Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 9th March 2015 Commons Chamber

[Mr Duncan Smith]

We have indeed. From what I have read of the reports my hon. Friend mentions, every single point made in them is wrong and misleading. We will be making our position clear on that. The analysis that he asks for has shown that the benefits of universal credit are statistically significant. Findings now show that, compared with similar claimants on jobseeker’s allowance, universal credit claimants spend more time looking for work, enter work more quickly and spend more time in work. They also end up earning more.

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

The roll-out so far has been to specific groups of people with particular characteristics. That is partly because, to put it uncharitably, the original IT system does not work. If I were being charitable, I would say that it worked but with greatly reduced functionality compared with what was originally planned. However, the Department is piloting a digital solution in Sutton, Surrey, and I wonder whether the Secretary of State could tell us how that is going. When are we likely to get the results of that pilot? Can he tell us when the digital solution is going to be rolled out, given that it was meant to be the great white hope for saving universal credit?

[Mr Duncan Smith]

The IT system is exactly the same system, and it works in all categories. The difference is that we have rightly decided, in accordance with the Public Accounts Committee’s request, to roll this out stage by stage—we have been told that this is the correct way to do it—rather than trying to rush it, as was done with the tax credit system, which crashed. The hon. Lady mentioned the digital solution. Digital development and the online service are merging together, because the live service has many elements that will be used by the digital service anyway. This is a merging of the two services, and we will be reporting on that as we go along. It is successfully rolling out at the moment and expanding at the same time. I would be very happy if the hon. Lady wanted to go and visit it.

Universal Credit

Debate between Iain Duncan Smith and Anne Begg

Tuesday 25th November 2014 Commons Chamber

[Mr Duncan Smith]

I thank my hon. Friend; he is exactly right. We have worked on this together. As he knows very well, taking the early decisions to ensure that the programme rolls out safely and securely is far more important than, as the hon. Member for Leeds West (Rachel Reeves) seems to suggest, rattling ahead regardless of the consequences. That is exactly what happened with tax credits, where, on day one, 400,000-plus people did not receive any benefits. The disaster of tax credits has stayed with us ever since.

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

Will the Secretary of State confirm that the reason the volumes are so low is that only the simplest cases in the simplest groups are covered? Although it has been rolled out to families, they will still be only the simplest and easiest-to-deal-with families. Given that 250,000 jobseeker’s allowance claims are usually made every month, I wonder how he thinks we are going to get from today’s position of having had 20,000 claims in over a year to having 250,000 in a month. It seems quite a task to get the volumes up to that level and to be able to roll it out across the whole country.

[Mr Duncan Smith]

As the hon. Lady knows, we started with single people, but whenever somebody’s circumstances changed—they may have become a couple or had a family—they stayed in the system and have been dealt with. It is not correct, in any way, to say that these are the simplest cases. The roll-out to families introduces further complications, but we are doing this in way that makes sure that we get it right. By the end of this year, the north-west will have universal credit, so if someone falls unemployed and then goes into work, they will do so on universal credit. That is the key point. All the complications will be dealt with within the existing system.

Universal Credit

Debate between Iain Duncan Smith and Anne Begg

Wednesday 9th July 2014 Commons Chamber

[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.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 31st March 2014 Commons Chamber

[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?

Universal Credit

Debate between Iain Duncan Smith and Anne Begg

Tuesday 10th December 2013 Commons Chamber

[Mr Duncan Smith]

My hon. Friend is absolutely right. The Opposition want to talk about universal credit, but the reality is that, unlike tax credits, it will roll out without damaging a single person, and it will also deliver massive benefits, under control by our test, learn and implement approach. The waste that we inherited was the waste of people who did not listen, rushed programmes and implemented them badly.

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

The Secretary of State promised that universal credit would be digital by default—it isn’t; he promised that all new claims would be on universal credit by May 2014—they won’t; and he then promised that 10 areas would be assessing the simplest claims by the end of October—they aren’t; so why should anyone believe him when he says that the delivery of universal credit is now on track?

