Welfare Reform Bill

Lord Skelmersdale Excerpts

Tuesday 13th September 2011 Lords Chamber

[Lord Skelmersdale]

My Lords, I am rather tempted to start my speech with that part of his speech that the noble Lord, Lord Kirkwood, left out. Be that as it may, many noble Lords have made the point that this Bill starts the greatest single reform to the social security system since 1942. I note that the Minister and indeed Barnardo’s, in its excellent brief, called it “radical”. I would call it revolutionary. It is not, of course, that there have been no reforms since 1942. We have, though, arrived at a system that is costly, confusing and error prone both to the potential recipients and DWP staff. I agree completely with the noble Baroness, Lady Meacher, in her plea for good training of DWP staff. My noble friend Lord German and my former temporary boss, my noble friend Lord Brooke of Sutton Mandeville, also made the point about the difficulty of operating social security for recipients and DWP staff alike.

Looking at the Beveridge report, from whence modern social security arose, two things struck me. Paragraph 9 of the introduction states that:

“The state, in organising security, should not stifle incentive, opportunity [and] responsibility”.

I am grateful to my noble friend Lord Feldman, in his excellent and philosophic speech, and to the noble Lord, Lord Bilimoria, for speaking on this point. A little later, in paragraph 22, the report makes the point that:

“The insured persons should not feel that income for idleness, however caused, can come from a bottomless purse”.

Of course we would not use these exact words now, political correctness being what it is, but the points are nevertheless well made and form the basis of this Bill. The Government, very naturally, want to steer as many benefit recipients as possible into work, a policy which was adopted by the last Labour Government. That will not be easy as people are wedded to their current entitlements and the various add-ons and passported benefits that have crept into the system over the years. We have heard about many of them in this debate, not least from the noble Baroness, Lady Hayter.

What we have in this Bill is a system that is simple and easy to operate, which is something that no one can say of the current situation. The important thing about these new arrangements is that financially, even at the minimum wage, the withdrawal taper is reduced so that a single person is always better off in work, and a couple with two children only loses out, on my calculations, by working between 17 and 18 hours a week. Working for 16 or 19 hours is okay, but 17 or 18 hours is not—or at least that is what the White Paper says. So to all intents and purposes, as my noble friend Lord Freud almost said, the benefit trap disappears. Not only that, but it is intended that the introduction of universal credit will not mean a reduction in a recipient’s current benefit. To me, as my noble friend Lord Freud knows, the trick has always been to achieve a single out-of-work benefit coupled with the adoption of a permanent disability benefit. That is why I am not troubled by the proposal to limit contributory employment and support allowance to one year as opposed to the current two years. After one year, it should be possible to assess whether the incapacity is permanent for, say, the next three or five years before a new assessment is made. I was struck by something said by the noble Baroness, Lady Hollis. She spoke, as I understood her, as if the withdrawal of contributory ESA would mean that there would no longer be any state financial support. That, of course, is quite wrong.

I accept though, that there are debates to be had and questions to be answered on when the reassessment should start. Should it, for example, be after nine months with no change of benefits until the 12 months is up; or should it be after the full 12 months, in which case what happens to the benefits until the assessment is made? For myself, I prefer the former, but like so much in this Bill, I await developments once we see the statutory instruments that flow from it. In this connection, I am grateful to my noble friend for saying that we will be able to see as much information as is available, well before our consideration is completed.

A certain amount has been said about working mothers. Of course, this is a subject that we are returning to after dealing with it previously in the Bill and statutory instrument, which I am sure the noble Lord, Lord McKenzie of Luton, will remember well. The key for working mothers, of course, is affordable childcare. The noble Baronesses, Lady Meacher and Lady Hollis, I and others asked—or quizzed, I should say—the then Minister as to whether this would be available. He said words to the effect of, “Don’t bother your little heads about it, all will be well”. I ask my noble friend Lord Freud whether that statement has borne fruit, and the situation is such as the noble Lord, Lord McKenzie of Luton, predicated.

This debate has shown that the House is in favour of a universal benefit. The noble Baroness, Lady Hollis, put it well and most of us have followed her. That is fine, but the noble Baroness uttered a very loud “but”. This reminded me of a phrase I uttered in a pantomime in my amateur dramatics days: “But me no buts”. I know enough of my noble friend Lord Freud to know that he will examine all our buts, to which he knows we will all require answers if he is to secure his Bill. I look forward to receiving them in the remaining stages.

I make one plea to the Minister, for him to abide by an acronym that I invented last night. The beauty of universal credit is in its simplicity. I urge him therefore to abide by KISISS, which stands for Keep it Simple in Social Security.