Universal Credit
John Redwood Excerpts(6 years, 2 months ago)
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Ms McVey
I will continue just a little bit further.
In less than 10 months, my ministerial colleagues and I have met over 500 colleagues, charities and stakeholders. We have come to the House on 56 occasions; visited 46 jobcentres, service centres and pension centres; tabled 34 written ministerial statements; and appeared in front of Select Committees 12 times. My Department has published 637 responses to parliamentary questions, 153 pieces of guidance, 102 statistical releases, 30 research reports, and 23 consultations. We have gone to great lengths to be open.[Official Report, 22 October 2018, Vol. 648, c. 1MC.]
John Redwood
I am very grateful to the Secretary of State, who is doing an excellent job in improving an intrinsically good system and dealing with the little difficulties we need to sort out. Given that it is crucial that there is enough incentive for people to get into work, will she confirm that one of the improvements is to lower the rate of withdrawal so that it is more worth while to work, and will she push for that to be improved further?
Ms McVey
My right hon. Friend is quite correct. As he will know—and everybody in the House should know—under the legacy benefits there were punitive tax rates of over 90%. We have now brought that down to 63%. As an advocate of people who want to get into work, he is right: we should aim to get that taper rate down even further.
We also took the unusual step, earlier this year, of publishing a summary of the universal credit business case, which explained the economic case for universal credit, showing that it will help 200,000 more people into work when fully rolled out, and empower people to work 113 million extra hours.
Universal Credit Roll-out
John Redwood Excerpts(7 years, 1 month ago)
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John Redwood (Wokingham) (Con)
One flexibility the Labour spokeslady asked for was the opportunity to pay rents direct to the landlord, so that tenancy is protected. Is the Minister considering that?
Damian Hinds
Not only considering, but over a third of tenants in the social rented sector have that arrangement under universal credit right now. It is available for vulnerable claimants and for those for whom that arrangement is important.
As you said last week, Mr Speaker, what we do in this House is important. Members’ insights are important, too. Indeed, Members of Parliament are uniquely placed to funnel and convey feedback and to critique and propose improvements.
European Union (Approvals) Bill [Lords]
John Redwood Excerpts(9 years, 1 month ago)
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The Minister for Employment (Priti Patel)
I beg to move, That the Bill be now read a Second time.
The purpose of the Bill is to approve two draft decisions of the Council of the European Union. For the UK to agree the draft decisions at Council, Parliament must first give its approval, as the decisions rely on article 352 of the treaty on the functioning of the European Union. Article 352 allows the Union to take action to attain one of the objectives set out in the treaties but for which there is no specific power given. However, the European Parliament must give its approval, and unanimous support must be given by all other member states.
Section 8 of the European Union Act 2011 provides that a Minister may vote in favour of an article 352 decision only where a draft decision is approved by an Act of Parliament. I am setting out the draft Council decisions and will provide Members with the opportunity to debate and decide whether to approve the measures.
The first decision will enable the former Yugoslav Republic of Macedonia to be granted observer status in the European Union Agency for Fundamental Rights. The agency is the EU body with the objective of providing assistance and advice on fundamental rights issues to the EU institutions and to member states when implementing Union law. It carries out the same role for EU accession states with observer status. This measure does not extend the competence of the agency.
The proposal has been in existence since 2010 and it cleared the UK parliamentary scrutiny process in place at that time. The Greek presidency lifted its block on the decision in April 2014 and the decision re-emerged last year with all other member states ready to vote in favour of the decision. However, the UK had to enter the scrutiny reserve for the decision pending approval by an Act of Parliament due to the requirements of the EU Act.
The former Yugoslav Republic of Macedonia has been an EU candidate country since 2005, but in recent years there has been serious backsliding on the reforms. A political crisis has been unfolding in the country in the past year, which has raised concerns about the rule of law and adherence to democratic principles. A European Commission report issued in June set out a series of recommendations needed to return the country to the path to EU accession. This included reforms related to freedom of expression and the rule of law. Observer status at the agency could allow the country to have access to advice and assistance on fundamental rights issues to help to tackle its reform challenges, and provide assistance and help to the country on human rights issues.
The second measure gives effect to a decision by the Council enabling the EU tripartite social summit to continue to operate. The summit is a meeting of representatives of European social partner organisations, the Commission and the Council, and it meets on the eve of the European Council in the spring and autumn for high-level discussions between the three parties on aspects of the European agenda for growth and jobs. The summit was established by a Council decision in 2003, but, under the Lisbon treaty, agreed in 2007, the legal basis for the summit—article 202 of the treaty of Rome—was repealed. The decision in the Bill re-establishes the legal basis of the summit.
The decision takes account of formal changes in the EU institutions since the last decision and name changes among the employer organisations. The Government can support the continuation of the summit because discussion of the need for jobs and growth can support the labour market reforms needed in other member states. In the intervening decade, during the existence of the summit, no apparent risk to the UK has emerged. The final agreed text of the summit measure has been published by the Council and has received consent from the European Parliament.
John Redwood (Wokingham) (Con)
Are there any financial consequences from these decisions?
Priti Patel
I can assure my right hon. Friend that neither decision has any financial implications for the UK.
Finally, I do not consider that any of the Bill’s provisions engage the rights set out in the European convention on human rights, so no issues arise about the Bill’s compatibility with those rights. It is intended that the Bill will come into force on the day of Royal Assent. I look forward to hearing the views of the House.
Nick Thomas-Symonds
Absolutely. It is great to witness this pro-European moment. Even the right hon. Member for Wokingham (John Redwood) has come in for it. How great it is to see!
John Redwood
Given that the main purpose of the Bill is to endorse new procedures for discussing unemployment and the lack of growth on the continent, does Labour now think that getting countries out of the euro could help them price themselves back into work and get rid of the dreadful unemployment that now lies like a pall over much of the south of our continent?
Nick Thomas-Symonds
It is perhaps an indication of the paucity of my teenage years that I can remember watching the television in the mid-1990s and seeing the right hon. Gentleman ploughing his Eurosceptic furrow very finely, as he always does. In answer to his question, it is of course a matter for the countries themselves. I would not seek to dictate to them.
Stephen Gethins (North East Fife) (SNP)
It is interesting that this Bill underlines some of the positive work of the European Union. I am sure that Members across the House will welcome that, particularly at a time when we are debating our future in that Union.
First, may I associate myself with some of the excellent comments the hon. Member for Torfaen (Nick Thomas-Symonds) made about child poverty? He also made an excellent point about the way in which tax credits were debated last week.
This debate is about the draft decision on the Republic of Macedonia becoming an observer in the work of the European Union Agency for Fundamental Rights, as well as the decision on the tripartite social summit for growth and employment. I am sure that Members across the House will agree that the European Union’s expansion in 2004 was one of its great triumphs. It was a triumph both for Europe and, through our contribution to it, for the United Kingdom, and it has been good for us ever since.
