Welfare Reform and Work Bill

Ian Lavery Excerpts

Tuesday 27th October 2015 Commons Chamber

[Owen Smith]

Indeed they should. I cannot understand how on earth even this Chancellor, who is pretty slipshod on occasion when it comes to analysing the impact of his measures, can have allowed this one to slip through the net. A pasty tax and a caravan tax maybe, but a £4.4 billion hit on the very workers he purports to support is truly extraordinary.

Let us look beyond the statistics for a moment. On Friday, I was out in my constituency in the village of Beddau, a former pit village at the heart of Pontypridd. Entirely by chance, I met a young woman called Kirsten who was bringing her daughter Maisie home from school. Kirsten is a nursery manager in a small private-run nursery just outside the village. She works 21 hours a week. They are all the hours available, as the nursery is open only in the morning and she works all five mornings. She then brings her daughter home from school and looks after her. She earns £611 a month. That is what she earns from her 21 hours of work at £8 an hour. That is well above the minimum wage and well above the new minimum wage we will see next year. She is set to lose £1,300 of her £7,000 earnings as a result of the cuts. That is an enormous drop for her to contemplate. She said to me that she simply did not know how she would manage. She did not understand how, without the £128 she receives in tax credits each month, she will be able to make ends meet.

I sat down with Kirsten and talked through what she needs to pay out for each month: the housing association three-bedroom house she lives in, council tax, insurance, and running her car to get back and forth to the nursery and to pick up her child. There is nothing left over. The £128 she spends from the tax credits she rightly receives pays for food, new clothes and her child’s books for school. It is just beyond the ken of ordinary people that the Government could be asking them to pay the price for the bankers’ recession, which has led to the crisis in our economy and a Tory Government cutting the incomes of working people.

[Ian Lavery (Wansbeck) (Lab)]

Does my hon. Friend agree, when the issue of family tax credits is all boiled down and the arguments have been fine-tuned, that this is simply an ideological attack by the Government on the lowest paid in our communities? Does he agree with the Institute for Fiscal Studies, which says that low-paid people are being specifically targeted?

[Owen Smith]

I completely agree. It is extraordinary for the Government to describe tax credits as “a bribe”. That is how successive Ministers, including the missing Secretary of State for Work and Pensions, have gone out of their way to describe tax credits for working people. They do not talk about protecting pensioners’ benefits as a bribe by the Conservative party to pensioners—and I would never say that; it is entirely just to protect pensioners’ benefits. By describing tax credits as a bribe, they are even seeking to demonise working people on low and middle incomes who are doing the right thing. That is entirely wrong.

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[Owen Smith]

The hon. Gentleman could, of course, start by deciding not to do what the Government did this week when they offered an inheritance tax cut for properties worth more than £1 million. That would provide about £1 billion. He could decide to reverse the 50p tax rate cut for millionaires; that would provide another £3 billion. He could choose to do what the Chancellor has already chosen to do in the past, and delay the point at which the Government get the budget into surplus. He has moved the goalposts once; why does he not do it again? He is very good at it. He has practised. He has already had one crack at it.

[Ian Lavery]

My hon. Friend has been asked numerous times what the Labour party would do about the £4.2 billion. Will he now explain, categorically and in the simplest terms, that we would not do what the Government are doing, which is taking £4.2 billion from the lowest paid in society? People are losing £1,300 a year, and 200,000 kids are being pushed into poverty. That is not what we are going to do.

[Owen Smith]

I am delighted to say that I agree 100% with my hon. Friend. Let me be really clear: our view today is that the Government should repeal these measures. Our view is that it is wrong to seek to balance the books, in this or any country, on the back of the working poor—those with low and middle incomes who are doing the right thing. This is the wrong thing to do, and we will not do it.

Let me end by reflecting a little on what this whole unedifying spectacle means for the public, and to the public. I think we can agree that politics has been held in pretty low esteem in this country in recent years. People feel that we, as a political class, are not straight with them. They feel that we do not keep our word, or say what we mean.

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[Damian Hinds]

People who are in the work-related activity group are, by definition, people who are to be helped to move closer to the labour market. What I have said in the list of exemptions that I have read out is that the amounts that are specific to the additional costs of disability are protected, which is something that we discussed in Committee.

[Ian Lavery]

rose—

[Damian Hinds]

If the hon. Gentleman will forgive me, I will not give way, because it is 3.2 pm and I need to stop by 3.5 pm.

Amendments 53 and 55 seek to remove clauses 11 and 12 from the Bill, and amendment 54 seeks to retain the payment of the family element of child tax credit for all persons who are responsible for a child or a qualifying young person born before 6 April 2022.

The Government want to ensure that the system is fair both to those who pay for it and to those who benefit from it. Currently, the benefit system adjusts automatically to family size, but many families who are only in receipt of income from work would not see their budgets flex in the same way when they have more children. The Government want to encourage those families who are in receipt of benefits to make the same financial choice about the number of children they have as those families who are supporting themselves solely through income from work.

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[Ian Lavery]

I am not sure whether my hon. Friend was present about an hour ago, when the Minister suggested that it was a good idea for people in the work-related activity group to lose 30% of their benefits so as to move them nearer to employment. How ridiculous is that?

[Debbie Abrahams]

I entirely agree with my hon. Friend. In fact, I am going to move on to a section specifically concerned with incentivising work and how on earth people with, for example, progressive conditions can be incentivised.

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[Debbie Abrahams]

I appreciate that it is strong language, but I can only provide the hon. Gentleman with the evidence. In 2010, the use of the term “scrounger” by the mainstream press had increased by more than 330%, and it has remained at that level. We should always be mindful of the language that we use as leaders, and of how it is perpetuated.

[Ian Lavery]

May I advise my hon. Friend not to take any lectures from the team opposite when they are asking her to calm down in respect of her language against the disabled? Constantly, for the last five years, they have attacked disabled people, poor people and lower-paid people. No apologies are required.

