Oral Answers to Questions

Iain Duncan Smith Excerpts

Monday 2nd November 2015 Commons Chamber

[Mr Peter Bone (Wellingborough) (Con)]

8. What assessment he has made of the potential effect on his Department of restricting benefits for EU nationals.

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

Since the start of last year we have been taking action through a range of measures to restrict access to benefits for EU migrants looking for work in the UK, because the last Labour Government left us an open door. That will ensure that advantage is not taken of our welfare system, and that the system is also fair to those who pay into it. It is estimated that changes made by my Department and Her Majesty’s Revenue and Customs will save more than half a billion pounds over the next few years.

[Mr Bone]

Does the excellent Secretary of State agree that it would be easier and more efficient for us to treat all EU citizens in the same way, and allow into the country only the ones whom we want here? Would not the end of free movement make his life much easier?

[Mr Duncan Smith]

My hon. Friend started so well. However, I will avoid his blandishment to take myself even further than I might have.

I remind my hon. Friend—who is doing much to promote himself to a job in the Government—that no one who is unemployed and not a British citizen will be able to receive universal credit at all, which is a huge step towards the arrangement that he is after.

[Philip Davies (Shipley) (Con)]

I commend the Secretary of State for all the efforts that he is making to restrict benefits for European citizens within the framework of the law, but does he agree that the only way in which the country will ever gain complete control over benefits policy for EU citizens is by leaving the European Union?

[Mr Dennis Skinner (Bolsover) (Lab)]

That’s what he used to say.

[Mr Duncan Smith]

The Prime Minister has given the country a referendum on that matter, which is a huge step forward for the hon. Member for Bolsover (Mr Skinner) and everyone else—they will all have a vote. My hon. Friend the Member for Shipley (Philip Davies) will, at that moment, be able to make that powerful argument. I am sure, with his rhetoric, he may yet carry the day.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

9. What recent assessment he has made of trends in the level of in-work poverty; and if he will make a statement.

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

Work is, as my hon. Friends have said, the best route out of poverty, and that is why we are focused on getting people into employment. We have made significant progress and have the highest employment rate on record with over 2 million more people in work since 2010. The number of people in in-work poverty is 200,000 lower than at its peak under Labour in 2008-09.

[Alan Brown]

As always, the Secretary of State refers back to statistics relating to the previous Labour Government, but the way to solve in-work poverty is not to cut tax credits. Is he aware of analysis by the Institute for Fiscal Studies suggesting that for the 8.4 million working households currently eligible for benefits or tax credits, the new proposed increase in the minimum wage will, on average, offset the cuts by only 26%? That will lead to an increase in in-work poverty. What will he do about that?

[Mr Duncan Smith]

Let me pick the hon. Gentleman up on a couple of points. First, since the Government came to power, the number of people living in working families and not in poverty is up by about 1.7 million, compared with 2009-10. The number of people in in-work poverty peaked in 2008-09 and the latest figures are 200,000 lower than that peak. On the IFS, it is worth reminding him that in a recent interview on tax credits its director said that the Chancellor had taken the decisions to protect some of the poorest people on tax credits. That is where we are. The Chancellor is clearly looking at the last vote and he will come forward with further measures.

[Owen Smith (Pontypridd) (Lab)]

In trying to deal with in-work poverty, the Living Wage Foundation today unveiled its new, very carefully calculated rates of £9.40 for London and £8.25 outside the capital. They are designed to reflect the realistic costs of living and average wages. Will the Secretary of State tell us why, therefore, he and his Government continue to describe their new rate, the minimum rate for the over-25s of £7.20, as a national living wage?

[Mr Duncan Smith]

I made the decision for my Department to pay the London living wage to all the cleaners and everybody else who works on contract. My right hon. Friend the Chancellor came forward with a very generous position in the Budget to raise the national wage to £9 by 2020. That is a huge increase. Perhaps the hon. Gentleman would like to tell me why, throughout the 13 years of the previous Labour Government, they never engaged with raising it to the national living wage either.

