Marriage in Government Policy

Margaret Greenwood Excerpts

Tuesday 30th January 2018 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is an honour to serve under your chairmanship, Mr Rosindell. I congratulate the hon. Member for St Ives (Derek Thomas) on securing this debate, and I welcome his inclusion of the importance of protecting families and his focus on providing stability for children. However, I take exception to his claim that family instability is the root cause of poverty, when we know that this Government’s cuts to social security are creating problems for families.

Social security support for low-income families has been cut severely. Most working-age benefits, including child benefit, have been frozen until 2020, and universal credit has been shown to be failing those on low incomes, causing debt and rent arrears. When universal credit was introduced in 2011, the coalition claimed that it would lift 350,000 children out of poverty. By 2013, that estimate had been reduced to 150,000, and by 2016 the Government refused to offer any re-evaluation at all. Can the Minister tell us how many children he believes universal credit will lift out of poverty?

Child Poverty Action Group published an analysis last November estimating that cuts to universal credit would push 1 million more children into poverty by 2020, along with an extra 900,000 adults. When we consider the situation for disabled children, we see that four in 10 are living in poverty, yet the basic level of support for disabled children in universal credit is less than half that available in tax credits.

We have had some interesting contributions; it has been good to hear people talk about how much they have enjoyed their own marriages. I welcome the call from the hon. Member for South West Bedfordshire (Andrew Selous) to tread gently, as marriage is often an issue of cultural sensitivity, and the comments of the hon. Member for Strangford (Jim Shannon), who spoke of the hundreds of wonderful women he has met who are bringing up families alone. It is important to recognise that many people choose to bring up children on their own, and some people find themselves in that situation due to relationship breakdown or bereavement.

Since 2010, successive Governments have sought to reduce the role of the state wherever possible, especially in social security, yet when it comes to whether or not two people should marry—surely the most private of decisions—the coalition Government sought to influence behaviour in relation to that decision by introducing the marriage allowance in April 2015. Details of how the new transferable allowance would work, given in a note published alongside the 2014 Budget, stated:

“Couples where both partners are basic-rate taxpayers will in almost all cases see no gain or loss…Couples will benefit as a unit, but the majority (84 per cent) of individual gainers will be male.”

One must question the introduction of an allowance that the Government knew would disproportionately benefit men; I would be interested to hear the Minister’s rationale for it.

Take-up of the marriage allowance has been poor. Up to October, 2.4 million couples had claimed it, out of an estimated 4 million who were eligible. According to Government figures, the cost in 2015-16 is expected to be £385 million when backdated claims are ultimately included, and £425 million in 2016-17. It prompts the question whether that is really the best use of taxpayers’ money at a time when child poverty is soaring and the Government are cutting support for disabled people under universal credit and the employment and support allowance work-related activity group.

On pension equality, the question is whether some marriages are more equal than others in the Government’s eyes. The Government have spent a great deal of time and, no doubt, a sizable sum of taxpayers’ money opposing pension equality for same-sex couples. When the Marriage (Same Sex Couples) Act 2013 was debated in Parliament, the Opposition called on the Government to close a loophole in the law meaning that married same-sex couples and civil partners were treated differently when it comes to pension entitlement in the event of one partner’s death.

In July, the Supreme Court ruled in favour of equality in a landmark case brought by John Walker, a gay man who found that after 20 years of service to his company, it would provide £1,000 a year in pension to his surviving husband were he to die, whereas if he were married to a woman, she would receive £47,500 a year. Indeed, were he to divorce his male partner and then marry a woman, she would still receive the larger amount. When do the Government intend to respond to the Supreme Court ruling? Will the Minister ensure that the ruling will not be affected by the UK leaving the EU, as it was based in EU law, and will he assure us that the Government will end the disparities in public sector pension schemes?

The Government’s claim that they want to support marriage is also at odds with how cuts in social security since 2010 have put additional pressure on families and parents. Families on low incomes have faced long waits for initial payments of universal credit; figures last week from the Department for Work and Pensions show that one fifth of claimants are still not being paid in full on time, and more than one in 10 are not even receiving partial payment on time. Then there are the cuts to work allowances on universal credit, and the new, lower household benefit cap introduced in November 2016. At the same time, food prices in December were more than 4% higher than the year before. Families on low incomes tend to spend a higher proportion of their wages on basic items such as food and rent.

The Government have recently announced that they intend to create a new cliff edge for eligibility for free school meals, so that families with household earnings of more than £7,400 a year will no longer qualify. The Resolution Foundation has estimated that allowing all children whose parents claim universal credit to receive free school meals would cost £600 million a year. The chief executive of the Financial Conduct Authority warned in the autumn of the scale of the problem of household debt, and a recent study by the Institute for Fiscal Studies showed that one in four of Britain’s poorest households are falling behind with debt payments or spending more than a quarter of their monthly income on repayments.

Relate has highlighted how debt problems can easily lead to conflict and relationship breakdown, whether or not partners are married. That can have a serious impact on children, as research suggests that conflict, rather than family structure, has a negative impact on children’s development. The household benefit cap is forcing families to move away from sources of support such as family and friends. People on a low income may not be able to afford to travel back to see them frequently, either. More than 500 Sure Start centres have closed since 2010. They are another important support for more vulnerable parents in particular. If the Government value family, marriage and stability, why are they closing them? Again, I am keen to hear the Minister’s rationale.

