Universal Credit

Jim Shannon Excerpts

Wednesday 9th May 2012 Commons Chamber

[Maria Miller]

As I was saying, the hon. Gentleman rightly picked up on the importance of the online aspect of universal credit. It is designed to be an online service, providing access and support to claimants 24 hours a day. Importantly, it will also provide the service where constituents are, as opposed to where jobcentres are.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for giving way, and I apologise for not being here for the beginning of the debate. I was at another engagement down below, and I did not realise that the Adjournment debate had started.

I feel that certain people in the middle class are going to fall into the child poverty bracket as a result of the introduction of universal credit. What assurance can the Minister give me that such people will not be adversely affected by the changes that the Government are proposing?

[Maria Miller]

I welcome the hon. Gentleman’s intervention. At the point of transition to universal credit, we want to ensure that people will continue to receive the support that they were receiving before, if there have been no changes to their circumstances. It is important for everyone to understand that, as a result of universal credit, we will be making work pay. We will ensure that more people can stay close to the labour market, which will help them not only to get out of poverty but to stay out of it. We all know that families can cycle in and out of poverty; it does not affect a static group of people. It is therefore important that we have that support in place.

I want to get back to the digital nature of universal credit. We make no apology for the fact that this is designed to be an online service. It is designed to be available 24 hours a day, and to be available where claimants are and when it is most convenient for them to use it. The hon. Member for Nottingham East is right to say that that will not be the right approach for absolutely everyone, but let me stay with the group for which it will be the right approach. Estimates show that about 80% of individuals are already accessing services in an online scenario. We are not assuming that 80% will use the online service at the outset; we have always recognised that not everyone will be able to claim online. However, we expect that the proportion who do so will grow over time. We will supplement all of that with a face-to-face and telephone service that will always be available, for just the kinds of groups of people whom the hon. Gentleman referred to.

To ensure that we resolve any issues in advance of the system going live, and that we have the right kind of support in place, we are already working with local authorities on a number of pilot schemes. I urge the hon. Gentleman to look at the work that we are doing with the Local Government Association. We have also recently issued a joint prospectus calling on local authorities to deliver pilots to support residents in preparation for the introduction of universal credit in 2013. The pilots are expected to start in the autumn of this year and to end by September 2013. We will focus on delivering the kind of face-to-face support that individuals might need when claiming universal credit. I hope that he will agree that we will have a wide range of support available. It will be available online, as well as face to face and on the telephone.

The hon. Gentleman is right to say that it is important to get the IT right for this, and we are well under way in our designs and in testing the system to ensure that universal credit is introduced in 2013. Our ambition will, of course, always be to move the majority of people on to use of the online system, and we are working closely with other Government Departments and beyond to ensure that the best possible support is there to enable access to the internet for many people, supporting claimants to get even more value from being online.

The hon. Gentleman expressed an interest in the issue of fraud and the work being done to ensure that safeguards are in place. It will come as no surprise to him to hear that we take the issue of fraud very seriously indeed. Its prevention has been built into the heart of all policy and service design development. Universal credit will be protected by comprehensive and sophisticated cyber-defence and counter-fraud systems, which are currently under development with leading suppliers. I am sure that the hon. Gentleman will want to stay close to the sorts of issues that we are dealing with, but he will understand if I do not go into the details of those systems, as they are sensitive and not for open discussion.

The hon. Gentleman raised the issue of monthly payments, which I have touched on a little already. To be absolutely clear, we believe it important for universal credit to reflect what people experience in the workplace when they are working full time. For the most part, that means being able to budget around a monthly payment, a monthly salary or a monthly amount of money coming in. We will ensure that there is flexibility in the system for those who find that exceptionally difficult, but we believe that this will be an exception and not the rule.

[Jim Shannon]

I can see the logic behind the change to monthly payments, but it is clear that some who get weekly payments are not knowledgeable enough to know how to manage their moneys. Will the Government give any help to those who will depend on single weekly payments to start with, who will then have to manage on monthly payments, on how best to manage their money?

[Maria Miller]

The hon. Gentleman will be reassured to know that my noble Friend Lord Freud is looking at exactly those issues. We know that changing people’s behaviour cannot happen overnight. People need support and we will make sure that we understand the sort of support that will prove the most effective, as the hon. Gentleman would expect us to do.

The hon. Member for Nottingham East talked about the importance of banking in this process. Direct payments to bank accounts are an important part of helping people to prepare for work. We will encourage claimants to use bank accounts, and we are discussing this very issue with the British Bankers Association. We recognise, however, that it will not be suitable for everybody, so we expect to continue to pay rent directly to landlords in some cases and we will continue to ensure that suitable payment arrangements are in place for everybody. The hon. Gentleman is right that we need that nuanced approach for some individuals. The bulk of individuals, we believe, should be able to cope with the sort of monthly payments that I mentioned earlier.