[Debbie Abrahams]

I used that language to draw attention to the issue in the House, and more widely. I did so partly because I am sure I am not the only one to remember the autumn statement two or three years ago in which the Chancellor, at the Dispatch Box, referred to “closed curtains” when people were going out to work. It was quite clear what that implied. I use such language very carefully, and I repeat that its use in the media has increased by 330%. We all have a responsibility in this regard, including the country’s leaders.

The innuendo is that people with a disability or illness might be faking it or feckless. That is grotesque. As a former public health consultant, I speak with some knowledge. It is recognised that incapacity benefit and ESA are good population health indicators, and the release of the Government’s own data has proved the point. Disabled people in the ESA WRAG are a vulnerable group who need our care and support, and not our humiliation.

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[Priti Patel]

I beg to move, That the Bill be now read the Third time.

The Bill, alongside other measures, including the national living wage and the increase in the personal allowance for income tax, will ensure that the welfare system is fair to taxpayers while supporting the most vulnerable. It will help ensure that work always pays more than life on benefits. It will continue to build an economy based on higher pay, lower taxes and lower welfare.

[Ian Lavery]

As a result of these measures, people receiving family tax credits will lose up to £1,300 per annum and 200,000 more children will be pushed into poverty. Can the Minister explain how that is fair?

[Priti Patel]

I thank the hon. Gentleman for giving me the opportunity to respond once again on that issue and to make the case that, first, it pays to be in work, and secondly, through our package of measures, including the national living wage, the increase in the personal allowance and the extra support for tax-free childcare, families will be supported through the changes we are making. That contrasts with the system we inherited from Labour in 2010, which was not fair to the hard-working taxpayers who paid for it, and certainly did not support people trapped in a system of welfare, with no hope for a brighter future. That is why we are continuing to reform welfare so that work pays in the United Kingdom.

After 13 years in government, Labour left a welfare system that failed to reward work. Between 1997 and 2010, spending on tax credits increased by 335%, compared with an increase in average earnings of just 30% over the same period. Despite all the spending, 1.4 million people spent most of the last decade under Labour trapped in out-of-work benefits. [Interruption.] That is not a ridiculous point to make. Over the same period, the number of households in which no member had ever worked nearly doubled and in-work poverty rose, yet Labour has opposed every decision we have taken to fix the welfare system and support people off welfare and into work.

Our welfare reforms are focused on transforming lives by helping people to find and keep work. We are focused on boosting employment and ensuring fairness and affordability, while supporting the most vulnerable, and on making sure that people on benefits face the same choices as those not on benefits and in work. Over the past five years, 2 million more people have entered employment, while 2.3 million people are now in apprenticeships and the number of workless households is at a record low—down by more than 680,000 since 2010. This was achieved in the last Parliament, when welfare spending increased at the lowest rate since the creation of the modern welfare system.

Oral Answers to Questions

Ian Lavery Excerpts

Tuesday 10th March 2015 Commons Chamber

[Andrea Leadsom]

Yes, my hon. Friend is exactly right. The IFS report also showed that 200,000 fewer people were in relative poverty in 2014-15 compared with 2009-10, including 100,000 children, and that since 2010 the number of children under 16 in workless households had fallen by about 390,000, taking it to the lowest level since records began. That is very good news.

[Ian Lavery (Wansbeck) (Lab)]

25. The average wage in my constituency is £450, which is £71 per week less than the national average. How can the Minister defend real-terms cuts to tax credits for these hard-working people, particularly the women, in my constituency?

[Andrea Leadsom]

The hon. Gentleman will surely be delighted at the news from the IFS and other forecasters that real wages are now rising at a higher rate than inflation, and it is thanks to our long-term economic plan that inflation is so low. We have had council tax cuts and fuel duty freezes, and we have done everything we can by raising personal tax-free allowances to enable people to benefit from a recovering economy, but we can only do it by sticking to a long-term economic plan.

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[Ian Lavery (Wansbeck) (Lab)]

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

[The Chief Secretary to the Treasury (Danny Alexander)]

Mr Speaker, I should say that the Chancellor of the Exchequer is at ECOFIN, making sure that Britain’s voice is heard in the European Union, and the Exchequer Secretary is unwell. I am sure that the whole House wishes her a speedy recovery.

The core purpose of the Treasury is to ensure the stability and prosperity of the economy.

[Ian Lavery]

Will the Chief Secretary confirm that the Treasury has had discussions with the Department for Business, Innovation and Skills and the Department of Energy and Climate Change with regard to UK Coal’s application for state aid for the British coal industry? What stage are the discussions actually at?

[Danny Alexander]

It would be wrong for me to go into the ongoing discussions between BIS and other Departments and the industry. However, I can certainly say that I am aware of the issues that the industry is experiencing, and a discussion on that subject is going on with the Government.

Oral Answers to Questions

Ian Lavery Excerpts

Thursday 1st May 2014 Commons Chamber

[Mr Vaizey]

Absolutely. It is important to point out that the progress of rural broadband is really picking up pace, with 20,000 homes passed every week, but we must get out the information to local residents. I am sure that the Secretary of State will meet my hon. Friend at the earliest opportunity to discuss his points.

[Ian Lavery (Wansbeck) (Lab)]

When imposing the changes to the betting and gaming industry, did the Government consider conducting an impact assessment on the potential job losses? Before yesterday, William Hill had already announced 109 betting shop closures, with the loss of 420 jobs, which mainly affect young women between the ages of 18 and 24.

[Mrs Grant]

We are of course always mindful of jobs, not just for women but for everyone. The package I announced yesterday was sensible and proportionate and it deals with a number of concerns about powers for local authorities, controls for the community and the importance of protecting highly vulnerable people. We have acted where it has been needed, which is more than the Labour party did during its 13 years in power.