[Mr Duncan Smith]

The proof of this will be as we roll out the programme. I say to the Chair of the Select Committee that we intervened early when there were problems. We did not let this programme roll out so that anybody was damaged, unlike the Government whom she served, who rushed IT programmes into service, damaged vast numbers of people and wasted a huge amount of money. I wonder whether the Chair of the Work and Pensions Committee ever asked the shadow Chancellor or the previous Prime Minister why they did that.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 18th November 2013 Commons Chamber

[Mr Duncan Smith]

I already take full responsibility for everything that goes on in my Department. I have to say that I take responsibility for making sure that universal credit as originally planned was stopped and reset. Before anybody was affected, we made absolutely sure that when we roll it out, as we have begun and will continue to do, it will deliver maximum benefits of more than £38 billion to the public.

I take no lessons from the Opposition, who spent years rolling out programmes regardless of how they affected people—a disaster on IT for tax credits and a disaster on the health service. A little bit of humble pie on their part might not be a bad thing.

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

The pathfinder mentioned by the Secretary of State was meant to include 10 separate Jobcentre Plus areas by October this year, but only one has come on line, in addition to those already in place, so there has been a further slowing down of the roll-out of universal credit. Indeed, the ones assessed have been the very simplest cases. When will the Department deliver on its original timetable, far less on any speeded-up timetable?

[Mr Duncan Smith]

As I said to the hon. Lady when I appeared in front of her Committee in July, we have been very clear that we would roll out universal credit on the plan and programme already set out. The pathfinders are on track. Those before Christmas and those after Christmas are on track—[Interruption.] Yes they are. It is not just the pathfinder centres; we already have a huge amount of change. We are putting 6,000 new computers into jobcentres to be ready for universal credit, and we are training 25,000 jobcentre staff to ensure that they are ready for its delivery. We are on track to make sure that universal credit—the bit that follows next—can use those pathfinders to deliver a universal credit programme that works, unlike so many of the programmes that the previous Government used.

Universal Credit

Debate between Iain Duncan Smith and Anne Begg

Thursday 5th September 2013 Commons Chamber

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

I am very disappointed by the bullish way in which the Secretary of State has behaved this morning. I believe that it was the same attitude that dismissed the voices of members of my Select Committee and those of many others who suggested that the implementation of universal credit was not going as well as was being claimed. From now on, will the Secretary of State set realistic time scales for the roll-out of universal credit, will he be honest, open and transparent about the challenges posed by the introduction of such a large and complex system, and will he stop over-promising what cannot be delivered?

[Mr Duncan Smith]

When I appeared before the hon. Lady’s Committee in July, I was very clear about the changes that were being made, and also about the fact that we would return to the Committee with the full roll-out timetable in the autumn once we had delivered it. That is what we were asked to do, and I will do it.

I am not being over-bullish about this. The fact is that it takes determination to drive a reform through. I have that determination, and the Department is determined to make this happen, with support and help. It is in all our interests for that to be done. We believe all those who have been charged to deliver it and who say that it can and will be delivered on time and on budget. I see no reason why that should not happen, and indeed the National Audit Office said that it was wholly feasible for it to happen.

Pensions Bill

Debate between Iain Duncan Smith and Anne Begg

Monday 17th June 2013 Commons Chamber

[Mr Duncan Smith]

I hear my hon. Friend, and I would simply say to him that that would cost a sum knocking on the door of between £650 million and £700 million a year. Other Governments have considered it. I would be happy to discuss the matter with him, however, and to reflect on it. I am sure that those sitting further down the Bench will have heard his desire to serve on the Committee, although whether my hon. Friend the Minister of State would want that is another matter altogether.

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

If the Secretary of State is not prepared to go as far as the hon. Member for Worthing West (Sir Peter Bottomley) requests, will he perhaps look again at the Select Committee’s recommendation that the anomaly could be changed for those who reach pension age after April 2016? I appreciate that it would be expensive to change the system for those who are historically already in payment, but that might not be the case if the change related only to new pensions.