[Owen Smith]

The Labour Government introduced the minimum wage in the teeth of opposition from the Conservative party. I welcome the fact that the Secretary of State pays, in his Department, the London living wage, but continuing to describe the national living wage as just that undermines both the campaign and the concept of a real living wage that people can genuinely afford to live on. The under-25s, as we have heard, will not benefit from this. Is the reason for that, as the Minister for the Cabinet Office and Paymaster General, the right hon. Member for West Suffolk (Matthew Hancock) has told us, that young people are viewed by this Government as unproductive and therefore worth less money?

[Mr Duncan Smith]

For a moment, I forgot myself. I have been rather churlish. I did not welcome the hon. Gentleman to his post. I welcome him now to his post without reservation. [Interruption.] Well, that is not what he said on Second Reading of the welfare Bill, when he abstained, having decided since that he is really opposed to it. But never mind, the road to Damascus has a new route—I think it is called a career.

Moving on, it is this Government who increased the minimum wage to £6.70 and the living wage to £9 by 2020. Universal credit improves work incentives and supports childcare, with up to 85% of childcare costs covered. The lowest paid and the poorest will be best protected by what we are proposing, and not by leaving the minimum wage where it was under the previous Labour Government.

[Heather Wheeler (South Derbyshire) (Con)]

19. What estimate he has made of the number of households to which the benefit cap no longer applies.

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

The benefit cap is having a long-term and positive effect on those who are trying to find work, and on people’s lives generally. More than 60,000 households have been capped since April 2013, and as of May 2015, more than 40,000 households were no longer subject to the benefit cap. Of those, 16,300 households have moved into work.

[Andrew Bridgen]

I have good news from North West Leicestershire, where two thirds of the households to which a benefit cap applied are no longer subject to that cap. Does that show that the Government are successfully targeting taxpayers’ money in a way that encourages benefit recipients to seek work and reorder their finances, in exactly the same way as those in work do?

[Mr Duncan Smith]

Yes. The benefit cap is introducing fairness, and the claimant count in my hon. Friend’s constituency is down by 54% since 2010, and the youth claimant count by 64%. We want even more people to benefit from the financial and wider rewards of employment, and that is why we are reforming welfare and getting on with the job.

[Heather Wheeler]

Since the introduction of the benefit cap, some three quarters of households affected by it in South Derbyshire have taken steps so that they are no longer affected, and that is testimony to those who work tirelessly to help families improve their lot. Will my right hon. Friend join me in welcoming that, and assure me that efforts will continue to help people turn their lives around, and away from dependency and into work?

[Mr Duncan Smith]

I absolutely agree, and as I have said, the benefit cap is working. We are changing the levels at which that cap is set to improve it and to make it work further around the country. In my hon. Friend’s area, the east midlands, the number of workless households has fallen by 68,000 under this Government—households that are now benefiting from that return to work.

[Jeremy Lefroy (Stafford) (Con)]

12. What steps he has taken to ensure that his Department's policies promote family stability.

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

Family stability is at the heart of this Government because it creates better outcomes for children and society. We have taken a number of steps to promote family stability, including the family test, investing more than £8 million in relationship support, introducing the marriage tax allowance, and increasing childcare support to promote work as the best foundation for family stability.

[Jeremy Lefroy]

I welcome the Secretary of State’s answer. The cost of relationship and family breakdown has been estimated at some £47 billion a year. I welcome the support for relationship advice, but I ask the Secretary of State to do more on that and to help turn around the lives of troubled families.

[Mr Duncan Smith]

I pay tribute to my hon. Friend. He has made support for families an important issue, and I have talked to him on a number of occasions. I believe that the troubled families programme is critical in supporting families with multiple and often highly complex problems to turn their lives around. Between 2013 and 2015, the DWP created 150 troubled families employment advisers to support people, and 116,000 families have been turned around with nearly 12,000 adults moved into continuous employment. I hope that helps my hon. Friend to understand that the Government are serious about this issue.

[Mrs Madeleine Moon (Bridgend) (Lab)]

Poverty is a destructive element for family stability. Has the Secretary of State read the Joseph Rowntree Foundation report, “Monitoring poverty and social exclusion in Wales 2015”? It points out that working families and young people in Wales are at greater risk of poverty now than they were a decade ago, that 45% of all part-time jobs are classified as low paid, and that for those who work part time or are self-employed, the number of families living in poverty has increased by 100,000 in the past decade. It states that changes in the Welfare Bill will be damaging for families in Wales. Does the Secretary of State acknowledge that?