Zero-hours Contracts

Ian Lavery Excerpts

Wednesday 19th March 2014 Westminster Hall

[Alison McGovern (Wirral South) (Lab)]

It is a pleasure to open this debate under your chairmanship, Mr Dobbin. My contribution will not be terribly lengthy, which will enable other hon. Members to intervene or contribute, and to hear the Minister. I would like to start by referring to an e-mail that was sent to me recently. Knowing that I had secured this debate, quite a number of people got in touch with and wrote to me, as they feel so strongly about zero-hours contracts.

One gentleman who got in touch explained his life, saying that he lives to work and enjoys work, and wants to feel good about himself and perhaps own a house one day. He is signed up with an agency and has had various problems. Anyway, the agency felt that it could get him a job as a refuse collector. He has written me a long e-mail, explaining how he has turned up for work only to be turned away. He has had the odd day here and there, and he feels that the situation is like something from many years ago, where someone turns up not knowing whether he will be given work. He said that, when it started, he was “a little annoyed”, but “confused more than anything”. He said there were

“about 50 lads in that day and only 40 had work.”

He continued:

“It just carries on like this. I have been here two months now, and only ever had one full week; to cover a holiday, it looks like. And you daren’t take a sick day; not like I would anyway if it could be helped…you would just lose your place and start at the bottom of the pile.”

Reading that, as I did last night, brought it all back to me as to why my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), my right hon. Friend the Member for Knowsley (Mr Howarth) and I started a campaign and a discussion on zero-hours contracts last summer. I will go on to talk about the numbers of people whom we do not know are on zero-hours contracts.

The issue is about people who are facing a difficulty in the workplace. It is about how that makes them feel. The indignity of feeling useless through unemployment is very bad, and we must never let up on our passion to get people into work and see the difference. However, it is no better to feel the indignity of turning up for work and being turned away. Zero-hours contracts can be used to make people feel as if their efforts are for no good at all and that they are not wanted. The issue is not just a fact of economics, but a moral question about how people are made to feel by certain features of our labour market. That is why we need real action. I want to say a couple of things about understanding the phenomenon of zero-hours contracts; about what the Government are or are not doing, and what they might be doing; and about such contracts as a symptom of other developments in the labour market.

Regarding counting, the Office for National Statistics said that the most recent labour force survey suggests that there are close to 600,000 people—I think the exact figure is 582,000—on zero-hours contracts in the United Kingdom. That is up from its previous estimate earlier this year of around 250,000. We knew that there was a problem with the survey’s counting of zero-hours contracts, because in a parliamentary response to me, the Minister of State, Department of Health, who has responsibility for care, explained that a national survey of care workers estimated that more than 300,000 people working in social care were on zero-hours contracts. There cannot be 300,000 people on zero-hours contracts in the care sector when there are only 250,000 nationally across all sectors. Therefore we knew that there was a problem, and now the ONS has said that there is.

[Ian Lavery (Wansbeck) (Lab)]

I congratulate my hon. Friend on bringing this important issue to Westminster Hall. Does she agree that the recent figure of 500,000 zero-hours contracts is quite conservative? Other analysis suggests that there are more than 1 million people on such contracts. For those 1 million people, there is no production or wages, and they have no economic input whatever. If we have 1 million-plus people on zero-hours contracts, is that not a way of fiddling the employment or unemployment statistics that we are currently being fed by the Government?

[Alison McGovern]

My hon. Friend has pre-empted exactly what I am going to say. It is interesting that a Department for Business, Innovation and Skills Minister will respond to the debate, but we could do with having the Health Minister here, given how rampant zero-hours contracts are in the care sector. We could also do with the Minister of State, Department for Work and Pensions, the right hon. Member for Wirral West (Esther McVey), who has responsibility for employment, because I want to know exactly how many people we have forced to take jobs with zero-hours contracts to get them off the claimant count.

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[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jenny Willott)]

I thank the hon. Member for Wirral South (Alison McGovern) for securing this debate. It is a very important issue, which has been widely discussed in the media, online and in both Houses of Parliament. She raised some important points.

The term “zero-hours contract” encompasses many different forms of employment relationship, in which the employer does not guarantee any work and the individual does not have to accept it when offered. Such contracts can be direct contracts of employment or can cover people working for agencies and so on, so they include a wide variety of different models of employment. The Government, and indeed most people now, believe that zero-hours contracts have a place in today’s labour market, but we need to make sure that people get a fair deal when they are employed on such a contract. The Government have always been clear that we will crack down on any exploitation of individuals in the workplace and the zero-hours contract consultation that has just closed is an important part of the process.

As the hon. Lady highlighted, there has been some inconsistency in the statistics on zero-hours contracts. The picture has been very mixed. That is primarily because there is no legal definition of a zero-hours contract, so it has been difficult to gather good statistics. The labour force survey, as a survey of individuals, provides an estimate of the number of people who identify as being on zero-hours contracts. The greater media coverage in 2013 is likely to have increased awareness of zero-hours contracts. The Office for National Statistics believes that that has led to the estimate rising from 250,000 people in the final quarter of 2012 to more than 500,000 people in the final quarter of 2013; in other words, it more than doubled. We do need to gather information and analyse it sensibly if we are to know exactly what is going on and to achieve the right balance between the opportunities and the risks that zero-hours contracts provide. The hon. Member for Wirral South asked what is being done on that. The Office for National Statistics has been looking at the issue and will release the results of its new survey in April. That will, I hope, give us more clarity about the current figures and the number of people working in this way.

Let me put the issue in a little bit of context. Zero-hours contracts can give growing companies the opportunity to grow in a relatively safe way and can be used to increase flexibility in the range of services that businesses are able to give their customers or clients—for example, by employing people in specialist roles and in different geographical locations that a permanent staffing model could not provide for.