[Mr Duncan Smith]

Whenever the hon. Lady speaks, I always want to help her, particularly as I am due to appear in front of her Committee shortly. I really want to be as nice as possible to her, but I am not sure how much hope I can give her. My hon. Friend the Minister of State and I are certainly always happy to look at these proposals, but I come back to the point that it is difficult to do anything about them at the moment, because these things cost significant amounts of money. I recognise the concerns that are being raised, but these are expensive items and, right now, I do not think that we could possibly schedule in such changes. I am happy to discuss the matter further with the hon. Lady, however, as is my hon. Friend.

The regular review of the state pension age will ensure that the issue is considered in every Parliament, which will avoid the necessity for future Governments to have to take emergency action, as we did earlier. Men and women retiring at 67 in 2028 can expect to receive a pension for roughly just as long as those retiring at 65 today. The review will work on the same principle—namely, that people should spend a given proportion of their lives drawing a state pension. By regularly considering the state pension age in the light of changing life expectancy, we can ensure that our pension system remains on firm foundations. That will ensure a continuing and fair social settlement between young and old.

Another long overdue element of reform in the Bill relates to bereavement benefits. As we bring our pension system into the 21st century, we must do the same with our bereavement benefits. They form an important part of our state safety net, but they have remained unchanged for too long. They now reflect a time gone by, in which the life of a widow was quite different from what it is today. The conclusion, after long discussion, is that we have an outmoded system of complicated payments and contributions that, at worst, can harm people’s long-term job prospects by distancing them from the labour market.

While protecting existing recipients, the Bill makes provision to simplify the system through a lump sum payment followed by 12 monthly instalments. The new system will help spouses and civil partners to deal with additional costs in the critical time immediately after a bereavement when that help is most needed, as well as giving them the space and time to settle and resolve most of the other issues that require financial support. Those with dependent children will receive a £5,000 lump sum and £400 a month for 12 months. Those without children will receive a £2,500 lump sum and £150 a month for 12 months. This is not a saving measure. I can absolutely guarantee that the money being applied to this will go back into it, although it will be more narrowly focused over a particular time scale.

I believe that the Bill has the general support of both sides of the House, by and large. It is a genuinely good example of coalition politics coming together to find a solution for people who are unable to change their circumstances following retirement and who want simplicity and the certainty of a commitment by whichever Government are in power that their income will remain at a level that allows them to sustain their position in life.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 11th March 2013 Commons Chamber

[Mr Duncan Smith]

As I have just explained, one of those categories—severely disabled children—is covered and the guidance coming out tomorrow will make it very clear that we will apply that judicial judgment across the board to children with severe disabilities who need that extra room as they are unable to share. I shall keep everything under review and I guarantee to my hon. Friend that we will ensure that the intent of the change is bound up in how it takes effect in so far as the spare rooms will be kept for those who need them. Honestly, however, when so many houses have spare rooms and when so many people are in queues to get housing, it would seem wrong to go on subsidising everybody to stay the same.

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

Is it fair to penalise someone who had wanted a one-bedroom property, had asked their local authority for a one-bedroom property, but instead was given a two or three-bedroom property because there simply were no one-bedroom properties available?

[Mr Duncan Smith]

The purpose of the policy is to readjust the disparity that exists and that lay there under the previous Government. Local housing allowance for social tenants in the private rented sector does not and did not allow people to have spare rooms. In the social sector there are a large number of houses that people occupy without occupying all the rooms, so the purpose is to get that smoothed out. A number of councils have people waiting for housing, people in overcrowding, while others are subsidised to have spare rooms in housing that they do not need.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 10th December 2012 Commons Chamber

[Mr Duncan Smith]

That is absolutely true. We were left with a series of benefits that too often were riddled with fraud and error. Not all of this is about fraud. Many people are receiving overpayments or underpayments when they should be receiving the correct amount. Too often with tax credits, people are chased at the end of the year, without their realising that they had received the wrong money in the first place. Universal credit will be kinder in the sense that it will be adjusted each month. It will help us save huge sums—some studies state £2.2 billion per year.