Since last April, parents have been required to start looking for work as soon as their youngest child reaches the age of three, rather than five as was previously the case. A new report published by Save the Children last week found that many mothers would like to return to work or increase their hours, but find childcare simply unaffordable and Government help with the costs complex and difficult to access. Under tax credits, childcare costs are paid in advance, whereas under universal credit they will have to be paid up front and then claimed back, which is always likely to be problematic for parents on low incomes.

Of course, parents in many families are not married, and there are many lone-parent families. Government must recognise and value all family types. The alternative is to risk stigmatising families to no good purpose. Lone-parent families are particularly affected by access to childcare, and have been hit hard by cuts to social security since 2010. An independent study by the Equality and Human Rights Commission of the long-term impact of tax and welfare changes between 2010 and 2017 found that lone parents were set to lose an average of about 15% of their net income. That is almost £1 in every £6.

Lone-parent families make up one in four families with children, and have done for more than a decade. They are part of the mainstream of UK family life, and social policy needs to take that into account. Where a separated or divorced couple shares care of the children, the parent who is not the main carer cannot claim for an extra room for those children under the rules of the bedroom tax, for example. That can cause extreme difficulty for a family who must cope with the break-up of a relationship, and can cause parents, often fathers, to struggle to spend quality time with their children. A Labour Government would scrap the bedroom tax altogether. Will the Minister reconsider the rules of the bedroom tax as they currently affect separated couples to ensure that children do not suffer?

Where relationships unfortunately break down, changes to the child maintenance system have clearly not succeeded in supporting care for children or enabling parents to reach agreements themselves.

In 2012, the Government introduced a new system for child maintenance that aimed to nudge couples to reach agreement without the need for Government intervention. However, it does that by charging both parents—including the parent with care of the child or children, known as the “receiving parent”—if they fail to reach agreement independently.

The Department published a survey in December 2016 that found that around a third of receiving parents who paid the Child Maintenance Service application fee reported that it was difficult to afford. Of parents who did not have a maintenance arrangement at three months, 29% said that the £20 application fee was a factor. Of receiving parents with a direct payment arrangement, 42% cited a desire to avoid collect-and-pay charges as a reason for choosing direct pay and half said that the charges were a factor in their decision.

Will the Government take action to widen access—

[Andrew Rosindell (in the Chair)]

Order. I ask the hon. Lady to wind up, so that the Minister has a chance to respond.

[Margaret Greenwood]

I will.

In conclusion, a stable, loving family is undoubtedly what we would want for all children, but there are many types of family in the 21st century. My right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman) once said:

“Families come in all shapes and sizes. We don’t favour one way of family life over another. We want to support and back up all families...Government dictating family structures doesn‘t work.”

She is right. This is a question of respect.

The Government should commit to stable families by putting an end to austerity, by giving our schools, police and health services the funding they need, by banning zero-hours contracts, by ensuring that refuges are available for people fleeing domestic violence and by ensuring that the social security system is there for people in their time of need.

Food Poverty: Merseyside

Margaret Greenwood Excerpts

Tuesday 16th January 2018 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Crausby. I congratulate my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) on securing this important debate and making such a compelling speech. I join him, as I am sure all Merseyside MPs do, in paying tribute to the food bank volunteers who work so hard to address the needs of those who need help to feed themselves and their families.

We have had some fantastic, passionate contributions, in which the points were made incredibly well. My hon. Friend the Member for Garston and Halewood (Maria Eagle) spoke with passion about the Government’s years of failure to collect the statistics needed to understand the situation. My hon. Friend the Member for Liverpool, Riverside (Mrs Ellman) spoke about the disgrace of food poverty in this country, and the impact of hunger on public health, with particular reference to the increases in the number of people admitted to hospital with malnutrition and in the number of infant deaths. My hon. Friend the Member for St Helens South and Whiston (Ms Rimmer) spoke passionately about the huge inequalities of wealth in society. Her claim that poverty is not inevitable rings true. There were also good interventions from my hon. Friends the Members for Wirral South (Alison McGovern) and for Wallasey (Ms Eagle). I welcome the new Employment Minister to his post.

I believe that the debate is timely. This morning the Institute for Fiscal Studies published a study showing that one in four of Britain’s poorest households are falling behind with debt payments or spending more than a quarter of their monthly income on repayments. Earlier today the Office for National Statistics also published the latest data on food prices. Despite a slight fall in the rate of inflation compared with November, the price of food was still more than 4% higher in December, compared with December 2016.

The full service of universal credit is being rolled out on Merseyside and, despite the changes announced by the Government at the end of last year, leading voluntary organisations make it clear that universal credit has not yet been fixed. It was introduced in Bootle in October and in Wirral in November, and over the year it will spread to the rest of Merseyside, finishing with Everton and West Derby in December, at least if the Government stick to the current timetable. I want to underline the point that food poverty is just one aspect of the pressures that people on very low incomes face. They can face appalling choices such as whether to heat their home or go hungry. Parents may skip a meal so that their children can eat. Those are choices that no one should have to make. The British Medical Association and the Royal College of Paediatrics and Child Health highlighted the link between poverty and poor diet in reports last year, and went on to point out the impact on health not just in childhood, important though that is, but over a much longer period.

The Government do not collect or publish statistics on the number of people seeking help from food banks, despite years of pressure to do so from the Opposition and voluntary organisations. The Trussell Trust, the largest organisation of food banks in the UK, does not seem to find it a problem, and nor have any of the organisations that I have contacted for help on Merseyside, so I ask the Minister once again whether the Government will produce statistics on the number of people receiving help from food banks. We need to know not just how many people seek help but for how long. The Trussell Trust statistics show that in 2016-17, 37,000 adults and 24,000 children were helped by their Merseyside food banks.

