Oral Answers to Questions

Iain Duncan Smith Excerpts

Monday 1st September 2014 Commons Chamber

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

8. What steps he is taking to limit the availability of benefits to migrants from other EU member states.

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

Since January, EU jobseekers have not been able to claim jobseeker’s allowance until they have been in the country for at least three months and can then claim for only a maximum of six months. Shortly, we will further limit the claim time from six months to three months. In addition, EU jobseekers cannot now claim housing benefit.

[Stephen Metcalfe]

Will my right hon. Friend join me in welcoming the recent fall in non-UK nationals claiming working-age benefits, and will he do all he can to ensure that that trend continues?

[Mr Duncan Smith]

My hon. Friend raises an interesting point. Overall the total number of national insurance number registrations to adult overseas nationals is down by more than 7,000 on the year, or 1%. NINo registrations from outside the EU are down by 30,000 on the year, or 17%, and outside the EU annual registrations to all world areas have fallen to the lowest level since records began in 2002.

[Ian Lucas (Wrexham) (Lab)]

Will the Secretary of State confirm that when the Prime Minister finally reveals the shopping list for presentation to the European Union on renegotiation, it will include renegotiation of the position relating to benefits? Will he now specify which particular benefits he has in mind?

[Mr Duncan Smith]

I am not in a position to pre-guess what the Prime Minister will decide in his negotiations—he will make it altogether clear. But I hope that both sides of the House, including the hon. Gentleman, will recognise that a negotiation followed by trusting the people to vote on whether they wish to stay in the EU is a good plan rather than a bad plan.

[Tim Loughton (East Worthing and Shoreham) (Con)]

21. I congratulate the Secretary of State on the introduction of a much more robust test before people qualify for benefit, but what discussions has he had with his European partners on further steps to prevent benefit tourism and to get the message across that the UK is a place where people come to work, not to claim?

[Mr Duncan Smith]

I have visited and talked to a number of my colleagues across Europe—in Germany, Holland, Spain and France—and I have also talked to the Danish Minister. Everyone to whom I have spoken so far and many more—I see that the Poles have also come to the same conclusion—have decided that there is something fundamentally wrong with the European Commission interpretation of people’s right to access benefits in a country where they do not have residency. Recently, the Germans have tightened up in almost exactly the same way as we have done. We had all those people saying that what we were doing was terrible, but now that the Germans are doing it, those people have gone quite quiet.

[Mr John Redwood (Wokingham) (Con)]

Is not the question of who gets a benefit from this country, or who comes to stay in this country, a matter for this Parliament, not for the EU?

[Mr Duncan Smith]

That is exactly the point that I have been making from the beginning. We have always said to the European Commission that this matter lay outside the treaties. It is a national Government responsibility, and it is national Governments who should take that responsibility. The Opposition did very little about organising this so that they would be able to stand against the EU Commission on that basis.

[Mr Philip Hollobone (Kettering) (Con)]

9. How much his Department spent on benefits in 2010; and what estimate he has made of such spending in 2015.

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

In 2010-11, the Department for Work and Pensions spent £54 billion on working-age claimants and children at today's prices, and £106 billion on pensioners. Total expenditure was 9.8% of GDP. In 2015-16, as a result of our changes, the Department will spend £54 billion on working-age claimants and children at today's prices, and £116 billion on pensioners. Therefore, total expenditure is expected to be £170 billion, which is 9.6% of GDP. In this Parliament, we will therefore have saved cumulatively £50 billion, the equivalent of £1,900 for every household in the UK.

[Mr Hollobone]

Will my right hon. Friend confirm that for the first time in 16 years, thanks to his stewardship, the relentless annual increases in welfare spending have at last been brought under control, so that the proportion of our national output that goes on welfare spending has finally been controlled, allowing our economy more room to grow and more spending on important areas such as health and education?

[Mr Duncan Smith]

My hon. Friend is right. Last year, welfare spending fell in real terms for the first time in 16 years as a share of GDP, and will continue to do so. In 2010, spending was at 12.5%, and next year it will be at 11.9%. By 2015-16, the out-of-work benefit bill will fall back to pre-recession levels, down to 2.3% of GDP. It peaked under the last Government at nearly 3% of GDP.

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

The Government claim that they are tackling what they call dependency on welfare. In the north-east, the number of working households claiming housing benefit has shot up by two thirds because wages are failing to keep up with rent. Will the Secretary of State admit that without action to tackle low pay or deal with soaring rents, the welfare bill will continue to rise?

[Mr Duncan Smith]

The figure the hon. Lady did not give is that out-of-work housing benefit claims are falling, and that is because people who were claiming it are now going into work. That means that they are earning more money, which means that the likelihood of their being in poverty is far less. I wonder whether the hon. Lady would like to get up sometime and congratulate us on getting more people back to work and spending less on housing benefit as a result.

[Nic Dakin (Scunthorpe) (Lab)]

10. What recent discussions he has had with representatives of local authorities on transition plans relating to the closure of the independent living fund.

--- Later in debate ---

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

11. When he expects the business case for universal credit to be fully signed off.

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

I announced in December that Her Majesty’s Treasury has approved funding for the universal credit programme in 2013-14 and 2014-15. The final stage in Treasury approvals is sign-off of the full business case, which covers the full lifetime of the programme. We expect to agree that very shortly.

[Mr Brown]

The answer to a similar question two months ago was “very shortly”, but it is taking rather longer than the Secretary of State intended. What are the major outstanding issues between his Department and the Treasury, and where does universal credit now stand in the Cabinet Office’s traffic light system?

[Mr Duncan Smith]

Let me explain to the right hon. Gentleman that the reality is that we have agreed—I can run through the list for him—all the spending that is relevant to the plan that we set out at the end of last year. The final point relates to the full lifetime of that programme, which will take it all the way through, probably beyond all the years that anybody present will be in government. [Hon. Members: “Certainly you!”] To be fair, I do not think Labour will be in government given the way its Members behave. That is now being agreed and the reality is that it has to be done very carefully. I genuinely believe, from my discussions, that it will be signed off very shortly. The result will be that the programme will be seen for what it is: a programme that will deliver hugely to those who have the toughest lives and need the most support and help.

[Sir Tony Baldry (Banbury) (Con)]

22. One can see the advantages of the introduction of universal credit to those whose lives are toughest, but will my right hon. Friend tell the House what the benefits to both employers and businesses might be once universal credit is fully implemented?

[Mr Duncan Smith]

I invite anybody in the House to visit areas where universal credit is rolling out—across the north-west, and even here in London—not to talk to the likes of me but to the staff who operate the jobcentres, who will say that it has allowed them to get people started into work far quicker, so that they are taking work earlier and staying in work longer. It means that businesses on the high street can afford to take people on, to begin with for lower hours than they might otherwise have been able to do—in other words, not creating a job—and then expand it into a much fuller-time job, so improving the economy and improving lives.

[Andrew Gwynne (Denton and Reddish) (Lab)]

20. The Secretary of State has merely repeated what his Employment Minister has already said—that the strategic outline business case is approved until the end of the Parliament—but of course, in parting, the previous head of the civil service said that“we should not beat around the bush. It has not been signed off”,and the National Audit Office has slammed universal credit for “weak management, ineffective control and poor governance.”When are the Government going to get a grip of this chaotic shambles?

[Mr Duncan Smith]

It is always nice to live in the past, but the reality is that if the hon. Gentleman waits he will see that this programme is running well and will be delivering, that this programme of universal credit will benefit everybody who needs the support they most need, and that all the nonsense he is talking about will all go away.

[Chris Bryant (Rhondda) (Lab)]

The truth of the matter is that this programme—the Secretary of State’s pet project—is being kept on a life-support system, and all he can say is that the Treasury has guaranteed another 247 days of funding, with nothing beyond the end of this Parliament. He comes here again and says exactly what he said on 9 July, which was that this was going to be approved “very soon”. What has gone wrong? Did the Chief Secretary to the Treasury and the Secretary of State take two months going on holiday, or are there real sticking points in the programme because, frankly, the sums do not add up?

[Mr Duncan Smith]

There are no sticking points, but these matters need to be agreed carefully. This test-first-and-then-implement process is the way all future programmes will be implemented. I just want to quote Mr Manzoni, the new chief executive of the Major Projects Authority, who made it clear to the Public Accounts Committee in June that universal credit is stable and on track with the reset plan. [Interruption.] He said that it is stable and on track with the reset plan, so whatever the hon. Gentleman wants to say, when this is signed off I hope that he will come to the Dispatch Box and say that Labour Members fully support it and they will get on with it.

[Paul Uppal (Wolverhampton South West) (Con)]

12. What support his Department is providing for young people seeking employment.

--- Later in debate ---

[Mr Henry Bellingham (North West Norfolk) (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, I welcome an important step in our new test and learn approach to delivering universal credit, with the launch of 11 robust evaluation trials to test support for vulnerable households. We are working with local authorities in a way that has not been done before to make available a system of universal support that is delivered locally and that offers tailored help to get online and budget effectively as individuals progress into sustainable work.

[Mr Bellingham]

Is the Secretary of State aware that since July last year, unemployment in my constituency has fallen by a very welcome 689 people? That means that nearly 700 more families have a new wage earner and hope for the future. That is surely a clear vindication of his reforms and our long-term economic plan.

[Rachel Reeves (Leeds West) (Lab)]

Two thirds of children in poverty now live in families in which somebody is working, and a record 5 million people are earning less than a living wage. In-work poverty is an injustice and an indignity to those who suffer it, but it also costs the taxpayer through the benefit system. Will the Secretary of State tell us by how much the spending on housing benefit for people in work is expected to increase between 2010 and 2018?

[Mr Duncan Smith]

I wish the hon. Lady had been listening to my answer to an earlier question—[Interruption.] No, the reality is that the number of people who are out of work and on housing benefit is falling. The number of those who are in work is rising. Under the last Government, we saw a rise in the number of people who were out of work and having to claim housing benefit. Let me also remind the hon. Lady, who has voted against every single measure we have taken, that our housing benefit reforms were set to reduce the amount of money. When the Labour Government left office, housing benefit was likely to rise to £26 billion. It will now rise at a far slower rate than that, because of the reforms that we have made to housing benefit.

[Rachel Reeves]

The reality is that housing benefit overall is going to go up in real terms from £23 billion at the beginning of this Parliament to £24.6 billion at the end of it. Housing benefit for people in work is forecast to rise by a staggering £12.9 billion between 2010 and 2018. Does that not show that taking action to make work pay would be a much more effective way of controlling housing benefit than the unfair and unworkable bedroom tax, which I and many of my colleagues will be voting to change this Friday, and which we need a Labour Government to repeal after the general election next year?

[Mr Duncan Smith]

The hon. Lady is in a hole and she really should stop digging. Let me remind her of what we had to take over when we came into government. Left unreformed, the bill that Labour left us with would have exceeded £26 billion in 2014-15. Instead, today, it is £24 billion—£2 billion less. Under Labour, in-work and out-of-work housing benefit claimant numbers increased, and those who were in more despair, being out of work, had to claim higher payments. Under us, homelessness is down 7%, half the peak that occurred under the last Government, and rent collection is currently 98% higher than under the last Government. Also, housing association arrears fell during the last two quarters. All of that is better than anything that the last Government left us as a result of their record on spending.

[Caroline Dinenage (Gosport) (Con)]

T2. A number of my constituents have experienced lengthy delays while waiting for a decision on a review of their personal independence payment application. That is a time of great uncertainty and stress for all concerned. In addition to the efforts that the Minister has already outlined, will he tell us what steps he will take to speed up the application, review and appeal processes?

--- Later in debate ---

[Mr Rob Wilson (Reading East) (Con)]

T7. In a few weeks, I will hold my eighth Reading jobs fair. At the previous seven, 20,000 jobseekers and 300 local businesses have already been welcomed. Will my right hon. Friend the Secretary of State join me in thanking all the businesses and partner organisations that have made that possible, and in welcoming the impact that it has had on reducing unemployment in the Reading area?

[Mr Duncan Smith]

I congratulate my hon. Friend on working closely with businesses to get people back to work. Will he also pass on our congratulations to the businesses, small and large, that have done their level best to help deliver 1.7 million new jobs since the Government came to power and to turn the economy around so that it is the best performing economy in the whole of Europe?

[Mr John Spellar (Warley) (Lab)]

T6. With the lamentable record of the failures of Atos, the shocking delays in assessments, the injustice of the bedroom tax and the continuing scandal of the IT system for universal credit, why does the Secretary of State stay in the job?

[Mr Duncan Smith]

I remind the right hon. Gentleman that this Government have got more people back to work, that we now have record levels of employment, that we have cut the deficit and that we are getting the cost of delivering welfare down. We inherited a shambles, and we have turned that around. That is the purpose of government.

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

Will my right hon. Friend join me in congratulating Rossendale jobcentre, which has just signed up nearly 45 people to its work experience programme, including me and my office? The first young person to come through my office on work experience, Liam, has just secured a job because of that work experience.

--- Later in debate ---

[Dr Julian Huppert (Cambridge) (LD)]

On 11 March last year, I asked the Secretary of State about under-occupancy. I said:

“Does the Secretary of State agree that no benefit reduction should take place until people have at least been offered somewhere appropriately sized and located?”—[Official Report, 11 March 2013; Vol. 560, c. 22.]

The Secretary of State said, “I agree”. What has he done to deliver that?

[Mr Duncan Smith]

I remind my hon. Friend that we have given local authorities more than £300 million in discretionary housing payments. What they are meant to be doing right now—many of them are doing it, by the way—is finding people the accommodation that they require and supporting them through discretionary payments while they are looking for it. That is why we are saving £1 million a day and £500 million a year.

[Alison McGovern (Wirral South) (Lab)]

A constituent of mine, an older, experienced woman, recently told me that when she was made redundant she got barely any help from our local jobcentre. It was therefore no surprise to me to see recent figures showing that the Work programme is getting a job for only one in eight workers over 50. Who is going to fix that—those who are running the Work programme or Ministers?

--- Later in debate ---

[Ian Paisley (North Antrim) (DUP)]

Is the Secretary of State aware of the impending crisis to the stability of institutions in Northern Ireland as a result of the failure to implement significant reforms to the welfare system there? If he is aware of those threats, what message has he for Sinn Fein, which has failed to introduce those changes and appears to be more interested in the need of residents in Monaghan than those in Northern Ireland?

[Mr Duncan Smith]

Sinn Fein needs to face up to its responsibilities and cannot have it all ways. If it gets the welfare Bill through, it will benefit from the support that it will get, but it cannot sit in limbo land. I support what the hon. Gentleman has just said—it is time for Sinn Fein to get on and do what an elected Government need to do.

[Stephen Lloyd (Eastbourne) (LD)]

Will the Minister provide an update on when the decision on the moratorium on funding for deaf interpreters for Access to Work will be announced, because we have been waiting for a report from the DWP?

[Mr Duncan Smith]

Let me undertake to write to my hon. Friend as soon as I leave the House and give him the full details.

Universal Credit

Iain Duncan Smith Excerpts

Wednesday 9th July 2014 Commons Chamber

[Chris Bryant (Rhondda) (Lab)]

(Urgent Question): To ask the Employment Minister if she will make a statement on whether the Department for Work and Pensions’ business case for the implementation of universal credit has been approved by the Chancellor of the Exchequer.

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

In answering, let me lay out a couple of quick facts about where we are and then deal with the hon. Gentleman’s direct question.

Universal credit is a major reform that will transform the welfare state in Britain for the better, making 3 million people better off and bringing £35 billion of economic benefits to society. Rightly for a programme of this scale, the Government’s priority has been, and continues to be, its safe and secure delivery. This is demonstrated through our approach to date, which started with the successful launch of the pathfinder in April 2013 and has continued with the controlled expansion of universal credit.

On 5 December last year, I announced that universal credit would be rolled out to the north-west and expanded to couples from the summer of 2014, and would then expand to families later that year. That is exactly what is happening. A fortnight ago, we began our north-west expansion. Universal credit is now in 24 jobcentres and will reach 90 across the country by the end of the year. A week ago, we started taking claims from couples. This careful roll-out is allowing us, as we said we would, to learn as we go along, continuously improving the process—unlike so many of the programmes the previous Government instigated which crashed and burned.

In answer to the question, my Department has always worked, and will continue to work, closely with the Treasury on these roll-out plans. As we have made clear in a number of recent debates and answers to parliamentary questions, the Treasury has approved funding for the universal credit programme in 2013-14 and 2014-15, in line with the plan that I announced in December last year. These approvals are given by the Chief Secretary to the Treasury—such matters are delegated to him by the Chancellor—and are subject to rigorous controls, in line with the recommendations made last year by the National Audit Office.

It has always been the plan, as I set out last year, to secure agreement for universal credit in carefully controlled stages: first for singles, where we have agreed funding with the Treasury and are already rolling out in line with that agreement; then for couples, where we have agreed funding with the Treasury and are already rolling out in line with that agreement; and then for families, where we have recently secured agreement from the Treasury and will begin roll-out later this year. All this was confirmed by the Financial Secretary to the Treasury in an answer to a parliamentary question yesterday. That set of agreements confirms the approval of the strategic outline business case plans for this Parliament.

The final stage in this process, for which the logical point is now, has always been to approve and sign off the full business case covering the full, long lifetime of this programme, beyond this Parliament. We are in discussions over that, and it will eventually bring £35 billion of economic benefits to society. My right hon. Friend and I will, I am certain, approve that very soon.

[Chris Bryant]

That was a spectacular instance, as Sir Bob Kerslake might put it, of “beating about the bush”. It is a very simple question, to which the answer can only be yes or no: has the Department for Work and Pensions business case for the implementation of universal credit been approved by the Chancellor of the Exchequer? It is depressing that this Tory Minister and the Tory Prime Minister cannot tell the difference between an annual budget and a business case. It is pretty straightforward.

On 30 June, the employment Minister—who is disgracefully not answering for herself today—answered that question by saying:

“The Chief Secretary to the Treasury has approved the UC Strategic Outline Business Case plans for the remainder of this Parliament (2014-15) as per the ministerial announcement”.—[Official Report, 30 June 2014; Vol. 583, c. 434W.]

She was referring to the ministerial statement of 5 December, which explicitly runs up to 2017. On Monday, however, she had the carpet pulled from under her feet, as Sir Bob Kerslake answered exactly the same question with gratifying honesty, saying that

“it has not been signed off.”

It got worse yesterday when the Financial Secretary, answering the same question, said that all the Treasury has done is approve funding for the programme for another eight months, while a DWP spokesperson said that the Treasury has

“approved all funding to date”,

as if that was some grand vindication.

The same simple question has now been answered in eight contradictory ways. Not everybody can be telling the truth. There has been so much beating about the bush that it feels as if this House has been misled by a Government engaged in a deliberate act of deception. [Interruption.] The truth is that the Department is relying month by month on handouts from the national food bank. How ironic!

On 5 December 2013, the Secretary of State told the House that universal credit would bring

“a £38 billion economic benefit to society”.—[Official Report, 5 December 2013; Vol. 571, c. 65WS.]

I notice that he has just amended that figure to £35 billion. That figure is part of the business case. Has it been signed off by the Treasury, or is he just making things up?