Although they are not there yet and a great deal is yet to be done, I look forward to Macedonia and the other countries of the western Balkans joining the European Union, and hope that the decision on observer status is a step along the way. We have a great deal of work to do, but plugging the gap between Greece and Croatia will be welcome.
Giving Macedonia observer status may give it the help it currently needs. The right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper) spoke earlier today about refugees, and I and others have pointed out that those countries that are least able to deal with the influx and weight of refugees to Europe are those that are taking the greatest strain, not least Macedonia. It is clear from the current refugee crisis that some front-line states can be helped in that regard. It would, of course, be a great help if the United Kingdom could take its fair share of refugees. That does not seem to be forthcoming, but access to the work of some of the EU agencies could also help. It would be interesting to hear from Ministers what assistance the UK is giving the European Union Agency for Fundamental Rights, with particular reference to the refugee crisis faced by the western Balkan countries.
Secondly, I want to say a little about the tripartite summit. I am sure Members on both sides of the House will agree that, given the positive impact that the European Union has had on social issues for many years—my hon. Friend the Member for Ochil and South Perthshire (Ms Ahmed-Sheikh) is likely to comment on that point—the summit will play an important role in emphasising the social dimension of growth and employment between states, and the impact of EU policies on workers as well as executives. An approach that includes trade unionists, businesses and many others can only be a good thing, and in that respect the European Union has led the way in the past.
Finally, let me make a broader point. I think that the Bill shows us how the European Union brings added value to our daily lives. It helps to promote fundamental rights, and today’s debate is especially pertinent in the light of the refugee crisis. I also think that the Bill underlines the need for us to remain part of the European Union, and—this was touched on by the hon. Member for Daventry (Chris Heaton-Harris)—the ability of the UK Parliament to scrutinise European Union legislation. I often think that politicians, here and elsewhere in the EU, can be a bit lazy sometimes in hiding behind decisions that the EU has made. We must bear in mind the role that the UK Parliament ought to play, and I should welcome an increased scrutiny role for the devolved Administrations as well.
Stephen Gethins
I will give way to the right hon. Gentleman, if he wishes to take up my point about parliamentary scrutiny.
Stephen Gethins
We shall have to see whether the people say yes or no, but I think that the scrutiny—
John Redwood
What would happen if our Parliament suddenly decided to vote this down? Is the hon. Gentleman seriously suggesting that that is a possibility?
Stephen Gethins
I can only speak for Members on the SNP Benches, who will not be voting no. I know that the right hon. Gentleman cannot speak for those on his side of the House—in fact, the leaders of both sides of the House can barely speak for those on their own Benches at the moment—but at least we are unified on our Benches. We will not be voting against the Bill today.
As I was saying, we can be lazy when it comes to European Union decisions. We must adopt a more honest approach: we must become more critical, and when we have backed EU decisions, we must be more open about it.
John Redwood (Wokingham) (Con)
We have just been given a wonderful illustration of why our democracy does not work in relation to any European subject. The hon. Member for North East Fife (Stephen Gethins) pretended not to have understood my question, but what would happen if the United Kingdom Parliament suddenly voted against a solemn decision of the European Union? Because the hon. Gentleman is not prepared to countenance that idea, he simply says “I do not want to”, but many of our constituents would like us to stand up to the European Union and start to change it, and one of the reasons why they would like us to change it is the very topic of this debate.
We are being invited to agree to a change in the arrangements whereby we debate and consult, and try to grapple with the huge problem of mass unemployment and austerity which is so visible in the south of our continent, and which was largely brought about by the euro scheme. Today, all that we hear is the usual nonsense: “Because one or two things that the European Union does are fine, we will not grapple with the real issues.” Where are the voices against European austerity on the Opposition Benches?
Stephen Gethins
The right hon. Gentleman is right to raise that point, but does he agree that the devolved Administrations should also be given greater powers of scrutiny as part of this process?
John Redwood
That is a debate for another day. We are not here to debate the relative powers of the different parts of the United Kingdom. At present, the member of the European Union is the United Kingdom, and we are in the United Kingdom’s Parliament. It is part of my case that we have precious few powers left to make major changes in relation to things that really matter on the continent. I want to explore, briefly, what we can do to engage with the problems of mass unemployment and the huge migrations of people who are unhappy with their lot in other European Union countries, and what we can do about the austerity policies that are so deep and vicious in parts of the European Union, having been visited on countries such as Greece, Spain and Portugal by the European Union and the euro itself.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
I hope that the right hon. Gentleman will forgive me for taking him back to the beginning of his speech, when he said that he would like this Parliament to vote down something from the European Union, or at least try to do so. Had he anything specific in mind, or was he just looking for a genuine fight with the European Union? I ask that question, quite openly, for the purpose of illustration.
John Redwood
The illustration that I was using was that there are now large areas in which this Parliament is not allowed to vote against something that the European Union is doing—because it has been pre-agreed, because we have been out-voted, because it is a consequence of a treaty that some previous Government signed years ago, or because it is the result of a decision by the European Court of Justice. Do Opposition Members not see that we are losing our democracy? We are losing our right to disagree with European decisions in this place, and we are losing our right to assert our wish to do things differently. I do not want to choose any one particular thing, but I could name at least 100 things which come from the European Union that I wish were better and different, because I think that they get in the way of prosperity, better wages and a better lifestyle for my constituents and others in my country.
That, however, is not the point. The question that we are debating today is whether, by means of the minor set of improvements contained in the Bill, we can have any impact on the hugely important issues of the breakdown of employment, the denial of opportunity to half the young people in large swathes of the south of our continent, and the effect that the euro scheme is having on people’s prosperity and life prospects. I find it extraordinary that an Opposition who are—sometimes rightly—full of passion on behalf of anyone in Britain who does not have enough income, cannot bring themselves to say a single word for the tens of millions of people on our continent who are being very badly affected by this dreadful scheme. They should think about all those young people who are out of work. How would they like to represent constituencies in which young people knew that they had only a one in two chance of getting a job?
Alex Salmond
Was not the right hon. Gentleman’s political heroine the late Lady Thatcher, who pursued majority voting—which, by definition, means accepting some decisions with which one did not agree—in order to complete the European single market?
John Redwood
She did indeed, but she was not my heroine. I have great admiration for the late former Prime Minister, and I gave her a great deal of advice. Part of my advice was that she should not surrender those powers under the Single European Act, for the very reason that the right hon. Gentleman has correctly identified. Unfortunately, although she accepted a lot of my advice, she did not accept my advice on two very important matters: majority voting in the European Union, and the poll tax or community charge. However, I do not think we have time to explore the question of what would have been better outcomes in the case of those two issues.
I just hope that our Ministers, if they insist on whitewashing this through, as no doubt they will—no doubt they will have the votes to do so—will also ensure that this body does something useful for a change. As my hon. Friend the Member for Daventry (Chris Heaton-Harris) has already demonstrated, it is obvious that although they can range very widely, and can lobby and discuss a number of fundamental issues that matter to people throughout the European Union but especially in the euro area, they have been unsuccessful to date. Clearly this “social committee” has not been a voice against austerity policies in Greece, Portugal or Spain that has had any resonance. Clearly it has not been a voice for more employment. Clearly it has not been a voice for dealing with the problem that a great many southern countries are locked in a currency union with Germany at the wrong exchange rate, which has put them into poverty and unemployment.
