Sanctioning of Benefit Recipients

Debate between John Healey and Stephen Timms

Thursday 3rd April 2014 Commons Chamber

[Stephen Timms (East Ham) (Lab)]

I, too, congratulate my right hon. Friend the Member for Oldham West and Royton (Mr Meacher) on his initiative, as a result of which we have had a very interesting debate.

The debate raises this question: what has become of Jobcentre Plus? As my hon. Friend the Member for Wansbeck (Ian Lavery) has just described, those who work in jobcentres say that they are under enormous pressure to sanction people’s benefits. In opening the debate, my right hon. Friend the Member for Oldham West and Royton referred to the “toxic” culture in Jobcentre Plus. People who depend on it for help say that too often its main interest is now in catching them out.

As we have heard, sanctions are vital to the system. They encourage effective jobsearch, and a sound rationale for them was set out in Professor Paul Gregg’s report for the Government in 2008. They featured in the new deal and the future jobs fund, and we have made it clear that they will also feature in our compulsory jobs guarantee. However, as my hon. Friend the Member for Makerfield (Yvonne Fovargue) argued, sanctions need to be applied fairly and proportionately. Claimants must understand their responsibilities and the consequences of not meeting them. That is not the case at the moment, as the hon. Member for Birmingham, Yardley (John Hemming) correctly pointed out. The Child Poverty Action Group has referred to the frequent very vague letters from jobcentres, which people cannot understand, telling them what they are supposed to have done or not done. The Work and Pensions Committee report in January set out an approach to sanctions that makes a great deal of sense, and I must say that I was disappointed by the quite negative tone of the Government’s response.

The hon. Member for Banff and Buchan (Dr Whiteford) was right to remind the House, as other hon. Members have done, that rocketing benefits sanctions have fuelled the extraordinary growth in food bank demand. Volunteers say that a lot of people at food banks have no idea why they have been sanctioned. We might expect that Ministers, after hearing that from the Trussell Trust, would want to find out what is going on. Instead, the Secretary of State for Work and Pensions has refused to meet the Trussell Trust and, quite bizarrely, has accused it of having a political agenda. The Trussell Trust therefore had to make do with meeting the Prime Minister. It is disappointing, but not surprising, that the Select Committee recommendation that the Department should compile data on the number of signposts to food banks it is making has been rejected.

The first that some people know about a sanction is when they find out that there is no money in their bank account. Sanctions are supposed to incentivise people to undertake fruitful jobsearch, but if people do not know which rule they have broken and they are not told, a sanction cannot incentivise them. What has gone wrong?

Last week, at the invitation of Tesco, I visited its new store in Woolwich. The company personnel director told me that of the 400 staff the store had recruited when it opened in 2012, 100 had been chosen who had previously been unemployed. She introduced me to four of them, and it was frankly inspiring to hear how the opportunity to work was changing their lives and to hear how they are now optimistic about their prospects.

I took the opportunity to ask the four members of staff about their experience of Jobcentre Plus. Their answers were uniformly depressing. They said that advisers wanted to catch them out and to come up with reasons for imposing a sanction. One of them told me as a matter of fact that Jobcentre Plus advisers have to impose eight sanctions per month. He might have a point, because I understand that eight sanctions per month is regarded as the norm for an adviser. The Minister will correct me if that figure is wrong, but I think that it is right. As my hon. Friend the Member for Bolton West (Julie Hilling) pointed out, the number of sanctions issued by each adviser features in their regular appraisals. It is therefore not surprising that jobseekers get the impression that advisers have such a target. Indeed, I suspect that jobseekers are probably quite close to the truth about what is going on.

The reputation of Jobcentre Plus is now terribly poor. Examples such as the one given by the hon. Member for Hornchurch and Upminster (Dame Angela Watkinson), make it clear why that is the case, and there are too many examples like those given by my hon. Friend the Member for Wansbeck.

[John Healey]

My right hon. Friend is talking about the disincentives in the system that lead to more sanctions. Does he agree that one problem may be that the single measure of performance in Jobcentre Plus is the benefits off-flow, and that anyone sanctioned is counted in that way, even though they are not coming off benefits to get into work?

[Stephen Timms]

I agree. There are several problems with the benefits off-flow measure, and my right hon. Friend is absolutely right that that is one of them. Citizens Advice has made that point in the briefing for this debate.

My hon. Friend the Member for Edinburgh East (Sheila Gilmore) drew my attention to a report from West Dunbartonshire citizens advice bureau called “Unjust and Uncaring: A report on conditionality and benefits sanctions and their impact on clients”, which was published just a few weeks ago. It is full of depressing examples of the kind that we have heard in this debate.