The Secretary of State has told this House on 28 occasions that universal credit has always been on time and on budget; yet Sir Jeremy Heywood said on Monday that the Treasury and the Major Projects Authority had to tell the Secretary of State that his own project was “way off track”. When was he told that? Why did the Secretary of State not tell this House?

I will be honest: we would love to help the Secretary of State implement universal credit, but confession comes before redemption, and as long as he remains in denial he remains beyond help. I ask him once again to be straight with the House: has the business case—the business case, not the budget—for universal credit, which he says will come to fruition in 2017, been signed off—yes or no? [Interruption.]

[Mr Speaker]

Order. Just before the Secretary of State replies, I listened very carefully to what the hon. Gentleman said. He made no personal attack on any one individual. [Interruption.] Order. I will deal with this—the hon. Gentleman will have to accept my ruling, whether he likes it or not. The hon. Gentleman made no personal attack on any individual Minister, but my judgment, having heard him out, was that he went beyond the line in making an accusation of deliberate deception against a group of Ministers. [Interruption.] Order. I know what I am doing and I certainly do not require any help from the Education Secretary—that would be completely unimaginable. I ask Members to have regard to the way in which they express themselves. The point has been made, the situation is clear and the Secretary of State can now reply.

[Mr Duncan Smith]

The hon. Member for Rhondda (Chris Bryant) made the most pompous, ludicrous statement I have ever heard. I know what he did: he wrote it down before he heard the answer. I have made it quite clear and I stand by what I said: the strategic outline business case plans for this Parliament have been approved. The Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Wirral West (Esther McVey) made that clear the other day, and that is the statement that we stand by.

The next phase, as I said in my statement—the hon. Gentleman might like to listen to them in future—is approved. On the strategic outline business case for the overall lifetime of the programme, that is being discussed right now and we expect approval of that plan shortly. I have said categorically that all the expenditures and the work in this Parliament are approved. The reality is that it is approved. The point he needs to get round his head is that, on the figures he gave earlier—the billions—the National Audit Office, the Public Accounts Committee and the Work and Pensions Committee agree that we need careful controls in place. It is therefore natural that we have sought that approval at each stage. My right hon. Friend the Chief Secretary has approved all of those elements.

I know what this is all about. The truth is that this is about Labour’s failure to come to terms with welfare reform. We had a debate a week ago in which Labour crashed and burned, and we have an urgent question today. Labour Members want to avoid the reality that the Government’s welfare reforms are working and getting more people back to work. We have capped benefits so that no household can receive more than people who are in work. There are more people in work than ever before. Under Labour, youth unemployment increased by nearly a half; under this Government, the youth claimant count has fallen for the past 30 months. The rate of workless households is at its lowest since records began.

I say to the hon. Gentleman and the Labour party that this is the best instance of a man in an ill-fitting anorak dancing on the head of a pin. It is quite pathetic. He needs to think again about welfare reform.

[Mr Philip Hollobone (Kettering) (Con)]

Does my right hon. Friend agree that the very worst example of how to change any tax and benefits system was the introduction of tax credits by the previous Government, when more than £6 billion of overpayments were made within just the first three years?

[Mr Duncan Smith]

Absolutely. The Labour Government—the Labour party needs to own up to this—used to sign off business cases from day one, only to see the programme crash and burn. Tax credits left 400,000 people without money, and their reforms to the health service benefits system were an absolute disaster. We will take no lessons from Labour on how to manage a programme.

[Margaret Hodge (Barking) (Lab)]

As Chair of the Public Accounts Committee, I support the intent of the policy, but I have repeatedly sought assurances on the status of universal credit. On Monday, I asked Sir Jeremy Heywood, Sir Nick Macpherson and Sir Bob Kerslake four times whether the business case had been signed off by the Treasury. There were a number of unscripted pauses, but Sir Jeremy told us:

“I cannot speak for the Treasury.”

Sir Nick Macpherson told us:

“It is signed up, up to a point”,

before Bob Kerslake finally admitted:

“I think we should not beat about the bush. It has not been signed off.”

I plead with the Secretary of State that he should be open and honest with hon. Members rather than hide behind smoke and mirrors to create a false impression that universal credit is on time, in budget and delivering in full its intended objectives.

[Mr Duncan Smith]

I respect the right hon. Lady enormously for the job she does, but I say to her clearly that it was on the recommendations of her Committee and the NAO that we instigated—by the way, I think this is the way ahead for all future programmes—a programme in which, at every stage and in every separate part of development, we would have approvals from the Treasury and with the Cabinet Office, which is what is going on at the moment. My point is that the answer that Mr Kerslake, the head of the civil service, gave was correct in the sense, as I have said today, that the overall strategic business case for the full lifetime of the programme is in discussion right now for that completion. However, all the elements that are relevant—the strategic business plan for this Parliament, which includes all the roll-out, all the investments, of which the right hon. Lady will be aware, and the roll-out through to the north-west—have been approved. There will be no further need for approvals this Parliament, so the reality is quite clear: universal credit is on track and is rolling against the plan we set out last year. All those approvals are agreed, and we hope that the final element, which would logically come at the end of the process, will be agreed shortly with the Chief Secretary.

[Nigel Mills (Amber Valley) (Con)]

The Secretary of State has me convinced about the benefits of universal credit, but will he consider publishing the business case so that the House and the public outside can see the full benefits?

--- Later in debate ---

[Mr Duncan Smith]

I am quite happy to deal with that. I have also said to the Chair of the Work and Pensions Committee that we are happy to talk through that. We have an invitation from the Committee to come in and discuss it.

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

In April, the Work and Pensions Committee published a report on the progress of universal credit implementation, which said:

“DWP told us that it intended to clarify the impact of the changes to the implementation timetable on the overall costs and savings of the programme in the revised Business Case for Universal Credit, which it has now presented to the Treasury. We recommend that DWP makes its revised Business Case available to this Committee.”

Just two weeks ago, we got the Government response, which said that, no, they would not give us sight of the business case, but that some officials might talk us through it. For my Committee to be able to do our scrutiny role properly, that is not good enough. I join my colleague on the Select Committee, the hon. Member for Amber Valley (Nigel Mills) in making this plea: why will the Secretary of State not make the revised business case available to the Select Committee?

[Mr Duncan Smith]

I have said to the hon. Lady that we are happy to sit down to discuss this matter with her. I remind her that no other Government have ever published business cases, but I am happy to consider what she asks.

[Mr Mark Hoban (Fareham) (Con)]

Does my right hon. Friend agree that Opposition Members today have focused on process because they do not want to confront the reality that the welfare reforms that we have implemented successfully have helped to tackle unemployment—they have got more people into work—and that universal credit is essential in making it clear to people that work pays?

[Mr Duncan Smith]

My hon. Friend is absolutely right. The reality is that our welfare reforms are working, and our pensions reforms are working. The truth is that the Opposition have absolutely nothing to say about any of this. Instead, they want to delve and delve into the detail, but that will not tell them anything. Universal credit—started by this Government—will be a great success: it will get more people into work, and it will secure more households with greater earnings.

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

The head of the home civil service clearly has reservations about the full business case for the roll- out of universal credit. Which of those reservations has he expressed to the right hon. Gentleman?

[Mr Duncan Smith]

The head of the home civil service has expressed no reservations, and I do not believe that he has any reservations about these plans. As agreed, the plans will be signed off with the Chief Secretary to the Treasury, and when they are signed off, I hope that the hon. Member for Rhondda will write me a letter to say, “Thank you very much, indeed.”

[John Hemming (Birmingham, Yardley) (LD)]

Does the Secretary of State agree that the Opposition would do a better job if, rather than asking picky bureaucratic questions, they focused on whether universal credit will improve pay for low-paid people and ensure that work pays?

[Mr Duncan Smith]

My hon. Friend is absolutely right. The problem for the hon. Member for Rhondda is that his Government left behind a shambles in welfare—people unemployed, long-term unemployment rising, and youth unemployment rising dramatically—and there has never been an apology about that, or about crashing the economy.

[Sheila Gilmore (Edinburgh East) (Lab)]

The Secretary of State’s problem is that on numerous occasions over the past three or four years he has given the House and the Select Committee on Work and Pensions different versions of events. He told us that the project was on track and on budget, and he stated to the Select Committee in February that the business case would be approved by April. What is actually going on with universal credit? In what sense is what people are claiming any different from jobseeker’s allowance? Does he know what happens to people whose circumstances change, and is this really universal credit at all?

[Mr Duncan Smith]

I do know, actually. As we go along, we are developing universal credit correctly and stably, so that it rolls out properly. To repeat, we are rolling it out for singles in the whole of the north-west; couples development is now rolling out; and family developments are to come. Towards the end of this year, we will have rolled out universal credit to the north-west. I must say that that is the right way to do it: to make sure that what we produce is safe and delivers what we say it will, unlike tax credits and other problems that we got from the previous Government. I would like to know what the hon. Lady really thinks about the failure of her Government to deliver any programme correctly or safely.

[Stephen Barclay (North East Cambridgeshire) (Con)]

Does my right hon. Friend agree that there is a central contradiction in the figures from the Opposition? When the PAC last looked at this issue, the Labour Chair said:

“We believe strongly that meeting any specific timetable…is less important than delivering the programme successfully.”

Is it not right that we learn the lessons of the programmes that went wrong under the last Government, and that we get the programme right, rather than rush it?

[Mr Duncan Smith]

That is exactly correct. That is why, when the right hon. Member for Barking (Margaret Hodge) stood up, I explained to her that we are now doing what the Committee asked for. We are rolling out universal credit carefully: at every check, we make sure with the Treasury and the Cabinet Office that what we are producing works, and the next phase is then approved. We have approved all the roll-out plans for this Parliament, as was said by the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Wirral West. The strategic plan for this Parliament is exactly what the Chair of the PAC asked for, so we are giving her what she wants.

[Hywel Williams (Arfon) (PC)]

Does the business plan include delivering universal credit in Wales through the medium of Welsh, and if so, is that on track and on budget?

[Mr Duncan Smith]

The plan does include that. As the hon. Gentleman may or may not know, we are working on that to make sure it is deliverable, but the key is that we absolutely plan to do that.

[Charlie Elphicke (Dover) (Con)]

May I urge the Secretary of State to reject the representations of Labour Members? When it comes to universal credit, all they have done throughout is seek to promote welfare over work at every turn. What will be the savings to the Exchequer and the benefits to the UK when it has been fully rolled out?

[Mr Duncan Smith]

The NAO has come out with the figure of £35 billion, which I cited earlier, but the point is that I believe that universal credit is worth more than that. As well as the planning and implementation process, the work we are currently doing will also evaluate the net benefit to the Exchequer and taxpayers, which I believe will be even higher.

[Derek Twigg (Halton) (Lab)]

The Secretary of State goes on about his record on benefits, but I remind him about the disaster of his PIP—the personal independent payment. Have Treasury Ministers or officials at any time expressed concerns about the financial viability of the business case to him, his Ministers or his civil servants?

[Mr Duncan Smith]

No.

[Henry Smith (Crawley) (Con)]

Will my right hon. Friend confirm that the forecast savings to the taxpayer are about £100 million in this financial year, and will be about £200 million in the coming tax year?

[Mr Duncan Smith]

I can confirm that.

[Sammy Wilson (East Antrim) (DUP)]

The confusion around the business case will give succour to those in Northern Ireland who have blocked welfare reform and cost the Northern Ireland economy millions of pounds. Will the Secretary of State give us some indication of whether discussions on the business case to date have shown any reasons why there might not be a further roll-out of universal credit as he has planned, so that we can argue back against those in Northern Ireland who say that we should wait to see the full picture in England and Wales before doing anything in Northern Ireland?

[Mr Duncan Smith]

There have not been any such discussions, and I hope that he will take that argument back to his counterparts in Northern Ireland and try again to persuade them that the full welfare reform package will benefit Northern Ireland dramatically, as will the universal credit part of that reform.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

It is worth remembering that the tax credit disaster meant that £6 billion was overpaid in the first three years of its operation. Does my right hon. Friend agree that when implementing so crucial a change, it is right and proper to take time and to implement it stage by stage?

--- Later in debate ---

[Mr Duncan Smith]

What my hon. Friend says is exactly the point I have been making, but which Opposition Members just do not understand. There were too many disasters under their watch; we do not intend to repeat them. We are doing the implementation exactly as the PAC and the NAO recommended.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Once again, I am absolutely staggered at the Secretary of State’s hubris; there are more cover-ups, and everybody else is to blame apart from the Secretary of State. This has been an absolutely unmitigated disaster. UC is dead in the water, and he should go.

[Mr Duncan Smith]

That is pretty much what the hon. Lady says whenever she stands up on any question to do with welfare. The reality is that she is opposed to absolutely everything that we have done. If it was left to her and some of her colleagues on the Select Committee, they would repeal everything we have done, and welfare would be in the sort of chaos that Labour Members left us when they left Government.

[David Mowat (Warrington South) (Con)]

The Secretary of State may have seen Labour’s recent four-point plan for universal credit. Points 3 and 4 amount to significant uncosted scope increases, with no benefits applied to them. Given that, does he agree that it might be better for Labour to stay off the whole subject of business cases?

[Mr Duncan Smith]

I agree with my hon. Friend. The truth is that the Opposition do not want to talk about any of their welfare proposals because all of them would cost more money and deliver less. If we were to apply a business case to the Opposition, they would not exist any more.

[Ann Clwyd (Cynon Valley) (Lab)]

Will the Secretary of State look at the interesting report by Sheffield Hallam university on the state of the coalfields? It shows that although the welfare reforms might be working in some parts of the country, they are certainly not working in Wales. In the south Wales area that I represent, the share of pensioners living in poverty is about double that in the south-east of England. Welfare reform is anticipated to have a more substantial impact on the average financial loss per adult of working age in south Wales than across Britain as a whole. It is important to look at the variations within the UK, and I would be grateful if he gave them some attention.

[Mr Duncan Smith]

The right hon. Lady knows that I respect her hugely. I am very happy to look at the points that she raises. In Wales, we inherited a peculiarly difficult problem. There were very high levels of unemployment and a very high number of people on incapacity benefit. I believe that our reforms are working. We have seen unemployment fall dramatically and employment levels rise in Wales. Is there more that we can do? Absolutely. My door is open and I would be very happy to discuss anything that she thinks we could do.

[Richard Graham (Gloucester) (Con)]

The hon. Member for Rhondda (Chris Bryant) suggesting that he would like to help the Secretary of State implement universal credit is a bit like his friend, President Putin, offering to help the Ukrainians with their elections—and, I should think, almost as welcome. Does my right hon. Friend agree that when the business case has been signed off, we can get back to what really matters, which is discussing how we can allow my constituents who are offered jobs to work as many hours as they like without having to worry about whether they will lose more in benefits than they will gain in salary?

[Mr Duncan Smith]

My hon. Friend is exactly right. That is what universal credit will deliver, and that is why delivering universal credit safely and securely is the key to the plan. The approvals have been signed off. All the work that is being done in this Parliament is approved by the Treasury, and the long-term strategic business case should be approved very shortly as well.

[Yvonne Fovargue (Makerfield) (Lab)]

Free school meals are an incredibly important part of the benefits system. A number of teachers have said that some children come back after the summer break noticeably thinner. The Secretary of State promised an announcement on which universal credit recipients would be entitled to free school meals by summer 2011. What is the reason for the long delay, and when will that announcement be made?

[Mr Duncan Smith]

The Department for Education is making a decision about the best way to deliver free school meals. People who are eligible for free school meals will be eligible for them under the new arrangements. This is an opportunity to ensure that all those who really need free school meals actually get them. There are often problems in the existing system, so this is an opportunity to reform the system to improve the take-up and the accuracy.

[Mr Peter Bone (Wellingborough) (Con)]

We have seen Parliament at its best over the past two days. There were a couple of points of order yesterday and there is an urgent question today. I say gently to the shadow Minister, who is one of the best shadow Ministers, that he went over the top. The Secretary of State has come to the House and answered the question. It is a shame that the shadow Minister did not listen to the answer before commenting. Does the Secretary of State not think that he has one of the best teams in Parliament, and that his Ministers are of the highest integrity? If one of them had made a mistake, they would have come to the Dispatch Box and apologised.

[Mr Duncan Smith]

The Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Wirral West, and others have not made mistakes. We have been crystal clear about this matter. I stand by the words that have been used and the statements that have been made, as I said earlier. The hon. Member for Rhondda normally does not listen, but just says what he was going to say, regardless of the answer. I suspect that a conversation with him is a very one-way process.

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

I have been absolutely staggered to hear the Secretary of State defending a system that, as I have heard repeatedly at the Public Accounts Committee, has had very poor planning from day one and at subsequent stages. We are glad that there is a plan to get it back on track, but let us get back to the real question. The Minister of State, Department for Work and Pensions, the right hon. Member for Wirral West (Esther McVey), came to this House and said that the business case had been signed off. Either she is not on top of her brief or she was misleading this House, neither of which inspires confidence.

[Mr Duncan Smith]

I will give two answers. First, the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Wirral West, stated what is factually correct: that the strategic business plans for this Parliament have all been approved. That is an absolute fact. Secondly, it was I who was not happy with the way the development was taking place nearly two years ago, and who instigated the first process through my red team report. That is correct and I stand by that. Working with the Cabinet Office, we changed the plan. The plan is now being delivered exactly as the Public Accounts Committee, on which the hon. Lady sits, wanted us to deliver it, with all the necessary checks and balances. I would have thought, therefore, that she would congratulate us.

[Guy Opperman (Hexham) (Con)]

Companies in the north-east provide some of the computer and IT support for universal credit, providing welcome jobs there. I have met the staff at those institutions, and they are committed to the project, which is getting people back into work and training, and they are supportive of the slow, careful and measured way in which we are rolling out universal credit, which, after all, is something that the whole House supports.

[Mr Duncan Smith]

Again, we hear reason from the Government Benches. My hon. Friend is absolutely right. It is necessary to roll out the programme carefully so that it works, and so that we do not end up, as we did with tax credits, with 400,000 people not getting any money and going off to food banks and getting food parcels. That is the shambles that the Labour party created. We will not repeat it.

[Jonathan Ashworth (Leicester South) (Lab)]

The Secretary of State said a moment ago from the Dispatch Box that we should be congratulating him. I remind him that only a few months ago his Cabinet colleague, the Paymaster General, was giving television interviews saying that the implementation of universal credit had been “lamentable” and that a lot of money had been “wasted”. We have also learned of friction between the Cabinet Office and the Department for Work and Pensions over the withdrawal of the Government Digital Service. Leaked documents at the time said that the DWP might not be

“able to obtain the skills required to replace GDS within the current market at affordable cost”.

Will the Secretary of State tell us how much additional taxpayers’ money has been spent on IT support systems since the GDS was withdrawn?

[Mr Duncan Smith]

There is no additional money. All the money has been budgeted for. The hon. Gentleman said that we would not be able to hire people; we have hired a dramatic number of digital experts. They are working in the Department right now to develop the digital option. He is more than welcome to come and see them and talk to them if he likes. The door is open; we have nothing to hide. If he does accept that invitation, perhaps he will also persuade his hon. Friends to visit the IT. They do not want to visit it because they are pretending that it does not work.

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

When my hon. Friend the Member for Harrogate and Knaresborough (Andrew Jones) and I went to the Harrogate jobcentre recently, universal credit recipients were passionate about the confidence that the new scheme is giving them to get a job, and recruiters were persuasive about how it is making it easier to place people in jobs. Will the Secretary of State ignore the hue and cry from the Labour party and focus on the benefits that universal credit is bringing to the lives of real people?