Mr MacNeil
The right hon. Gentleman is making a fantastic speech as a Greek nationalist against the evils of a Union Parliament that is holding all the powers to itself, and, indeed, against anti-austerity. I do not want to castigate or to pigeonhole him, but we are seeing great progress in the debate. If the European Union is achieving one thing, perhaps it is achieving that.
John Redwood
If the hon. Gentleman was interested in my views and had read any of them, he would know that I have consistently over the years wanted more work, better paid work, people to own shares, and people to own homes. I believe in prosperity, not austerity, as I regularly try to remind him. I want that for our continent, but we are not going to get it for our continent under the system we have today—I am beginning to stray a little wide of the detail of this Bill.
In summary, I urge our Ministers to make sure of two things: first, that there genuinely is no extra cost to British taxpayers because so far this body has achieved nothing and is part of the problem, not of the answer; secondly, that, if they can, they start putting on the agenda of Europe the scandal of unemployment, the scourge of austerity, and the dreadful mess the euro is making of the economies to the south, because they are our friends and potential market, but I do not want them to be our country.
Alex Salmond (Gordon) (SNP)
Thank you, Madam Deputy Speaker, for squeezing me into this vastly over- subscribed debate. That brings me to one of only two points I wish to make. The purpose of the Bill is to fulfil the requirement in section 8 of the European Union Act 2011 that EU legislative proposals made on the basis of the catch-all article 352 of the treaty on the functioning of the European Union be approved by an Act of Parliament before the UK Government can support them in the Council of the European Union. That is presumably why the debate is so vastly oversubscribed.
Despite the clear lack of interest in the debate, as evidenced by the relatively sparse attendance in the Chamber, the usual channels have chosen not to timetable the Bill. We could speak until 7 o’clock. I could do so—I really could—and be perfectly in order, and the right hon. Member for Wokingham (John Redwood) could have spoken for far longer if he had chosen to do so. Yet we have this open-ended timing today—there is no regulation that says a Second Reading has to take even a half-day—whereas next Monday Scottish Members are expected to cram in Government amendments to the Scotland Bill and its Third Reading. The contrast between the two timetables indicates the Government’s total lack of respect for the need to prioritise the House’s business in accordance with Members’ interest in contributing. I hope that the Government will take that on board.
John Redwood
Does it not also illustrate that the official Opposition never have anything to say about the EU and never want to say anything about it? However, should they not have a view on it?
Alex Salmond
The fact that the Bill is so full of motherhood, apple pie and things that even the right hon. Gentleman finds difficulty in disagreeing with, as we heard in his speech, illustrates that even the serried ranks of Euroscepticism could scarce forbear to cheer this particular piece of legislation.
Scotland Bill
John Redwood Excerpts(9 years, 5 months ago)
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Priti Patel
As I have said, the clause will allow the Scottish Parliament to decide on the details of who carers’ benefits are paid to. I want to make progress now, because I need to come to many other points that have been made.
John Redwood
I am grateful to the Minister; I think there is some problem with Ministers getting to the House.
How will the block grant be adjusted to take into account both the extra welfare responsibilities and the extra revenues? That is a rather important point if we are to understand the significance of the clauses on benefits.
Priti Patel
That is subject to the discussions taking place on the fiscal framework.
Returning to carers, we recognise and appreciate, as everybody in the House will, the contribution of informal carers, who provide tremendous support to parents and other family members.
Amendment 115 relates to the powers being devolved on the provision of the regulated social fund. Clause 20 will give the Scottish Parliament legislative competence over support currently provided through a number of reserved benefits such as funeral payments and maternity grants, which some Members have briefly touched on today. As with our approach to disability benefits and carers’ benefits, the clause devolves not simply the existing benefits but the subject matter of them. That will give the Scottish Parliament wide-ranging powers to make its own provision for the areas in question.
I wish to respond briefly to Members’ points about amendments 132 and 117—the hon. Member for Nottingham North (Mr Allen), who is no longer in his place, spoke to the former. The Government have made significant changes to the clauses on discretionary payments since they were first published in draft in January, having listened to the views of the Scottish Government, the Scottish Parliament and key stakeholders. The Bill now includes new top-up provisions in clause 21, and we have removed some provisions on discretionary housing payments that people felt would unnecessarily constrain the powers being devolved. Together, clauses 21 to 23 will give the Scottish Parliament significant powers to legislate for discretionary payments to people in Scotland, whether by topping up a reserved benefit or by providing assistance to meet short-term needs. The Scottish Government will be able to provide people with money additional to that provided by the UK Government.
Some Members mentioned welfare reforms and tax credits. I should point out that my right hon. Friend the Chancellor will bring his Budget to the House next week, when further measures will be highlighted. The hon. Member for Banff and Buchan mentioned the letter in today’s Herald and spoke about children, and I want to put it on the record that the proportion of children in poverty is at its lowest level since the mid-1980s.
There has been some discussion of welfare reform. The Government are absolutely committed not just to reforming welfare but to supporting families into work. The best route out of poverty is work, and I make no apology for all our efforts to raise incomes by expanding employment opportunities. We will of course have a debate about employment opportunities in a later group of amendments this afternoon, and because we are short of time I will not touch on that subject now.
Members mentioned sanctions and conditionality. Conditionality is an important feature of our welfare system, and I note that both the Labour party and the Scottish National party have always stated that they agree that there should be conditionality in the system. I put it on the record again that there has been an independent review of sanctions, the Oakley review. The Government have accepted all the recommendations highlighted in it and have already implemented a number of provisions, including improvements to the hardship payments process.
Dr Whiteford
The hon. Lady is mistaken. The procurement legislation was hampered by EU legislation. In recent public sector contracts, however, the Scottish Government have started to integrate living wage requirements from the outset. In fact, all the people for whom the Scottish Government are now responsible are on a living wage. There remain many challenges with contracted-out services, particularly at local authority level, but we are trying hard to move towards a living wage in all parts of the public sector. In recent months, we have also made real progress in making sure that private sector employers move towards a living wage. After all, most low-paid jobs are found in the private sector. We need the power to raise the minimum wage to a living wage. When people on low incomes have money in their pockets, they spend it, thereby boosting and strengthening the economy and creating jobs. We saw that when the minimum wage was introduced.
It is incumbent on everyone in the House to listen to the voices of people in Scotland who have put their heads above the parapet on this issue, because they are some of Scotland’s largest and most influential civil society organisations: Citizens Advice Scotland, Barnardo’s Scotland, the Child Poverty Action Group Scotland, the Church of Scotland, Inclusion Scotland, One Parent Families Scotland, Oxfam Scotland, the Poverty Alliance, the Scottish Council for Voluntary Organisations, Shelter Scotland, the Scottish Federation of Housing Associations, the Trussell Trust and last, but by no means least, the Scottish Trades Union Congress. The veto in the Scotland Bill is a barrier to responsive and responsible governance in Scotland.