The situation varies across Merseyside. Areas such as Birkenhead, Liverpool and Knowsley have the highest rates of poverty, but it is also striking that in my constituency the demand for help has grown even in some relatively affluent areas. In 2017, Wirral food bank distributed 109 tonnes of food. In the north-west as a whole, between April and September 2017, Trussell Trust food banks gave more than 87,000 three-day food supplies to people in crisis, compared with nearly 78,000 during the same period in 2016. That is a 12% increase. The Government commissioned a report from the University of Warwick, which was published in 2014, and one of the points that it made was that people seek help from food banks as a last resort. The fact that so many people are in that situation should be a major concern.

Many of my colleagues have spoken clearly about the reasons why people turn to food banks. The Trussell Trust found that of the people accessing its support 43% did so as a result of benefit delays and changes and 27% did so due to low income. Those are things that the Government can take action on, as my hon. Friend the Member for St Helens South and Whiston pointed out. The length of time for which people wait for an initial universal credit payment has been a major reason for social security delays, if by no means the only one. That also increases the likelihood that people have to turn to a food bank more than once.

Last April the Trussell Trust warned that food banks in areas where the full service of universal credit had been introduced in the previous six months had a 30% average increase in requests for help compared with a year before. From this month, people will be able to ask for a 100% advance on the first payment, and from February the initial five-day waiting period will be removed. Will the Government make a commitment to publish regular statistics on whether they are meeting the new target of five weeks for initial payments, as well as figures for the number and percentage of claimants asking for advances, so that we can have an idea of how far removing the five-day waiting period is affecting the need for advances?

If people are sanctioned, they can be referred to a food bank by the Department for Work and Pensions. The latest statistics for sanctions published by DWP show that the sanctions rate for universal credit increased by more than 3% in the last quarter. Will the Minister look seriously at introducing a yellow card system and non-financial sanctions, as suggested by the Work and Pensions Committee, to help to reduce the number of people who need help from a food bank? Ten per cent. of the people who sought help from Wirrall food bank last year were in employment. That is one reason why it is so important for the Government to reverse the cuts to work allowances for universal credit. Will the Minister urge his new colleagues to do that?

A study published by the University of Oxford for the Trussell Trust, in June 2017, found that people using food banks were likely to belong to groups that are most affected by recent reforms to social security: disabled people, lone parents and large family households. Those groups are particularly affected by universal credit and the changes introduced last April. In the study, more than 50% of households that had received help from a food bank included a disabled person. Mental health conditions affected people in a third of the households. The basic disabled child element in universal credit is half that of the disability element in child tax credit. There is no severe disability premium in universal credit, which means that disabled people who would have been entitled to it will be £65 a week worse off than tax credit recipients.

[Maria Eagle]

Does my hon. Friend accept that many disabled people have special diets and a requirement to eat or not eat certain things? Neither food banks nor the emergency support that they normally access take that into account.

[Margaret Greenwood]

My hon. Friend makes an important point, and for many disabled people, the need to heat their home is also a bigger element in their weekly bills.

Will the Government reverse the cuts to support for disabled people in universal credit? Those cuts will have an increasing impact as universal credit is rolled out to a wider range of claimants. Lone parents and their children constitute the largest number of people receiving help from food banks overall. A study for the Equality and Human Rights Commission found that lone parents were set to lose around 15% of their net income on average—around £1 in every £6—and that households with three or more children could lose as much as £5,400 per year. Will the Government look again at reversing the two-child policy, and heed the warning from the Resolution Foundation that cuts to the work allowance could act as a disincentive for some lone parents to work additional hours, once they have entered employment doing a smaller number of hours at the start?

The Government recently announced that children would be eligible for free school meals if their family’s income was £7,400 per year or less, excluding social security. That creates a cliff edge in universal credit, which could create a disincentive for people to work additional hours—that has always been the Government’s argument against tax credits in general. Free school meals are worth £2.30 per child per day, which over a 38-week school year works out at £437 per child. The Resolution Foundation has calculated that crossing the threshold by earning more than £7,400 a year would effectively mean losing £11 a week in income, and it would take £30 of earnings to claw that back, given the universal credit taper rate. Eligibility for free school meals is another area where families lose more the larger they are. People in insecure work whose income may fluctuate from week to week could face a difficult choice. Will the Government act to avoid families being put in that situation by removing the cliff edge and ensuring that all children in families who receive universal credit are eligible for free school meals?

To conclude, let me underline the seriousness of the situation. New figures this morning show that food prices are still increasing by more than 4%. There is a freeze in key working age benefits until 2020, and wages are stagnating for those in work, particularly those on low incomes. Universal credit is far from fixed, and aspects such as the low level of support for disabled people and the cliff edge for eligibility for free school meals have received much less attention. The Government should act to fix those problems with universal credit at an early stage before people are driven into extreme poverty, and they should return to the original principles of universal credit to ensure that work always pays. They need to tackle poverty, not push families into it.

Just as people are experiencing multiple forms of destitution, there may be more than one reason why someone is forced to turn to a food bank for help. If those groups most likely to use a food bank—disabled people, lone parents, and larger families—are also those who have been hit the hardest by cuts to social security support since 2012, and by cuts to local authority spending and a reduction of services in their areas, then the social security net is clearly not doing the job it is designed to do. It should be protecting people in their time of need.

--- Later in debate ---

[Alok Sharma]

That is the word of an individual who actually has made use of the system.