[Mr Duncan Smith]

I always make it my priority to ignore the nonsense that comes from the other side. The Opposition live in la-la land when it comes to the welfare reforms. My hon. Friend is absolutely right that this is about real people who are trying to get back to work. We are delivering for them right now, and we will deliver even more when universal credit arrives safely and securely.

[Ian Lucas (Wrexham) (Lab)]

On Monday, I received an e-mail from the Secretary of State’s office telling me that he would be visiting Wrexham on Monday afternoon. Every week, I meet constituents in Wrexham who are suffering from his incompetence. The only person who is running away from conversations about benefits is the Secretary of State. Will he meet me to hear what is happening in Wrexham in respect of personal independence payments, universal credit and all the other benefits that are falling apart?

[Mr Duncan Smith]

I accept that the hon. Gentleman needed to plan that statement. I did visit Wrexham the other day and the jobcentre there. It has a phenomenally dedicated group of people who are doing brilliantly. As a result, unemployment levels in his area are falling. They are falling as a direct result of the welfare reforms that we have brought in. I only wish that he had said the same thing to the last Government. My door is always open. If he wants to come and talk to me about any problem, I will be very happy to see him.

[Mr Christopher Chope (Christchurch) (Con)]

May I thank my right hon. Friend for the open and frank way in which he has responded to questions about the business plan? Does he agree that the Opposition’s role in questioning business plans is important, and would he like to encourage them to be a bit more zealous in questioning the business plan for High Speed 2?

[Mr Duncan Smith]

My hon. Friend always tries to tempt me, but I will resist that temptation and say that he needs to raise that matter with other Ministers who will no doubt come to the Dispatch Box.

[Mr Speaker]

Plenty of people raise it with me, including people who live in Swanbourne.

--- Later in debate ---

[Clive Efford (Eltham) (Lab)]

The Secretary of State needs to understand that when we ask questions in the House, we expect frank, honest and accurate answers from the Government, but that is not what we have had. He suggests that Sir Bob Kerslake did not know what he was talking about when he gave his answers to the Public Accounts Committee. Will Sir Bob Kerslake correct the record, or are we being misled again?

[Mr Duncan Smith]

I have been absolutely clear—I do not think I could have been clearer—that the strategic business plans for this Parliament have all been approved. [Interruption.] Would the hon. Gentleman like to let me finish? What Sir Bob Kerslake was referring to was the overarching full roll-out, including the years beyond this Parliament. I have already said that I and the Chief Secretary to the Treasury are about to finalise that, as approved.

[Mark Durkan (Foyle) (SDLP)]

The Secretary of State has to accept that there have been valid concerns behind all the questions that have been asked about the feasible delivery of universal credit. There is also real confusion about the differing answers that have been given. Those concerns extend to Northern Ireland, where people are concerned about the implications for hard-pressed families and for local and regional economies. Given the question mark against the overall business case, is it right for the Assembly to be brow-beaten by the Treasury, through threats of cuts to other budgets, into passing the karaoke Bill that would legislate for universal credit?

[Mr Duncan Smith]

I believe that the welfare reforms that the Assembly is being asked to pass, which include universal credit, are right. They are already delivering for the rest of the UK, and I believe that there will be net value to Northern Ireland when it rolls them out. I hope that it gets on and does it, and universal credit will be part of that.

Bill Presented

Local Government (Independence) Bill

Presentation and First Reading (Standing Order No. 57)

Chris Ruane, on behalf of Mr Graham Allen, presented a Bill to define the independence of local government; to regulate the relationship between local and central government in England by means of a statutory Code; to require public authorities to act in compliance with the Code; to provide that the Code may only be amended by means of an Order under the super-affirmative procedure, approved unanimously by each House of Parliament or by a majority in each House equal to or greater than two-thirds of the number of seats in each House; to exclude any Bill to amend this Act from the provisions of the Parliament Act 1911; to make provision regarding the powers and finances of local government in England; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 5 September, and to be printed (Bill 72).

DWP: Performance

Iain Duncan Smith Excerpts

Monday 30th June 2014 Commons Chamber

[Rachel Reeves]

I have already given way to the hon. Gentleman, so, no, I will not.

I know that many hon. Members will have similar stories to tell today, and I hope the Secretary of State stays to listen, because when we write to the Department with our constituents’ problems we only ever get replies from the correspondence unit. I realise that the Secretary of State is probably deluged with letters raising problems.

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

I am sorry, but I just cannot agree with that. Every letter from a member of the Privy Council gets replied to by me, and every other Minister replies to every single other Member of Parliament’s inquiry. If the hon. Lady is now insinuating that we do not, perhaps she could demonstrate why.

[Rachel Reeves]

Well, I will send the Secretary of State all the letters I have had from his correspondence unit, not one of them signed by him. [Interruption.] Well, letters that I have written to the Department about the challenges facing—[Interruption.] The right hon. Gentleman says he replies to these letters; he has not written a single letter to me about—[Interruption.]

--- Later in debate ---

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

I welcome today’s debate. We have waited and waited for a debate on welfare in Opposition time, yet today we see a cynical motion from a cynical party, pandering to their unions and chasing media headlines. They have cynically avoided the topic of welfare reform, missing the real point, which is the impact and success of what we are delivering. More people are in work than ever before, with the figure up 1.7 million. More people are in private sector work than ever before, with the figure up more than 2 million. Unemployment and youth unemployment are lower than the Opposition left them at the last election, and workless households are at the lowest rate since records began.

The Department processes 7.4 million claims successfully, issues more than £680 million in payment to 22 million claimants and carries out more than 24 million adviser interviews. To date, since we introduced the efficiency programs, call volumes have been at their lowest level, as have complaints. We have seen record debt collections of more than £2 billion—and, by the way, debt is lower than the figure we were left—as well as record online claims. At the same time, we have saved £2 billion from the Department’s baseline spending compared with 2009-10—

[Several hon. Members]

rose—

[Mr Duncan Smith]

I am going to make a little progress, as you have told me that we need to, Madam Deputy Speaker. I will give way later.

Let me repeat that: £2 billion has been saved from the Department’s baseline expenditure compared with 2009-10, when the previous Government left office. Let me give two examples of where, when we came into office, there was ridiculous, excessive and personal waste. When I walked through the door, I found that the previous Government and their Ministers had had six cars and six drivers sitting permanently inactive, costing more than £500,000. We have reduced that to one pool car used by all of us, or we get taxis or the tube—

[Several hon. Members]

rose—

[Mr Duncan Smith]

I will give way in a second.

Equally, under Labour the DWP spent £13 million on first-class travel. I honestly wonder whether anybody wanted to see them that much more quickly as they got off at the other end—I doubt it. We have banned that.

[Huw Irranca-Davies (Ogmore) (Lab)]

Will the Secretary of State give way?

[Mr Duncan Smith]

I will give way in a second; I want to set out the ground rules. The motion contains no mention of those efficiencies or achievements, no suggestion of what Labour would do and—there is no better illustration of how cynical the Opposition are—no admission of the shambles they left behind. The economy was at breaking point, £112 billion had been wiped off our GDP and we were burdened with the largest deficit in peacetime history. Welfare bills were completely out of control. Housing benefit alone had doubled, contributing to overall spending increasing by 60%. The benefits system was in meltdown, with a mess of 30-plus benefits that meant that work simply did not pay.

Under Labour, the safety net had become a trap—

[Ian Lucas]

Give way.

[Mr Duncan Smith]

At its peak, 5 million people on out-of-work—

--- Later in debate ---

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Mr Lucas, the Secretary of State is not giving way. Do not shout.

[Mr Duncan Smith]

I said that I will give way, Madam Deputy Speaker, but I wanted to set out the successes of this Government against the nonsense of the Opposition’s debate.

At its peak, when I walked through the door, our inheritance was 5 million people on out-of-work benefits, a million of them for more than a decade. Youth unemployment had increased by nearly half and long-term unemployment doubled in just two years. One in five households was workless and the number in which no one had ever worked almost doubled.

[Ian Lucas]

I am grateful to the Secretary of State for giving way. I want to talk about incompetence on his part. Every week, people come to my surgery who cannot have their personal independence payment claims processed. Will he take some responsibility and apologise to them for the incompetence of his policy and his Department?

[Mr Duncan Smith]

We take full responsibility for ensuring that that benefit is rolled out carefully, so that when we do the full national roll-out of the whole benefit, we will know that it works. We have made a series of adjustments and also have more recruitment going on and more staff going in. I will give some pointers about where we will be when I return to this point. I simply say to the hon. Gentleman that when Labour rolled out tax credits, more than 400,000 people failed to get their money and the Prime Minister had to make a personal apology. I do not want to repeat that in this case. I want to ensure that those most in need will get the benefit.

[Margot James (Stourbridge) (Con)]

Amid the litany of failures of the previous Government, which my right hon. Friend was recalling, and their dreadful legacy in this area, does he remember that of all the new jobs that the property boom-fuelled growth generated, three quarters or more went to foreign nationals? Is that not a circumstance which this Government have reversed entirely?

[Mr Duncan Smith]

My hon. Friend is absolutely right. Well over 70% of new jobs now go to British nationals, as opposed to 90% that went to foreign nationals before.

I want to repeat the figures: there were 5 million on out-of-work benefits, youth unemployment increased by nearly half, long-term unemployment doubled in just two years, and one in five households—it is worth stressing that—was workless, and the number of households where no one had ever worked almost doubled under Labour. Now, as the Opposition themselves seemed to admit over the weekend, as I noticed in the papers, they have no plans, no policies and no prospects—only, as the hon. Member for Dagenham and Rainham (Jon Cruddas) put it put rather succinctly, an

“instrumentalised, cynical nugget of policy to chime with our focus groups and our press strategies and our desire for a top line”.

I agree. Today’s debate is just that—a cynical nugget of short-term policy to put to the unions.

--- Later in debate ---

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order.

[Mr Duncan Smith]

No one ever complains about someone raising issues to do with their constituents. That is what we are all here for. However, instead of scaremongering, we deal with these points. I do not say for a moment that what we are trying to do is anything but difficult. We are trying to reform a system that was in many senses broken. It was not delivering money to key people. DLA was, by common agreement, not doing what it was meant to do. The delivery times that the hon. Gentleman talks about are out of date. As regards terminally ill people, nobody should wait for more than 10 days under the PIP programme. That is happening.

[Several hon. Members]

rose—

[Mr Duncan Smith]

I want to move on, but I shall give way to one of my hon. Friends.

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

Does it surprise my right hon. Friend that the shadow Minister made no mention of the 80 constituents who have benefited in her constituency from the new enterprise allowance, creating successful new businesses? There was no mention of them in her speech.

[Mr Duncan Smith]

No, that does not surprise me. The purpose of today’s debate is to avoid anything to do with welfare reform and just pick away at issues that the Opposition think will get them some kind of coverage. That is the cynicism that the hon. Member for Dagenham and Rainham was talking about.

[Several hon. Members]

rose—

[Mr Duncan Smith]

I want to make a little more progress and highlight a couple of programmes. First, let me deal with the issue that shows the cynicism of the Opposition more than anything else—the issue that the hon. Member for Leeds West (Rachel Reeves) did not want to raise, child maintenance, the enforcement commission and the Child Support Agency, on which the Opposition have remained silent. When we came into office, £500 million had been wasted on scrapped IT, including £120 million on a botched rescue scheme. I notice that the Opposition now want a rescue scheme for universal credit. At that rate—£120 million lost—we do not need any of their rescues.

On child maintenance, 75,000 cases were lost in the system. There were no effective financial arrangements at all for more than half the children. The IT system cost £74 million a year in operating costs alone, even as the number of expensively managed clerical cases hit 100,000. [Interruption.] Instead of becoming his party’s megamouth, the hon. Member for Rhondda (Chris Bryant) needs to keep a little quieter and listen to reality. It was his party that made a shambles of the IT introduction when it was in government.

As the NAO has confirmed, our phased roll-out is ensuring that we have a new, efficient system that works: 60% more parents than we expected are paying directly; processing procedures are down, from an overall 21,000 to 450; and we expect savings of £220 million a year once it is complete.

[Emily Thornberry]

I just want to make sure that I understand correctly what the right hon. Gentleman has said. I believe that he has just given an undertaking to the House that work capability assessments will be done in 10 days. [Interruption.] He has not given that undertaking. I wrote to the Department about a constituent who applied for PIP on 19 November, and I received a letter on 18 June telling me that it did not have a time scale for when he would get his work capability assessment.

[Mr Duncan Smith]

I was referring to PIP and the fact that the terminally ill will not have to wait longer than 10 days to be seen. I think that the hon. Lady is referring to WCA. They will go straight to the support group. [Interruption.] Well, I have given an undertaking that they should not have to wait more than 10 days to be dealt with.

[David Mowat (Warrington South) (Con)]

My right hon. Friend mentioned the shadow Secretary of State’s four-point rescue plan. Part 1 is a three-month delay, which would lead to a write-off. Parts 3 and 4 include scope increases, which at this phase in the programme would be bound to cause further write-offs. That is precisely why Labour lost £20 billion in the previous Parliament.

[Mr Duncan Smith]

I am grateful to my hon. Friend, who is right about that, and I will come to that point in a minute. That is what happens in the development process. Universal credit is rolling out against the time scale I set last year, as I will demonstrate.

[Andrew Bridgen (North West Leicestershire) (Con)]

On behalf of my constituents, I want to thank the Secretary of State for all the excellent and essential work he is doing on welfare reform and for the part his Department is playing to deliver the Government’s long-term economic plan, which has seen unemployment in my constituency fall by 40% and youth unemployment fall by 50% over the past 12 months.

[Mr Duncan Smith]

What an excellent intervention. It is a testing one, but I will try to live up to it.

Let me move on to universal credit. Across all 44 programmes of change in the Department, we are taking a careful and controlled approach to achieve a safe and secure delivery. For example, the benefit cap started with an early roll-out and is now fully implemented, seeing 42,000 households capped and 6,000 move into work. Universal credit is on track to roll out safely and securely, against the plan I set out last year. The hon. Member for Leeds West quoted a figure of £12.8 billion but, as ever, shows a poor grasp of the finances. We have always been clear that universal credit’s total budget is £2 billion, and we will not overspend.

Furthermore, we have taken decisive action so as not to repeat the way in which programmes were rolled out under the previous Government. The reset will avoid the “big bang” concept that they put forward at the last election. They did a number of things that led them to have to write off huge sums of money. For example, their benefit processing replacement programme was not even introduced; it was just scrapped after £140 million had been wasted on IT that could never be used. Lectures about money that has to be written off with nothing to show for it should be directed at them, not us.

We have introduced the pathfinder in order to test and learn. We are now rolling it out, as I announced the other day, to 90 jobcentres across the north-west, and that process will be completed in the autumn. Furthermore, I have announced that, from today, new universal credit claims for couples will be rolling out into the live status, and claims for families will follow that roll-out. That will complete universal credit’s roll-out in the north-west, as we set out last year.

On the digital solution, nothing offers clearer proof that the existing live service works. It is delivering universal credit and will continue to do so. As I have always said, the majority of the existing IT will continue to be used, even as we develop the final element, which is the digital service, using all that equipment. It is about an end-state solution—fully online, fully secure and responsive to all digital threats—enhancing what we have already built. Universal credit will roll out on time, and it will deliver what we have said it will deliver—at least £38 billion in net benefit to the Exchequer.

[Sheila Gilmore]

I wonder whether the Secretary of State can explain what an “end-state solution” actually is, or what it will mean, and why he did not properly test PIP, which had only a two-month pilot, meaning that every applicant is now a guinea pig?

[Mr Duncan Smith]

I think that I have been pretty clear about the end-state solution. It is universal credit completely delivering to everybody in the UK. That is the end-state solution—live, online and fully protected. Perhaps I need to spell it out to the hon. Lady again. On PIP, I will simply say that we did not rush it. We have kept control of the level and scale of the roll-out. As we have learnt what the difficulties are, we have made changes, working with the providers. I will demonstrate in a moment that we are driving those numbers down to reasonable levels, as expected.

[Guy Opperman]

Government Members welcome the rise in job numbers, which have improved by 30%-plus in Hexham. I also welcome the transformation in universal credit, which is fixing a broken system. The pathfinders, the pilots and the reform are necessary and we must stick to our guns. My right hon. and hon. Friends are behind the Secretary of State.

[Mr Duncan Smith]

I thank my hon. Friend.

[Joan Walley (Stoke-on-Trent North) (Lab)]

Can the Secretary of State tell me how in touch he is with those people who have wasted over six months waiting for PIP? What are we to say to our constituents when they cannot get an answer from his Department? Where is his humility and his accountability? How is he dealing with this?

[Mr Duncan Smith]

First, no wait that is not in accordance with the time it takes to do these assessments is acceptable. We are driving those down. For anybody who has been waiting, I accept that for them it is a personal tragedy. We want to change that, which is what we are doing. That is why we are doing it in this way, and I will come back to that point with some figures later. The point is that we introduced the changes with PIP because ultimately it will be a better system than DLA. Many people did not get the kind of service they needed under DLA, and that is the purpose of PIP.

[Joan Walley]

rose—

[Mr Duncan Smith]

I will come back to that point in a moment, but first I will make some progress.

[Gareth Johnson (Dartford) (Con)]

Will the Secretary of State give way?

[Mr Duncan Smith]

Okay, but then I must make some progress.

[Gareth Johnson]

Does the Secretary of State agree that the most effective way of getting people out of poverty is by ensuring that they achieve employment? To that end, is he aware that not a single Labour Government, from the time they took office to the time they left, have ever reduced unemployment? I therefore urge him to stick with his policies.

[Mr Duncan Smith]

I am grateful to my hon. Friend. I will return to the matter of unemployment later, but the reality is that we are driving unemployment down and employment up. Youth unemployment and long-term unemployment are falling as a result of this Government’s actions.

[Several hon. Members]

rose—

[Mr Duncan Smith]

I will make a little progress, because I am conscious that many Members wish to speak.

With regard to employment and support allowance, I make no secret of the fact that the process of reform is challenging; I have said so from the word go. There will always be issues when dealing with such delicate matters, but the question of how we deal with them and what lessons we learn is important. Let me remind the House that the previous Government, with our support—I thought that they were moving in the right direction—introduced the WCA, but the contract was a very difficult one. To break it arbitrarily would have cost over £30 million. What we saw at the beginning, and then had to change, was some very harsh decision making, particularly in relation to those with cancer and mental health conditions. Some 200,000 cases were then locked in the system in a growing backlog, and there were a very high and rising number of appeals. In fact, the previous Government had to increase spending on appeals by 1,500% at the time.

We have taken decisive action to deliver improvements. There have been four independent reviews, which have accepted over 50 Harrington recommendations. There is now an easier route into the support group for cancer sufferers, and there are three times more people with mental health conditions in the support group than there were in 2009. We ended the Atos contract a year early, with a significant sum paid back to the Department by Atos. More than 1.35 million incapacity benefit claimants have gone through the reassessment process, and 720,000 more people are now preparing or looking for work. Furthermore, appeals against ESA decisions are down by just under 90% and we are bringing in a new provider. The hon. Member for Leeds West pressed me about the new provider, so let me say something about it. We are going through the competition process and companies are willing to bid and compete. In due course, we will announce which companies secure the bid in the end. There will be a new provider.