The contracts are sometimes portrayed as simply a way for businesses to try to reduce labour costs, to the detriment of the people who work for them, but we have also heard in evidence that we have received that the contracts sometimes offer positive work opportunities to people who would find it difficult to take regular work at fixed times. For example, one quarter of all zero-hours contracts are taken up by students, who cannot necessarily commit to a fixed working pattern, as their timetables change. The contracts can allow them, for example, to be more flexible around exams and so on. Zero-hours contracts offer them an opportunity to gain useful work experience and to progress on to other forms of employment when they wish to do so. That is also true of many other people with responsibilities outside work—in particular, caring responsibilities. The additional flexibility that zero-hours contracts can provide can be greatly valued.

Having said that, we must be clear that although zero-hours contracts suit some people, they do not suit everyone and there are people on zero-hours contracts who would prefer to be in full-time, permanent work. I am sure that, as constituency MPs, we have all seen people in that situation.

[Ian Lavery]

Does the Minister agree with the comments from Lord Oakeshott, the Liberal Democrat peer, who said:

“A zero-hours Britain is a zero-rights Britain in the workplace—Beecroft by the back door. Being at the boss’s beck and call is no way to build a skilled, committed, loyal labour force”?

[Jenny Willott]

As I said, zero-hours contracts can have a place in the labour market. They can suit some people—students, people with caring responsibilities and others—but clearly they are not appropriate for everyone. Anecdotal evidence, including that highlighted by the hon. Member for Wirral South and by the hon. Member for Hayes and Harlington (John McDonnell), suggests that some individuals are being pressured into working when it does not suit them and have the implied threat hanging over them of being denied future work, which removes the flexibility for those individuals.

HMRC Inquiry Centre Closures

Ian Lavery Excerpts

Tuesday 4th March 2014 Westminster Hall

[Ian Lavery (Wansbeck) (Lab)]

As ever, it is a pleasure to serve under your chairmanship, Dr McCrea. This debate focuses on the Government’s proposals to close all HMRC inquiry centres in the UK. Inquiry centres provide a vital public service, allowing taxpayers to access free expert advice from highly skilled HMRC staff. In 2012, some 2.5 million people visited those offices, where they could take advantage of free phone and internet access, and 340,885 of those customers made a face-to-face appointment to get help complying with their tax duties and receive advice on their benefit entitlement.

Last month, Her Majesty’s Revenue and Customs announced that a “needs enhanced support” service model would be rolled out, resulting in the closure of all 281 HMRC offices by the end of June 2014. The taxpayers most likely to be prevented from accessing the proposed new service as a result of the cost are the unemployed, those on low incomes such as migrant workers and pensioners, and child benefit and child tax credit claimants. Such taxpayers rely heavily on the free service currently provided by HMRC staff at inquiry centres.

The closures will also put the 1,300 jobs of those who work in the centres at risk as a result of compulsory redundancies. Staff in the offices are faced with an impossible decision about their future as the Department rushes to implement the closure of the offices in four short months.

[Jonathan Ashworth (Leicester South) (Lab)]

I apologise for coming in to the Chamber a few minutes late. My hon. Friend is making a powerful case. One of the offices affected is in Leicester, where a number of staff jobs are now at risk. Does he agree that the Government must put in the time to negotiate properly with the workplace unions, particularly the Public and Commercial Services Union, and do all they can to ensure that if they insist on closing the offices—although I hope they do not—the staff will be redeployed?

[Ian Lavery]

I fully agree, and I am sure my hon. Friend will agree that closing 280-odd offices—the service is provided up and down the country—will cause huge problems, mainly for people who are least well off but also, of course, for the staff themselves.

[Graeme Morrice (Livingston) (Lab)]

I congratulate my hon. Friend on securing this important debate. He will be aware that my constituency has an inquiry centre due for closure. I have been approached by constituents and members of PCS expressing concerns related to job losses and the impact that they could have on members of the public, particularly the most vulnerable. Does he agree that if the Government are serious about addressing the problem of underpaid and undercollected tax, the proposed closure programme is the wrong way to go about it?

[Ian Lavery]

I agree that the Government are going about it in entirely the wrong way. PCS, the union representing the HMRC workers, has agreed with HMRC that all members should have the opportunity for a formal one-to-one to help them consider their options. However, HMRC has withdrawn from that agreement in an attempt to pressure people into making decisions without information about applying for jobs and voluntary exits. That shows contempt for staff and puts huge pressure on people to leave by demoralising the work force.

[Mr Mark Williams (Ceredigion) (LD)]

I have four constituents who work at the Aberystwyth office and who will be affected in the way that the hon. Gentleman suggests. Before he moves on from customer service, does he agree that there are particular concerns about how the new service, in so far as it is a new service, will be delivered in rural areas? Access will be denied to many of our constituents by virtue of the fact that huge tracts, in my case of rural west Wales, will be covered by a diminished service, and arguably a more costly one.

[Ian Lavery]

I will certainly come to that later in my speech. The hon. Gentleman makes a valid point.

I am fairly positive that the Minister—perhaps he can indicate that this is the case—met PCS representatives this morning.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

indicated assent.

[Ian Lavery]

The Minister nods positively. I am pleased: perhaps he can assure me that support will be given to staff who are uncertain about their future and that compulsory redundancies will not be made.

[John McDonnell (Hayes and Harlington) (Lab)]

We are all grateful that the Minister met the union, but let us be clear: he met the union only after this debate was announced. There has not been full transparency in the sharing of information with the union by management about the various options going forward. The Government introduce changes, but it is best to do so in a negotiated way rather than by imposing them, as this management seems to have done.

[Ian Lavery]

Again, I thank my hon. Friend for a positive intervention.

The pilot scheme has been rolled out not just in my constituency, but in my region—the north-east area. In June last year, 13 offices in the north-east of England were closed, including Royal Sovereign house in my constituency, in Morpeth. They were closed as part of a pilot of the new needs-enhanced support service model. If the closures of all 281 offices throughout the UK go as planned in June, I hope that HMRC does a better job of letting the public know than it did in our region last year.