Ensuring that people get the benefits they are entitled to is important. Whether in work or not, jobcentre staff help their customers to ensure they access their full entitlement to benefits and any other support, such as free school meals and free prescriptions. They also have tailored support for those people who face the most complex employment barriers. That can include temporarily lifting requirements where claimants are homeless, in treatment for drug or alcohol dependency, or victims of domestic abuse.

The hon. Member for Liverpool, West Derby raised a point about people having delays in getting money paid to them. The statistic on universal credit is that 92% of all claimants get all the money they are due paid on time. Of course, no one wants to wait for money if they need it—advances can be claimed on the same day in an emergency.

[Margaret Greenwood]

The Minister is being generous with his time. He is talking about support for the most vulnerable, so would his Government reverse the cuts to support for disabled people under universal credit?

[Alok Sharma]

Hopefully I will have enough time to respond to that point—I believe the hon. Lady is talking about the higher rate of disability premium.

A number of other points were raised about food banks. Jobcentre staff also work in partnership with a variety of local agencies and signpost claimants to local services, including food banks, to help them access the full range of support available. The hon. Member for Liverpool, West Derby quoted from a report from 2016 by Taylor and Loopstra based on UN data. There are a number of reports, including one on income and living conditions produced by Eurostat, which found that the UK has a lower percentage of food insecurity than the EU average and a lower percentage than Germany, France and Italy. Ultimately, we need to ensure that we get help to people who need it, and that we help them into work so that they can support themselves.

[Alok Sharma]

I have given way quite a lot in this debate. If I may, I will continue. If I have time at the end, I will of course take further interventions.

Food inflation has been discussed. Food prices have fallen in three of the past four years, which has a positive impact. Let me address up front the question about the use of food banks. The Government do not propose to record the number of food banks in the UK, or indeed the potential number of people using them or other types of food aid. There is a range of available food aid—from small local provision to regional and national schemes—and the all-party parliamentary group on hunger, which set up an inquiry to thoroughly investigate the use of food banks, said that there were numerous complex reasons why people use food banks.

Jobcentres engage regularly with the Trussell Trust, and are encouraged to foster good relationships with local food banks. In Merseyside, all jobcentres have a food bank single point of contact, and jobcentre staff have been working actively with food banks to ensure that staff are up to speed with the changes resulting from universal credit.

The hon. Member for St Helens South and Whiston (Ms Rimmer) mentioned international comparisons. I refer her to statistics produced by the OECD showing that, since the mid-2000s, the UK has been one of only two major advanced economies with increasing redistribution. It found that, since 2010, growth and income from work for the lowest-income households in the UK is higher than in any other major advanced economy.

The Government have always been clear that universal credit would be introduced in a way that allows us to continue making improvements. That is why, at the autumn Budget, we announced a comprehensive and wide-ranging package of measures worth £1.5 billion to address concerns about the first assessment period and the budgeting issues faced by some claimants at the start of their claim. Since the start of this year, claimants have been able to get 100% of their estimated universal credit payment up front as an advance that they can pay back interest-free over 12 months.

I will address a couple of other points, as I have a few minutes. On the point about disability payments, as the hon. Member for Wirral West (Margaret Greenwood) knows, income-related employment and support allowance and the link to disability premiums, including the severe disability premium, are being replaced by universal credit as part of simplifying the benefit process and to address overlaps. Universal credit has two disability elements for adults, mirroring the design of ESA. The higher rate is set substantially higher than the ESA support component equivalent.

[Margaret Greenwood]

That being the case, why will some disabled people receive £65 a week less than they would have before universal credit?

[Alok Sharma]

I am happy to have a dialogue with the hon. Lady, particularly in my new role, but I point out, as I have said, that the rate is set substantially higher than the ESA support component equivalent. However, I am happy to enter into a dialogue with her outside this debate.

Universal Credit: Private Rented Sector

Margaret Greenwood Excerpts

Tuesday 9th January 2018 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate the hon. Member for Eastbourne (Stephen Lloyd) on securing this really important debate. Many valuable contributions have been made, from which it is really clear that people are experiencing real hardship as a result of the impact of universal credit on ability to pay rent. The example provided by my hon. Friend the Member for Lewisham, Deptford (Vicky Foxcroft) clearly demonstrates the effect of delayed payments, and my hon. Friends the Members for Batley and Spen (Tracy Brabin) and for Newport East (Jessica Morden) spoke about the specific difficulties that single parents face in having a secure home.

It really is important that the Government take action to address the problems with universal credit in the private rented sector. Approximately 5 million households —just over 20% of the total—are in private rented accommodation, and a quarter of those are families with children. That figure is predicted to rise to just under a quarter of all households over the next five years. Some 1.2 million households currently receive housing benefit in the private rented sector, one third of which are in low-paid work and require support to help top up their rent. Prolonged delays in receiving an initial payment of universal credit have led to many claimants being in rent arrears and at risk of eviction.

The Residential Landlords Association has reported that landlords have become increasingly reluctant to rent to universal credit claimants. Two thirds of private landlords are basic rate taxpayers not on high incomes, so they need rents to be paid on time in order to pay their own bills. That puts increased pressure on the social housing sector and local authorities. Councils hit by cuts in funding from central Government are having to set aside large amounts of money to support people affected by the impact of universal credit. Newcastle City Council is spending more than £390,000 of its own resources to support UC claimants, including £88,000 to cover rent arrears; there is more than £1.2 million in uncollected rent across a tenancy base of just 27,000, purely as a result of universal credit. Nearly three quarters of the spending on discretionary housing payments by Conservative-controlled Bath and North East Somerset Council in this financial year has likewise gone to supporting universal credit claimants.

