime to ensure that the worst cases, of criminal gangs and larger-scale identity fraudsters are robustly dealt with. It is worth reminding the House that the universal credit system reform will go a very long way to helping to resolve some of the problems concerning errors, which amount to a huge and significant sum each year.

[Mr Jones]

I thank my right hon. Friend for his response. Many of my constituents will be horrified to learn that during the last year of the Labour Government, prosecutions for false benefit claims slumped by 11%. I should therefore be grateful if he confirmed what action he intends to take to reverse that worrying trend.

[Mr Duncan Smith]

As I said earlier, we will undertake a major drive on that issue. We think that, taking on board what the previous Government did, we need to take further action. There have been reports about the issue, and I can clarify some matters. The three strikes policy to which I referred consists of, first, essentially the loss of benefit, sanctioned for four weeks, going up to 13 weeks; secondly, the loss of benefit from 12 weeks to 26 weeks; and, on third conviction, the loss of benefit sanctioned for about three years. We will look further at the penalties, particularly when we detect criminal activity by a consortium trying to defraud the state. The reality is that we have to undertake that drive, and to those who moan about it and say that it is wrong, I must say that the main problem that we face is that taxpayers, who are often on low earnings, pay their taxes to support people in difficulty, and they do not want to see their money wasted, going to people who, frankly, set out to defraud the system. I hope that Members on both sides of the House can agree on that.

[Several hon. Members]

rose—

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[Mr Frank Field (Birkenhead) (Lab)]

When Members of Parliament hand on to their local offices allegations of fraud made by their constituents, will the Secretary of State arrange for the MPs concerned to read the fraud report to ensure that the job has been properly done?

[Mr Duncan Smith]

That is very tempting. I am happy to discuss that with the right hon. Gentleman, and I am definitely tempted in his direction.

[Jo Swinson (East Dunbartonshire) (LD)]

10. What steps his Department is taking to enforce payment of child support by parents who refuse to pay.

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[Karl Turner (Kingston upon Hull East) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

I draw the House’s attention to the fact that today, as I referenced earlier, the Department for Work and Pensions and Her Majesty’s Revenue and Customs published a joint strategy to tackle fraud and error in the benefits system, which we believe should save £5 billion each year. The proposals in the fraud and error strategy, which together represent an additional £425 million of funding over the next four years, will, we believe, deliver a £1.4 billion reduction in fraud and error by 2014-15.

[Karl Turner]

Can the Secretary of State explain to a large number of my constituents why he reduced the support for mortgage interest payments before his Department ensured that mortgage lenders would average out rates? Why did he communicate this only a few days before it was reduced, and is it not true that lenders are fighting this reform tooth and nail?

[Mr Duncan Smith]

I do not know whether the hon. Gentleman was listening to the Minister of State, my hon. Friend the Member for Thornbury and Yate (Steve Webb), when he pointed out that the last Government left plans to slash that support. It is we who have actually brought it to the average, which means that people will do better under us than they ever would have done under the last Government—so an apology would do very nicely thank you.

[Amber Rudd (Hastings and Rye) (Con)]

T2. I know that the Secretary of State is aware of conversations I have been having in my constituency with youth leaders about how we can communicate changes in the welfare programme to young people who do not watch the Parliament Channel and sometimes do not read the papers. Do we have a campaign plan to try to communicate the changes to them, perhaps through texting or facebooking and the internet?

[Mr Duncan Smith]

We do indeed. My hon. Friend is right to draw the matter to the House’s attention. Using new media, it is important that we ensure that young people are brought fully into the net, particularly through voluntary sector organisations, which are much better at using the new media. However, I must also draw her attention to the Department’s commitment—a commitment that I have made—to ensure that older people approaching retirement should not retire without the ability to use the net and the web. That is a big commitment but one that we will stand by.

[Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)]

Last week, PricewaterhouseCoopers suggested that 1 million jobs could be lost over the next year. Given the answer we just heard from the Secretary of State and the present uncertainty in the labour market, will he confirm again that people affected by the change he just discussed will do very nicely—as he said—and assure the House that the reduction in the interest rate used for the support for mortgage interest programme will not lead to a rise in the number of repossessions among the approximately 255,000 people affected?

[Mr Duncan Smith]

I welcome the right hon. Gentleman to his position, although it would have been nice if he had risen at the Dispatch Box and first apologised for being part of a Government who left plans to cut the support to mortgage holders—[Interruption.] Yes, as the Minister of State, my hon. Friend the Member for Thornbury and Yate implies, they planned to slash the rate. So when the right hon. Member for Paisley and Renfrewshire South (Mr Alexander) next gets to the Dispatch Box, perhaps he will tell the world that he was going to do that, and apologise. We will give the support necessary and reform the system. As he knows, organisations and individuals, including a lot of very senior businessmen today, have said that our economy will grow, that they will provide the jobs and that therefore this Government will be right.

[Graham Evans (Weaver Vale) (Con)]

T3. Building business will create employment opportunities in my constituency of Weaver Vale. What support will the Government provide to help unemployed people into self-employment?

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[Mr Marcus Jones (Nuneaton) (Con)]

T4. Following a succession of soundbites from the previous Government, who promised to be tough on benefit fraud but delivered, as usual, very little, can my right hon. Friend the Secretary of State explain to the House why he thinks the new initiatives that he has proposed today will succeed where those of other Governments have failed?