I have heard examples of people travelling miles, only to find their local office no longer open to the public. In one prime example, an 85-year-old man used two buses to get to Scarborough, only to find the inquiry centre closed. Staff were actively prevented from assisting him: I repeat that they were actively prevented from assisting an 85-year-old gentleman. Another member of the public was trapped inside Gilbridge house in Sunderland, while trying to look for the inquiry centre, which had been closed. Many taxpayers decided to travel outside the region to inquiry centres that were still open, just so they could get face-to-face advice.

A recently widowed elderly woman turned up at Gilbridge house office for assistance with a tax form she needed to complete on behalf of her late husband. She told a member of HMRC staff that she simply did not feel that she could discuss her affairs over the phone, that she was afraid of completing it herself, just in case she did anything wrong, and that she could not grieve properly while she had this worry on her mind. I use this specific example, because staff are particularly concerned about the prospect of mainly older customers getting the support they need to complete the R27 form over the telephone, as these appointments need time. They not only need time; they need empathy, understanding and a common touch. It is common for staff, so they tell me, to keep a box of tissues handy on their desk for such occasions. It is hard to see how this kind of personal service can be replaced over the phone or on the internet. What assurances can the Minister give that such people, who will be in a particularly vulnerable state, will not be disadvantaged by the new service?

There are also problems involving equality issues. It is clear that the pilot scheme could not possibly identify the equality impacts on customers and staff, due to the demographics of our north-east region. For example, migrant workers make up 25% of all inquiry centre customers. However, the percentage of these customers is much lower in the north-east of England than it would be in other regions, such as London, which is a prime example. The consultation carried out by HMRC last year did not present equality data about customers. The document was not produced in different languages, which is of particular concern considering the high number of migrant workers who use the service. Only 11% of staff work part time in the north-east, compared with a national average of 36%. For example, 45% of workers in Wales and Scotland work part time. Only 7% of staff declared a disability in the north-east, compared with 27% based in Wales. Some 30% of inquiry centre staff in London and south-east are black, Asian and minority ethnic, compared with just 2% in the pilot area. How can the pilot area possibly identify the equality impact these closures will have on the country as a whole?

It is also worth mentioning, while considering the equality implications of this decision, that in October 2013 three appellants supported by the Low Incomes tax Reform Group won their appeal against the HMRC’s requirement that they must file their VAT returns online. A tax tribunal found that HMRC’s regulations that required online filing of VAT returns without providing exemptions for older people or disabled people, many of whom live in parts of the country that are too remote for broadband access, breached the appellants’ human rights and were unlawful in EU law.

If we consider the intervention of the hon. Member for Ceredigion (Mr Williams), it is important that ordinary people can access those services. It does not matter whether those people live in London or in rural areas where access is extremely difficult. It was identified early in the pilot that a significant number of customers will not be able to call contact centres or interact with the website owing to the cost and low mobile or internet access in many parts of the UK. The taxpayers who are most likely to be prevented from accessing the proposed new service owing to the cost are the most vulnerable members of society. They are not able to afford a landline or a mobile telephone, and even if they own a mobile telephone it is often on a pay-as-you-go facility with a minimum amount of credit reserved for emergency calls only. Those taxpayers include the unemployed, people on low incomes, migrant workers, pensioners, people on child benefit and child tax credit claimants. Those taxpayers rely heavily on the free service that is currently provided by our inquiry centre network because their tax queries are often complex.

Low earners, for example, often work in multiple jobs to provide for their family, which means that the tax code is often incorrect. They visit the HMRC inquiry centres to use the free phones and free internet facilities or to receive face-to-face support and advice. HMRC agreed that an alternative access solution needed to be found if the new model was to be rolled out nationally. It is therefore concerning that the decision to move to the new service model and to close the inquiry centres has been made despite HMRC not having found those solutions.

Can the Minister reassure me that solutions have been found? If not, why has a decision been made without the Department having been able to resolve those important issues? Even in areas that have decent mobile phone coverage, taxpayers need to be reassured that contact centres will be sufficiently staffed to handle their calls. If the closures go ahead, people will no longer be able to walk into their local inquiry centre and receive face-to-face assistance on tax issues that are often complex. Instead, they will have to call a contact centre. A member of staff will then vet them and determine whether to refer them to another adviser. Only if that two-tier adviser deems it appropriate will a taxpayer classed as needing enhanced support be given access to face-to-face advice. Call handling levels have consistently been criticised by the Public Accounts Committee and the National Audit Office. There are figures that prove conclusively that people will find it extremely difficult to contact the centres.

The fact that we are removing HMRC offices from local communities is one of the most important issues. HMRC is effectively moving its presence away from people who are supposed to pay, which will make closing the tax gap even harder. It will make tax compliance more difficult, both for those who want to comply but cannot get access to the information they need and for those who intentionally want to slip under the radar because they are disengaged with the tax authority at a local level. Those concerns have been raised by a large number of stakeholders in the public consultation exercise, including by the Association of Taxation Technicians, Citizens Advice, Gingerbread, the Institute of Chartered Accountants in England and Wales, Lancaster city council, Milton Keynes council, TaxAid and a number of individual taxpayers. What work has HMRC done to estimate the amount of money that could be lost in uncollected tax owing to large numbers of taxpayers being prevented from engaging with the Department?

I conclude simply by asking the Minister to reconsider the decision to close the offices. There is a real danger that if the plans go ahead, some of the most vulnerable people in society will lose their access to HMRC’s services. Hundreds of quality jobs will be lost, and the Government’s attempts to tackle the tax gap will be seriously set back. It would surely benefit society and the economy if the Government would concentrate on closing the tax gap, not tax offices.

--- Later in debate ---

[Mr Gauke]

It is important that HMRC communicates the closure of inquiry centres. It has written to all Members of Parliament on the matter and will take other steps to ensure that our constituents are aware of the changes.

Inquiry centres are not universally distributed across the country, and large parts of the UK are not even served by them. My hon. Friend the Member for Ceredigion (Mr Williams), who is no longer in his place, raised the position of rural areas. Rural areas do not tend to be well served by inquiry centres at present. There has been a sharp decline in the use of inquiry centres. Visitor numbers have halved from more than 5 million in 2005-06 to just over 2 million in 2012-13, and the number of face-to-face appointments also dropped by four fifths to 140,000 last year.

