Coronavirus Outbreak: DWP Response

Karen Buck Excerpts

Thursday 26th November 2020 Commons Chamber

[Ms Karen Buck (Westminster North) (Lab)]

I will start by congratulating the Select Committee on a superb report, as always, and on the introduction by the Chair of the Committee, my right hon. Friend the Member for East Ham (Stephen Timms). It will not be a surprise that I agree with everything he has said. In the middle of a crisis of this kind, it is very tempting to not welcome rigorous scrutiny and, indeed, challenge of the policies that are brought forward in response to it. However, it is even more important at these times that we hear that kind of scrutiny, which draws particular strength from being cross-party: we have heard contributions from both sides of the House on these important points.

Getting this right makes the difference when it comes to people having food on the table and being able to warm their homes, and being able to have a roof over their heads and communicate with each other—essentials of a basic but decent standard of living. It also means offering people security and dignity at a time of personal crisis, when their worlds are crumbling around them. Getting it wrong means debt, hunger, homelessness, and the fears, stresses and insecurities that can and do trigger mental and physical ill health. It is entirely possible for two things to be true at the same time: that the system has indeed handled, and handled well, a soaring number of claims for benefits, and that too many people are left in desperate need and, in some cases, total destitution. It is true that more money has been spent this year in response to this crisis, but also that the level of need is outstripping it, and it is certainly true that—as we learned yesterday—the temporary nature of so much of that assistance is leaving us with some profound concerns for what happens next.

It is absolutely right, as I think has been said by everybody who has spoken so far, that a debt of thanks is owed to the DWP staff, locally and nationally, supported by the work of voluntary organisations and other public bodies. People have gone above and beyond what is required of them, as they did during the financial crisis 10 years ago, when the system also rose splendidly to the challenge it was put under. As always, we owe our thanks to those dedicated staff.

It is no reflection on the work of the Department’s public servants to say that the effectiveness of the policy response itself has been more mixed. In part, that is because of the austerity policies pursued by the Conservative Government since 2010, which left the benefits system woefully unprepared for the impact of this crisis. Ministers like to boast about the £9 billion they have allocated to social security in response to the pandemic, but the Office for Budget Responsibility has confirmed that £9 billion is the amount taken out of social security by the Government in the 2015 Budget alone. The long history of failing to uprate benefits—the benefit freeze that we had for so many years—meant that between 2010 and the onset of the pandemic, the value of the main income replacement benefits—JSA, ESA, income support and universal credit—fell by 9% in real terms. We cannot ignore that this is the context of what we are now dealing with.

That is why it is also so concerning that we are hearing about measures that have been adopted since the start of this crisis being temporary. Several hon. Friends have made reference to the £20 uplift for universal credit. It is absolutely essential that the Government lift the threat that is hanging over millions of people who are reliant on a low income, and ensure that this uplift is made permanent. It is also essential, as my hon. Friend the Member for Luton South (Rachel Hopkins) in particular referred to, that the Government continue to increase the support available for people who have a housing need and are reliant on local housing allowance, which has also drifted further and further away from meeting real housing costs. The Government cannot ignore the relationship between that failure to meet genuine housing costs in many parts of the country and homelessness, which has soared over recent years. The local housing allowance must be related to real rents in the real world, in all parts of the country.  We only just came out of a period of freeze of local housing allowance, and now we are told that we are going back into it.

In short, the social security system has been falling further and further away from living costs as a matter of Government policy for a long time. The increases in funding that we have seen this year are no more than a partial reversal of policy. As the Committee has stressed, the Government have taken a completely different approach to universal credit and working tax credit on the one hand, and to other legacy benefits on the other—a point also made by several hon. Friends—with the latter receiving only a 1.7% uprating after years of real-terms cuts. This affects 1.8 million people on ESA, nearly 300,000 people on income support, nearly a quarter of a million people on JSA, and more than 1 million working families receiving child tax credit but not working tax credit. On present trends, next year they can look forward to a 37p a week uplift in their benefits.

The Committee rightly condemned this unjustified disparity in the treatment of people in similar circumstances depending on whether or not they are receiving the Government’s flagship benefit. To argue, as Ministers have done, that this disparity is due to the greater flexibility of universal credit is particularly galling, as the Government are simultaneously pleading the inflexibility of universal credit as an excuse for not addressing the issue of advance repayments and the five-week wait. I can only echo the words of the Committee:

“We were astonished to hear that the Universal Credit system has been built in a way that makes it all but impossible for repayments of Advances to be suspended in a crisis situation.”

The Government’s response has been undermined by a failure to join up policy across Government. The pandemic has meant that the Department for Work and Pensions now plays an essential role in supporting public health policy, which is—or should be—a major shift in the Department’s priorities. If people are to comply with Government rules on social distancing and self-isolation, we need to ensure that they are able to do so and that the DWP is up to this task. That is why we have consistently called for the suspension of the no recourse to public funds rules for DWP benefits for the duration of this pandemic—a point that was stressed by my hon. Friends the Members for Leicester East (Claudia Webbe) and for Brentford and Isleworth (Ruth Cadbury).

The DWP has proved its operational ability to deal with unprecedented demands, but that effort has been severely hampered by the impact of austerity over many years, by the inflexibility of universal credit and by a failure to co-ordinate policy across Government Departments. Above all, the Government must ensure that the measures that have been taken over recent months in response to this crisis are not ended next April, and that they give security to millions of people who are looking to them.