John Redwood
If the Scottish Government did have wider-ranging powers on welfare, as the hon. Lady would like, by how much would they need to put up benefits compared with UK levels to tackle the problems she has identified?
Dr Whiteford
The right hon. Gentleman raises an interesting point. It is worth pointing out that, over the past five years, Scotland has spent a lower proportion of its GDP on pensions and benefits than the UK as a whole. The question of what a social security system can afford is dependent on the success of the economy. That is why our amendments are all designed to bring into the ambit of the Scottish Government and the Scottish Parliament those powers that would enable us to grow our economy, run it more effectively and join up the existing devolved powers with the new powers that we propose. Frankly, getting powers over work and powers over benefits covered by universal credit is extremely important. The other really important point is that we protect the most disadvantaged people in our society from the onslaught of Tory cuts. Again and again, the people of Scotland have made it clear that they want an alternative to this austerity regime—and that is what we want to be in a position to deliver.
The Deputy First Minister, John Swinney has pointed out that it is not difficult to foresee that what might appear to be pretty innocuous requirements to consult the Secretary of State and secure his or her agreement could be translated into what is essentially a blocking power. All sorts of excuses could be used to prevent something from happening. As the Deputy First Minister put it, if the Secretary of State has a “reasonable explanation” for why he is acting in such a way, that passes the test as it currently exists in clause 24. In practice, the Bill gives the UK Government the ability to veto decisions made by the Scottish Government and Scottish Parliament. This is not a hypothetical scenario. The Deputy First Minister has pointed out how he spent two years trying to make progress on the block grant adjustment, and was stalled and delayed with more analysis at every turn by the UK Government.
For me, no issue illustrates the shortcomings of the Scotland Bill better than the restrictions it would place on the power of the Scottish Parliament to abolish the bedroom tax. As the Secretary of State knows only too well, this has been an issue close to my heart over the last few years, because of its punitive impact on disabled people in Scotland, its gross unfairness and the enormous pressure it puts on councils and other social housing providers. In Scotland, 80% of people affected by the bedroom tax are in homes with a disabled adult, and there is a chronic mismatch between the house size requirements of tenants and the available housing stock. Back in April 2013, I led one of the SNP’s very few Opposition day debates here in this Chamber during the previous Parliament on that very topic, and the Secretary of State knows that I questioned him on several occasions about the failure of the policy and its deep unpopularity right across the country.
The Scottish Government have mitigated the impact of the bedroom tax by providing discretionary housing payments to everyone affected, but it is important to recognise that we still cannot abolish that legislation, which remains on the statute book. Moreover, the money to mitigate its worst side-effects has had to be found from other devolved policy budgets—and, crucially, the legal liability remains with tenants. It is far from an ideal solution. In order to mitigate the bedroom tax by lifting the cap on discretionary housing payments, the Scottish Government first had to secure the permission of the UK Government, and the protracted and frustrating process they encountered in attempting to secure that permission illustrates, I think perfectly, why we need to lift this veto. It shows how a need for permission can be drawn out for months at a time.
Dr Whiteford
I am not giving way, as I am about to wind up my remarks.
This group of amendments comes down to respect—respect for the promises made to the people of Scotland; respect for our Parliament; respect for the democratic process; and, above all, respect for our citizens and our ability to make decisions in our own interests. That is, after all, what meaningful devolution is really all about.
John Redwood
I think that the Committee wants to implement the spirit and the letter of Smith, and I look forward to hearing the Secretary of State’s response to the detailed arguments advanced by the hon. Member for Banff and Buchan (Dr Whiteford). I think, however, that when we are dealing with a matter as potentially wide-ranging as universal credit, we also need to think about the money, and about how far it is possible to operate a very different welfare system in different parts of a country such as the United Kingdom. What we have seen in the unfolding and dreadful Greek crisis is that, if a country belongs to a currency union but has not brought its benefits system into line, and if there is no proper system of sharing revenues and expenditures throughout the eurozone, that becomes extremely damaging, as it has for the poor Greeks.
Mr MacNeil
I am sure the right hon. Gentleman is not suggesting that there is an in-line benefits system across Europe. The real problem is austerity. The Greeks were told five years ago that, if they followed austerity measures, their problems would end, but their problems have not ended. They have become worse, because austerity makes things worse. It is nothing to do with welfare; it is to do with austerity.
John Redwood
I think that welfare has quite a lot to do with austerity, and I think that we agree. I think that the policies that have been forced on Greece have been too austere. It is quite wrong to make the Greeks cut public spending when they cannot expand their money supply, expand credit or expand the private sector to create the jobs that they clearly need to create in order to make some success out of the cuts imposed on the public sector.
When, after 2010, we conducted policy as a coalition to bring about recovery in Britain—including Scotland—it worked very well, and it was private sector led. We were able to do that because we had a full range of powers over interest rates, money creation, credit and banking, which a nation that has joined a currency union does not have. That is the Greek tragedy. The Greeks are able to carry out only the public sector part of the EU fix, which is the bit that is austere. They are not able to carry out the private sector-led recovery.
Of course, we are not here to talk about Greece; we are here to talk about our currency union. However, I wanted to make that point because, whereas Greece is having to move away from a position in which it shared only currency and is now discovering that it needs to share a great many other policies with the European Union in order to achieve success, in Scotland things are going in the opposite direction.
We have a currency union—a perfectly good currency union, which is supported on all sides. I believe that Members of the SNP are great fans of the currency union and do not wish Scotland to have an independent currency, but they need to consider this: if they do not want proper independence in the sense of having their own currency, and if the currency is to work in the way in which it has worked in the past, there will have to be some basic standards of welfare that are common across the country, and there will have to be agreed systems of transferring money from rich areas to poor ones. There are rich towns and cities in both Scotland and in England. The rule of our system is that those in areas of high income or relative success pay more tax, and those in, say, towns or counties with a lot of poverty benefit from big transfers.
Mr MacNeil
I almost feel sorry for interrupting the right hon. Gentleman when he is advancing a good argument for the redistribution of wealth through taxation, and has also admitted that austerity is not a good idea. However, I think that the mention of Greece is erroneous. If we are talking about an optimal currency zone, a better parallel would be Germany and the Netherlands. The independence that those countries have from each other is welcomed by SNP Members. I hope that the right hon. Gentleman will go a little further than the enlightened remarks that he has made so far, and will agree with us that Scotland and England should be as independent from each other as Germany and the Netherlands.