[Ian Lavery]

Is it not the case that individuals who wish to have a face-to-face meeting will be vetted on the telephone, and then someone will adjudicate whether they need one?

[Mr Gauke]

I will turn to how the new service will work in a moment, if the hon. Gentleman will bear with me. HMRC’s in-depth research further revealed that nine out of 10 of those who visited an inquiry centre last year did not require a face-to-face appointment and would have been able to resolve their queries through a phone call or by visiting the HMRC website.

[Ian Lavery]

On that point, will the Minister give way again?

[Mr Gauke]

I am keen to answer the hon. Gentleman’s question, but I will give way.

[Ian Lavery]

Where on earth did that information come from? Surely, people who wanted a face-to-face meeting had one and thought it beneficial. Where do the statistics that the Minister has just mentioned come from?

[Mr Gauke]

They are the result of research undertaken by HMRC. Matters can often be resolved over the telephone rather than in a face-to-face meeting. The hon. Gentleman rightly highlighted a case in which an 85-year-old gentleman caught two buses to attend an inquiry centre. If it is possible to drive that service more easily over the telephone, so be it, but there are circumstances in which a face-to-face meeting will be appropriate, so that will be provided.

HMRC’s research has highlighted that up to 1.5 million customers need extra help with their tax and benefits affairs. Many of them need help only for a specific event in their lives, such as when they approach retirement. Others may have low literacy skills, or a mental health condition may make it difficult for them to cope with their affairs. The new, more accessible service will be tailored to the needs of customers who require extra help. Specialist help will be provided over the telephone by extra support advisers who have the time, skills, knowledge and empathy to handle customers’ inquiries at a pace that suits them, and who can identify when a customer needs extra help. If a customer’s query cannot be dealt with over the phone, they can arrange a face-to-face meeting with a team of mobile advisers based across the United Kingdom. Such meetings can be arranged at a time and place convenient to the customer, and extra help will be delivered through HMRC’s voluntary and community sector partners who have been provided with extra funding so that they can support more customers and refer them directly to the new service.

Economic Policy

Ian Lavery Excerpts

Monday 25th February 2013 Commons Chamber

[Ian Lavery (Wansbeck) (Lab)]

The Chancellor of the Exchequer has quite simply lost all credibility as an individual and all credibility as a Chancellor. What will he do to regain the confidence of the general public? Hundreds of thousands of people have lost greatly as a result of the failure of his economic policies.

[Mr Osborne]

Actually, the unemployment rate is lower today than when we came into office, and there are 1 million more people with jobs in the private sector than there were two years ago. Families want to know that the Government are determined to tackle the nation’s problems, to keep rates low, and to ensure that we provide the right environment for business. They have our assurance that we will do that.

Oral Answers to Questions

Ian Lavery Excerpts

Tuesday 29th January 2013 Commons Chamber

[Mr Osborne]

Unemployment rocketed because of the disastrous economic policies of the Labour party, and the deficit rocketed too. The good news is that 1 million jobs have been created and that the deficit has come down by 25%. Perhaps one day we will get an economic policy from the Labour party and we can make comparisons with what it would do in office. Until then, the hon. Gentleman should get behind the measures to clear up the mess that he left behind.

[Ian Lavery (Wansbeck) (Lab)]

2. How many households no longer eligible for child benefit have opted not to receive it.

[Barry Gardiner (Brent North) (Lab)]

8. How many households no longer eligible for child benefit have opted not to receive it.

[The Economic Secretary to the Treasury (Sajid Javid)]

The Government estimate that in the 2013-14 tax year over 1 million out of 8 million families are affected by the new charge. As of 24 January, over 340,000 recipients have opted not to receive the payment. The charge will raise over £1.7 billion each year to tackle the deficit.

[Ian Lavery]

The Government pride themselves on their fairness. Can the Minister explain to this House what is fair about a one-earner family making up to £50,000 having their child benefit cut while a two-earner family making up to £100,000—twice the amount—is able to retain their child benefit?

[Sajid Javid]

I know that the hon. Gentleman is a man of principle, and I have respect for him, particularly since he refused to work for the right hon. and learned Member for Camberwell and Peckham (Ms Harman); I do not blame him. I note that on his website he says that he has

“a strong commitment to supporting the…less well off in society.”

He is absolutely right and I agree with him, so perhaps he can explain why he is against a measure that is targeted at the 15% of people who are the highest earners in society. [Interruption.]

Autumn Statement

Ian Lavery Excerpts

Wednesday 5th December 2012 Commons Chamber

[Mr Osborne]

My hon. Friend is absolutely right. That is precisely what the Labour party offers: more borrowing, more debt, and a return to the mess it left this country in. People are not going to trust Labour with the public finances again, and they are particularly not going to trust the shadow Chancellor again.

[Ian Lavery (Wansbeck) (Lab)]

In my constituency, 15.9% of young people aged between 18 and 24 are unemployed. That is twice the national average. What is in the autumn statement for them?

[Mr Osborne]

First, of course any young person who cannot get a job is a matter of regret, but youth unemployment has fallen this year. Our welfare to work schemes are helping to get people back to work, and our work experience scheme in particular is doing a great job of getting people into work, so I would ask those young people to go to their jobcentre and see the schemes that are available. As I have said, 1.2 million jobs have been created in the private sector over the past couple of years, in what are very difficult circumstances. I hope that, with the measures we announced today, business will be able to create some more jobs.

Public Service Pensions Bill

Ian Lavery Excerpts

Tuesday 4th December 2012 Commons Chamber

[Mike Freer]

My hon. Friend makes a good point. He knows my views and is tempting me down the path of debating the future of defined benefit schemes. I have been entirely consistent on this point: for many years, I have said that all defined benefit schemes are no longer sustainable, whether in the private sector or public sector. That is a debate for another time and is certainly not pertinent to the amendment, but I share his view that perhaps we need more wholesale change and a larger debate.