Now we are doing the same to drive down the ESA backlog, which has fallen by 100,000 in the past few months—it is now about 688,000 and falling further. That is a good start, but I understand that there are concerns and issues that people want to raise. [Interruption.] I thought that somebody at the back wanted to intervene.

[Chris Bryant (Rhondda) (Lab)]

You’re begging them to intervene.

[Mr Duncan Smith]

I do not need people to intervene on me; the hon. Gentleman makes enough noise for all of them. One thing I do know is that he needs to listen more and talk less.

We made the deliberate choice to introduce PIP in a controlled and phased way. [Interruption.] It is good fun being opposite the hon. Member for Rhondda (Chris Bryant); one does not need much of an audience with him sitting there.

We have taken the right approach. On PIP, the NAO said, “The Department has learnt from the controlled start in April 2013…the MPA identified the controlled start as a positive way to implement the programme and reduce the risks”. As I said, the delays faced by some people are unacceptable, and we are committed to putting that right. Already we have introduced a dedicated service to fast-track terminally ill people, and that is down to around 10 days and below. The Public Accounts Committee has said that too many people have waited longer than six months. By the autumn, no one will be waiting longer than six months, and before the end of the year, no one will be waiting for more than 16 weeks, which brings things back into line with where we were expecting them to be.

[Fiona O'Donnell (East Lothian) (Lab)]

I am sure that the Secretary of State would not wish to mislead people watching this debate. Will he clarify what he means by “terminally ill”—somebody who is terminally ill, or somebody who has to die by a certain date?

[Mr Duncan Smith]

It is the definition given by the consultants who refer the people in question to the programme. That group will be seen and dealt with within the 10 days. That is the definition.

I repeat that by the end of the year those on PIP will not be waiting for longer than 16 weeks.

I say to the hon. Member for Leeds West, who made a poor speech, that my Department has a proven track record of delivery—[Interruption.] In that case, perhaps she will answer this question, which has been raised before. A little while ago, in March, she is recorded as having said that, left to her, “all the changes that the Government has introduced” in welfare reform would be reversed “and all benefits” could be and should be “universal”. She has been asked this question before. It was a quote. I will give way to her if she wants to deny it.

[Rachel Reeves]

indicated dissent.

[Mr Duncan Smith]

There we have it—we now know what the policy is.

[Rachel Reeves]

The right hon. Gentleman did not read out a quote and I deny what he said.

[Mr Duncan Smith]

I have to say to the hon. Lady that it is reported that she said that “all changes that the Government has introduced” in welfare could be reversed and “all benefits can be universal”. That is what she is quoted as saying. I will send her the quote if she likes. This is important.

[Rachel Reeves]

As I said, what the right hon. Gentleman read out is not a quote of what I said and I deny that that is my view.

[Mr Duncan Smith]

In that case, will she explain why she was saying—to a group called the Christian socialists, I think—that all the changes that the Government have introduced to welfare can be reversed and all benefits can be universal? That is what she said.

[Stephen Mosley (City of Chester) (Con)]

To be fair to the hon. Member for Leeds West (Rachel Reeves), she spent 30 minutes not saying what she was going to do, so she may not have said what she was going to do then either.

[Mr Duncan Smith]

This is what is so interesting. Over the weekend, the lid was lifted on what is really going on. [Interruption.] They do not like this, because it is the truth. The hon. Member for Dagenham and Rainham said of the Opposition employment policy announced the other day:

“We managed in the political world to condense it into one story about a punitive hit on 18 to 21-year-olds around their benefits. That takes some doing, you know, a report with depth is collapsed into one instrumentalised policy thing which was fairly cynical and punitive.”

He was making the point, I think, that the Opposition are failing to say what they really want to do. The hon. Lady let the cat out of the bag when she made it clear that the Opposition want to spend more on welfare and to reverse our changes to the welfare system.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Perhaps we could get back on track and scrutinise the performance of the Department for Work and Pensions. Will the Secretary of State confirm when he anticipates actually delivering 1 million people on universal credit? Will it be by 2191? At the current rate, it will be.

--- Later in debate ---

[Mr Duncan Smith]

The hon. Lady asks that ridiculous question time and again. We are rolling out in accordance with the plan. Universal credit will have rolled out by 2016, delivering massive benefits. It would be good if the hon. Lady said at any stage that she wanted to support universal credit. Her party has voted against it and all the savings.

My Department has a proven track record of delivery. Nothing illustrates that more clearly than our employment reforms. Universal Jobmatch has transformed how almost 7 million jobseekers look for work, with an average of more than 4 million daily searches. Work experience has been one of the Government’s great successes for young people, with half of participants off benefits at a 20th of the cost of the future jobs fund. The Work programme has been better than any Labour programme. It helps more than any programme before, with half a million people having started a job and 300,000 having moved into lasting work. That was not the case under Labour. We are confident that the programme’s performance will improve, and the payment by results de-risks taxpayers and ensures value for money.

What we are seeing is remarkable. Unemployment is down by 347,000 on the year, the largest annual fall since 1998. Long-term unemployment is down by 108,000 on the year—again, the largest annual fall since 1998. Youth unemployment is down among those who have left full-time education; it is now at its lowest since 2008, down 94,000 on the year.

[Penny Mordaunt (Portsmouth North) (Con)]

The Secretary of State is making excellent points about the Government’s reforms and the maladministration under the Labour party. What about the other issue of the maladministration of pension credit? Under the last Labour Government, pension credit in my city was under-claimed to the tune of £10 million a year.

[Mr Duncan Smith]

My hon. Friend makes a huge and important statement. The inefficiencies and chaos under Labour were so great that the welfare system was haemorrhaging money. There was a 60% increase in welfare spending—the party that really presided over chaos and malfunction is the Labour party.

Before I get on to some of Labour’s spending commitments, I should say that the hon. Member for Leeds West said to the Minister, my right hon. Friend the Member for Hemel Hempstead (Mike Penning), that she had never had a letter from him. She has had many. In future, instead of making allegations, she might like to read her correspondence.

With a little over a year to go to the general election, this is the choice facing the electorate. On the one hand, there is the party that in government wasted £26 billion on botched IT programmes and lost £2.8 billion on catastrophic tax credit implementation, £500 million on scrapped Child Support Agency IT and £140 million on the axed benefit processing replacement programme in 2006. In opposition, the party has opposed every single measure of welfare reform and it would turn back the clock to reverse our progress—back to more borrowing and spending. Reversing the spare room subsidy would cost £1 billion over two years. The unfunded jobs guarantee has costs underestimated by £0.6 billion in the first year and £1.7 billion in future years. Skills training for all 18 to 21-year-olds below A-level would be hugely expensive given that 92% of all those not in education, employment or training do not even have GCSE numeracy skills. Paying older workers higher JSA would mean, because under-25s are already paid less, that money would have to be taken from those with lower contributions such as young people and carers. The welfare party has learned nothing.

[Ian Swales (Redcar) (LD)]

At one of my first Public Accounts Committee hearings in 2010, the permanent secretary of the Department said that, with the systems he had, he could not get losses through fraud and error much below £1 billion. Does the Secretary of State think we can do better?

[Mr Duncan Smith]

We have already saved over £2 billion on fraud and error. We continue to drive that process forward, and there are more savings to be made. We have done remarkably well considering what we were left by Labour, which, as far as I can make out, did not even bother to try to save any money on fraud and error.

[Julie Hilling]

Can the right hon. Gentleman explain why only one in 20 disabled people is getting work? He says that the number of people on benefits has dropped. How many of them have stopped claiming because of sanctions? Can he at least tell us what is the quality of the jobs that people are getting? How many are unpaid, how many are zero-hours contracts, and how many are part time?

[Mr Duncan Smith]

In fact, we have been more successful in getting disabled people back into work. The proportion of disabled people in work is now rising as a result of what we have been doing. On the back of the work capability assessment, some 700,000 people will now be seeking and finding work.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

I hope to be able to raise this matter again if I am called to speak. Why did the Treasury have to borrow £13.5 billion extra above its target? The reason given was the fall in income tax receipts. People are now living on poverty wages—they are being forced into what the Secretary of State calls jobs, but they do not pay a wage that they can live on.

[Mr Duncan Smith]

Fond as I am of the hon. Gentleman, the reality is that this coalition Government have raised the tax threshold, meaning that 26 million people now pay less tax and millions have been taken out of the lowest tax band altogether. That is a huge statement.

[Anne Marie Morris (Newton Abbot) (Con)]

rose—

[Mr Duncan Smith]

I will give way one last time and then I must finish.

[Anne Marie Morris]

The Secretary of State should be truly proud that self-employment is now much more on the agenda of those going through jobcentres. When I did a review with the all-party group on micro-businesses, only half the job centres and Work programme providers were able to help people into self-employment. That is not the case any more. In my constituency, unemployment is down in the past 12 months by 33%, and many of the people coming into work are setting up their own businesses.

[Mr Duncan Smith]

My hon. Friend is absolutely right. By the way, the situation is the same for every Labour MP. They do not want to talk about the improvement in employment or the fall in unemployment. They do not even want to talk about the successes in getting the long-term unemployed back to work, on which we have done so much.

We have got Britain back to work. There is record high employment, with three quarters of the rise over the past year accounted for by UK nationals. Half a million people have started a job through the Work programme. We have seen the creation of nearly 50,000 new businesses through the new enterprise allowance. There is the lowest rate of economic inactivity on record. There is the lowest rate of workless households on record. We have a proven track record of delivery. Departmental baseline spending is down by £2 billion. The welfare cap is bringing £120 billion under new controls. Welfare spending is falling as a proportion of GDP. Reforms are set to save £50 billion. This is a record we can all be proud of—one of success, unlike Labour’s waste and failure.

--- Later in debate ---

[Mr Frank Field (Birkenhead) (Lab)]

May I make one point in this debate and seek one undertaking?

The issues that we are debating are immensely important, particularly for large numbers of our constituents. One advantage of being in this place for 35 years is that one notices the changes. I notice that two of the Government Members who are present are part of a parliamentary inquiry into hunger and food poverty. They have therefore had the opportunity to look at what is happening elsewhere in the country and not only in their backyard.

The Secretary of State used one phrase that stung me into action. I wish to address that rather than say what I was going to say. He said that one problem with the Labour Government was that we just paid out money too easily.

[Mr Duncan Smith]

Did I?

[Mr Field]

I have the quotation here, although perhaps I did not get it right. The Secretary of State said that Labour “wasn’t delivering the money”. It is the delivery of the money that I would like to take him up on and on which I would like to seek the undertaking.

Many of our constituents—not just those of Opposition Members, but those of Government Members—become dependent only and totally on benefit for part of their life. How effectively, efficiently and quickly that benefit is delivered is of immense importance. For many of our constituents, although not all, claiming benefit is not a pleasant thing to do. They do not do it lightly or think that they gain out of it, other than gaining the hope that they will have money with which to put food on the table. It is quite clear not only from my constituency, but from going around the country, that there is a growing difficulty for people in gaining benefit in an adequate space of time. It is undignified not to have money. It is appalling to have to grovel across the counter for money. The alternative of attending food banks is, for many people, a very last resort.

The Department has rules. It makes judgments about who is out of money, and money is paid to people in those circumstances. I ask the Secretary of State to ensure that an undertaking is given in the concluding remarks that he will look at how well—or not well—those rules are working. Although some people are without money because sanctions have been applied against them, others are seeking benefit genuinely but are not gaining it. When I asked the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb) how many people had been without benefit for one month, two months and three months, he said that the Department did not know. Just imagine what it is like having no money and waiting one day, let alone months, for benefit to come through. I therefore ask the Secretary of State to give the undertaking that the safety measures that the Department has in place will be reviewed and new rules brought in quickly, so that people are not left dangling at the end of a string, destitute, waiting for decisions that do not come.

Child Poverty Strategy 2014-17

Iain Duncan Smith Excerpts

Thursday 26th June 2014 Written Statements

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

Today, jointly with my right hon. Friend the Minister of State for Schools, I will publish the Government’s child poverty strategy 2014-17. At the end of this Parliament, as at the start, the coalition Government are committed to ending child poverty by 2020, transforming the lives of the most vulnerable in our society.

Despite the tough economic climate, we are making progress. With employment at a record high, up by nearly 1.7 million since 2010, there are now 290,000 fewer children in workless households. Poor children are doing better than ever at school, with the proportion of children on free school meals getting good GCSEs, including English and maths, having increased from 31% in 2010 to 38% in 2013. This is the kind of lasting life change that makes a real difference to children’s outcomes.

Based on an in-depth evidence review, today’s strategy sets out the actions we will take to build on this momentum, restating our commitment to tackle poverty at its source.

We will help families into work and to increase their earnings; support living standards through decreasing costs for low-income families; and prevent poor children becoming poor adults through raising their educational attainment. In doing so, we can break the cycle of disadvantage, offering families security and stability for the future.

To achieve this end, our strategy calls for action from employers, the devolved Administrations, local areas and the voluntary and community sector. All must play their part, for we know that central Government action alone cannot end child poverty.

Alongside the strategy, it is our firm belief that we need a revised set of child poverty measures which underline our commitment to ending child poverty, but better reflect the evidence about its underlying causes and where we need to target action most.

We are not yet in a position to put these forward. In the meantime, the Child Poverty Act 2010 requires us to set a persistent child poverty target through affirmative regulations by December 2014. As we will not have put forward new measures by then, the Government remain committed to meeting their existing obligations under the Act. We are therefore consulting on a persistent child poverty target based on the definition set out in the Act and at a level of less than 7% by 2020, which is consistent with existing statutory child poverty targets.

Oral Answers to Questions

Iain Duncan Smith Excerpts

Monday 23rd June 2014 Commons Chamber

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

15. What assessment he has made of recent trends in employment figures.

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

The recent trends are remarkable: there are more people in work than ever before, youth unemployment is down 91,000 since the election, the claimant count for 18 to 24 year-olds has fallen for 30 consecutive months, and we have seen the largest annual fall in long-term unemployment since late 1998. I also note that in the constituency of my hon. Friend the Member for Central Devon (Mel Stride), the claimant count is down 33% and the youth claimant count is down 41%.

[Mel Stride]

As my right hon. Friend has pointed out, youth unemployment in my constituency is substantially down since the last election, not least due to his efforts to ensure that work always pays. However, does he agree with me that approaches to incentivising work are always best if they are universal, unlike the Opposition’s proposal for means-tested youth allowances, which would punish hard-working families and those people who do the right thing?

[Mr Duncan Smith]

Yes, the reality of what we have been trying to do is to make sure that people can get into the jobs that are available. What they do not need—and what is quite ridiculous about the Opposition’s proposal—is to try to take everybody who is below level 2 up to a level 3 qualification. Some people who do not even have a GCSE in maths, for example, are expected now to do training courses to take them to level 3 before they go into work. The reality is that we are getting them work-ready and giving them the training they need. That is why there are record employment levels of some 30.5 million, which beats what we were left by the last Government.

[Mr Amess]

Will my right hon. Friend join me in welcoming the 29% decrease in the number of 18 to 24-year-olds claiming jobseeker’s allowance in the constituency I represent, and does he agree that it is further evidence of the success of our long-term economic plan?

[Mr Duncan Smith]

It is worth noting that under the last Government, youth unemployment increased by nearly a half—up almost 300,000—and long-term youth unemployment increased by 74,000. Since then, excluding full-time students, youth unemployment has come down to 7.9%, which is the lowest figure since 2008. Youth unemployment is down 98,000 on the year, and down 91,000 since the election, and long-term youth unemployment is down 25,000 on the year. That is getting the job right.

[Oliver Colvile]

Plymouth, as my right hon. Friend knows, is a low-wage, low-skills economy. Does he support the Government’s proposal to give Plymouth the city deal for a marine energy park, which will create more than 10,000 new jobs and help provide jobs for the young unemployed?

[Mr Duncan Smith]

I absolutely agree with that; it is the right thing to do and it shows how this Government are investing in providing in an area the right kind of jobs for the right kind of people. Even in a difficult area such as my hon. Friend’s, the claimant count is down by 27% and the youth claimant count is down by 30% on the year. This kind of investment helps us to get people into real jobs, not jobs subsidised by the Opposition’s proposals.

[Mr Dennis Skinner (Bolsover) (Lab)]

Is the Secretary of State aware that a disabled unpaid voluntary worker has been told by the Department for Work and Pensions that as from now she will be in the same category as part-time workers who have a job? Is this a way of padding out the number of people in employment?

[Mr Duncan Smith]

I do not know what this case is, but if the hon. Gentleman would like to write to me about it, I will deal with it specifically—

[Mr Skinner]

I have done.

[Mr Duncan Smith]

Well, I have not seen the letter, but I will once I have ferreted it out. We are not padding anything out—we do not need to, because there are about 600,000 vacancies now in jobcentres up and down the country and we are doing our level best to help people of all descriptions, including those who have disabilities, most of whom would genuinely like to seek and find work. We are working with them to help them get the kind of job that can change their lives, rather than parking them for many years in a row, as Labour did.

[Lucy Powell (Manchester Central) (Lab/Co-op)]

With so many young people still in unemployment, especially long-term unemployment, does the Secretary of State not think it anomalous that young people can get support in higher education but not in further education?

[Mr Duncan Smith]

That is not true really, because young people can get help in further education. Under jobseeker’s allowance, traineeships allow up to 30 hours’ training per week—we have made that more generous, because under the previous Government the figure was only 16 hours. For others, two to eight weeks’ full-time training is allowed, depending on the duration of the jobseeker’s allowance. It is one thing to come up with a policy, but another to come up with a policy answering a question that nobody has ever asked.

[Hywel Williams (Arfon) (PC)]

Employment rates in Wales are about the same as elsewhere in the UK, which is very welcome, even if historically rather anomalous. However, we have a large number of people who are involuntarily employed part-time, because they cannot get the hours required. Is it fair or even reasonable for the Government to insist that people take on hours when those hours are just not available?

[Mr Duncan Smith]

The jobcentres do not force anybody to take on something that is not there; the jobcentres are working will all those individuals. I welcome the hon. Gentleman’s welcome for the figures from Wales, because it has been particularly successful, having had some very difficult times, particularly in the valleys. I welcome that improvement in employment. Jobseekers go to the advisers, who help them to find those jobs and take the hours that are available. No one will be punished or penalised for trying to take a job or for working with the advisers and only taking the jobs that are there.

[Stephen Mosley (City of Chester) (Con)]

6. What assessment he has made of the performance of Universal Jobmatch.

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

Universal Jobmatch revolutionises the way jobseekers look for work. Since it was launched in November 2012, we have seen 6.9 million jobseekers register on the site; 4.3 million average daily job searches; over 560,000 jobs available; and more than 550,000 companies set up an account. It has been a successful transformation.

[Stephen Mosley]

My right hon. Friend will be delighted to hear that more than 5,500 jobs within 5 miles of Chester are being advertised at the moment, which is a massive testament to the number of new jobs that have been created under this Government. However, Universal Jobmatch depends on accurate data, so what steps is he taking to ensure that all the jobs on the site are described accurately, are real and are available for jobseekers?