John Redwood
I am not prepared to go that far. I think that there can be problems in the euro currency zone between Germany and the Netherlands, because they do not have the full range of common policies that they may need. At present, it appears that the Dutch and German economies are sufficiently synchronised for the arrangement not to cause problems in the Netherlands, but that is clearly not true of Portugal, Spain, Ireland or Greece. The fact that there are more countries that it does not fit than countries that it does fit implies that there is something wrong with the fundamental architecture of the euro. That is why I am anxious for us to bear it in mind, when we are debating the issue of how much welfare discretion there should be, that a common welfare system is normally one of the characteristics of successful currency unions.
Yes, I do believe in redistribution. We all believe in redistribution. We believe that, in a civilised country such as ours, we should tax the rich more and give money to those who need support. We have arguments about how much the amounts should be and about the conditions, but we all believe in transfers, and we all believe that the balance must be right.
When I asked the hon. Member for Banff and Buchan to say how much more an enlightened Scottish Government would like to give, by means of welfare payments, to tackle immediate problems of low income or poverty, she was not able to tell me. That was a pity, because I took it that her intention, and the purpose of the amendments, was to give the Scottish Executive power to increase benefit levels in comparison with the levels, or the range, of benefits currently on offer in the Union. I did not think that SNP Members were seeking these powers in order to be meaner than the Union Government are proposing to be, and I see them consenting to that. I feel that this debate would be richer and fuller if they shared with us the amount of extra money that they would like to spend.
Patrick Grady (Glasgow North) (SNP)
Surely the point is that it is for the Scottish Government, whatever their colour, to decide how they want to use the powers. Perhaps one day a Government of the right hon. Gentleman’s colour will be using them. However, no Government would be able to use any powers that had been vetoed by the Secretary of State.
John Redwood
That brings us back to an important and interesting question. At what point does the transfer of power become destabilising for the currency union and the common transfers that make up our common country? That, surely, is one of the issues that were examined in the referendum, when a majority of Scottish people felt that they wanted to remain in the United Kingdom and in the currency union. Having read and listened to what was said by those who were actively involved in the debate, I suspect that the currency union was rather central to the securing of that vote, and that it was when the parties of the Union said that Scotland should leave the currency as well as the UK, if that was the wish of the Scottish people, that the majority voted to stay in the Union.
Mr MacNeil
I should be fascinated to know the size of the changes in welfare spending that the right hon. Gentleman would find destabilising. The hon. Member for Gainsborough (Sir Edward Leigh) said yesterday:
“the Scottish Parliament spends £37 billion and raises £30 billion”.—[Official Report, 29 June 2015; Vol. 597, c. 1234.]
He described that as “quite responsible”. He also said that the UK raised staggeringly more—£648 billion, an amount that is about 20 times greater—but, of course, the UK also spent a great deal more, with a black hole of £732 billion. Given those figures, and given the difference between the sizes of the states of Scotland and the UK, in terms of both spending and raising powers, just what type of changes does the right hon. Gentleman think would have to hit welfare before it began to destabilise the Union? I suggest that it would be necessary to make a millionaire of each and every unemployed person before that point was reached.
John Redwood
I do not think that it would be necessary to go that far. At present, there is clearly a disproportion between the size of Scotland and that of the rest of the United Kingdom, and, as the hon. Gentleman’s budget figures show, a lot more money is collected elsewhere than in Scotland. That, however, is not the point at issue. [Interruption.] I am not asserting anything; I am just asking a question. We are engaging in a crucial debate on how much welfare power should go to Scotland. I am one of those who agree that some welfare power should go to Scotland in accordance with Smith, but we have to ask how far it goes, and what the consequences might be.
If countries have a common work area and a free movement area, and if they share a language, a labour market and a currency, that arrangement can bring benefits when it has settled down, because it is backed by political union. When we start to unpick the political union, we must ask ourselves at what point that unpicking of that union, or the welfare transfer union, will become damaging. A point will be reached when it does become damaging, because one part of the country will be too attractive, or too unattractive, compared with another part. A single currency area as big as the United Kingdom can work only if there are fair systems for raising money from the rich, wherever they may be in that big area, and giving enough to the poor, wherever they may be.
Drew Hendry
Is the right hon. Gentleman aware that parts of the United Kingdom are already more unattractive because of decisions on welfare spending? The bedroom tax is one example. In the highlands, there are some 70 communities with no one or two-bedroom properties on the social register for people to move to. How can it possibly be fair for that principle to apply across the UK, when the people who live there are unable to cope with that heinous tax?
John Redwood
I fully understand the arguments against the spare room subsidy, or the bedroom tax. I understand the politics of it only too well. I do not want to go into my private views now, but it is a matter to be settled within the Union Parliament, and by the Government of the Union, under current powers. It does not make good law to say that if there is a particular benefit that people in Scotland do not like very much, that is the one that we should be able to fix. We need to come up with a settlement for a longer-term period which takes account of the principles.
It is for that reason that I am presuming to spend just a few minutes reminding colleagues that very big principles are involved in this instance. We need to secure the right balance, one that enables Scotland to feel that it can make enough of its own decisions to meet the mood of the majority, but falls short of giving it so much power that the Union’s mechanisms for switching money around do not work. I find it very difficult to make decisions on this Bill without knowing what the financial settlement will be, because it will not work unless there is enough money to make it work, or if England does not think that it is fair to them. Scotland may well find that the financial settlement is not fair to them—I am sure our SNP colleagues will not be shy if that is the case—but England has delivered big majorities for me and many of my colleagues, so we have a mandate and a voice and we need to make sure that the financial settlement that emerges is fair to us. The range of powers that Scotland has will have a bearing on that settlement.
Mr MacNeil
I thank the right hon. Gentleman for giving way; he is being very kind. On welfare, we already share a common language with a country in the common travel area, namely the Republic of Ireland, where people can get up to €188 per week, with extra payable for those who have children. I am not saying that people are going from Liverpool or the north-east of England to a far more advantageous situation in the Republic of Ireland in the common travel area—which they could do—so I think that the right hon. Gentleman’s fears are misplaced. I would almost suggest that his fears are politically motivated and based on wanting to keep powers in Westminster and a deep psychological need for Westminster to over-control aspects of people’s lives around the current UK.
John Redwood
I am afraid that that is a bad example, because it proves my case. Ireland broke from the pound, set up its own currency and then, unfortunately for Ireland, chose the euro, but that was Ireland’s decision and it has had a bumpy ride ever since.
The big difference we need to remind ourselves about for the purposes of this welfare debate is that there is a common currency, so there have to be some limits to the amount of freedom appropriate for welfare benefits. If the SNP wishes to be truly independent and wants an independent currency, I fully understand its position and none of these arguments makes any sense.
I think I have made my point and I hope that Ministers will bear it in mind that it is very difficult to come to a conclusion before we know what the financial settlement will be. It is also very important to remember that there is a common work, language and currency area, which means that there has to be some family resemblance in the benefits that are paid.
Mark Durkan
I want to follow on from some of the issues touched on by the right hon. Member for Wokingham (John Redwood), particularly his last point about a financial settlement. When debating the earlier group of amendments, he intervened on the Secretary of State to ask whether he would address how the Barnett formula might be adjusted.