The Government announced a number of changes in the Budget that were designed to address the problems with universal credit. We welcome them as far as they go, but they do not go anywhere near far enough. For example, from February, the Government are to remove the initial seven-day waiting period, so that the wait built into universal credit at the start of a claim will be five weeks rather than six. That is still too long for people on low incomes, who in many cases are unlikely to have savings to tide them over for that period. According to the English housing survey, 66% of private renters have no savings. We need up-to-date statistics on the timeliness of payments, so that we know exactly how long people in each local authority are waiting and whether the five-week target is being met. Will the Minister make a commitment to publish regular statistics on this matter, rather than ad hoc releases when it suits the Government?

From this month, it will be possible for someone to obtain 100% of their estimated universal credit as an advance payment, which will then have to be paid back over a maximum of 12 months. However, the maximum advance for people who made an initial universal credit claim in the run-up to Christmas was only 50%, which will undoubtedly have meant hardship for many families.

If it is possible to estimate someone’s universal credit for the purpose of giving them an advance and to pay that advance within five working days, or on the same day when someone is in immediate need, why do universal credit claimants still have to wait five weeks for an initial payment to be made? Again, will the Minister make a commitment to publish regular statistics on how many people ask for advance payments, how many people receive them and the default rates on repayments? Ministers have stated repeatedly that universal credit is designed to mirror the world of work, but with 58% of new claimants who are moving on to universal credit being paid either fortnightly or weekly prior to claiming, it is time for all claimants to be offered fortnightly universal credit payments.

The Government announced that from April they will introduce a two-week run-on between a housing benefit claim and a new universal credit claim. Again, that is welcome, although it will only help people who have already been claiming housing benefit. The Government have also said that they will make it easier for direct payments to be made to landlords. However, it appears that that is principally aimed at ensuring continuity where a tenant whose housing benefit is already being paid directly to their landlord moves over to claiming universal credit. That is positive, but my Opposition colleagues and I would like to see all tenants offered the option of direct payments. For vulnerable people, who need payments to be made quickly, the need to negotiate with the Department for Work and Pensions for direct payment of housing support to a landlord can take time and effort.

Surely all tenants should have the right for payments to be paid directly to the landlord, and not just those who are vulnerable and have difficulty managing their money. Direct payments provide security for landlords renting to people who are claiming universal credit, providing them with the confidence that they will be paid. Direct payments are especially helpful in the case of people who have formerly been homeless. Private landlords may be much more wary of renting to them, and people who have been homeless may not have had recent experience of managing large bills, such as rent.

The DWP has been working with Crisis on a pilot project in Newcastle whereby people who have been homeless or who are at risk of homelessness because of arrears can have their claimant commitment relaxed while they focus on their housing situation, and they are also offered the opportunity to have their housing support paid directly. Will the Minister, as a matter of urgency, consider issuing guidance to work coaches to identify people who may be in rent arrears and proactively offer them direct payment of housing support? Claimants often appear to be unaware that it is possible for this to be done.

Landlords themselves do not appear to think that the changes announced in the Budget are enough. In a survey carried out by the Residential Landlords Association into the reaction of private landlords to the changes to universal credit, 64% of private landlords said the changes did not give them more confidence to let properties to tenants in receipt of universal credit.

Overall, one of the key reasons for arrears is the level of local housing allowance. LHA rates simply have not kept up with sharply rising rents. They were first cut by the coalition in 2011, and then increases were capped at 1% in both 2014-15 and 2015-16. A freeze was introduced in April 2016, which will last until 2020. According to research by the Chartered Institute of Housing, private sector rents in England grew by an average of 14.6% from May 2011 to May 2017, while wages increased by only 10% in the same period.

That inadequate housing support continues in universal credit. In fact, there is no housing support at all in universal credit for people aged between 18 and 21, unless they are in one of the groups of people who are protected, such as care leavers. Also, the national living wage is set at a lower rate for people under the age of 25, and the chief executive of the Financial Conduct Authority has recently warned about the high levels of debt being incurred by young people just to cover basic household bills such as rent.

[Dr Drew]

Will my hon. Friend give way briefly on that point?

[Margaret Greenwood]

I am sorry, but I am really short of time and so cannot give way.

We are all shocked by the sight of people sleeping in the streets. Will the Government think again and restore housing support in universal credit for people aged between 18 and 21?

Overall, the number of working households claiming housing benefit in the private rented sector has more than doubled since 2009. We know that many people, especially many young people, have not just been priced out of home ownership but are finding that their income does not even cover their rent. The DWP’s own data show that only 7% of private renters claiming housing benefit are unemployed and seeking work. The rest are either already working on low incomes or are currently unable to work.

Just last week, it was reported that the Stop Start Go charity in Manchester has opened new bedsit accommodation for working people who are homeless because they cannot afford the cost of accommodation in the city. On one night in December, a third of people sleeping at the Booth Centre for the homeless in Manchester were actually employed. The DWP’s own data show that the number of people in work who are being placed in temporary or short-term accommodation rose from 15,500 in August 2013 to more than 22,000 by 2015. Research by the Joseph Rowntree Foundation found that the private rented sector has grown by a third over the last 12 years, but the number of tenants being evicted has also grown; 7,200 more tenants lost their homes in 2015 than in 2003.

Labour is committed to increasing the national living wage to £10 an hour across the age range; to building at least 100,000 council and housing association homes for genuinely affordable rent or sale; and to reforming universal credit so that it meets its original principles of making sure that work pays and reducing poverty. Labour will also end insecurity for private renters by introducing controls on rent rises, as well as introducing more secure tenancies, landlord licensing and new consumer rights for renters. That is the real way to make work a route out of poverty and to reduce the need for people to claim housing support.