[Mr Duncan Smith]

We regularly talk to all the employers. New employers are seen by advisers in the jobcentres in the local area. Fraudulent jobs are rare on the site; it is estimated that fewer than 0.1% of these vacancies have been fraudulent since go-live, and those have been removed. We constantly monitor the Universal Jobmatch system and we crack down on abuse. In addition, employment advisers are meeting all those employers they are not aware of or who have just come up on the system for the first time.

[Sheila Gilmore (Edinburgh East) (Lab)]

The problem is that that is just not happening, and perhaps the Secretary of State should accept that. For example, I saw a job advertised in my constituency today for a care assistant in a care home that has just closed down. Jobs are being wrongly categorised. Among sales assistants, we find jobs for account executives, for which qualifications are needed. What exactly is happening with Universal Jobmatch?

[Mr Duncan Smith]

The problem is not what the hon. Lady describes. It is with Labour Members, who cannot bear the idea that, when they were in government, they had an archaic system that worked only from 8am to 6pm. Our system works for 24 hours. It works while people’s computers are shut down. It nominates jobs, and advisers can offer advice online. This is a major success story. The problem is that Labour does not get it. We are getting more people into work, higher levels of employment and falling levels of unemployment. In fact, we have some of the lowest levels in the European Union.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

7. What recent progress he has made on the universal credit programme; and if he will make a statement.

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

Universal credit is on track to roll out against the timetable set out last year. The claimant commitment is in place across all jobcentres. Universal credit is live in 14 sites, and from today further expansion is under way across the north-west, with couples and families joining at a later stage. Based on the case load projections, there are, at the moment, around 11,000 people making those claims on universal credit.

[Mark Lazarowicz]

I am interested in the Secretary of State’s answer. In 2011 he announced that a million people would be claiming universal credit by April 2014, when the true figure was just 6,000. What went so badly wrong with his projections, and what are his current milestones for the delivery of universal credit?

[Mr Duncan Smith]

I think I made that clear before, but I will repeat it again. Back in 2012, I was not happy with the plan for the roll-out, because it mirrored too much the roll-outs that used to happen under the previous Government—[Interruption.] We hit the bump. [Laughter.] It is interesting that Opposition Members sit there laughing, because I remember the tax credit fiasco. They launched tax credits and people suffered. People did not get their payments and were out of pocket. That has not happened with universal credit. In answer to the hon. Gentleman, I simply say that we deliberately set a pathfinder and we are expanding it now, with 90 new sites. Universal credit is rolling out carefully, and we are ensuring that all those who are eligible get the money that is due to them when it is due. It is not the disaster that we had under the previous Government.

[Sir Nick Harvey (North Devon) (LD)]

What progress is the Secretary of State making in his discussions with other Government Departments about the various forms of state support they give in the era of universal credit? I am thinking of free school meals, which could be considerably improved. Is the matter all sorted? If it is not, how is he getting on?

[Mr Duncan Smith]

I believe it is getting sorted. Very soon, the Department for Education will be able to make announcements about its preferred options for universal credit, and we will be able to accommodate them regardless of what it asks for.

[Chris Bryant (Rhondda) (Lab)]

That is very interesting. In 2011, the then employment Minister, the right hon. Member for Epsom and Ewell (Chris Grayling), said that the Department would consult on new eligibility criteria for passported benefits such as free school meals

“in good time to take decisions to meet our overall timetable to introduce universal credit by October 2013.”—[Official Report, 7 November 2011; Vol. 535, c. 66W.]

The Schools Minister has only just admitted that it would cost an extra £750 million to give free school meals to the children of all those whom he eventually expects to be on universal credit. Can we clear this up this afternoon? Do the Government intend to give free school meals to everyone on universal credit, or do they intend to introduce a new means test for free school meals? If the Secretary of State cannot give a proper answer this afternoon, as I suspect from the way he is performing, will he at least tell us when he will make up his mind?

[Mr Duncan Smith]

It is interesting that the hon. Gentleman does this publicly—he was told the answer to this the other day when he came to my office to talk to me directly. Just in case he does not know how free school meals work, let me tell him that they are means-tested today: there is no change to that.

[Chris Bryant]

No, they are not.

[Mr Duncan Smith]

Yes, they are, because they are set against means-tested benefits. I wish the hon. Gentleman would get his facts right and learn something about the benefits system. We have a system that will enable us to deliver the free school meals to those who are eligible for them, and not to those who are not eligible for them. The reality is that the mess that the Opposition left us is being cleared up and they cannot bear it. They do not even know whether they support universal credit. They flip-flop more on every policy than any other Opposition ever have.

[Julie Elliott (Sunderland Central) (Lab)]

8. What estimate he has made of the number of people below the threshold for auto-enrolment in a workplace pension.

--- Later in debate ---

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

Our reforms have ended a situation in which migrant workers had indefinite access to jobseeking benefits, which we inherited from the previous Labour Government. Since April, we have banned access to housing benefit. From July, migrant workers will have their claims to jobseeker’s allowance stopped if they have claimed for six months and cannot show that they have found employment. I intend to tighten this up further still.

[Mr Ruffley]

I am grateful for that reply. I congratulate the Secretary of State on the tougher habitual residence test and the new minimum earnings guarantee. Has he received support from European partners for his tougher approach to curb benefit tourism, and are they taking further steps to move the approach forward?

[Mr Duncan Smith]

I am in discussions with colleagues from various countries in the European Union. Many of them, including the Dutch and the Germans, have made it clear that they essentially support our direction of travel and that some kind of change must be made to the regulations. The German Chancellor made Germany’s position clear, saying that the EU is “not a social union” and there cannot be de facto immigration into other EU social systems.

[Kelvin Hopkins (Luton North) (Lab)]

19. What estimate he has made of the number of people who will receive face-to-face guidance at the point of retirement in 2015-16.

--- Later in debate ---

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

Today I welcome the National Audit Office’s positive response to the report on the child maintenance scheme, which simplifies the system and helps parents work together in the best interests of their children. There will be further to come on this soon. Already we know that twice as many parents intend to pay direct, even before the second stage of our reforms and ahead of expectation.

[Rehman Chishti]

What support are the Government giving to older workers and their employers in Medway to assist them into work and to build a fairer society?

[Rachel Reeves (Leeds West) (Lab)]

At the start of this year 3,780 people were claiming universal credit. The most recent numbers show that 5,610 people are receiving the benefit. At this rate of progress, how long will it be until the 7.7 million households that are supposed to receive this Government’s flagship benefit, as the Secretary of State originally set out, are receiving it?

[Mr Duncan Smith]

We have already made that clear. To date around 11,000 people are on the pathfinders. We have started a roll-out to another 90 sites beyond the 10 sites where the pathfinder took place. There will be further changes and enhancements, and we expect and believe, according to the plan that we laid out, that everybody eligible will be on the benefit by 2017.

[Rachel Reeves]

I think that is the first time I have not heard the Secretary of State say that his project is on time and on budget, but we still hear total and utter complacency. At the present rate of progress, it will take a staggering 1,052 years before universal credit is fully rolled out. So what do we have? Universal credit delayed, personal independence payments delayed and employment and support allowance delayed. Does not the Secretary of State realise that his incompetence is not only wasting tens and hundreds of millions of pounds of taxpayers’ money, but causing untold pain and hardship for some of the most vulnerable people in our country?

[Mr Duncan Smith]

As I said, we are rolling out universal credit to 90 sites and we will deliver it safely and carefully, unlike what the Labour Government did with tax credits. To answer the hon. Lady’s general question about what we are doing, this Department and this Government have undertaken the biggest welfare reform programme ever and we are getting more people into work—there are record numbers in work and record falls in unemployment; and we are getting more young people into work and more young people who have been long-term unemployed back into work. The benefit cap means that 42,000 people have been capped, as a result of which 6,000 have moved into work.

On universal credit, 600,000 claimant commitments have been signed. There are 6.9 million people registered for Universal Jobmatch. The Work programme—[Interruption.] She does not want to hear this because these are all records of the success of welfare reform. Through the Work programme, 550,000 people whom the previous Government wrote off and who never got a job are now back in work, and through auto-enrolment under the Minister of State, my hon. Friend the Member for Thornbury and Yate (Steve Webb), 3.6 million people have moved into a workplace pension. This is a Government who are reforming welfare. The Opposition have no policies, no purpose and no prospects.

[Mr Robert Buckland (South Swindon) (Con)]

T5. This morning I was with the staff and students of Farleigh college of further education in my constituency, which offers excellent education and training opportunities to young people with autism and other complex conditions. What more can my right hon. Friend do to ensure that we reach the goal of full employment by ensuring that increased opportunities exist for young people with learning disabilities and autism?

--- Later in debate ---

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

T4. My local citizens advice bureau has been contacted by a young single woman who has been hit by the bedroom tax. After paying her rent and utility bills, she has just 84p a day left to spend on food and toiletries. With eight households for each available one-bedroom property in my area, moving is simply not an option. How can the Secretary of State continue to try to justify a policy that results in such extreme poverty?

[Mr Duncan Smith]

We have given local authorities between £300 million and £400 million for discretionary payments. It is their job to ensure that individuals with particularly difficult circumstances can be helped with that money. The overall policy is very simple. It is about people who are living in accommodation that they do not fully utilise, and about others, including the quarter of a million left by the last Government in overcrowded circumstances and the 1 million people on waiting lists. I do not think that the hon. Lady has ever got up and asked a question about those people. The reality is that this policy will help them to get the accommodation they need to improve their lives, and not waste it on people who do not need it.

[Dr Julian Huppert (Cambridge) (LD)]

I hear repeated concerns that there may be targets for benefit sanctions at jobcentres. Will the Secretary of State confirm that that is not the case, and send a clear message to advisers that they should not be seeking to sanction people inappropriately to hit some sort of target? Their aim is to help people.

[Mr Duncan Smith]

I can assure my hon. Friend that there is no target on benefit sanctions, that the advisers give benefit sanctions as a last resort, and that the system has a full set of checks and balances. There is a mandatory reconsideration almost immediately of that decision, and then there is the opportunity to appeal. The purpose of a sanction is to help to remind the individual that this taxpayers’ money comes with an obligation to co-operate; to find work by seeking work.

[Lyn Brown (West Ham) (Lab)]

T6. Why will the Government not pay universal credit payments to the main carer of children in a family rather than the main earner?

[Mr Duncan Smith]

Let us pause and get this absolutely right. The reality is that what the Opposition are now saying is utterly illogical. [Interruption.] Let me give the hon. Lady the figures. What is fascinating is that 93% of cohabiting couples and 98% of married couples share their finances, so most of those people will reach a conclusion. The second point is that we have put safeguards in place within universal credit so that the payments can be nominated as an exception if the carer is to receive the money. Right now, this is about a household getting more money than under the existing systems. This is a benefit that benefits more people, and, honestly, the idea of micro-managing everybody’s lives from Westminster is the kind of absurdity that the Labour party tried when it was in government.

[Stephen Mosley (City of Chester) (Con)]

It is welcome that youth unemployment has fallen by some 59,000 in the past three months, but I understand that there has been an underspend of some £50 million on the Youth Contract budget. Can my right hon. Friend reassure the House that that money will be spent on supporting young people into work?

[Kerry McCarthy (Bristol East) (Lab)]

T8. It is a great shame that Tory Members of Parliament criticised the Trussell Trust and Oxfam—in fact, some might say threatened them—for daring to suggest a link between food poverty and the social security system: the cuts, the delays, the misapplied sanctions and the abolition of the social fund. Will the Secretary of State now accept his responsibility for what has been a 54% increase in the need for food aid in just one year, and commit to working positively with those organisations to see how his Department can help to address the root causes of food poverty?

[Mr Duncan Smith]

Inequality is at its lowest since 1986. There are 500,000 fewer people in relative poverty than at the election; 300,000 fewer children in relative poverty than at the election; 200,000 fewer pensioners in relative poverty than at the election; and 450,000 fewer workless households than at the end of 2010. We have done more to help people who are hard up than the hon. Lady’s Government ever did.

[Charlie Elphicke (Dover) (Con)]

What impact has the Government’s long-term plan had on long-term unemployment, and what representations have the Government received on long-term unemployment from the Opposition?

--- Later in debate ---

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

I have been here since the beginning of Question Time and may I tell the Secretary of State that I have been sickened—there is no other way to describe my feelings—by his complacent indifference to the agonising hardship suffered by the most vulnerable in our society? He should be ashamed of the policies he is pursuing.

[Mr Duncan Smith]

The only sickening thing is the last Government plunging the economy into such a crisis that more people fell into unemployment and hardship as a direct result of the incompetence of the people whom the hon. Gentleman has progressively supported.

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

Under this Government, how many more women are now in employment?

[Mr Andy Slaughter (Hammersmith) (Lab)]

After nine months, fewer than 200 people in Hammersmith and Fulham are on universal credit. This morning the shadow ministerial team visited Hammersmith’s citizens advice bureau to hear directly from my constituents about the catastrophic failure of the Secretary of State’s Department in every area of operation. Is his failure to roll out universal credit just a cover-up of another DWP crisis in the making?

[Mr Duncan Smith]

Isn’t that interesting? What a revealing statement. We have endlessly offered the Opposition Front Bench team the opportunity to visit jobcentres where universal credit is rolling out, but only one spokesman went—[Interruption.] No, the shadow Secretary of State never went and is refusing to go. Now she would rather visit citizens advice bureaux than the people who are actually delivering universal credit. Surely that is the most pathetic excuse I have ever heard.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

I have a number of very sick constituents who have been pushed into severe financial hardship as a result of unacceptable delays in the PIP process. Some of them are now dependent on food banks. I listened carefully to the Minister earlier, but will he set out a timetable for clearing the backlog for all applicants, not just the terminally ill? What interim support will he offer to those having to wait more than 28 days?

[Andrew Gwynne (Denton and Reddish) (Lab)]

Underlying the overly positive spin that Ministers have put on the employment figures is the fact that for the first time ever the majority of families living below the poverty line are in work. What are the Government going to do to make sure that work is always a route out of poverty?

[Mr Duncan Smith]

Nothing is more revealing than when the Opposition start claiming that we somehow have to spin the fact that there are more people in work now than when we came into office. We will soon break through the barrier and have the highest proportion of people in work. Unemployment is falling, youth unemployment is falling, and adult unemployment is falling. We do not need to spin facts, because facts in this case tell us that our welfare reforms are working.

[Several hon. Members]

rose—

Jobs and Work

Iain Duncan Smith Excerpts

Wednesday 11th June 2014 Commons Chamber

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

It is always a pleasure and an honour to conclude a debate on the Gracious Speech. I urge right hon. and hon. Members to oppose the amendment, which I will address later. I congratulate Members on their speeches. I have sat here for some time listening to them and the quality of speeches by Members on both sides of the House was of the highest order, particularly given the time constraint, which was imposed for good and obvious reasons. I congratulate in particular those who had to change their speeches after being addressed by the occupant of the Chair.

I congratulate and agree with my hon. Friends the Members for Norwich North (Chloe Smith) and for Stourbridge (Margot James), who spoke about the importance of youth employment and the way in which we are now driving youth employment up and unemployment down. On support for growth in manufacturing employment, my hon. Friend the Member for Stourbridge said that manufacturing employment is now growing and improving after a fall of 2.5 million under the previous Labour Government. As my right hon. Friend the Secretary of State for Business, Innovation and Skills said in his opening remarks, we are getting more balance in the economy as a result of the work we have been doing, which is different from what was going on before the recession.

I congratulate my hon. Friend the Member for Worcester (Mr Walker), who talked about the small business measures and measures to get rid of excess zero-hours contracts, which my right hon. Friend the Business Secretary spoke about earlier. Many Opposition Members spoke passionately, and rightly so, about excesses in employment, particularly with regard to zero-hours contracts, but, as my right hon. Friend said, they never once addressed zero-hours contracts throughout their time in government. To listen to them, one would think that zero-hours contracts were an innovation created by this Government and that they began some time last year, but they did not: they were running under the previous Government, and it is only this Government and this Business Secretary who will address the matter, which is what Labour should have done.

As I recall, the last time that the hon. Member for Great Grimsby (Austin Mitchell) and I spoke in the same debate, he urged me to vote against the Government. I did, and look what happened. Today, he advised us that we should borrow more, but I do not think that I will listen to him this time, if he does not mind—it got me into more trouble than I like to think about last time. However, I welcome him to his place and recognise that he also attacked the previous Government for the amount of quantitative easing they oversaw, which he said was wrong.

My hon. Friend the Member for Bournemouth East (Mr Ellwood) was making an effective speech about international matters before he was interrupted. I commend him for managing to get his speech out, regardless of the change in the interpretation of the rules. He made a really important point about the taking of Mosul, which is a terrible issue and we need to deal with it.

I welcome the fact that the hon. Member for Blaenau Gwent (Nick Smith) welcomed the rise in employment in Wales. I will pass on to the Transport Secretary his views about the electrification of the railway to Swansea.

My hon. Friend the Member for Cleethorpes (Martin Vickers) spoke very well about the increase in small business. He rewrote his speech as a result of the ruling from the Chair, and I congratulate him—I do not know whether he is in his place—on making a brilliant five-minute speech with no warning at all.

My hon. Friend the Member for Tamworth (Christopher Pincher) spoke about the good results from business men in his area, and particularly about making sure that small business is supported. My hon. Friend the Member for Dover (Charlie Elphicke) also spoke about that, as well as about the increase in people’s disposable income—that is true—and economic models showing that the UK is now growing faster than any other country.

The hon. Member for East Lothian (Fiona O’Donnell) spoke about abuses of zero-hours contracts. In relation to what she raised earlier, there is no mandation on zero-hours contracts and there are no sanctions. I provide that for clarification and so that she is aware of it.

My hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw) welcomed the fall in unemployment and the grant of assisted area status for Fleetwood, which I pass on to my right hon. Friend the Secretary of State for Business, Innovation and Skills, who is in his place. My hon. Friend said we should push on with shale gas, and I fully agree that it has potential benefits for us all.

The hon. Member for Liverpool, West Derby (Stephen Twigg) and my hon. Friend the Member for Ceredigion (Mr Williams) spoke about vocational training. I welcome the speeches of my hon. Friends the Members for Reading West (Alok Sharma) and for Folkestone and Hythe (Damian Collins), who spoke about real falls in unemployment and rises in employment, particularly youth employment, in their areas. My hon. Friend the Member for Warwick and Leamington (Chris White) spoke about growing business and manufacturing.

I welcome the speech of the hon. Member for Rochdale (Simon Danczuk), which was mentioned by the hon. Member for Leeds West (Rachel Reeves). He made me feel very hungry, as I am sure she did, by talking about Danczuk’s Deli. I hope that we can give it more advertising—I can promise him that something in return would be very welcome after three hours on the Front Bench.

My hon. Friend the Member for Macclesfield (David Rutley) said that the Federation of Small Businesses had welcomed the Bill on small businesses in the Queen’s Speech as a “landmark Bill”. I agree that the Bill to protect small business is a landmark measure.

My hon. Friend the Member for Weaver Vale (Graham Evans) spoke about the importance of the fall in unemployment in his constituency. Youth unemployment there has fallen by 41%, which I welcome. Apprenticeships in his area have risen by 27% since he became its Member. I am not sure whether that fact is directly connected to him, but it will not do him any harm in his area.

I congratulate the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) on the very strong and powerful points she made about taking the burden off small businesses.