In essence, I think that the right hon. Gentleman is corroborating some of the basic questions asked by the hon. Member for Banff and Buchan (Dr Whiteford) about clauses 24 and 25, which presume an awful lot and raise a lot of questions about what else should be in them and what is happening outside them. The clauses presume a standard of behaviour and courses of action and events in relation to how decisions will be made. For instance, the word “concurrently” is used, but if we look at the sequence of decisions and processes involved, we will see that they do not look very concurrent. There could be distended periods and a lot of dispute and difference. The most important gap in clauses 24 and 25 —both Labour and the SNP have tabled amendments to address this—is that they do not say what will happen if Scottish Ministers and the Secretary of State do not concur on some of the issues.
If we as legislators are going to pass clauses that presume certain standards, the course of events and political behaviour, the question we need to ask is, “And what if not?” The Bill does not answer that question. If there is no agreement between Scottish Ministers and the Secretary of the State on the decisions, timelines, details and other implications, what will happen? We will be in difficulty and we will be told, “Well, the legislation faithfully followed Smith and we couldn’t do any more than that,” but it is clear that Smith is not of itself sufficient to address those questions, so we as legislators must address them. The Smith commission exercise was different from that for which we have responsibility as legislators. It is not good enough for us to say, “We’re not going to answer those obvious questions, because Smith didn’t address them.”
Tommy Sheppard
I was just going to quote the right hon. Gentleman, but I will take his intervention.
John Redwood
I entirely agree with the hon. Gentleman’s description of what we want from our welfare system, but by how much does he want pensions and universal credit to go up to meet his aspirations compared with what is on offer?
Tommy Sheppard
The right hon. Gentleman has on several occasions in this and previous debates talked about cost and about how much will be paid for certain welfare benefits. I have to say to him that he must not assume that the cuts his Government are making in the welfare budget are cost free. There will be consequences as a result of what they are doing.
If the Government reduce the amount of money that poor people have and impoverish them even further, there will be consequences for the rest of society. It will increase the burden on our national health service as people become physically and mentally ill. It will drive people to drug dependency and petty crime, and put extra demands on our police service. Most of all, it will cost our economy in the lost opportunity of those wasted lives. Do not think for one minute that there are no consequences to what the Government are doing with the welfare budget.
Tommy Sheppard
I am anxious not to get into a debate with the right hon. Gentleman, but I will take one more intervention.
John Redwood
This is a debate, and I am delighted that the hon. Gentleman is prepared to get into such a debate. I have no wish to take money away from people who need it; fortunately, we do not have to debate that today. What is the answer: how much more is needed to meet his aspirations for greater generosity than the Government have volunteered?
Tommy Sheppard
I am happy to have a debate; I just do not want to have it with the right hon. Gentleman by himself. It is a matter for assessment: we will have to sit down and work out exactly how much more will be required. The question here is: who should make the assessment—should it be the representatives of the people in the Scottish Government, or should it be someone else?
I want to talk about the bedroom tax, which has been mentioned several times. I will give one example of a human story, rather than the statistics that people have thrown around the Chamber. I have a 62-year-old constituent, who has lived in the area for 30 years in the same two-bedroom house. She has brought up her family, who have now left home. She now suffers from chronic angina and arthritis, and she can barely leave the house, never mind go into employment. She is probably not going to work again. The question is: what type of social protection do we offer someone in that position?
When I came across my constituent last year, she was running up against the spare bedroom subsidy regulations. She was told that she would either lose £14 a week off her benefit, or she would have to move house. Not having £14 to lose, she inquired about where she should move to. The only options given to her were five miles away, in an estate with a number of social problems that hers did not have, with no support from family or friends and no ability to continue the life she had. She was almost terrorised when I came across her: she was at the point of distraction and was making herself ill. I am glad to say that, because of the actions of the Scottish Government, we have now been able to help that woman and others in her situation, but I fear for people throughout the rest of the United Kingdom who are in that terrible situation.
Another example of parsimony is the sanctions regime, which has been mentioned several times. Let us not kid ourselves that officials in the DWP are using sanctions as a last resort. In many cases, they are being used as a first resort. We all know of cases in which people have been sanctioned for the most petty of breaches.
Dr Eilidh Whiteford
We have had an interesting and wide-ranging debate on the amendments this afternoon, perhaps more wide-ranging than I could ever have envisaged. I am not sure how we managed to get sidetracked into Greece so early in the afternoon’s debate, and the comparison between Greece and Scotland did seem rather ill-conceived. It was, of course, refuted ably and comprehensively by the hon. Friend of the right hon. Member for Wokingham (John Redwood), the hon. Member for Gainsborough (Sir Edward Leigh).
However different Scotland and Greece might be in cultural, economic and climatic terms—
Dr Whiteford
I will not give way just at the moment, because I think we have talked quite enough about Greece. I want to make a couple of substantive points about the issues that were raised, however.
Whatever differences Scotland and Greece have, what we have in common, apart from our patron saint, is the fact that people in Scotland will feel great sympathy for their fellow European citizens in Greece and will have a sense of solidarity about the level of deprivation they are having to undergo. My hon. Friend the Member for Na h-Eileanan an Iar (Mr MacNeil), who is not in the Chamber at the moment, made the important point that the real morality tale from the Greek situation that is relevant to our discussions today is that austerity does not work and that we need the power to create alternatives to it.
The other salutary tale we heard this afternoon came from the hon. Member for Foyle (Mark Durkan) who, with his usual eloquence, drew on his experiences in Northern Ireland to warn of the difficulties ahead if we fail to legislate clearly. He also warned of the dangers of what has been termed “karaoke legislation” in Northern Ireland, in which people have powers but not the power to enforce those powers.
My hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford) made a powerful speech that highlighted some of the real differences between the challenges we face with welfare and pensions in Scotland and those in other parts of the UK, pointing out the low life expectancy and the poor value that Scottish pensioners get. Indeed, we have some of the lowest pensions in Europe and Scottish pensioners end up about £10,000 each worse off because of our pension arrangements. My hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) drew attention to the issues with the work allowance, which is a really good example of what we might do with these powers to improve the support we give to lower paid workers.
Above all, we need to talk about the veto. My hon. Friend the Member for Edinburgh East (Tommy Sheppard), who is quickly becoming one of the stars of this Parliament, set out how new clauses 45 and 46 would enable constructive working between the UK and Scottish Governments. That means not just fine words about constructive working but fine working.
To move on to those who spoke from the Front Benches, I welcome the support from the hon. Member for Edinburgh South (Ian Murray) for our lead amendment and for amendment 119. I listened very carefully to the Secretary of State’s conclusion to the debate. I fully accept that there are constructive relationships through the joint ministerial working group and many other parts of the Scottish and UK Governments, but when there are genuine differences of opinion and of ideological direction as well as different policies and different circumstances, we need the mechanisms and the legislation that enable us to deal with them effectively. That is what we still do not see on the face of the Bill.