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

The Government’s decision to go digital by default—in other words, people will be able to receive universal credit only if they apply online—surely creates a greater chance of fraudulent activity. We all remember what happened with the online form for child tax credits. What guarantees do the Government have that universal credit will not be susceptible to online fraud and that the necessary checks will not take such a long time that they will delay payment? All of a family’s income will come through universal credit.

[Mr Duncan Smith]

We have taken account of that. I have had the opportunity to discuss this with the hon. Lady, and I am sure I will again. The reality is that digital by default does not mean that that is the end of it for people who are not online. On the contrary, we allow for those who are not online. We will help and support them as they make their claim, and it will be taken through the system. They will receive their money on time. For those in doubt, we will make payments anyway. We fully recognise the reality of the need for money and for it be sorted out afterwards—that has been taken into account.

Universal Credit and Welfare Reform

Debate between Iain Duncan Smith and Anne Begg

Tuesday 11th September 2012 Commons Chamber

[Mr Duncan Smith]

May I make a little progress? I think I have been reasonably generous in giving way. I promise that I will try to get the hon. Gentleman in later.

On our engagement, it is clear from what I have just said that the independent OBR has open access. We have been in regular discussions. The right hon. Member for Birmingham, Hodge Hill described it yesterday as a think-tank, but it is not a think-tank. It accredits and decides whether the Government’s calculations and projections are correct. No one has a perfect view of the future, but at least it is independent of all political positions and positioning. It is working with us at the moment. I can assure hon. Members that the process is robust and will continue until the Government announce the final rates for universal credit and the OBR includes them in its forecasts. That is what we are working to.

Elsewhere, we are continually engaging with a host of organisations. The Work and Pensions Committee’s inquiry concluded, quite legitimately, that organisations have concerns. Of course, they will be concerned and will want answers, and we are working and talking with them. We are also dealing with local government, and have shared our draft regulations with the Social Security Advisory Committee and are carefully considering its advice. We are in regular contact with local authorities. We recently visited many local authorities and are informing them about policy work and regulations.

We are consulting on the future—this was raised in one or two questions—of the passported benefits and the interaction with universal credit. That is taking place right now, and we are discussing the matter with the regular and other Departments. They have to decide what they want to do, and we must decide how and whether to incorporate that into universal credit. That process is under way. Rather than constantly saying, “We can’t do these things, it’s impossible, so we won’t try”, it is worth trying to get the system right. One problem for many people is that they have to go to so many places for so many different things, they get confused and often do not get it right, and each time they feel a bit more worn down. If we can smooth out that process and make it easier and more accessible, in due course we will improve the lot of those in the greatest difficulty.

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

Does the Secretary of State now regret responsibility for administering council tax benefit being given to local authorities? That seems to fly in the face of the whole concept of universal credit and creates the very difficulties he claims he is trying to solve.

[Mr Duncan Smith]

I am a huge admirer of the Chairman of the Select Committee, but her inducements for me to express any personal opinion must be resisted. My general view is that localisation is a good thing, and I am sure that local authorities will robustly deliver a system that works brilliantly. Collectively, we are absolutely in favour of it.

--- Later in debate ---

[Dame Anne Begg]

If the group about whom I have been talking cannot access the system, there is very little chance that they will be able to return to work. That is why the support is needed.

[Mr Duncan Smith]

I had not intended to intervene, but I think that I ought to take up the point that the hon. Lady has raised. Our plans already take account of a number of people who will not be online. We want 50% of those receiving the benefit to be online when we launch the system in October 2013, and we want the proportion to rise to 80% by 2017. We have always had parallel arrangements for those who will not be online, and we will explain those key arrangements to the hon. Lady.

[Dame Anne Begg]

I thank the Secretary of State, and may I also make a plea for it to be easily accessible, high quality and free, which is very important, too?