[Mr Duncan Smith]

I acknowledge that the Joseph Rowntree Foundation has written its report, and it has said many things in the past about what we have been doing. As I said earlier, the number of families that have risen out of poverty directly as a result of our changes has been dramatic. As the hon. Lady well knows, Wales had a difficult time in the recession, but unemployment is now falling dramatically and employment is rising. I believe that the best way to get people out of poverty is to get them into work, and eventually into full-time work. That is happening right now.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

16. What discussions he has had with the Chancellor of the Exchequer on the effect on family carers in receipt of carer’s allowance of reforms to benefits and other financial support.

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[Mark Pawsey (Rugby) (Con)]

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

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

Today the Legatum Institute is publishing is global prosperity index. I raise it because it ranks countries on a number of measures, including the economy and levels of opportunity, with the UK rising nine places in the economic index, which is the latest evidence showing the positive impact of our reforms. As today’s report shows, thanks to our welfare reforms and economic reforms more people than ever have the opportunity to benefit from the dignity and sense of purpose that comes from having a job.

[Mark Pawsey]

I have been contacted by a number of constituents who have been in receipt of a Motability vehicle and have appealed against a PIP assessment. They tell me that it can take months for their appeal to be heard, during which their entitlement to the vehicle, to which expensive adaptations have sometimes been made, is withdrawn. What steps can the Minister take to ensure that those rightly in receipt of a Motability vehicle retain it?

[Emily Thornberry (Islington South and Finsbury) (Lab)]

Given the considerable disquiet in the country about cuts to tax credits, not to mention the alarm on the Secretary of State’s side of the House, where 20 of his own MPs have said that the Government are in danger of cutting a lifeline to working families, does he now regret describing tax credits as a “bribe”?

[Mr Duncan Smith]

The hon. Lady should remember exactly how the money was spent. If she looks back, she will find that in the run-up to the 2005 general election, the then Chancellor raised the spending on tax credits, strangely, by 71%. After that the rate stayed pretty flat, but before the 2010 election it was suddenly raised again by nearly 23%. I simply say to the hon. Lady that if she does the maths, she might wonder why Labour lost the 2010 election.

[Neil Carmichael (Stroud) (Con)]

T4. Will the introduction of universal credit, and all the associated data that that entails, enable the Government and the Department to help young people on low incomes to find new opportunities to progress into higher-paid jobs?

[Mr Duncan Smith]

Yes. What happens now when someone on jobseeker’s allowance gets a job is that they disappear and nobody sees them. Under universal credit they will stay with their adviser, who will help them with any subsidiary training, help them to find extra hours if they want them, and help them to sort out any problems at work. That is a remarkable change, and it will give us the opportunity really to help people to progress in work.

[Paul Blomfield (Sheffield Central) (Lab)]

T2. According to the Office for National Statistics, nearly one in four jobs in my city of Sheffield pays less than the real living wage. On the day that the living wage is being increased to £8.25 an hour, will the Secretary of State congratulate the Living Wage Foundation on its work and outline what he will do to ensure that more people are paid the real living wage, which is now over £1 an hour more than the Government’s bogus national living wage?

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[Jack Dromey (Birmingham, Erdington) (Lab)]

T3. With one in four workers in Erdington earning less than the living wage, 82% of children are being brought up in families that are dependent on tax credits. Does the Secretary of State not accept that this is the worst possible time to cut tax credits, and that those families will not be compensated by his phoney living wage? Will he join me in welcoming the initiative taken today by the Labour-led Birmingham City Council to declare that no Brummie in the city should earn less than the real living wage?

[Mr Duncan Smith]

Despite all the other arguments, the Labour Government had 13 years in power and they let the national minimum wage fall further behind than ever before. It is this Government who have increased the minimum wage and who are now proposing a real living wage of £9 at the end of this Parliament.