The problem is that the Bill, in its current form, does not cut the mustard. The Secretary of State’s position on this could probably be summed up by the old saying, “They’re aw oot o’ step but oor Jock.” There is a consensus in Scotland, among all the other Scottish MPs, among MSPs, including MSPs from the Secretary of State’s own party, and among civil society that the veto needs to be taken out of the Bill. I urge the Secretary of State to listen. Part of the problem in Scotland for too long has been that people have not listened, but the voices of the people of Scotland will not be silenced. If the Secretary of State thinks that these issues will go away, I can tell him that they will not. We have heard salutary lessons about why we need to have the legislation pinned down and secure.
Earlier in the debate, I should also have stated my intention to move new clauses 39 and 40 and I am grateful to the hon. Member for Edinburgh South for flagging up that omission. We will press—
Oral Answers to Questions
John Redwood Excerpts(10 years, 3 months ago)
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Mr Duncan Smith
I have visited and talked to a number of my colleagues across Europe—in Germany, Holland, Spain and France—and I have also talked to the Danish Minister. Everyone to whom I have spoken so far and many more—I see that the Poles have also come to the same conclusion—have decided that there is something fundamentally wrong with the European Commission interpretation of people’s right to access benefits in a country where they do not have residency. Recently, the Germans have tightened up in almost exactly the same way as we have done. We had all those people saying that what we were doing was terrible, but now that the Germans are doing it, those people have gone quite quiet.
Mr John Redwood (Wokingham) (Con)
Is not the question of who gets a benefit from this country, or who comes to stay in this country, a matter for this Parliament, not for the EU?
Mr Duncan Smith
That is exactly the point that I have been making from the beginning. We have always said to the European Commission that this matter lay outside the treaties. It is a national Government responsibility, and it is national Governments who should take that responsibility. The Opposition did very little about organising this so that they would be able to stand against the EU Commission on that basis.
Inherited Social Housing Tenancies
John Redwood Excerpts(10 years, 8 months ago)
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Esther McVey
No. It is something we are having to deliver because of what we inherited from the previous Government, including a benefit, the cost of which had doubled in 10 years, and a policy that had left nearly 2 million people on housing waiting lists and 400,000 in overcrowded houses. It was a skewed policy under which people living in private rented accommodation could have their spare room subsidy removed but people who lived in the social rented sector could not. And as for people giving out wrong numbers, I would remind the hon. Gentleman that, when he plucked numbers from the air in the last debate, St Helens said that he had got his numbers wrong. Now, in response to his citing a figure of 2,100 cases, Birmingham has put up on its website this statement:
“We haven’t finished identifying them at Birmingham so can’t give you an exact number, but the number of possible cases has dropped substantially below the 2,100 that was reported in the papers”.
We have trebled the discretionary housing payments. We have also said that we will cover the differences involved for people who are exempt and that we will help local authorities with the administration charges. We have answered these points and we have voted on them. I suggest that the hon. Gentleman look again at the debate we had on 26 February.
Esther McVey
The number so far, on best records, is about 5,000. However, the cases are having to be manually checked at the moment, because of a change of computer system, and everybody is going through that. Also, a person has to be in continuous receipt of housing benefit and has to have lived in the same home since 1996.
Housing Benefit
John Redwood Excerpts(10 years, 9 months ago)
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Rachel Reeves
The facts speak for themselves: two thirds of the households hit by the bedroom tax have fallen into arrears and councils up and down the country are trying hard not to evict people, because they know it is the wrong thing to do. They are trying to help people and we should welcome that and applaud them for doing the right thing, unlike this Government, who are failing to do the right thing.
Mr John Redwood (Wokingham) (Con)
Could the hon. Lady explain why Labour in office supported a scheme just like this for private rented sector tenants?
Rachel Reeves
The right hon. Gentleman knows full well that this scheme is retrospective in a way that the scheme for the private sector was not. The people affected by this loophole have been living in their properties since 1996. They thought they had a secure and permanent tenancy, but it turns out that they do not, because they cannot afford to live in the home they have lived in for, in some cases, their whole lives.
Job Insecurity
John Redwood Excerpts(10 years, 10 months ago)
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Mr Umunna
My hon. Friend is right. It is worth recalling that when my right hon. Friend the Leader of the Opposition first talked about the cost of living crisis and the squeezed middle, Members on the Government Benches and their supporters ridiculed the very notion, but the existence of that living standards crisis is now undeniable. Indeed, since my right hon. Friend first talked about the squeezed middle, in 2011, I think, the people who compile the Oxford English Dictionary named it their word of the year, despite the fact that it is two words.
Words are one thing, but they are backed up by the reality of what we see in our communities. Ministers can do whatever jiggery-pokery they want with the figures, as the Chancellor did the other day when he claimed that the top decile of earners was the only decile that had lost out from his measures. In so doing, he miraculously forgot to take into account the huge tax cut he had given the top 1% at the same time as heaping a VAT rise on working families and taking away support from them.
The average employee is earning substantially less than when this Government came to office—over £1,600 less a year. It is important to remember that on Wednesday 13 February last year—almost a year ago—the Prime Minister at Prime Minister’s questions in this House pledged that people would be better off in 2015 than in 2010, and we will hold him to that. The head of the Institute for Fiscal Studies, who is often cited in all parts of the House, thinks differently. He said last month:
“We will be able to say definitively—I’m pretty sure—that, come 2015, average household incomes will be lower than they were pre-recession and lower than they were in 2010.”
Mr John Redwood (Wokingham) (Con)
Can the hon. Gentleman assure the House that no one working for a trade union or a Labour council is on a zero-hours contract or is a part-timer who wants a full-time job?
Mr Umunna
I will come on to zero-hours contracts shortly, if there is some patience on the Government Benches.
This living standards crisis is not just one of rising costs and falling wages. It is one, too, of increasing insecurity at work. People in work today feel less secure and more pressurised at work than at any time in the past 20 years, according to the most recent UK skills and employment survey. Members on the Government Benches shake their heads. It was the Government’s own UK Commission for Employment and Skills, which co-funded that survey, that described what we now have as a “climate of fear”. More recent research carried out towards the end of last year found that the number of people feeling insecure at work had almost doubled since this Government came to office, with half the working population believing that the economic policies of this Government have made them less secure.
There is a constant worry about whether people will be able to hold on to their jobs. There is a constant worry about whether they will be able to provide for themselves and their families—a continuing squeeze, yes, and an increasing amount of insecurity. That is the reality of life in this country in 2014.
Housing Benefit
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Madam Deputy Speaker (Mrs Eleanor Laing)
The hon. Gentleman makes his point very well, as ever. However, as he knows, that is not a matter for the Chair.
Mr John Redwood (Wokingham) (Con)
Further to that point of order, Madam Deputy Speaker. Is it not a matter for the Chair if the fundamental rights and liberties of this great House of Commons are damaged by a foreign court and we can do nothing about it?
Madam Deputy Speaker
I have just said that it is not a matter for the Chair. It may be a matter for debate at some other time, but it is not a matter for the Chair and that was therefore not further to the point of order.