The Government simply refuse to recognise the scale of the shortage of truly affordable housing that exists. At the same time, they are failing to provide housing support at a level that will at least enable people to cope with the consequences of Government inaction and to meet rising rents. In the Budget, the Chancellor conceded:

“House prices are increasingly out of reach for many”.—[Official Report, 22 November 2017; Vol. 631, c. 1057.]

Yet he offered more of the same on housing. There was no new Government investment in affordable homes and nothing for private renters. The need for someone to have a roof over their head—a home where they can bring up their family—is a basic human need. By 2021, it is estimated that some 7 million people will be claiming universal credit, more than half of whom will be in work. Where will they live if their wages do not cover their rent and housing support does not make up the shortfall? It is time for the Government to heed the warnings from landlords, the voluntary sector and Opposition Members, and to pause and fix universal credit.

Oral Answers to Questions

Margaret Greenwood Excerpts

Monday 18th December 2017 Commons Chamber

[Caroline Dinenage]

The Government are committed to building an economy that works for everybody, which is why we have committed to raising the national living wage—we are talking about an increase of 33p. This will be equivalent to a 9% increase in the national living wage since its introduction in 2016. It represents an increase to a full-time minimum wage worker’s annual earnings of more than £600.

[Margaret Greenwood (Wirral West) (Lab)]

On behalf of Labour Members, I would like to express our condolences to Mr Deputy Speaker. Our thoughts are with him and his family.

Disabled people are twice as likely to live in poverty as non-disabled people because of the extra costs they face. The Equality and Human Rights Commission recently estimated the cumulative effect of Government cuts since 2010 at £2,500 a year for a disabled adult, but when the Government discovered that they had underpaid approximately 75,000 disabled people who transferred on to ESA support between 2011 and 2014, they announced in last Thursday’s written statement that they would only be repaying claimants from October 2014. How many of the 75,000 disabled people will receive an arrears payment? Given that attempted suicide rates among ESA claimants doubled between 2007 and 2014, what estimates have been undertaken on the impacts on claimants’ mental health as a result of this Department for Work and Pensions error?

[Caroline Dinenage]

I am sure that I can write to the hon. Lady with the details on that. As well as being very mindful of the impact on people’s mental health and wellbeing, we must apply the law. We have to value disabled people in our workplace, which is why the Government are making sure that many, many more disabled people are able to access work and get into work.

[Margaret Greenwood]

Recent data shows that 8 million working families are living in poverty. Despite Government rhetoric, work is not the route out of poverty.; four out of five people who are in low-paid work now are likely to be in low-paid work in 10 years’ time. But in his interview on yesterday’s “The Andrew Marr Show”, the Secretary of State failed to mention that, under universal credit, sanctions have escalated and are being applied to people who are actually in work. The Public Accounts Committee and the National Audit Office have both raised concerns about the impact of sanctions on debt, rent arrears and homelessness. So why is the Secretary of State intent on punishing people in low-paid work by sanctioning them?

[Caroline Dinenage]

Sanctions are applied only as a very last resort and there are mitigations in place to support people when this is done. The hon. Lady is wrong to say that people in work are more likely to be in poverty; a key driver of in-work poverty is the part-time work that people were trapped in when her party was in government—people were trapped working fewer than 16 hours a week. The Labour Government were literally paying them to stay poor, whereas our reforms are about supporting people to progress in work and keep more of the extra money that they earn.

--- Later in debate ---

[Mr Gauke]

We should be clear: if people need cash before Christmas, they are able to get it under the universal credit system, which is designed so that they can do that. People trying to discourage claimants from taking an advance, which I am afraid is the tone that we hear too often from the Labour party, are causing unnecessary anxiety for claimants.

[Margaret Greenwood (Wirral West) (Lab)]

The chief executive of the Financial Conduct Authority has recently warned about high levels of debt among young people incurred just by their covering basic household bills such as rent. Young people aged 18 to 21 are not entitled to housing support under universal credit. Why did the Government ignore a Social Security Advisory Committee recommendation that young people on the edge of care should be exempted from that?

[Mr Gauke]

As the hon. Lady will be aware, there are a whole host of exemptions that do allow 18 to 21-year-olds to access housing benefit, if those exemptions apply to them. I have to come back to this point, which the Labour party does not seem to accept: the best way in which we can sustainably lift people out of poverty is to have a welfare system that encourages them to work and to progress in work. That is what universal credit does and it is what the legacy system failed to do, which is why we are making these changes.

Youth Employment

Margaret Greenwood Excerpts

Wednesday 6th December 2017 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Moon. I congratulate the hon. Member for Chichester (Gillian Keegan) on securing this debate on such a vital issue. Finding a first job is part of a young person’s passage into adulthood. It is important that young people get the education and training they need and make the transition into employment smoothly, without spending a long period out of work.

At first sight, the youth employment statistics look like good news. Unemployment among young people has been falling, as has unemployment generally, and the Government have set a target of 3 million new apprenticeships by 2020. In the period July to September 2017, the unemployment rate for 16 to 24-year-olds not in full-time education was 10.3%, compared with 11.7% a year ago. However, youth unemployment remains much higher than unemployment among the working-age population as a whole, which according to the latest figures is 4.3%.

If we look more closely at the picture, we see further causes for concern. Some 12.3% of 16 to 24-year-olds were not in education, employment or training in the second quarter of 2017. That figure is even higher in some places and among certain groups.