In their opening and closing speeches, Opposition Members made no reference whatever to one of the big and important features of the Queen’s Speech, which is the continuation of pensions reform. I will say a few words about that because it is very important. I start by paying tribute to the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb). It is way past time for him to be made right honourable, given the work that he has done—I say that to my hon. Friends—because the work that we have done in concert will leave behind a serious platform of pensions reform. The House will come to recognise that and the fact that his work will have rewarded many people. Obviously, we are ensuring that it pays to work, but also, most importantly, that it pays to save, which is one of our major platforms.

Let me just remind the House what we have introduced since being in office. There is the triple lock on the basic state pension; it is worth about £440 more in 2014-15 than it would have been under uprating by earnings, which was the process we inherited. Under automatic enrolment, more than 3 million people have already joined pension schemes, and there are more to come. We have capped rip-off charges, banned hidden charges and set minimum quality standards. Vitally, there is a new state pension, which is set above the means-test level, so that those who have contributed at the full rate for 35 years are guaranteed a decent minimum income.

We are now going further, with a pensions Bill that will pave the way for innovation, competition and choice. We will introduce new flexibilities, trusting individuals to use their own money in retirement as they see fit, not as the Government tell them to do. Our consultation on guaranteed guidance closes today. We intend to strike a balance between impartiality and deliverability, alongside robust standards and monitoring.

At the same time, we are enabling the creation of a defined ambition pension, which is wholly compatible with the new flexibilities, to facilitate greater risk pooling, while offering savers greater certainty. There was a degree of confusion on the Opposition Benches when the Minister of State said that he had been looking at that idea for some years. My shadow, the hon. Member for Leeds West, tweeted on 1 June:

“I said last week Labour will legislate to introduce collective pensions. Days later, ministers are following suit”.

I did not know we acted that fast. After all the years that my hon. Friend has been considering the idea, the hon. Lady suggests that we owe it to her that we have brought it in. She recently attacked the Labour leadership for not showing enough passion, but she must not confuse passion with accuracy. I notice that we have the pair of them here: the shadow Secretary of State for Work and Pensions and the shadow Secretary of State for Business, Innovation and Skills.

When we talked about freeing up annuities, there was chaos among the Opposition. During his speech on the Queen’s Speech, the Leader of the Opposition did not mention pensions reform. The next day, the shadow Chancellor said only that Labour would look at the Government’s proposals—he did not tweet at all. The day after that, the hon. Member for Leeds West said that she supported the reforms. By the weekend, the shadow Business Secretary backtracked and said:

“I’m not going to sign a blank piece of paper on your show”.

Later the same day, my shadow also backtracked, saying that Labour supported the reforms, but that they did not go far enough. The Opposition have been in complete chaos and confusion about these landmark pension reforms—some of the most important that will ever be introduced. The reason why they have been in chaos is that they really do not trust people to dispose of their own money, which they have worked for and saved, whereas the Government do.

Throughout the shadow Business Secretary’s speech, he would not accept that any of the problems that we have had over the past four years were caused by Labour’s great recession. My right hon. Friend the Secretary of State for Business, Innovation and Skills reminded him—and it is worth reminding him again—that the recession that happened on Labour’s watch cost the British economy £112 billion and cost 750,000 people their jobs. Youth unemployment increased by nearly a half, long-term unemployment almost doubled in just two years, 5 million people were left on out-of-work benefits and one in five households had no one in work. The shadow Business Secretary wonders why we want to go on talking about that. We do so because we do not want anyone out there ever to forget that Labour almost destroyed the British economy.

[Mr Ronnie Campbell (Blyth Valley) (Lab)]

rose—

[Mr Duncan Smith]

No, I do not have time.

Under this Government, there is record employment. More than 30 million people are in work. Employment is up this quarter, with the largest rise on record. It is up 1.7 million since the election. Record numbers of women are in work. There is record private sector employment, which is up by 2 million since the election. Three quarters of the rise in employment is made up by full-time jobs. Over the past year, more than three quarters of jobs went to UK nationals, reversing the damaging trend of Labour’s last five years in office.

I close today’s debate on the Queen’s Speech with a very simple point: we cannot trust Labour to be in control of the British economy ever again. The Government are helping people into jobs and ensuring that those who work hard and save all their lives are properly rewarded. To set the record completely straight, there are now more people in work than ever, more women in work than ever and more people in private sector work than ever. Youth and long-term unemployment is falling, and we have the lowest rate of workless households since records began. The Queen’s Speech allows us to build on our success, not Labour’s failure. I commend it to the House.

Question put, That the amendment be made.

Scotland Analysis (Work and Pensions)

Iain Duncan Smith Excerpts

Monday 28th April 2014 Written Statements

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

I laid before the House on 23 April 2014 the latest paper in the Government’s Scotland analysis programme, “Scotland analysis: Work and Pensions”. This series of publications is designed to inform the debate on Scotland’s future within the United Kingdom ahead of this year’s referendum.

The paper sets out why a UK-wide social security system and labour market works well for Scotland. It considers how the UK’s broad tax base ensures Scotland benefits from secure and stable funding and how by pooling resources, variations in demand for social security support in one part of the UK can be absorbed without varying the levels of funding received by individuals. It sets out how by remaining in the UK both the higher levels of social security expenditure in Scotland and future costs pressures from an ageing population are more affordable.

In the future the number of pensioners is predicted to increase, and cost pressures will increase accordingly. The paper highlights that an independent Scottish state would face a more acute challenge than the UK as a whole, both from demographic change, and its ability to absorb the impacts from a narrower tax base. The paper finds that an independent Scottish state could face additional social security costs rising to around £1.55 billion per year over the next 20 years (in today’s terms) as a result of demographic changes and policy commitments by the current Scottish Government. This would result in a total increased cost of around £450 per working-age person per year in Scotland over the next 20 years, than if spending per working-age person was at average UK levels.

The paper also sets out how an independent Scottish state would also face costs and complexity from unpicking the UK’s integrated social security infrastructure. It explains there would be costs in developing and setting up new systems while running costs could increase as economies of scale are lost. The UK Government would do nothing to put at risk the continuity of payments to their own citizens and would not be prepared to incur significant costs to change IT systems to cater for a different approach in Scotland. The paper also finds that if Scotland does not use sterling as its currency, it would not be possible to share a benefit system even for a transitional period.

The paper concludes that Scotland’s citizens and employers benefit from being part of the UK and the UK benefits from having Scotland as part of it.

Oral Answers to Questions

Iain Duncan Smith Excerpts

Monday 31st March 2014 Commons Chamber

[Damian Hinds (East Hampshire) (Con)]

5. What steps his Department is taking to promote financial inclusion and to help families to budget.

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

Through universal credit, the Department for Work and Pensions is investing £38 million in expanding credit union services to help more people to access affordable credit. A budgeting support package will be available to all those who need it through universal credit. At the same time, the Government are clamping down on loan sharks and doorstep lenders who have taken advantage of vulnerable people for too long.

[Damian Hinds]

In this 50th year of credit unions in Britain, may I commend the Secretary of State for what he continues to do to support the sector? Will he update the House on what is being done to tackle the excesses of the payday lenders he mentioned?

[Mr Duncan Smith]

The Financial Conduct Authority will limit continuous payment authorities, which allow payday lenders to take money out of people’s bank accounts, to two payments. The FCA will keep that under review. It is also preventing CPAs if a person would be left without money to buy essentials or for priority debts. We have already seen some payday lenders leave the market because it is being restricted in the right way. It is worth saying that before the last Government came to power, payday lending did not exist, but it spiralled to £1 billion-worth under them.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

Has not the source of the pressure on family budgets been policies such as the freeze in child benefit and the cuts to tax credits, which have left families hundreds of pounds worse off?

[Mr Duncan Smith]

The biggest pressure on family budgets was the fact that far too many people lost their jobs as a result of the crash in the economy, in which GDP fell by 7.2%. Since then, we have reformed welfare. It is difficult when people are out of work, but we are doing huge amounts to get them back into work. As my hon. Friend the Minister of State has said, more people are in work, more women are in work and more young people are beginning to get into work, so we are getting more people into a position to look after themselves.

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

Financial resilience for families in my constituency can be a real challenge. One of the biggest impacts on the family budget can be the loss of a loved one. Does the Secretary of State think it is now time to consider whether social fund funeral payments should be index linked to inflation to ensure that they keep pace with the cost of funerals?

[Mr Duncan Smith]

I am certainly prepared to discuss the matter with my hon. Friend if he wants to come and see me about it. I keep that area of the social fund under review, as he knows. We localised about £200 million of the social fund to councils so that they could deal with the problems people face directly. We also kept the remaining money, so a total of about £1 billion goes out to all sorts of things, such as funeral payments, support for loans and support for people in hardship. This is a big push by the present Government to help people ahead of payday lenders.

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

Last week the BBC reported that just 6% of households affected by the bedroom tax had managed to move. Also last week, a report from Real Life Reform showed that nearly eight out of 10 tenants hit by the bedroom tax were in debt, with borrowing increasing by an average of £52 each week and families increasingly relying on loan sharks. Rather than preaching about careful budgeting, why do Ministers not just scrap this hated and unworkable tax, which is sending people spiralling into debt?

[Mr Duncan Smith]

It is interesting that the Opposition and the hon. Lady take the view that people moving is a bad thing. Let me just tell her—[Interruption.] It is interesting that they say that, but 30,000-plus people—I will repeat that: 30,000 people—who were in overcrowded accommodation have now had the opportunity for the first time to move into houses where they are not overcrowded. The hon. Lady and the Opposition left us with a quarter of a million people in that position—250,000—so in 10 months over 10% have had the opportunity to move and we are saving over £1 million a day. I call that a success.

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

6. What steps he plans to take to tackle long-term unemployment.

--- Later in debate ---

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

12. What assessment he has made of the effectiveness of the benefit cap.

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

The benefit cap is working. The latest statistics show that 39% of those who are no longer subject to the cap have since moved into work. We will evaluate the policy thoroughly, and expect to publish the findings in the autumn.

[Ian Swales]

The average yearly pay in my constituency is about £21,000 before tax and national insurance. Does the Secretary of State think that a benefit cap of £26,000 gives people outside London an incentive to work?

[Mr Duncan Smith]

The introduction of the benefit cap meant that, for the first time ever, people who were out of work could not end up with more than the average earnings of people who work hard and try to make their way in the world. That was the first stage of the process. Obviously, as with all our policies, we continue to look at it, but I currently have no plans to change the existing levels.

[Stephen Metcalfe]

Given that Members in all parts of the House have now supported a cap on benefit spending, will my right hon. Friend tell us whether he has received any representations on how it is possible to promise to repeal some welfare reforms such as the benefit cap while at the same time avoiding a breach of the overall cap?

[Mr Duncan Smith]

Interestingly, the Opposition voted against the imposition of the benefit cap, which they subsequently claimed to support. Last week they did a U-turn and voted for the welfare cap, which is the overall setting of the level of welfare. They plan to get rid of the spare room subsidy, but they have not told us where they will find the money. So here we go again: it will mean more money in taxes, more money in spending, more money in borrowing, and a bust economy once more.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

9. What progress he has made on the mesothelioma compensation fund scheme; and if he will make a statement.

--- Later in debate ---

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

14. How many IT specialists are working on the digital solution to universal credit.

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

We continue to build up the Department’s digital capability, having launched the Government’s first digital academy and brought in a man called Kevin Cunnington, who was previously global head of online at Vodafone. Some 370 people are working full time on the universal credit change programme. The aim of any multidisciplinary team is that individuals should come and go, reflecting requirements at each stage. A team of 50, of which 25 are digital specialists, is currently working alongside other experts, and it is steadily building and on track.

[Chi Onwurah]

It is my understanding that the Secretary of State plans to continue the development of the existing, discredited universal credit IT system while building a new system in parallel, on the recommendation of the Government Digital Service. Will he confirm whether that is the case, and set out how much extra that double development is going to cost? Also, how is he going to recruit the skills he needs, given the current shambles?

[Mr Duncan Smith]

First, on the skills side, we have been recruiting and we have also been educating internally at the DWP, which has been a big success. The digital process, which is about improving this, will carry on. It is the development that was recommended for the longer term. In the meantime, the live service is running, and the system is not discredited. It is working, with the pathfinder rolling out through the north-west, and it will continue to roll out. The vast majority of the equipment being developed in that will be used within the digital system, so those who say that the money being spent on that is being wasted are simply wrong. It will be used in the medium and longer term for all of the universal credit roll-out.

[Charlie Elphicke (Dover) (Con)]

In developing universal credit and its IT system, what lessons have the Government drawn from IT projects conducted by the previous Government?

[Mr Duncan Smith]

The reason why we are doing this in a way that tests it at each stage, so we make sure we have got it right before rolling it out and taking more numbers on board, is because we want to make sure that taxpayers’ money is protected through this process and that the system works. I recall, as I am sure my hon. Friend does, that when the Labour Government launched tax credits it was a total disaster; we had loads of people in our surgeries with real problems relating to payments. This Government will never revisit that, which is why I will never accept any advice from the lot who wasted billions on failed IT programmes.

[Chris Bryant (Rhondda) (Lab)]

I know the Secretary of State loves to argue that black is white and white is black, but how on earth can he possibly stand here and suggest that this project is “on track”? The Government promised that 1 million people would be on universal credit by tomorrow—by 1 April this year—but how many are on it? He said at the beginning of the month that there were 6,000, but the figures given by the Minister of State, the right hon. Member for Wirral West (Esther McVey), show that fewer than 4,000 are. So precisely how many people are working on the IT? Is it 50, as the Secretary of State just said, or is the figure eight, as the Minister of State said earlier this month?

[Mr Duncan Smith]

I know the hon. Gentleman likes to get up and speak, but sometimes he needs to be aware of the facts that have been given to him. I have just given those facts, but because he was not listening I will give them again. Of the team of 50 working on the digital system, 25 are digital specialists—there will be more as we develop it and report back. May I simply say that instead of moaning about this system, Opposition Members might like to visit it, as many other MPs have done, because they will see how successful its rolling out has been? Some 90% of the claims for JSA as a result of universal credit are now made online, and 78% are monthly payments—these are people confident to receive those payments. [Interruption.] The reality is that the systems the Labour Government implemented were failures, whereas this will succeed and change many people’s lives.

[Mr Speaker]

Order. Mr McCann, I say to you in all courtesy and in all charity that the role of the Parliamentary Private Secretary—you are sitting in the PPS slot—is to nod and shake the head in the appropriate places, and to fetch and carry notes, not to shriek from a sedentary position or gesticulate in an unseemly manner.

[Andrew Bridgen (North West Leicestershire) (Con)]

Will my right hon. Friend confirm, and remind the House, that universal credit is set to deliver £35 billion of benefit to our economy?

[Mr Duncan Smith]

Yes, I agree with my hon. Friend on that. The National Audit Office report said that a minimum of £38 billion would actually be the positive elements brought to the UK economy and those who are in need. The real problem is that the Opposition say they support it, but they carp about it. The reality is that every change they ever brought in was a failure. They wasted billions of pounds of taxpayers’ money. We will implement this carefully and because of that, people will benefit, rather than suffer, as we all recall they did when Labour introduced tax credits.

[Mark Pawsey (Rugby) (Con)]

15. What recent assessment he has made of the effect of universal credit on employers.

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

The Department has consulted widely with employers over the past 12 months to ensure that universal credit works in the best way possible for them. The Minister with responsibility for welfare reform recently met national employers, trade bodies and employer representative groups, and we know that universal credit will have a positive impact on employers through the flexibility it brings to their work force—unlike tax credits.

[Mark Pawsey]

I thank the Secretary of State for that answer. He will be aware the Rugby jobcentre is among the first six offices to introduce universal credit. Will he join me in complimenting the staff there on achieving a successful roll-out in a complicated procedure? Given recent concerns about child care, will he reassure the House about the availability of child care support under universal credit for families in work?

[Mr Duncan Smith]

I am grateful to my hon. Friend for raising that issue, because under universal credit we will increase the child care level to 85% of the cost. We will be investing a further £400 million a year in a steady state, and 500,000 families will gain. These are positive incentives to go back to work. Child care costs are now paid up to a maximum of £646 per month for one child and £1,108 for two or more children. In universal credit we are removing the 16-hour rule, which exists in tax credits and is a major disincentive for many lone parents and others to take jobs—that has been abolished, and some extra £200 million will help 100,000 families back into work.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

17. What recent assessment he has made of whether the UK will meet the 2020 statutory child poverty target.

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

The Government are committed to the Child Poverty Act 2010 and to ending child poverty by 2020. It is not possible accurately to project child poverty figures, but already we are seeing progress in tackling the root causes. Just last week, we learned that there are now 290,000 fewer children living in workless households compared with 2010, and that has a net impact and effect on child poverty.

[Catherine McKinnell]

The Secretary of State mentions reducing the number of children in workless households, but today child poverty is overwhelmingly a problem for working families. Since 2010, the number of parents who work part time but who want to work full time is up 45%. What are the Government going to do about the prevalence of low-paid insecure work that is trapping families in poverty?

[Mr Duncan Smith]

The last figures that covered people who were in work and in poverty were misrepresented by those who talked about them. In truth, those figures reflect what happened under the previous Government, when we saw an increase of 500,000 families who were in work and in poverty. That has been flat since the election. We are working on that to ensure that we get as many people out of poverty as possible. The reforms that we are changing and making to get people back to work, which the Minister of State, my right hon. Friend the Member for Wirral West (Esther McVey) has talked about, will have a huge impact on those who are in poverty now.

People are better off in work. Despite what Labour did, people have more chance now to change their circumstances and more likelihood of coming out of poverty. Let me remind the hon. Lady of one little fact. Labour spent £175 billion of taxpayers’ money on one benefit—chasing a child poverty target that it simply did not achieve. That was wasted money.

[Mary Macleod (Brentford and Isleworth) (Con)]

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

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

We were pleased this week to find elements of—that new families formed were no longer breaking up. These figures came out last week to ensure that we are making our programmes work for very good reasons. Families are now staying together. Stable families in households being able to—[Interruption.]

[Mr Speaker]

Order. May I gently interrupt the Secretary of State? I thought that he was going to give a brief rundown of his departmental responsibilities in answer to the first topical question.

[Mr Duncan Smith]

I was talking about the figures that came out last week on new families forming and staying together.

[Mr Speaker]

That is what the right hon. Gentleman was seeking to do?

[Mr Duncan Smith]

indicated assent.

[Mr Speaker]

We are grateful. We will leave it there for now.

[Mary Macleod]

May I thank my right hon. Friend for the work that he and his Department are doing in transforming lives and getting people back into work? In preparation for my jobs and apprenticeships fair on Friday, will he confirm the job vacancy figures for both London and Brentford and Isleworth?

[Mr Duncan Smith]

At the end of last week, there were 927 active vacancies and 1,493 active jobs in the Brentford and Isleworth constituency. The vacancies were largely in retail, travel, transportation and tourism. The jobcentre has also worked with Asda and Premier Inn to deliver work experience and sector-based work academy opportunities.

[Rachel Reeves (Leeds West) (Lab)]

Just 46% of disabled people are in work, while 40% of disabled people not working report that they want to work. Helping disabled people into work provides them with security and dignity as well as helping control the costs of social security. Will the Secretary of State tell the House what proportion of disabled people referred to the Work programme get a job?