Pensions Bill
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Sheila Gilmore
One of the issues that has come up in the course of all the debate about the single-tier pension is the decision that the Government have taken to bring to an abrupt end to the provisions that previously existed for women in particular—I shall talk primarily about women, although men could be in this position—to be able to derive a pension or years towards a pension from the contributions of their spouse. That dates back to a different world. When the state pension system was set up in the post-war period, there was an assumption that the standard pattern for married people was that one person, normally the man, would be the main breadwinner, and the woman would spend considerable periods out of the labour force, and perhaps not even work at all after marriage. Indeed, although they were about to go, there were still marriage bars on certain types of employment, so time out of employment was not just a question of choice; it was sometimes a question of necessity.
Things have changed and, although it can still be a necessity, for many women the amount of time out of employment can be very short. The arrangement in the original proposals was that a woman could receive a derived pension from her husband’s contributions—currently approximately 60% of the full state pension—or receive benefit if she was widowed or divorced. For someone widowed after retirement who was receiving only the 60% pension—sometimes referred to as the married couples pension when both bits are put together—it would be increased to a full single person’s pension, regardless of whether she had made contributions during her working life. For those who are divorced, there is currently provision in the system to inherit and carry over a spouse’s contribution record if it is better than one’s own. That can be beneficial to women, and some men, in building up a pension record.
Other changes that have taken place include crediting certain types of contribution that are not entirely financial. As well as the credits people receive during periods of unemployment when they are claiming benefit, successive Governments have introduced credits for periods of child care and for caring for other relatives, and that can make up some gaps. There are still some people—a decreasing number, without a doubt—who will end up in a position where they do not build up sufficient contributions in their own right. If the right to obtain these so-called derived benefits is taken away, there will be a group of people, primarily women, who, post-2016 when the new arrangements come in, will have less than they would have expected to get before that date. They will be in a worse position than they would have been previously, and that will have all sorts of consequences.
People have reasonable expectations of the rules. Age UK gave an example of someone who had specifically asked the Department for Work and Pensions for advice on whether she should start making contributions relatively late in her working life. She was told not to do so, because she would not be able to work to receive nearly as much as she would be getting in any event. That advice was given in good faith and at the time she accepted it in good faith, but it is now too late for her to make up the difference.
The Government estimate that there are 40,000 women in this position. I am not sure whether there is certainty about that figure, because I do not know whether a full survey has been carried out. However, 40,000 is not a huge number. New clause 5 asks for a full review to ascertain how many women are in this position and what the cost would be of allowing them to continue to benefit from derived rights for a transition period—it would not be for ever.
Mr John Redwood (Wokingham) (Con)
Does the hon. Lady have any idea how much money, on average, these ladies might be losing?
Sheila Gilmore
I do not know off the top of my head, which is why I am asking for a review. We might be talking about 40,000 women who clearly will not be getting a full pension, but certain of them will have made some contributions; it is not that they will have no contributions. The Work and Pensions Select Committee looked at this and recommended transitional arrangements for those within 15 years of the state pension age when the new arrangements came into force. It is not for ever, it would not go on and on, with a very long tail; but it would provide for those who quite reasonably made plans on the basis of particular expectations.
I have heard two arguments from the Government. The first was a generalisation about how the world had changed. Yes, of course it has changed, and we are not talking about most or all women doing this for ever. Just saying, “Well, the world’s changed”, is not a good enough answer to the fact that some women will suffer detriment if transitional arrangements are not put in place. The second argument was that apparently—I am not sure any figures have been offered up—an increasing number of these women were living abroad. It conjured up images of women much younger than their husbands and living abroad—I do not know whether the Minister had Filipino brides in mind. Nevertheless, it cannot be beyond the ingenuity of the DWP to ensure that people do not take undue advantage. Like I said, these arrangements would not last for ever.
There are a variety of reasons why somebody might not have contributed. They might have made a positive choice not to contribute or they might have been doing voluntary or care work before credits were allowed or without appreciating that they were allowed—we know that a lot of people are eligible for carer’s credits who have not claimed them. There are a variety of reasons. Others will have been in very low-paid or short-hours part-time work and earning below the level of contribution, and they might have concluded that it did not matter too much because of the derived right.
We debated this matter in Committee and I hope that the Government will this time be prepared to accept my new clause. Then, when we have carried out the review, a decision could be made about whether to proceed with transitional arrangements.
Mr Redwood
Does my hon. Friend know whether the requirement to uprate in the European Union countries is a European requirement that the Government can do nothing about or a Government choice?
Sir Peter Bottomley
The Government chose and Parliament endorsed that we would have free movement of people and of benefits in this sense, but the Secretary of State will no doubt be able to answer my right hon. Friend with greater certainty. The essential point is that as a country joins the EU—or even EFTA—the entitlement to increases in pensions comes with it.
When preparing my thoughts on this matter, I might have anticipated that the Prime Minister would say that he would give consideration to calls for a wider review of the issue. I might also have expected him to conclude that he was not minded to pursue such a review at this time. That is the gentlest form of saying no that I have come across.
I suspect that, as and when we extend voting rights to British nationals living overseas, either for a period of 15 years or for even longer, as many other countries do, our Members of Parliament who represent those overseas resident voters will start putting the pressure on, and that change will come. The Prime Minister might be anticipating that. He might see the sense and justice of such a change, but, given his position, he has to say no to a lot of popular causes. Perhaps the justice element for which is so rightly praised in the Commonwealth has not quite come to his mind yet.
In fact, I received a letter from the Prime Minister about half an hour ago confirming what I had anticipated. He has said that
“the case for not departing from the position of successive Governments is clear.”
I have already pointed out how the position has changed in respect of the reciprocal arrangements. His letter goes on:
“To do so would cost hundreds of millions of pounds at a time when the pressure on a welfare system is considerable and when we are asking many people who live in the UK to make sacrifices.”
That could be an argument for cutting off increases for all overseas pensioners, but that is not going to happen. The anomaly will continue. It has carried on from 1972 to 2013. If I am still here in 20 years’ time, will Ministers still be trotting out the same arguments that they used in 1972? I jolly well hope not.
I pay tribute to the leaders of the International Consortium of British Pensioners in Canada and Australia. They have had work done by Oxford Economics to make the case for the health care savings. We all know that the majority of costs to the national health service are incurred by people in the last years and weeks of their lives. Which of the people living overseas are the most likely to return to this country for their end-of-life health care? I suggest that it is those living in the United States, whose insurance might have run out and who cannot meet the costs, and people in Europe who might want to return to this country to be treated in a health service they know and in a language they are used to. I doubt that many people would come back from New Zealand, Australia, South Africa or Canada.
The health care question was what prompted us to call for the whole of Government review. I pay tribute to my hon. Friend the Member for North Thanet (Sir Roger Gale), who came with me last week when the Prime Minister very kindly gave us the opportunity to put some of these points to him.