A survey by Impetus Private Equity Foundation’s youth job index in June 2017 estimated that 1.18 million young people were not in education, employment or training for six months or more. In addition, the number of young people spending 12 months or more not in education, employment or training increased from 714,000 last year to 811,000 this year. That can have an extremely negative impact on a young person’s mental and physical health and their future employment prospects. About 5% of 16 to 17-year-olds, for example, are not in education, employment or training, despite the requirement that all young people are to be in education or training until they reach the age of 18. A significant number of people—290,000 at the last count—are therefore slipping through the net. I would be interested to hear what the Government plan to do to address that.

The proportion of young people who are not in education, employment or training is about 15% in Yorkshire and Humberside. The Social Mobility Commission’s “State of the Nation” report, published last week, highlighted that some affluent areas such as West Berkshire, the Cotswolds and Crawley are among the worst for offering good education and employment opportunities for their most disadvantaged residents. Some young people can be caught in a cycle between being in and out of employment, education or training, which again can have long-term consequences for their earnings, employment, health and wellbeing.

It is extremely difficult to estimate accurately the number of young people not in education, employment or training in the UK, and the numbers may be much higher than the official figures. Evidence from London and Manchester youth talent match programmes suggests a significant number of hidden NEETs, as they are referred to. London Youth’s talent match found that 35% of its intake from January 2014 to December 2016 were people who could be said to be hidden NEETs. Talent match is funded by the Big Lottery Fund and the European social fund. While the Government have guaranteed funding agreed up to the point of Brexit, there is a question of where funding will come from after that. I should be grateful if the Minister would respond on that point.

How do the Government plan to ensure that those hidden young people are found and given the support that they need? That was once a local authority responsibility but, due to financial pressures, many local authorities have reduced youth services and do not track the whereabouts of the local youth population.

People in certain groups are especially likely to be not in education, employment or training. The proportion of 16 to 24-year-olds not employed or in training or education was higher for some ethnic groups than others: for example, it was highest for those from Pakistani and Bangladeshi backgrounds, at 16%. Thirty per cent of young disabled people are not in education, employment or training, nor are 40% of care leavers aged 19 to 21, compared with 14% of all 19 to 21-year-olds. Those statistics should really concern us. What additional support is being put in place to ensure that those young people are given the same opportunities to progress as other young people?

Last week, the Government launched a new strategy to support disabled people into finding work, “Improving lives: the future of work, health and disability.” However, the Work and Health programme is a much smaller scheme than the Work programme and Work Choice. Overall, there will be an 80% reduction in specialist employment support from the Government—most employment support for disabled people is provided by Jobcentre Plus, but it has adopted a generalist model for work coaches rather than one where they specialise in specific kinds of claimants. The Work and Health programme is targeted at people who are likely to be able to find work within 12 months with much more specialist support. However, the reality is that, for young people with the greatest barriers to finding work, it may take much longer. The Big Lottery Fund’s talent match scheme, aimed at young people who are furthest from the jobs market, has found that it can take up to two years for the people they work with to find employment. It is important that specialist support continues as well once someone starts a job, so that they can continue in it.

We also need to consider those young people more generally who are registered as unemployed and who, with the closure of the Work programme, will be increasingly likely to receive employment support directly from Jobcentre Plus. Some of the same problems with the way that Jobcentre Plus operates in relation to people with specific needs apply to young people more widely. Jobcentre Plus has adopted a generalist model for work coaches, but supporting young people to find employment may require more specific knowledge of the job market and skills.

The Select Committee on Work and Pensions, in its “Employment opportunities for young people” report, published at the end of March, suggested that the DWP might look at recruiting people with experience as youth workers or coaches. It also suggested that the DWP could learn from schemes such as the MyGo employment service in Suffolk, which operates from modern, open buildings that are more welcoming than many jobcentres. In fact, it is open to young people regardless of whether they are claiming benefits or not.

I have spoken in a number of debates in this Chamber to oppose the Government’s programme of jobcentre closures. Will the Minister tell us what consideration the Government have given to using the end of their contract with Trillium to renovate the estate and provide jobcentres with a much better experience for users, rather than simply decimating the numbers of offices? Will he also tell us what consideration the DWP has given to the use of texts and social media to reach out to young people who are unemployed, and whether texts are used to remind them of appointments—as is done for NHS appointments—at all jobcentres, decreasing the risk of sanctions?

As the full service of universal credit is being rolled out, those young people who are registered as unemployed will receive support through the youth obligation, which will mean an intensive support programme from day one of their claim. Young people who remain out of work for six months will be expected to apply for an apprenticeship or traineeship, or take up a work placement. There is anecdotal evidence, however, from organisations in the field that delivery of the youth obligation is patchy, and that some work coaches do not know what it is. Will the Minister give us the DWP assessment of how effective the youth obligation has been so far?

The Work and Pensions Committee highlighted evidence of concern from employers about compulsory work placements. Will the DWP ensure that the Work programme’s rigid approach to placements is not repeated? In particular, will it ensure that there is flexibility in the youth obligation for young people, especially those facing the greatest barriers, so that, where necessary, steps to prepare for employment may be given priority rather than a placement? I think here of basic skills such as literacy, numeracy and IT skills, as well as other steps, perhaps to improve social skills and build self-confidence.