The poorest in our society are already disadvantaged in the digital age. They have already fallen behind the rest of us. Universal credit and its reliance on digital claims could exacerbate that still further. Instead of giving people living in poverty the help and support, and the access to work, that raises them out of poverty, universal credit could plunge them further into poverty and disadvantage. That would be a disaster.

We will not know the full impact of universal credit until we know the level at which it is set. Despite what the Secretary of State has said today, only then will we know the real marginal reduction rates and who will be better and worse off—who will be up, and who will be down—and whether people genuinely will be better off in work. Only when we get the real figures for real families, rather than the scenario planning that has gone on thus far, will we be able to see whether universal credit will work and they will have more money. Until then, a lot of what we are discussing is just an academic exercise. We need to get those figures, and I hope they will come soon.

There is, however, a great deal to play for. I said on Second Reading of the Welfare Reform Bill that a single working-age benefit is the holy grail of welfare reform. It is now up to the Government to make sure it does not turn out to be a very expensive cracked clay pot.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 10th September 2012 Commons Chamber

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

Does the Secretary of State accept that somebody on jobseeker’s allowance with a disposable income of less than £70 a week who manages with fortnightly payments is actually very good at budgeting? The danger of monthly payments is not budgeting but the lack of money to buy everything that everybody else takes for granted and that a person should be able to buy with their benefit.

[Mr Duncan Smith]

Absolutely—I accept that we have to deal with those issues. We are seeking to move to monthly payments. When payments moved from being weekly to fortnightly, everyone said it would cause major problems, but very little happened. We are putting in place requirements so that people may receive their money on a two-weekly basis if they are unable to cope. We recognise that when we introduce this process, people will have to transition into it so that they are not left with a period without any money. All that is under consideration. We are trialling the programmes to ensure that we get this right. I give the hon. Lady my assurance that we will not move on this unless we are certain we can make it work.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 23rd January 2012 Commons Chamber

[Mr Duncan Smith]

I recognise that, and the point is that although the vast majority of those who receive local housing allowance make their payments on time, there is always a group that does not. The way to deal with that is to recognise that we need to help landlords by not allowing those kinds of people to get away with it—for example, by paying a little bit at the two-month point, which sets the clock back to zero. We can make adjustments that way, and we can also deal with those who have difficultly by assisting them and, where necessary, making direct payments. However, those payments should always be the exception, to try to help people manage their budgets.

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

10. What estimate he has made of the average cost to a small business of real-time reporting of PAYE information to enable calculation of universal credit entitlement.

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

Real-time information—there was a question about this earlier—should not be an additional cost to business, and I do not believe it will be. Ultimately, it will help to reduce administration burdens for employers. RTI will also be good for Her Majesty’s Revenue and Customs, because it will help to eradicate some of the errors caused by HMRC waiting a year before adjusting what it has already paid and then trying to chase people for that money. The fraud and error savings that will arise from the RTI programme—which the DWP considers vital for the universal credit—should be around £700 million, which is an important feature.

[Dame Anne Begg]

I do not think that the businesses I speak to have any idea whatever that this is about to hit them ahead of the introduction of auto-enrolment, which they are more conscious of and worried about. However, that may be academic, because from what I am hearing, HMRC’s timetable for real-time information has slipped. It will not be ready to roll out RTI universally across the country on the date that the universal credit is introduced. What happens to universal credit if RTI is not in place on its launch date?

[Mr Duncan Smith]

From the word go, we have not needed the full system of real-time information to be ready for universal credit. We get our information from essentially two feeds, which we have already been working on with HMRC, long before any further timetables. The reality is that RTI will dovetail nicely with universal credit, but we do not need it for that, and we are not expecting it to be ready at the start of universal credit. We were never expecting that, and we have been working on that basis. However, RTI will come in—it is “on timetable”—and those involved will be working hard to produce it.