[Mr Duncan Smith]

The Work programme has been successful for those who are furthest from the labour market. The group of people the hon. Lady is talking about who suffer from sickness and disability have, for the first time, been worked with and helped back into work. The figures that we are seeing now are slower than we would have wished, but they are, none the less, improving all the time. Let me remind the hon. Lady that no one has ever attempted to get these people back into work. The Work programme is succeeding in helping into work those who were never in work before.

[Rachel Reeves]

The truth is that just 5% of disabled people on the Work programme end up in work. If that is a success, I would like to know what failure is. It is worse than doing nothing. It is a disgrace to let disabled people down in such a way. In the Budget, spending on employment and support allowance was revised up by a staggering £800 million because of delays, incompetence and the complete failure of the Work programme. Will the Secretary of State now agree to take action to help disabled people and give them the support they need and reform the failing Work programme?

[Mr Duncan Smith]

Let me remind the hon. Lady that, as I said earlier, for these people, and the previous Government made no effort whatsoever to get them back to work—[Interruption.] No, 2.5 million people were written off on sickness benefits under the previous Government. No one worked with them and about 1 million were left without anybody seeing them for nearly 10 years. That is the record of the previous Government. I simply remind the hon. Lady that since we came to power, some 22,000 have started a job for the first time and many thousands more have worked with the Work programme to get ready for work without a requirement to go to work. The programme is succeeding and improving all the time and this is the first time that the thousands who are going back to work have ever had help—they got none from the previous Government.

[Henry Smith (Crawley) (Con)]

T2. What is my right hon. Friend’s assessment of how the Government’s triple lock guarantee for increases in the state pension has benefited thousands of pensioners in my constituency and across the country?

--- Later in debate ---

[Steve Baker (Wycombe) (Con)]

T9. What recent assessment has the Secretary of State made of the innovation fund in helping disadvantaged young people?

[Mr Duncan Smith]

The innovation fund, which started with £30 million put in by my Department, has helped to build up the concept for social impact bonds, which will help to invest in the sort of projects that my hon. Friend is talking about. The trials have been to help children from the ages of 14 to 16 to get remedial education and to be job-ready. That has been a huge success and we will in due course publish the figures, but it opens the marketplace to new money from private investors and trusts.

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

Last week, the Select Committee on Work and Pensions published a report that recommended that the backlog for the PIP assessment should be cleared before the Government continued with the migration from the disability living allowance to PIP. Will the Government accept that? Will the fact that Atos has now lost the contract for the WCA have an impact on PIP? What action has the Minister taken to speed up new claims for PIP?

[David Rutley (Macclesfield) (Con)]

Given the German Government’s determination to clamp down on EU migrant benefit abuse, does my right hon. Friend agree that there is growing support among key EU member states for this Government’s agenda on this vital issue?

[Mr Duncan Smith]

Yes, there is huge support in other countries. Recently, Mrs Merkel, the Chancellor of Germany, said:

“There is a need for clarity: who is entitled to claim social security in Germany, and under what conditions.”

The Deputy Prime Minister of the Netherlands, among others, has said exactly the same. I am in discussions with many of my counterparts across Europe to make sure that we, as individual independent nations within the EU, will be able to impose the conditions we require to stop migrants coming here just to get better benefits than they would in their own country.

[Mrs Mary Glindon (North Tyneside) (Lab)]

With thousands of PIP claimants waiting six months or more for even their medicals before they get anywhere near any money, will the Minister say exactly what penalties he is imposing on Atos and Capita for failing so abysmally?

--- Later in debate ---

[Mr David Nuttall (Bury North) (Con)]

Does the Secretary of State agree that, when it comes to a jobs guarantee, in the real world there is no such thing as a guaranteed job and that new, genuine jobs can be created only by growing companies?

[Mr Duncan Smith]

What is interesting about the Opposition’s view of a jobs guarantee is that their future jobs fund failed. We have introduced work experience, which costs a tiny proportion of what the future jobs fund cost—some £300, as opposed to £6,000 or nearly £7,000 a job—and as many people get into work and come off benefit as did under the future jobs fund. Labour’s make-work schemes do not work, but our schemes, which get private sector employers to help, do. We are getting people back to work.

[Bill Esterson (Sefton Central) (Lab)]

More than 15,000 people in my constituency, which is over 40% of those in work, earn less than the living wage. For millions of people the employment figures hide the reality of underemployment, zero-hours contracts and part-time, low-paid and insecure work. I wonder whether the Secretary of State can tell me how many of his constituents earn less than the living wage.

[Mr Duncan Smith]

I never heard Labour Members moan much about the living wage when they were in government, but all of a sudden it becomes an issue. The reality is that we are doing more to get people back to work, which gives them a chance to improve their living standards and incomes. The reality is that I took the decision to ensure that my Department pays the living wage, including to the cleaners. The Opposition never did that. I think that we stand ahead of them in that matter.

[Philip Davies (Shipley) (Con)]

Has the Secretary of State noticed that when the spare room subsidy was first removed the Opposition and their mouthpiece of choice, the BBC, complained that too many people would be removed from their homes, yet last week Labour BBC was complaining that too few people have been removed from their homes? In the interests of fairness, surely taxpayers not on housing benefit who cannot afford a spare bedroom should not be expected to pay for a spare bedroom for people on housing benefit.

[Mr Duncan Smith]

The first and principal point is that this programme is saving over £1 million a day for hard-pressed taxpayers, many of whom, as my hon. Friend said, cannot afford a spare room themselves but were paying taxes to subsidise those who had spare rooms. The second point is that over 30,000 people who were once in overcrowded accommodation, left behind by Labour in terrible conditions, are now moving into better houses. This programme is a success. The Opposition did nothing about those people the whole time they were in government.

[Mrs Anne McGuire (Stirling) (Lab)]

In my constituency the waiting time for PIP assessments is now 26 weeks. [Interruption.] After further investigation, I discovered that that is because of a lack of suitable accommodation in which to carry out assessments. Why was a contract signed with Atos when there were no suitable premises in my constituency in which to carry out PIP assessments?

amendment of the law

Iain Duncan Smith Excerpts

Tuesday 25th March 2014 Commons Chamber

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

Last week the Chancellor presented his Budget, reiterating this Government’s commitment to a long-term economic plan. [Interruption.] I will say that again—a long-term economic plan, something that Labour does not have or is in search of, I am not sure. We are restoring the public finances and supporting businesses while providing security and stability for Britain’s families. I must say that today’s other news that inflation is down to 1.7% is very good news for hard-working families.

Following Labour’s great recession, which, I remind the House, wiped out 7.2% of our economy, worth £112 billion or £3,000 for every household in the country—it is still in denial—last week we learned that our economic recovery is now established and taking hold faster than originally forecast.

[David Wright (Telford) (Lab)]

Will the right hon. Gentleman give way?

[Mr Duncan Smith]

I will give way, but many Members want to speak, so first I want to make a little progress.

A year ago, the Office for Budget Responsibility predicted that growth in 2014 would be 1.8%. Now, the forecast is 2.7%, the biggest upward revision between Budgets for at least three decades. The deficit has fallen by a third in three years, and is forecast to halve by next year. By 2018-19, the OBR expects the public finances to move into surplus by some £4.8 billion for the first time in 18 years. Before that, in 2017-18, the fiscal mandate will be met a year early. Employment has been revised up and unemployment revised down in every year of the forecast.

[David Wright]

The right hon. Gentleman was talking earlier about the process under the previous Government, and he claimed that it was Labour’s recession. When he was leader of the Conservative party was there any point at which he did not agree with the spending plans of the then Chancellor of the Exchequer?

[Mr Duncan Smith]

I remind the hon. Gentleman that when one goes into government one is responsible for what happens. I know it is hard to take, but I have always believed that one wants to go into government to take responsibility for all the things that take place while one is government. He may not want to know it, but the reality is that the Labour was in government, the recession was very hard, and people have suffered.

There is still more to do—we have not done enough—if we are to secure Britain’s future. That is why the Budget set out further investment to ensure a resilient economy that delivers the promise for business that it can compete with the best in the world, and hope for families—this is important—about their prospects now, and for their children’s futures. From next week, corporation tax will be down to 21% from the 28% inherited from Labour, and will be down again to 20% next year—the joint lowest in the G20—making it competitive to invest in Britain, which is good for jobs and good for young people.

That will be matched by the best export finance, doubling direct lending to £3 billion and the investment allowance to £500,000, so that British business can take advantage of the best opportunities at home and abroad. Again, that is good for investment and good for growing jobs.

We are cutting tax not just for business but for Britain’s hard-working people, ensuring all can share in the benefits of Britain’s growth. By raising the personal allowance threshold to £10,500 next year, we are taking some 3 million of the lowest paid out of tax altogether and ensuring 25 million people pay less.

As a result of those changes since 2010, the typical taxpayer is £800 better off—something that Labour’s simple measure of real earnings fails to recognise. Similarly, through new child care support, we are helping families overcome prohibitive costs and ensuring that more parents find that it pays to get a job. Under universal credit, we have already invested £200 million to remove the 16-hour rule, so that 100,000 families in mini-jobs or part-time work receive help for the first time. Now, we are going further still, increasing child care support from 70% to 85% of costs so that work pays more for half a million families.

It pays to work, and now, finally, it pays to save, reversing the damaging trend whereby for too long Britain has borrowed too much and saved too little. The radical changes to retirement saving announced in the Budget are possible only because of the significant pensions reforms the Government have already delivered: a triple lock on the state pension; auto-enrolment to make saving the norm, helping up to 9 million save in a workplace pension—over 3 million are already saving, and I give due credit to the Minister of State, my hon. Friend the Member for Thornbury and Yate (Steve Webb) for that—and, vitally, the single-tier pension, for which I again give credit to my hon. Friend, set above the level of the means test, so that those who have contributed for 35 years have a secure basic income, without having to resort to additional state support in later life.

[Mr Mark Harper (Forest of Dean) (Con)]

I listened carefully to what my right hon. Friend said about incentives to work. Will he say a little about the 450,000 fewer workless households, and the 290,000 fewer children living in such households? Perhaps that has something to do with his welfare reforms.

[Mr Duncan Smith]

I am going to come on to that, but one of the great success stories is the fact that the number of workless households has fallen for the first time in 30 years. My hon. Friend is absolutely right, and I shall give a few more details about that in a second.

[Several hon. Members]

rose—

[Mr Duncan Smith]

I shall make a little more progress before giving way to the hon. Member for Edmonton (Mr Love).

As a result, for the first time, we can rethink the rules and trust people to use their own money as they see fit, not as the Government tell them. After the Budget, gone will be the prescriptive limits on how and when people can turn their pension pot into annual income, which, we all agree led, for too long, to inertia among consumers and risked locking people into low-yield annuities, with rates that have fallen by 15% since 2009. In countries such as the United States, Australia and Denmark, Governments do not impose restrictions. Now, that will be the case in the UK too, freeing people to shape their finances in retirement as they choose, which is absolutely right.

We are consulting on guaranteed guidance—an important feature of the Budget—asking the Financial Conduct Authority to work with the pensions regulator, consumer groups and others, to develop a robust set of standards and monitoring arrangements, with £20 million provided to kick-start that thinking. Whether people choose to buy an annuity as now, take the cash, or grow their pension pot, the reforms will increase the attractiveness of saving for retirement. That will pave the way for new financial products, increasing competitiveness in the market, driving innovation and a better service, as well as giving people new choice over their future.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

The OBR has forecast that under the Budget the savings ratio will fall to 3%. Is the Secretary of State concerned about that, and what action will he take to get savings back on an upward path?

[Mr Duncan Smith]

As I recall, the savings ratio under the previous Government fell to all-time lows, and under this Government it will be higher at the end of this Parliament than it ever was under Labour. When I take interventions from the Opposition they always fail to recognise that the economy crashed in 2009-10, taking 7.2% off gross domestic product, which had a staggering effect on savings and everything else. The reality is that we will have a better savings position, which will grow, given the fact that we are working to improve savings in pensions in the workplace, with a single-tier pension and giving people the right and responsibility to choose where their savings go.

[Mr Love]

rose—

--- Later in debate ---

[Mr Duncan Smith]

I have given already way to the hon. Gentleman, and I just want to make another point about something that is typical of what has been going on.

On Wednesday, in his Budget response, the Leader of the Opposition did not mention pension reforms at all. Come to think of it, he did not mention any single measure in the Budget. On Thursday, the shadow Chancellor would say only of the measure that Labour would somehow look at the proposals. On Friday, in a panic, I think, the hon. Member for Leeds West (Rachel Reeves) said on “Any Questions” that she supported the reforms. On Sunday, when asked whether he supported the measure, the shadow Business Secretary began to backtrack and said:

“I’m not going to sign a blank piece of paper on your show”.

Later the same day, the hon. Member for Leeds West began to backtrack, saying that Labour supported the reforms but that they did not go far enough. Labour’s position on this policy is a complete shambles. It has struggled to reach a position and say that it may support the measures not because it believes in it but because it realises that it is popular. The reason Labour does something is all about popularity and nothing to do with values—that is the truth of it.

Over and above the radical changes to pensions savings, the Budget announced four further important measures to make saving pay, including abolishing the 10p rate for savers altogether, for the first £5,000 of savings. As my right hon. Friend the Chancellor said, when we abolish a 10p rate, we take it to zero; when the previous Government abolished the 10p rate, they took it to 20p. Those measures also included merging cash and stocks to create a single, simple new ISA, with an increased annual limit of £15,000; launching a new pensioner bond, paying market-leading rates; and introducing something that we have worked on in the Department with the Treasury and my right hon. Friend, the excellent Chief Secretary: a class 3A national insurance contribution, so that anyone who has reached state pension age before the single tier is introduced can top up their state pension.

The Opposition’s response is becoming chaotic. I want to press the hon. Member for Leeds West: normally by this point in the Budget debate, I understand, the Opposition make it very clear what resolutions they will vote against, but we have heard nothing from them at all. It seems that there is a row and chaos, so I will give way to the hon. Lady if she would like to tell us which ones.

I particularly want to ask her about resolution 43, which, I understand, is about the treatment of salaried members within limited liability partnerships. I wonder if she can tell us whether the Opposition will vote against that, given the fact that their economic policy is now fundamentally limited, that their leadership is a liability, and, after all their rows, that they are clearly not in a partnership? I will give way to her if she would like to tell us which resolutions she is going to vote against. Will she confirm or deny that she is voting against anything? I will give way to her if she wants. Well, they clearly do not know, Mr Speaker, so we will look forward to this evening with some relish.

It now pays to save. That is what is going on—I am glad that you enjoyed that joke, Mr Speaker; you are always a good test on these things—and so under the Government it pays to work, breaking dependency and getting people back into jobs.

[Mr Speaker]

For the avoidance of doubt, I should just say that I was happy to see the Secretary of State looking happy.

[Sheila Gilmore (Edinburgh East) (Lab)]

The Secretary of State will be aware that, for very many people, the average level of savings is in the hundreds, not the thousands. Do the Government regret abolishing the savings gateway as one of the first measures they took on coming into government?

[Mr Duncan Smith]

When the hon. Lady got up to make an intervention, I wondered whether she would take the opportunity to say how much she welcomes the fact that unemployment has fallen by 20% in her constituency—a very good thing. I know she does not want to say that, but I say it for her.

I have to say to that no, we do not regret that. What we have undertaken since we came into power is going to hugely incentivise and improve pension savings and the savings marketplace. The extra vehicles announced in the Budget will rapidly improve that and I believe, all in all, that we will have a much better savings position than we inherited, so I think I have answered that question.

I need to make the point about employment and unemployment. Let me get this right: when we came into power, we inherited a situation where unemployment rose by nearly half a million. At its peak, some 5 million were on out-of-work benefits—1 million for a decade or more—and in one in five households, no one worked. The number of households where no member had ever worked doubled under Labour, from 184,000 in 1997 on an upward trend to 351,000 by 2010. I do not recall Labour Members mentioning those figures, and they avoided them when they were in power.

Correspondingly, since we came to power, unemployment is down 168,000 since the election. The claimant count has fallen by almost a quarter over the last year, which is the fastest annual fall since 1997. Workless households have fallen to the lowest rate since records began, down 450,000—two percentage points—since the end of 2010.

At the same time, we now have record employment: more people in work than ever before, more women in work than ever before and more people in work in the private sector than ever before—up over 1.7 million since the election. Ninety per cent. of the increase over the last year has come from British workers, unlike before, and more than three quarters of the increase since the election is from full-time work, up over 1 million compared with part-time work, which is up only 300,000.

Here is the point: we hear a lot from Labour Members about what they would do if they were in government, but youth unemployment increased under the previous Government by nearly half from 1997 to 2010—up almost 300,000. Now, on what the shadow Work and Pensions Secretary called

“the failure of this government to get young people into work”,

youth unemployment is down 81,000 on the year and is lower than what we inherited. The International Labour Organisation long-term youth unemployment is also down 37,000 on the year. The number of young people out of work and not in full-time education is down 63,000 and the long-term youth claimant count is down 23,900 on the year, having fallen for the last 15 consecutive months.

I remind the Opposition, who are chuntering away from a sedentary position, that under them long-term unemployment nearly doubled in two years, from 400,000 in 2008 to 800,000 in 2010. While they were seeing that rise, they gerrymandered the figures on the claimant count: 80,000 were put on to training allowances so that they came off the measurement of whether they were long term unemployed. Even though they were back out of work or back out of training, they went back as though they had just started their claims.

The trend slowed and is now falling. ILO long-term unemployment is down 38,000 this quarter and is down 59,000 on the year. The number on the claimant count for 12 months, ungerrymandered, is down 74,000 on the year—a fall of 17%. That is down, I believe, to so many of the reforms and changes that we have made, improving the labour market and improving the process of getting people back to work. The latest labour market statistics are remarkable and nothing demonstrates more clearly the Government’s success in getting Britain working.

[Mr Love]

In recounting all the figures going down, the Minister omitted to mention that living standards have gone down—according to the Institute for Fiscal Studies, by about 6% over the past four years. What is the Minister going to do about that figure?

[Mr Duncan Smith]

Again, I say to the hon. Gentleman that he really needs to address his question to those who were governing, because, as I said earlier, GDP fell by 7.5% under the previous Government during the recession. What does he think forced those economics for individuals and working households to fall? It was the fact that there was a massive recession—the biggest for 100 years —on Labour’s watch.

I want to make some progress. The latest labour market statistics are remarkable. The Work programme that we brought in is now helping long-term unemployed people dramatically: half a million people under the programme have started a job; 252,000 have now gone into sustained work; and 10 times as many people have achieved job outcomes now compared with the end of the first year.

Compared with the flexible new deal, one of Labour’s great flagship programmes, under the Work programme, twice as many people have gone into a job, and it costs £5,000 less per place according to all the estimates. So, too, with the work experience programme that we brought in, allowing young people to take a work experience placement for up to two months while still keeping their benefit. That has helped 50% of participants off benefits and into work. It has the same success rate as the future jobs fund, but at a 20th of the cost—£325 as opposed to £6,500 of wasted money. What is more, the majority of places are in the private sector, whereas the future jobs fund created jobs almost exclusively in the public sector.