In supporting specific exemptions where physical demands can be proven, I am not undermining the broad thrust of ensuring that our public sector pensions are sustainable. I have long argued that the contribution rates of both employee and employer do not match: what goes in does not match what comes out. That has driven my long-held view that defined benefit schemes are no longer fit for purpose. Having said that, this Bill is a major step forward in making sure that our public sector pensions are sustainable. We have a duty, however, to protect those who protect us and we ought to revisit this point where there is hard empirical evidence that physicality, in certain roles within those categories, can be proven to be detrimental to people’s health after retirement. I am not suggesting that I will support the amendment, but I am urging my ministerial colleagues to revisit the matter.

I have rehearsed at length the point about physicality. I am sad that the Minister is no longer with us, but I hope that he will address that point when he winds up. Should empirical evidence emerge, I hope that we can revisit this subject.

[Ian Lavery (Wansbeck) (Lab)]

I want to refer, in particular, to my amendment 1. I found the contribution from the hon. Member for Finchley and Golders Green (Mike Freer) very interesting indeed. I certainly agree with a range of points he made.

The amendment seeks to place two additional occupations into the Bill, and they have been mentioned on both sides of the Chamber. They are those of prison officer and psychiatric nurse. Clause 9(2) lists the three occupations to be enshrined in the legislation as exemptions from subsection (1)—they have been discussed by various Members and there seems to be some agreement—which are

“fire and rescue workers who are firefighters…members of a police force, and…members of the armed forces.”

I fully support people working in those occupations and the courageous work they do on a regular basis. I fully understand why they are included in the Bill and support their inclusion, but for the very same reasons I wish to amend the Bill to include prison officers and psychiatric nurses.

It is widely accepted that prison officers and psychiatric nurses have to deal with some of the most dangerous, dysfunctional and disruptive people in society on an almost daily basis. Expecting these categories of worker to work above the age 65 is totally and utterly unjustified; in fact, when we look at it in great detail, the decision seems absolutely outrageous. The hon. Member for Finchley and Golders Green mentioned a constituent of his, a very fit police officer from the territorial support unit who explained exactly how he kept himself in peak fitness to do his job. We cannot expect people in the Prison Service to be grappling with prisoners at the age of 65 and above, but the Bill as it stands would allow that.

Currently, prison officers regularly have to take five different tests: a grip strength test, an endurance and fitness test, a dynamic strength test, an agility test and a static shield hold test. If a prison officer fails any of those tests, they fail the entire health and fitness test. The current regime is therefore rather stringent. If clause 9 is agreed to unamended, it will mean many prison officers and psychiatric nurses either dying in service or retiring on ill health grounds and not having a very healthy lifestyle thereafter.

[Bill Esterson]

My hon. Friend is doing a fine job of explaining the concern of people who work in the Prison Service or in psychiatric health. Ashworth hospital and HM Prison Kennet are in my constituency, and people working at both have expressed exactly those concerns to me. Does he think that, as well as potentially leading to damaged health and increased disability, the Bill will discourage people from entering the Prison Service and that part of the NHS?

[Ian Lavery]

That is absolutely right. When anybody looks to take up a new employment opportunity, they look at a whole array of things. The public sector is changing by the day—although the Prison Service and the NHS now involve not just the public sector, but the private sector. People look at how their pensions will end up and what the pensionable age is, which we have also been discussing this afternoon. That is a huge consideration for many people who want to choose their profession early on in life. This measure will put people off becoming prison officers.

--- Later in debate ---

[Lady Hermon]

May I gently ask the hon. Gentleman to remind the House that prison officers in Northern Ireland also run a particularly grim risk? After a gap of almost 30 years, a prison officer, David Black, was murdered recently in rush-hour traffic on a busy motorway on his way to work. Prison officers in Northern Ireland run an additional risk. It is an absolute disgrace that prison officers are not exempted in clause 9.

[Ian Lavery]

The hon. Lady makes a powerful point. Prison officers in Northern Ireland have had a particular problem with security for decades. They have the same security problem here, although it is definitely not as bad as the problem experienced during the troubles in Northern Ireland. Nevertheless, prison officers put their neck on the block at all times. I have been out socialising with members of the Prison Officers Association when they have been approached by ex-convicts. They were out having a decent time, and those people were coming up to them. They addressed the prison officers very politely, but I have to say that they looked rather strange. I would not want them coming to talk to me. We need to look at the security of the people who work in the Prison Service. As I have said, we need to protect those people.

The hon. Member for Finchley and Golders Green said that members of the police force were highly trained, and that they needed shields and other forms of protection. He said that they were out on the front line when there were problems, and that they would get stuck in to try to resolve them. Prison officers and psychiatric nurses do that on almost a daily basis, and it is not very pleasant for them. There are also problems in the Prison Service and the health service, when prisoners are not only violent but spit in people’s faces and when blood is thrown at people’s faces causing all sorts of distress.

It is common sense to try to ensure that prison officers and psychiatric nurses are added as part of the exemption under clause 9(2), just as we rightly wish to protect police officers in their daily duties. Our brave armed forces and our firefighters are other examples, so we should look to protect the prison officers and psychiatric nurses, whose duty is solely to protect us, in the same way.

I will not press my amendment to the vote, as I do not want to divide the House. Should I say that we are too conciliatory on this issue, and should I say that Members of all parties seem to agree—albeit to different degrees—on it? Rather than split the House on it, I gently ask the Minister at least to consider the amendment to ensure that psychiatric nurses and prison officers are included in the provisions of clause 9(2).

[Mr Gibb]

I shall make a brief contribution and oppose amendment 2, tabled by Opposition Members, which would leave out lines 22 and 23 of clause 9— essentially subsection (1)(a) and (b)—and insert in its place

“65, or current pension scheme age if lower”.