Community Links works in my constituency in east London. It produced a policy briefing on sanctions in January, which states:

“There is a culture of fear and misunderstanding surrounding sanctions: some people are afraid of making tiny mistakes such as being one minute late for a meeting.”

The briefing includes a case study of Rita, a young and strongly work-oriented woman who was employed for six years until being made redundant. She has a degree in journalism and aspires to a career, not just to a job. She was sanctioned for non-attendance at a meeting, even though she had agreed with her jobcentre adviser to participate in work experience elsewhere. We have heard a number of examples of that. She was also incorrectly sanctioned for missing a meeting while at a pre-arranged hospital appointment, even though she had informed her adviser in the official way. She avoided that sanction, but only by insisting on speaking to the line manager at the jobcentre. One sanction meant that she did not have enough money to attend a job interview. She blames the jobcentre directly for preventing her from potentially getting a job.

Rita made the following comments:

“I had times when I literally had no food and no gas. I just lay in my bed looking at the walls. I couldn’t travel or make any calls. I couldn’t even afford to get the bus to sign-on, but I knew that if I didn’t go I’d be suspended again. It’s like a vicious cycle. I turned up at the Jobcentre actually hungry. I hadn’t eaten for two days and I was scared that if I was five minutes late they would suspend me again.”

She was present on Monday this week at the launch at Church House of Community Links’ troubling study “Tipping the balance?” on the cumulative impact of welfare reform in Newham.

The evidence that we have heard in this debate makes it clear that there is a serious problem. A year ago, I asked a parliamentary question:

“what was the total amount of benefit withheld as a result of benefit sanctions in each of the last four years.”—[Official Report, 25 March 2013; Vol. 560, c. 986W.]

The answer told me that in 2009-10, £11 million was withheld and that just in the first six months of 2012-13, £60 million was withheld. In cash terms, that is more than a tenfold rise.

I have since requested an updated answer. The Minister of State, Department for Work and Pensions, the right hon. Member for Wirral West (Esther McVey), told me in an answer in February:

“The information is not available in the format requested. Trends in sanctions are better understood” —[Official Report, 5 February 2014; Vol. 575, c. 268W.]—

in some other way. It is not clear to me why the information was available a year ago, but is not available now. It is not the job of the Minister to tell us what questions she would like us to ask; Ministers are required to answer the questions that we do ask. I tabled the question again yesterday and I ask the Minister here today who is much more reasonable in these respects, to have a word with the right hon. lady and ask her this time to answer the question that she is asked.

A very large number of sanctions are overturned on appeal. Those sanctions should not have been imposed in the first place. The Policy Exchange report, which my right hon. Friend the Member for Oldham West and Royton mentioned, said:

“After reconsideration and/or appeal, 29% of those who receive their first ‘lower’ tier sanction have it overturned, meaning around 5,600 of them a month are wrongly sanctioned.”

In February, as my hon. Friend the Member for Wansbeck said, DWP statistics showed an appeal success rate of nearly 60%. Those statistics are gone from the Department’s website and have not yet come back corrected. I wonder whether the Minister can tell us what the correct figure is and when the figures, having been corrected, will be republished.

Last summer, as my hon. Friend the Member for Bolton West reminded us, the Opposition forced the Government to set up a review of sanctions. Ministers appointed Matthew Oakley to carry it out, although they drew up rather narrow terms of reference. I have appreciated the opportunity to discuss the issues with Mr Oakley, who has set about his task with thoroughness and diligence. I hope that his report, when we see it in a few weeks’ time, will lead to important improvements. However, it is very disappointing that today’s Government response to the January Select Committee report reneges on the commitment to a further wider review.

The Policy Exchange report says:

“we recommend a series of cumulative increases in sanction duration for those who consistently fail to comply with the conditionality regime. This reflects an aim to make sanctions less punitive for those who may have made genuine mistakes”.

As my right hon. Friend the Member for Oldham West and Royton said, that comes from the ideological standpoint of the Minister’s coalition partners. I hope that he will indicate whether he accepts that it is a helpful direction of travel.

Sanctions by Jobcentre Plus have become far more punitive. They explain a large part of the explosion in food bank demand. Many people have no idea why they have been sanctioned. It is agreed across the political spectrum that the system has gone wrong, as we have heard in this debate. I hope that the Minister will indicate that he understands the problem and that he intends to do something about it.