Universal Credit and Welfare Changes

Margaret Greenwood Excerpts

Thursday 21st June 2018 Commons Chamber

[Margaret Greenwood (Wirral West) (Lab)]

I thank the Secretary of State for advance sight of the statement, but the Opposition believe that she should have come to the House on Monday to make a statement about both the damning National Audit Office report that was published last Friday and the Government’s decision, announced last Thursday, to put back the target for the completion of universal credit by another year—the sixth such delay. Rather than taking pride in not continuing with the appeal on PIP regulations, the Secretary of State should reflect on her Department being forced three times in the past year by legal challenges to review payments to disabled people.

Universal credit is the Government’s flagship social security programme, and the NAO report on it that was published last Friday is damning indeed. It concludes that universal credit is a major failure of public policy: it is failing to achieve its aims and, as it stands, there is no evidence that it ever will. The report suggests that universal credit may cost more to administer than the benefits system that it replaces, and concludes that it has not delivered value for money, that it is uncertain whether it ever will, and that we will never be able to measure whether it has achieved its stated goal.

The Trussell Trust recently reported that food bank referrals have increased by 52% in areas where the full service of universal credit has been introduced in the past year, compared with 13% across the UK as a whole. In Hastings, food bank referrals went up by 80% following the roll-out of the full service. The Department for Work and Pensions does not measure whether claimants are experiencing hardship; is it not time that the Secretary of State woke up to the realities of poverty in the UK and instructed her Department to do so? Some 60% of claimants have asked for advanced payments, showing just how high the level of need out there is.

The Secretary of State says that universal credit is based on leading-edge technology and agile working practices. However, the National Audit Office report says that 38% of claimants were unable to verify their identity online and had to go to a jobcentre to do so. It makes no sense to accelerate the roll-out of universal credit at the same time as rapidly closing jobcentres. The NAO report reveals that a significant number of people struggle to make and manage their claim online. The Department for Work and Pensions’ own survey found that nearly half of claimants are unable to make a claim online unassisted, and that a fifth of claims are failing at an early stage because claimants are not able to navigate the online system.

The Government claim that the introduction of universal credit will result in 200,000 more people finding long-term work than under legacy benefits. They repeatedly cite evidence from 2014-15, but that was before the cuts to work allowances were introduced and covers only single unemployed people without children. If one looks at the range of claimants in areas where universal credit has been rolled out, there is no evidence that it is helping more people find long-term work. Delays in payments are pushing people into debt and rent arrears on such a scale that private and even social landlords are becoming increasingly reluctant to rent to universal credit claimants.

The NAO report also points out that 20% of claimants are not being paid in full and on time, and more than one in 10 are not receiving any payment on time. The people who are most at need from the social security system are the ones most likely to have to wait for payments. A quarter of carers, over 30% of families who need support with childcare and, most shockingly of all, two thirds of disabled people are not being paid in full and on time. The report points out that the Department does not expect the time limits of the payments to improve over the course of this year, and that it believes that it is unreasonable for all claimants to expect that they will be paid on time because of the need to verify each claim. Does the Secretary of State find the expectations of her own Department acceptable? She has made some claims that things have improved greatly since the closure of the report, so will she substantiate that by putting that information in the Library?

The impact of universal credit on some of our most vulnerable people is clear. Universal support is supposed to help people, but funding is severely limited and provision is patchy. What assessment has the Secretary of State made of it? Is she satisfied that her Department is doing enough to support people who are struggling?

Universal credit was supposed to offer personalised support to claimants, but stressed and overloaded staff are often failing to identify vulnerable claimants. The DWP is aiming to increase the workloads of work coaches fourfold and of case managers nearly sixfold as the Government try to cut the cost of universal credit still further.

The NAO is very clear that the DWP should not expand universal credit until it is able to cope with business as usual. The Government must now listen to the NAO, stop the roll-out of universal credit, and fix the flaws before any more people are pushed into poverty by a benefit that is meant to protect them from it. Universal credit is having a devastating impact on many people and will reach 8.5 million by 2024-25. The Secretary of State must now wake up to the misery being caused by her policy.

[Ms McVey]

First off, this was the earliest time that I could come to the House to make an oral statement. I sought to make a statement as soon as possible, which is why I am here today. Obviously, everyone will know what has been happening this week in the House.

On the legal changes that I have made, let me say that I took them from day one. I took them immediately. No one was forced to do that; I actually took the changes on myself with the rest of my team and also with Conservative MPs who came and told me what they would like to do. I also went out to visit various groups up and down the country. I felt that that was the best thing that we could do.

When this system is fully rolled out, it will be £50 cheaper per claim. It is an automated system and it is a personal tailored system. For those who cannot get access, or who are not sure about the IT and how to support it, we have given an extra £200 million to local authorities to support people—to help them with IT and to help them with debt—not that we would ever recognise that from the scaremongering of the Opposition.

Labour talks about poverty figures, but, compared with 2010 when it was last in office, there are now 1 million fewer people in absolute poverty. Rates of material deprivation among children and pensioners have never been lower, inequality has fallen and remains lower than in 2010, and according to the latest figures, out this week, inequality, because of our benefit and tax changes, has fallen by two thirds in the last year. I wish the Opposition would keep up with the rapid changing of things.

We are helping more people into work. More than 3.2 million more people are in work—1,000 jobs every day since 2010. How much evidence do the Opposition need, for heaven’s sake? The support is there, and now the advances. It was key we made those changes in the last Budget. We knew if people were having difficulty with the benefit, which was there to support them, we had to make those changes—the advances, the two-week run-on for housing benefit, stopping the waiting days—and now we find out that 4% of people are moving into work in fewer than six months and that 50% spend more time looking for work. That is the reality.

Please allow me, Mr Deputy Speaker, to mention some of the real people I have met and spoken to and what they are saying about universal credit. Shafeeq, who was homeless, got an advance that got him temporary accommodation and put him in a better place to look for work. He said it

“helped me out a great deal and I’d have been lost without it”.

He is now in a job. Lisa said an advance payment helped her to secure a place with a childcare provider. She is paying it back over 12 months, which she says means a great deal to her. Gemma, a lone parent, said,

“it’s amazing being able to claim nearly all my childcare costs back, it’s a real incentive to go out to work – I’m going to be better off each week”.

Ben in Devon had a work coach, who helped him to progress in work from day one. Ryan from Essex had a lack of work experience and confidence, and his work coach helped him through universal credit. I will end it there—with the people receiving the benefit.