That would drive a coach and horses in many ways through one of the Bill’s key provisions, which is to have a link between the normal pension age and the state pension age. I think that is an important way to minimise the risk of longevity to the taxpayer.

Paragraph 4.5 of the final report of Lord Hutton says:

“It is generally assumed that longevity will continue to increase in the future, but there is significant uncertainty about the scale of any future changes.”

He goes on to say:

“Increases in life expectancy have historically been… underestimated”

when the calculations have been made.

In paragraph 1.2 on page 22, Hutton says:

“As a result”

of this underestimation,

“pension costs…have been much higher than originally expected.”

He cites the example of a female pensioner in the NHS scheme who would retire at the age of 60 in 2010, and says that she would be expected to spend around 45% of her adult life in retirement, compared with about 30% for pensioners who retired in the 1950s. That is the issue that Hutton is trying to address. Spending 45% of one’s life in retirement is simply not sustainable for any pension scheme—even one backed up by the vast coffers of the state sector.

Page 9 of the Hutton report states:

“The main risks within defined benefit schemes are: investment; inflation; salary”—

because salaries can be put up without actuaries being aware of the rises—

“and longevity risk. While government, as a large employer, is capable of bearing the majority of the risk associated with pension saving…present schemes involve too much risk for government and the taxpayer.”

He went on to say:

“There should be a fairer sharing of risk between government”

and scheme members. It is that risk that amendment 2 would push back to the taxpayer.

Hutton says that the increases in life expectancy have been recognised within the state pension scheme, and he therefore recommends that we should follow that lead when it comes to helping members bear pre-retirement longevity risk. That is why he recommends the link between the state retirement pension age and the normal pension age. Recommendation 11—it is in a shaded box, which will please the shadow Minister—states:

“The Government should increase the member’s Normal Pension Age in the new schemes so that it is in line with their State Pension Age.”

Lord Hutton also says:

“The introduction of the link to the State Pension Age, which will initially move Normal Pension Ages to 65, will move the proportion of adult life in retirement for public service pension scheme members back to about a third: roughly where it was in the 1980s. The current State Pension Age of 65 is already the Normal Pension Age for most new entrants to public service pension schemes.”

Teachers, for instance, have a 2007 scheme and a pre-2007 scheme. For those who joined before 2007 the normal pension age is 60, while for those who joined after that date it is 65. Lord Hutton goes on to say:

“In the long term, the timetabled increases in State Pension Age should help to keep the proportion of adult life in retirement for members around this level”—

that is, a third—

“on current life expectancy projections.”

I believe that amendment 2 is a mistake, and would increase risk disproportionately for the taxpayer.

Finance Bill

Ian Lavery Excerpts

Tuesday 3rd July 2012 Commons Chamber

[Charlie Elphicke]

What I have set out also highlights the previous Government’s role in failing to regulate and, it seems, in indulging in a bit of market manipulation pressure of their own. I do not think that is acceptable. In her scene setting, the shadow Minister was basically saying, “What happened at Barclays is outrageous; therefore we need to do this.” What I am saying is that we should be careful what we wish for, because banks need enough capital to lend to small businesses, to create the jobs and money that we need to expand the economy and make this country a great success in the next 10 years, building Britain back up to the sort of success that we saw in the ’80s.

[Ian Lavery (Wansbeck) (Lab)]

New clause 13 is extremely important and deals with the bank bonus tax for youth jobs. It is an admirable new clause.

It is indisputable that the financial services industry is an essential part of our economy, but equally, there must be an acceptance that the industry—the banks and the financial institutions—needs to pay its way. The June 2010 Budget announced that a levy based on banks’ balance sheets would be introduced from 1 January 2011. Labour supports the bank levy, but we want to go further. We want to repeat the bankers’ bonus tax, which brought in an estimated £3.5 billion. We can argue about net and gross, as the hon. Member for Dover (Charlie Elphicke) explained; however, as far as we on this side of the House are concerned, the bankers’ bonus tax brought in £3.5 billion. Despite slight increases in the rate of the levy, the Government’s failure to repeat Labour’s bank bonus tax—and, in the meantime, create more than 100,000 jobs for young people—means that the banks simply received tax cuts last year and will do so in future years. It is wholly unacceptable, when we have a double-dip recession, for us to allow banks off with fortunes and tax cuts year on year.

In the last financial year, the amount raised by the bank levy was just over half the amount raised by Labour’s bank bonus tax—£1.8 billion, compared with £3.5 billion. The Chancellor’s spending review plans have simply failed. The Government’s austerity measures have led to the flatlining of growth in the economy, resulting in long-term youth unemployment spiralling to record levels. In the last year it has gone up by 112%, while the number of young people out of work for over a year has gone up even more, by around 156%. That is the result of the Government scrapping the future jobs fund, immediately after they came to power, without putting a viable alternative in place. They had no idea what would replace the fund or how on earth they would be able to create any employment, for young people in particular. The Work programme started only a year later, in June 2011, and we all know now, from people coming to our surgeries, about the difficulties that the workfare and other programmes have created.

That is why we are calling for Labour’s youth jobs guarantee, which would redress the Government’s scrapping of the future jobs fund. On a cautious estimate, we believe that the bank bonus tax could raise at least £2 billion this year, which the Government could use to build thousands of affordable homes and introduce the real jobs guarantee for young people who are long-term unemployed.

As part of Labour’s five-point plan for jobs and growth, the real jobs guarantee would cost £600 million, and would provide a six-month job for every 18 to 24-year-old who had been on jobseeker’s allowance for 12 months or more. We estimate that it could assist up to 110,000 people in that category. The Government would pay full wages directly to the business, which would cover 25 hours of work per week at the minimum wage. That would equate to about £4,000 per job. In return, the employer would be expected to cover the young person’s training and development for a minimum of 10 hours a week. The ultimate objective would be the opportunity of a permanent job at the end of the six months. New clause 13 would tackle the issue of youth unemployment, and make the banks pay their way.