Pensions Bill [Lords]

Debate between Iain Duncan Smith and Anne Begg

Monday 20th June 2011 Commons Chamber

[Mr Duncan Smith]

My hon. Friend tempts me enormously, but she will forgive me if I do not give in to that temptation. Let me simply repeat what I said earlier—it is a bit like a recording, but I shall do it none the less: we have no plans to change equalisation in 2018, or the age of 66 for both men and women in 2020, but we will consider transitional arrangements.

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

Does the Secretary of State accept that some women in the group that we are discussing have already retired or signed early retirement arrangements in the belief that they would receive their state pension when they were 63 or 64? The original equalisation was announced 25 years in advance. For some women, the equalisation that we are considering is only five years ahead. Surely that cannot be right when we are asking people to plan long term for their retirement.

[Mr Duncan Smith]

I think that the hon. Lady refers to people who have retired early, at around 57, as far as I can tell from her calculations. Other than that, I do not think that there is a huge difference. I recognise what their due would have been, but the change is no different thereafter for all the others. I acknowledge her point—I am sure that we will deal with it when we get into Committee.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 22nd November 2010 Commons Chamber

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

T4. May I ask Ministers to look again at the proposal to reduce housing benefit by 10% for people receiving jobseeker’s allowance for a year? The Minister for Housing and Local Government said this morning that people in social rented housing will be kicked out of their homes if they go into work, and under the proposal on housing benefit, people will be kicked out of their homes if they do not go into work.

[Mr Duncan Smith]

I always appreciate the hon. Lady’s advice. We certainly keep all that under review and intend to do so all the way through until we introduce the Bill. However, having said that, there is a lot of good evidence out there to show that we have to give people some sort of incentive not to decide to refuse that work. We believe that that is one of the areas where a lot of international evidence shows that such a spur actually helps people to do that.

Welfare Reform

Debate between Iain Duncan Smith and Anne Begg

Thursday 11th November 2010 Commons Chamber

[Mr Duncan Smith]

I understand the point that my hon. Friend is making. The reality is that we will reform the whole jobcentre process to make sure that it dovetails with what we are trying to do. Yes, of course, there are areas where some of the advice that is given is not always necessarily of the highest quality, but most jobcentres, and most of the people who work in them, are determined to help the individuals they meet, to advise them properly and to get them back into work. Of course, the Work programme will include private and voluntary sector organisations, so we will tap into the very best qualities and skills that lie outside the jobcentres. My hon. Friend should rest assured that this will only get better.

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

The creation of a single working-age benefit is the holy grail of welfare reform, and the Government will need to be congratulated if they can pull this off, especially if they fulfil their promise that there will be no losers. I am sure that the Work and Pensions Committee, which I chair, will watch the issue carefully. However, I am still not clear as to where the tax credit system fits into the universal credit. The Secretary of State did not answer the questions from the shadow Secretary of State about where they will fit. Will there, for instance, be a single application form to cover the Treasury-delivered benefits and the DWP benefits?

[Mr Duncan Smith]

The problem right now is that when people make applications, they have to make at least two completely separate applications at the same time if they are going back to work. There is literally no communication between HMRC and the DWP about what they are sitting on and what they are making their calculations about. That is why the reconciliation at the end of the year is so gross and why we so often have major overpayments and then try to claw money back. The purpose of these proposals is to bring everything together so that we have one single point from which to take information. Therefore, the tax credit system and the DWP system will come together to create this single taper withdrawal. In future, as people’s circumstances change as they go into work—in the past, if they did not inform HMRC or the DWP, they might have been overpaid because they did fewer hours—the information will automatically cascade back to the centre, and we will know what people are doing, so they will be paid exactly what they are meant to be paid. There will be no chase for the money at the end of the year, which, as the hon. Lady and many others know, causes fear and worry among far too many constituents who find that they have been overpaid and have to pay the money back.

Oral Answers to Questions

Debate between Iain Duncan Smith and Anne Begg

Monday 18th October 2010 Commons Chamber

[Mr Duncan Smith]

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

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

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

[Mr Duncan Smith]

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