This Budget has been very good for jobs but it is very good for apprenticeships as well. The Government have already committed to a quarter of a million more apprenticeships than Labour ever planned, with 1.6 million starts since 2010. The Budget announced £170 million more for another 100,000 apprenticeship grants and for developing new degree-level apprenticeships as well. It is important that the Government are not only finding and helping to find people work, but helping to shape their skills and experience.

[Nick de Bois (Enfield North) (Con)]

In the Secretary of State’s list of successes, rightly attributed to the businesses in this country and the Government’s policies, will he also make reference to those that are now being supported by the enterprise allowance and the start-up schemes? As we saw at my recent jobs fair, more people are seeking self-employment as well.

[Mr Duncan Smith]

I pay tribute to my neighbour and hon. Friend for his phenomenal work on the jobs fairs, on all the creation he has done and on the work he has done with local unemployed people. He is absolutely right: the new enterprise allowance has been a phenomenal success. Thousands of people have started their own businesses under it. It is one of the big success stories of this Government. It is going to grow and we are going to ensure that many more people, particularly young people who are more and more keen to start their own businesses, get the kind of support they want.

[Sheila Gilmore]

Does the Secretary of State not have any concern that even now there are 2.3 million people unemployed, and as his own statement made clear, the total has gone done by only some 160,000 since the election? The figure was 2.4 million before the election and now it is 2.3 million. What has gone wrong with getting those people into jobs?

[Mr Duncan Smith]

Of course I want to see more people back in work, particularly young people, but the hon. Lady must remember that we inherited from the previous Government an economy that had hit the buffers, with young people cascading out of work in the two years running up to the election. Youth unemployment rose over their whole period in office, which suggests to me that their policies were hurting young people long before the recession. What we are doing is aimed at getting more people back into work. We have been successful in improving the situation, as the figures now are better than those we inherited—more people are in work, including more young people—but of course there is more to do, and it is this coalition Government who are doing it.

We are also introducing our other programmes, including the Work programme and universal credit, with the pathfinders moving into the north-west and eventually rolling out by 2016. We know that 90% of claims for jobseeker’s allowance and other benefits are already being made online, which is a huge change—only about 10% or 12% were made online before—that is improving speed and accuracy. Some 78% of claimants are confident about their ability to budget with monthly payments, as a result of the programmes we have run. Two thirds think that the universal credit process offers a much better work incentive than jobseeker’s allowance. Even in its early stages, universal credit is having a significant impact on people’s work prospects: claimants are likely to spend twice as long looking for work; two thirds agree that it is easier to understand their obligations; and 86%—rising to 90%—are confident of gaining a job within three months, which is a much higher rate than for jobseeker’s allowance.

These are dynamic changes that we are making, improving the path back to work, the incentives and the choices that people make. We are improving their work prospects and helping them into meaningful, long-term jobs. However, I gather from the Chief Secretary that the Treasury received a submission from the Opposition in the run-up to the Budget for an alternative to our programmes, which they call a jobs guarantee. I thought that we should look at that, just to examine whether it was worth embracing. I think it only fair that we tell the House whether or not it would work. Having looked at the proposal in a completely ambivalent manner, I have to say that it is confusing. The first submission said that it was a six-month programme for young people. The second submission said that it was a year-long programme. The third submission said that it was a two-year programme for the long-term unemployed. I gather that there is now some suggestion that it might be a six-month programme for everybody.

Apparently the jobs guarantee is now a flagship policy for the Opposition, but I understood that it would be funded for only one year. Now we hear that the same funding they announced for one year is meant to last all the way through a full Parliament. We asked the Treasury to do some formal costings for that, which I hope have been made available to the Opposition. They said that their scheme would cost only £1.9 billion in its first year and £0.9 billion thereafter, but the Treasury’s formal costings—[Interruption.] I know that Opposition Members do not want to listen, because the last thing they want to hear is how they would pay for it The Treasury, which is full of decent people doing a hard day’s work, has shown that there is a massive gap of £2.6 billion per year between what the Opposition say their jobs guarantee will cost and what we calculate it will cost.

Not only have the Opposition underestimated the costs by £0.6 billion in the programme’s first year, and £1.7 billion in future years, but they have no robust means of funding it. They say that they will fund it with a bankers’ bonus tax that will raise £2.3 billion, which is questionable, but I understand that they have spent that 10 times over. Let me list a few of the things they have committed to spend it on: reversing the VAT increase, which would cost £13.5 billion; more capital spending, which would cost £5.8 billion; reversing child benefit savings, which would cost £3.1 billion; reversing tax credit savings, which would cost £5.8 billion; and more housing, which would cost £1.2 billion. They have made £30 billion of spending commitments, apparently to be paid for by a tax that would save them £2.3 billion.

[Charlie Elphicke (Dover) (Con)]

Does my right hon. Friend agree that the lesson of Labour’s crash is that more spending, more borrowing, more debt and more taxes do not work? Does this not show that the Opposition have not worked that out, because they have spent their bankers’ bonus tax more times than the number of sides on the new £1 coin?

--- Later in debate ---

[Mr Duncan Smith]

My hon. Friend is absolutely right. The reality is that the Opposition are not very good at learning lessons. Were they in power again, I suspect that they would crash the car into the buffers, just as they did the last time.

At the same time, the Opposition’s proposal for restricting pensions tax relief has been called “extraordinarily complex” by the IFS and “unworkable” by the CBI. Labour needs a little reminder that make-work schemes are enormously expensive and, worse still, a mean attack on these pension proposals. The saving they expect to make from pensions tax relief is another mean attack on people who do the right thing by saving for their future. Labour has learnt nothing. Its proposal is even possibly a rehash of its old StepUp programme, which ended up costing a massive £10,000 per place before it binned it, rather than introducing it.

There we have it: a policy—the only one I have heard from the Opposition—that is full of flaws, unfunded and simply would not work. It is small wonder that when asked they said, “Okay, this will be about the private sector.” Actually, the future jobs fund, on which this proposal is based, never got jobs in the private sector. In fact, Barnsley council reported that only 7% of those jobs were in the private sector, and Birmingham council reported only 2%. It is small wonder that when asked to confirm whether that would be for private sector jobs, the shadow Chancellor said:

“But if not, you can do it through the voluntary sector. If not… you have to have a final backstop: public work scheme.”

If not one, then the other, but if not that, then another one. It begins to sound a bit like Vicky Pollard: “Yeah but no but yeah but no.” They have no policy for employment at all. To this date the private sector’s response has been unequivocal:

“Wage subsidies for employers are not the source of sustainable jobs… Government must focus on creating the conditions for growth”.

It is the same old Labour; the same old failed policies.

A little over a year before the next general election, this Budget sets out the choice now facing the electorate. On one hand we have an Opposition who every day are mired in confusion, who have voted against every reform measure and who have learnt nothing. After making welfare spending balloon by 60% during their time in government, they now want to spend more.

I want to ask the hon. Member for Leeds West what she meant by something she said when addressing a meeting of Christian socialists—perhaps they were just socialists, but I am not sure. She said:

“It will be much better if we can say all the changes that the Government has introduced we can reverse and all benefits can be universal.”

There we have the beating heart of Labour, and the public should know this—[Interruption.] They are cheering, because that is exactly what they want. Only now will they vote for the welfare cap—although I understand that a number of them will not—but they have no intention of sticking to it. That is only because, as the hon. Lady went on to say, to do what she wants to do would at the moment appear unpopular. They do something because it appears popular, not because they believe in it.

[Mark Pritchard (The Wrekin) (Con)]

I wonder whether my right hon. Friend can help me. Does he know whether it is now the policy of Her Majesty’s Opposition to have an individual welfare cap or a universal budget cap? It is not only hon. Members in this place who would like to know what their policy is; 27 bishops in the other place would, too.

[Mr Duncan Smith]

With respect, I have found in the past few weeks that I cannot really answer for bishops. They usually think they can answer for me, which is a fair response, but I am happy to avoid that challenge.

The Opposition have been quite confused about the welfare cap. They say that they are going to support it, but within the cap they have a policy they say they are going to change by ending the spare room subsidy. [Interruption.] Opposition Members call it a bedroom tax. I noticed that when they said last week that there were 24 tax rises under this Government, they did not schedule that as one of those tax rises. The truth is that they know it is not a tax, so, as ever, they are trying to fool the public. Let me point out that reversing that policy will cost them up to £500 million a year, and they have, they say, produced only one measure within the welfare cap that they will use to pay for that—means-testing winter fuel allowances for wealthier pensioners, but that will save only £100 million. Almost as soon as they vote for the cap tomorrow, they will be planning to break it. Perhaps the hon. Member for Leeds West can tell us—I will give way to her if so—what other elements she is going to change within the capped programme to reduce spending to bring it under the cap. Will she will intervene to tell me that? Of course not; she has no idea. There we have it—it is just a game for them. The only reason they might vote for the cap is that they are worried that it would be unpopular not to do so, but they do not intend at any stage to implement it.

On the other hand, this coalition Government are reforming welfare in the firm belief that it is the right thing to do, not only saving money but breaking dependency and restoring the incentive to work. We have record highs in employment and record lows for the rate of workless households. What is more, this Government are rewarding hard work and saving, in the belief that people have a right to take their own decisions on the money that they have earned, not dictating to them through high taxation or forcing them to buy poor yielding products as the previous Government did. This Budget delivers support for those who try, help for those who need it, and security for hard-working families up and down the land. I commend this Budget to the House.

[Several hon. Members]

rose—

--- Later in debate ---

[Mr Duncan Smith]

The hon. Lady has mentioned her jobs guarantee, which Labour has said will involve the private sector. Which companies have actually signed up to it?

[Rachel Reeves]

The compulsory jobs guarantee, which will last for the full five years of the next Parliament, will be based on what we have seen with the jobs growth Wales programme, whereby 80% of the jobs are in the private sector. A couple of weeks ago, the shadow Minister for employment—my right hon. Friend the Member for East Ham (Stephen Timms)—and I visited a software company in Cardiff that had taken on 12 people through jobs growth Wales. It had made a huge difference to those young people, giving them hope and opportunity. The Government carp at our policies to get young people back to work, yet under them long-term youth unemployment has more than doubled. That is the Secretary of State’s record under this Government.

If the Chancellor really wanted this to be a Budget for savers, he would cap fees and charges on pensions and require insurance companies to provide free independent brokerage, as Labour has called for. Why did the Chancellor not do those things? It is because he is strong when it comes to standing up for the rich, but weak when it comes to standing up for the poor.

--- Later in debate ---

[Rachel Reeves]

The right hon. Gentleman will not have to wait too long: at 7 pm, he will find out how we will vote on the different measures. Let us be clear: what matters most of all is what was omitted from last week’s Budget, including a compulsory jobs guarantee, a cap on fees and charges and cancelling the bedroom tax. Those things would make a real difference to the lives of our constituents, but the Chancellor did not even mention them in last week’s Budget statement.

The Secretary of State has not just failed with the Work programme; he is failing with universal credit as well. It is years behind schedule and £130 million has already been wasted on IT, yet the Secretary of State continues to say that his flagship reform is on time and on budget.

[Mr Duncan Smith]

indicated assent.

[Rachel Reeves]

He continues to do so now. If three years later and £130 million down the drain is on time and on budget, that says more about the Secretary of State’s grasp of mathematics than anything else.

The truth is that from Easterhouse—where the Secretary of State had his epiphany—to the Vatican, people are queuing up to tell the realities of this Government’s reforms. Rosemary Dixon, the chief executive of a charity on the Easterhouse estate in Glasgow—the Secretary of State might remember her—has said that the simple truth is that “things are going backwards.” A letter from 27 bishops stated that

“we must, as a society, face up to the fact that over half of people using foodbanks have been put in that situation by cut backs to and failures in the benefit system, whether it be payment delays or punitive sanctions.”

Archbishop Vincent Nichols has said that

“the role of food banks has been crucial to so many people in Britain today and for a country of our affluence, that quite frankly is a disgrace.”

The Secretary of State says that he is on a moral crusade. The people affected by his policies know what sorts of morals he has.

--- Later in debate ---

[Hazel Blears (Salford and Eccles) (Lab)]

It is a pleasure to follow the hon. Member for Stourbridge (Margot James). I want to concentrate my remarks on the social economy. I draw the House’s attention to my—unpaid—entry in the Register of Members’ Financial Interests.

Since the crash of 2008, there have been a difficult few years for countries around the globe. Many companies have struggled to find investment and to grow. Ordinary people have very often been faced with redundancy and unemployment. That particularly applies to our young people, of whom nearly 1 million are struggling to find work. Public services have been cut quite dramatically, and many are facing increased demand at the same time, none more so than in the spheres of the national health service and social care.

Against that very difficult background, and as we enter what I certainly hope will be a period of better economic news of sustained growth and job opportunities, we have a real chance not to do business as usual, but to take a new path towards what many of us have talked about in this House—a more responsible capitalism. At the moment, it is still a fairly nebulous concept, but I believe that we can start to put some flesh on the bones and to invest in the social economy.

For the past 18 months, I have convened a group of local authorities, social enterprises and some large corporate firms to consider how we might come together to get the public sector, the private sector and the third sector to work in a much more integrated fashion. We have done that under the banner, “Doing good is good business”. Social enterprise has always been a passion certainly of mine, but it is now taking a much more central position in our economy. In this country, there are 70,000 social enterprises, which contribute £18.5 billion to the UK economy and employ about 1 million people. It is no longer a niche part of our economy, but is becoming absolutely mainstream. In Europe, one in four new businesses that starts up is a social business. Some 35% of people who left private sector employment last year have gone into the social economy. It is really moving on apace. There are now many brilliant social enterprises. I have Unlimited Potential and Social adVentures in Salford. In the constituency of every hon. Member, there will be social enterprises that not just provide jobs and opportunities, but bring into our economy the absolute gold dust of innovation and creativity.

I want us to give a real boost to social enterprise on a cross-party basis, but we also need to do something about public procurement. The Public Services (Social Value) Act 2012, which I helped to take through the House, empowers public authorities to take into account social, economic and environmental impacts, as well as value for money. That can be absolutely transformational, provided that we get behind it, give it teeth and really make it work.

[Mr Duncan Smith]

I pay tribute to the right hon. Lady, whose work in this area has been really first rate. I told her that last time we met, over dinner at Apsley House, but I am just dropping names. Will she take her point a little further, because the creation of social impact bonds is a very big and important area? I know that she is a big supporter, but how does she see that rolling out, particularly now that the Budget will bring in tax relief for it?

[Hazel Blears]

I am absolutely delighted that social investment tax relief has been set at 30%. Some estimates suggest that that might liberate up to £500 million of extra investment into the economy. At a time of austerity and when there is very little public money about—whichever party is in power—we must absolutely seize the possibility of mobilising private capital for public good.

I pay tribute to the Secretary of State, because he has been a pioneer. He set up his social investment fund, which has catalysed the market in Department for Work and Pensions areas. I have spoken to the Secretary of State for Education to try to get something similar in relation to social mobility and educational attainment, and he is very interested. I said to him, “The Secretary of State for Work and Pensions is a bit of a pioneer, so why don’t you get involved in this as well?” I have also spoken to the Minister of State, Department of Health, who has responsibility for social care, to look at social investment bonds for the care of the elderly, particularly in relation to dementia, which is a huge issue for all of us and, indeed, countries across the world. Mobilising private capital to enable us to transform public services is an extremely exciting agenda.

I want to say a word about the Public Services (Social Value) Act, because a whole range of local authorities are now taking up the new powers, including my own in Salford, as well as Liverpool, which has declared itself a social value city, Birmingham, Wakefield, Hackney and Lambeth. People from all political parties and local authorities of all shapes and sizes want to commission in this new way. We now need transparency, through metrics and measurements, so that the people on this playing field can get some recognition.

One of the most exciting things is that some companies in the private sector want to do exactly the same in moving from traditional corporate social responsibility into using their mainstream business model to make a social impact. Companies such as Fujitsu, Veolia, Interserve and CH2M Hill are now looking at their supply chain to see how they can get social enterprises and small businesses to bring them the agility and creativity that such big global enterprises sometimes cannot put into the system. In particular, Fujitsu has done a report called “Collaboration Nation” about building a very different supply chain. It has told me that it absolutely sees the business case for doing so, because it is able to develop new products. It is also attracting the best talent, because these days young people want to work for an organisation that has values, and to go home at the end of the day being proud of what they do. All those private sector companies want to do that and be responsible capitalists in that way, but we must encourage them and recognise that this will be a long-term agenda.

I say to the Chancellor and the Secretary of State that if we could extend the Public Services (Social Value) Act to goods and infrastructure—that is where the big spend will be in the next 10 to 15 years, not necessarily on services and revenue expenditure—why can we not have social clauses in procurement for High Speed 2, for the possible new airport, or for regeneration projects that bring apprenticeships, get a better supply chain and make a social impact?

As I said, I am delighted that social investment tax relief is being brought forward. We now lead the world in that, and at the G8 meeting that I was privileged to attend we could see how much the United Kingdom’s creativity has taken that forward. There are now a whole range of new social investment bonds. We have just signed one off in Manchester to help young people come out of care, and to provide foster care and adoption, which is an amazing ability.

When I went to Brussels last week I met Commissioner Andor, who was hugely encouraging about social procurement and social investment. We are about to launch some local investment funds. The first was launched in Liverpool two weeks ago, and we would like to have 10 to 15 across the country over the next year. We are hoping to do that in Greater Manchester, bringing together European Union structural social funds with social investment, to provide unsecured loans to social enterprises of £50,000 to £100,000—exactly the kind of loans they need.

All that brings the social economy into the mainstream. We used to think about social enterprise as a niche or an add-on to the mainstream economy, but no longer. If we take what measures we can to make social procurement mainstream, including goods and infrastructure, and to support social enterprises to make social investment and the market grow in the long term, we can genuinely harness the innovation that is often in social enterprise, together with people who want to do capitalism in a more responsible way and the engine of the public sector. In doing that we will show that “doing good” really is good business.

Child Poverty Strategy 2014-17

Iain Duncan Smith Excerpts

Thursday 27th February 2014 Written Statements

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

Today, jointly with my right hon. Friend the Minister of State for Schools, I am publishing the Government’s draft child poverty strategy 2014-17. We are seeking views through a public consultation, closing on 22 May 2014.

Our draft strategy builds on the good progress we have made so far in tackling child poverty. Despite the tough economic climate, employment has increased by 1.3 million since 2010 and the number of children in workless households has fallen by 274,000. Poor children are doing better than ever at school; the proportion of children on free school meals getting good GCSEs including English and maths has increased from 31% in 2010 to 38% in 2013.

Alongside our strategy, we are publishing an in-depth evidence review which identifies what leads families to be stuck in poverty and what leads poor children to become poor adults. By identifying and understanding the root causes of child poverty, now and across generations, we can target action effectively. This is an important step in our mission to eradicate child poverty.

Based on the evidence in the review, our strategy sets out the action Government are taking to tackle child poverty.

It sets out how we will tackle poverty now through supporting families into work and to increase their earnings, support living standards through decreasing costs for low-income families and prevent poor children becoming poor adults through raising their educational attainment.

However, central Government action cannot, by itself, end child poverty. Action is also needed by employers, the devolved Administrations, local areas and the voluntary and community sector. Today, we are asking for views on what more can be done and how we can all work together to end child poverty. Only by working together can we transform the lives of the poorest children in our society.