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[Andy Slaughter (Hammersmith) (Lab)]

T8. Over the previous Parliament, the number of working families in London claiming housing benefit increased by 84%. Over the past three years, London councils have been able to replace only one in seven of the council homes they have sold. Does the Minister see any connection between those two figures?

[Mr Duncan Smith]

What the hon. Gentleman failed to remind us all is that under the last Government the number of people claiming housing benefit, both out of work and in work, rose dramatically, whereas under this Government the number of those claiming housing benefit out of work has fallen dramatically.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

T7. I welcome the reforms to welfare, which have helped 609 people in my constituency back into work since 2010. Moving from benefits into work can cause cashflow difficulties, so I additionally welcome the initiative to put Jobcentre Plus advisers into food banks to make sure those delays do not occur. What progress are we making on speeding up benefit claims to make sure those situations do not occur?

[Mr Duncan Smith]

We want to ensure that anybody who goes to a location such as a food bank has the ability to check whether there is a problem—if there is, let us deal with it there. We have also advertised hugely across all the jobcentres, telling everybody they can get benefit advances, hardship loans and so on. We are now beginning to find that when they go to the food banks, they are also being helped to get back into work, which is an added bonus.

[Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)]

T9. On the administration of the benefit sanctions regime, yesterday’s Sunday Herald reported new figures showing that in nearly 300,000 cases benefit claimants had been penalised with sanctions without being officially notified—that includes an estimated 28,000 cases in Scotland alone. Will the Minister apologise to all those who have faced destitution without proper notice? Will he finally commission an independent review of this badly intentioned and poorly administered system?

[Mr Duncan Smith]

I do not recognise those figures, but I will say to the hon. Lady that back in 2001 the last Labour Government decided to move—

[Ms Ahmed-Sheikh]

I am not interested in the last Labour Government.

[Mr Duncan Smith]

Well, she asked the question and if she does not want the answer, that is fine by me. What I am saying to her is that the last Labour Government moved to a clerical system. We have reviewed that approach over the past year and decided that, under the changes we want, going back to an automatic system is much better. The recent statistics released last week show that the rate of appeal was slightly higher among those who did not receive the initial letter appeal than among those who did; we therefore do not think there is a difference. We will be writing to people to remind them that they still have rights to appeal if they wish to do so.

[Richard Fuller (Bedford) (Con)]

A substantial benefit of the issues relating to tax credits is that more companies are encouraged to pay the national living wage—£9 an hour—now. What conversations has my right hon. Friend had with the Chancellor about incentives that we could provide to companies to pay £9 an hour?

[Mr Duncan Smith]

Yes, the No. 1 reality is that companies that believe the economy is well run will invest in their workforce and give them a better salary. The problem was that the last Labour Government set up a system that encouraged companies to pay low wages and leave them static. The change now is this: universal credit is making them move on; higher salaries; a better wage packet. Many companies are already paying the higher level—they have come and said they will.

[Greg Mulholland (Leeds North West) (LD)]

I was pleased to meet the Under-Secretary of State for Disabled People to discuss children with Batten disease who were having to re-apply for disability living allowance, but we were disappointed to be told that we would not get a formal response. Will the Minister ensure that the Batten Disease Family Association gets a formal response about how the Department will take the recommendations forward?

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[Jake Berry (Rossendale and Darwen) (Con)]

Given the Government’s ambition to have all benefit claims online by the end of this Parliament, will the Minister update the House on what discussions he has had with internet service providers to ensure that those on low incomes can get online?

[Mr Duncan Smith]

The ambition is to get as many claims online as we can, but there will be some people who cannot get online. Under universal credit, we are keen to ensure that people can, if necessary, continue to make paper submissions, and that they will be treated inside jobcentres, but we will get as many online as we can. We have been talking constantly to the providers about how best to do this, and also about matters of security.

[Mr David Winnick (Walsall North) (Lab)]

For clarification, is the Secretary of State pleased that, as a result of sustained parliamentary and public pressure, the Chancellor has been forced to reconsider the proposals on tax credits? Is that a matter that meets with his approval?

[Mr Duncan Smith]

Everything the Chancellor proposes meets with my approval, as I am a member of the Government.