[Mr Duncan Smith]

Yes, I can. One thing that it is important for everybody to understand is that not only will we have the three-strikes policy, but we will try to disincentivise people in what I call the low-level area of fraud, which is when they knowingly fail to report changes in their circumstances. In those cases, there will be the ability to fine them £50 on the spot, which will have a big effect on people saying, “Well, I forgot and I didn’t do it.” Providing that we think they knew, it is time they realised that they have, in fact, defrauded the state as well.

[Alun Michael (Cardiff South and Penarth) (Lab/Co-op)]

T6. Does the Secretary of State accept that the result of changing indexation from the retail prices index to the consumer prices index is that pension increases in 2012 will be cut from 4.6 to 3.1%? Is that what he regards as fairness?

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[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

T7. Before the election, one of the policies that resonated most with my constituents was the Conservative plan to eliminate the couple penalty—the absurdity whereby people can be better off splitting up as a family than staying together. Can my right hon. Friend assure me that that penalty will be erased completely in the next few years, and that there will be no unintended consequences of any other policies that we might be putting forward?

[Mr Duncan Smith]

I must say that this remains a target for us, which is—[Interruption.] It is all very well for the Opposition to laugh: they are the ones who created the couple penalty. They could not care less whether people had to split up because of their benefits bills; the disincentives were all there and they created them. We will do our level best to eradicate them.

[Natascha Engel (North East Derbyshire) (Lab)]

On the Secretary of State’s announced crackdown on people fraudulently claiming benefits, the latest figures from his Department for fraud and error in the benefits system show that £1 billion is due to fraud, but that another £1 billion is due to official error. How will he ensure that his campaign against fraud is as high profile as any campaign against official error in his Department?

[Mr Duncan Smith]

I thank the hon. Lady for her question. The reality is that going after error—and not just fraud—is a critical component. As I said earlier, one of the big changes that we are making is the reform of the benefits system, which is so incredibly complex that many of my officials say that often they simply cannot quite figure it out until 45 minutes or an hour of serious study for each case. Simplifying the system will reduce the scope for error, which will be in the interests of all her constituents and members of my Department.

[Julian Smith (Skipton and Ripon) (Con)]

T8. A constituent with bowel cancer has been found fit for work, despite having his colostomy bag changed 16 times a day. He is now going through appeal. How will my right hon. Friend ensure that those who are genuinely and obviously not fit for work are dealt with more humanely?

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[Mr Duncan Smith]

We are not responsible for aircraft carriers, so I apologise for that!

[Stephen Phillips (Sleaford and North Hykeham) (Con)]

T9. My right hon. Friend would no doubt agree with me that the last Labour Administration presided over a system of welfare that trapped people in poverty and ignored devastatingly high levels of workless families in our country. Will he tell the House what he is going to do about it?

[Mr Duncan Smith]

My hon. Friend will know that we are planning to bring forward a White Paper on reform of the benefits system soon. As I alluded to earlier, one of the biggest problems is that the existing benefit system has become so complex, with so many different withdrawal rates and different tapers—some at gross, some at net levels—done through different Departments. By bringing all that together and simplifying the system by giving people basically one withdrawal rate, we should be able to allow them to understand what they will retain, while also ensuring that work always pays. That, I think, is in the interest of everyone in the House.

[Toby Perkins (Chesterfield) (Lab)]

I welcome what the Minister of State, the right hon. Member for Epsom and Ewell (Chris Grayling), said previously about looking into the work capability assessment. I met a delegation from Chesterfield and north Derbyshire on Thursday, although they were due to have a meeting with him. One in the group was told that she was fit to work four days before a cancer operation, while another who had a plaster cast the whole length of his arm was told that he was fit to work. Unfortunately, the Minister cancelled his appointment to see them on the day before they came down to London. Will he commit to seeing them? If he really wants to learn about the work capability assessment, he should meet some of the people who have been affected by it.

[Harriett Baldwin (West Worcestershire) (Con)]

T10. The auditors of the Department have not signed off the accounts for many years. Will the Secretary of State’s announcement today keep the auditors happier in future?

[Mr Duncan Smith]

It is always very difficult to know what keeps auditors happy—or if they are among that breed of people who are never happy—but the reality is that we are in discussions with them about the need to be a little more realistic between the two groups to make sure that the accounts are signed off in future. After all, this Department has made huge strides—both under the last Government and this one—to be more efficient. That has been acknowledged by the auditors, so perhaps it is time for us to come to a conclusion.

[Yvonne Fovargue (Makerfield) (Lab)]

The Government have said that the June Budget will have no impact on child poverty up to 2012. Will the Minister confirm that the new benefits cap will not change that fact? Will he publish the figures to demonstrate the effect of the cap on all categories?

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[Mr Duncan Smith]

We have no such strategy, but of course, if those people want a job change, that is up to them.

[Nicky Morgan (Loughborough) (Con)]

I welcome the earlier remarks of the Under-Secretary on achieving equality for disabled people by helping them back into work. Does she recognise the excellent work done by the RNIB college in my constituency to help those who are blind or visually impaired back into work? Will she visit the college with me at some point?