It is clear from the “State of the Nation” report that the unequal opportunities that young people face have roots in the poverty and inequality they experience as they grow up. In the north-east and south-west, young people on free school meals are half as likely to start a high-level apprenticeship. The Government’s target of 3 million new apprenticeships by 2020 is laudable but, in the first quarter following the introduction of the levy in April this year, there was a 59% fall in apprenticeship starts, and the majority of starts were at higher levels for older workers. What will the Government do to ensure that young people under the age of 24 do not lose out as a result of businesses using the levy to upskill their existing workforce and recruit staff at level 4 apprenticeships?

Beneath the apparently improving youth employment figures lies a more complex story. Evidence from specialist organisations suggests that there are schemes that are working well and producing results for young people with the greatest barriers to finding work. Those young people need support tailored to their specific situation and experience but also time for that support to make a difference. I hope the Government are listening.

Universal Credit Project Assessment Reviews

Margaret Greenwood Excerpts

Tuesday 5th December 2017 Commons Chamber

[Margaret Greenwood (Wirral West) (Lab)]

This has been an important debate. We have heard some excellent contributions, in which Members have raised the broad range of issues that remain to be addressed by the Government in relation to universal credit and the problems arising from its design and implementation. Those contributions have been, by turn, insightful, constructive, passionate, and at times emotional, particularly those of my hon. Friends the Members for Crewe and Nantwich (Laura Smith), for North West Durham (Laura Pidcock) and for High Peak (Ruth George).

Opposition Members welcome the statement that the Secretary of State has made about the project assessment reviews, but it is disappointing that this would never have happened if we had not tabled the motion. We look forward to the handing over of the reports to the Work and Pensions Committee, and we hope that there will not be too many redactions, which would render them valueless. We also look forward to the consequent recommendations of the Committee—which may, of course, consider wider publication in the public interest, given the view of the Information Commissioner. The Secretary of State’s announcement does not get away from the fact that the Information Commissioner has asked for the reports to be put in the public domain, and I ask him to give serious thought to the commissioner’s instruction and make the reports public.

Between 2012 and 2015, five project assessment reviews of universal credit were carried out by the Government’s Major Projects Authority, which is now known as the Infrastructure and Projects Authority. In August this year, after a complaint from a campaigner, the Information Commissioner’s Office ruled that the reports must be disclosed. In a decision notice, the Information Commissioner said:

“The reports provide a much greater insight than any information already available about the UCP”

—the universal credit programme—

“there are strong arguments for transparency and accountability for a programme which may affect 11 million UK citizens and process billions of pounds, which has had numerous reported failings in its governance.”

Why, then, have the Government failed to act? What have they to hide? Are they afraid that the reports will shine a light on what the commissioner refers to as the

“numerous reported failings in its governance”,

or is it that they do not want to provide us with an insight into how they came to develop the universal credit full service into the chaotic programme that it is proving to be?

It is important that we are given sight of these reports, because the competence of the Department for Work and Pensions really is a matter of public interest. It is important that we have that insight and that we understand what challenge there has been within the system to improve the programme. It is also important if we are to understand the kind of questions that have been raised in the Department about the Government’s flagship social security policy. Armed with that information, we can scrutinise whether they are the right kind of questions and, if they are not, we on these Benches are ready to help.

The debate today has been revealing. I feel that the Secretary of State has displayed a degree of complacency in relation to some of the remaining serious problems being generated by the Government’s design and implementation of universal credit. It would therefore be useful to know which issues have been raised in the reports. Have questions been asked about the impact on single-parent families, for example? Gingerbread has entitled its report on the impact of universal credit on lone parents “An impossible bind”, which indeed it is for many single parents. The report, which was published last month, highlights the practical problems facing single parents when they try to find work or increase their hours.

The shortage of part-time work and flexible jobs is a real issue, as is the very high cost of childcare, yet under universal credit, the Government have brought in new conditionality requirements. For the first time, parents of three and four-year-olds will be required to look for work or risk being sanctioned. By the time universal credit is rolled out, nearly 2 million single-parent families will be eligible to receive it. According to Gingerbread, 220,000 parents, including 165,000 single parents, will be affected by the new rules concerning three and four-year-olds.

Then there is the high cost of childcare, especially in London and the south-east. Any lone parent who has been watching “Motherland” will have laughed at the deep irony of the prospective childminder who, on being asked why she is charging as much as £18 an hour, replies, “Because I have to pay someone to look after my own children while I’m looking after yours.” But of course this failure of Government policy is no laughing matter, and it is important that universal credit supports the practical realities facing lone parents. Perhaps the reports can cast some light on that.

Then there is the two child policy. From April this year, under universal credit, third and subsequent children within a family will not receive the same social security support as their older siblings. This policy really is offensive in its implication that some children are valued more than others. It would indeed be useful to understand how on earth the Government came up with a policy that implies that. Children are our future, and we need the Government to invest in them for their sakes and for all our sakes.

There is mounting concern around the country at the growing and shameful problem of poverty, particularly child poverty, under this Government. The Joseph Rowntree Foundation’s report published yesterday, “UK Poverty 2017”, makes for sobering reading. It highlights the fact that more than 14 million people live in poverty in the UK. That is one in five people, or 20% of the population. It includes 8 million working-age adults, 4 million children and 1.9 million pensioners, and we know that 8 million people in poverty live in families where at least one person is in work.

That brings me to the cuts that have been made to universal credit. The cuts to work allowances, and so to work incentives, under universal credit were implemented in 2016, and they have undermined one of the core aims of the universal credit programme—namely, that work should always pay. We on these Benches know that people want to be able to work. Research carried out by Labour shows that, following cuts to work allowances and subsequent changes to the taper rate, some families will be £2,100 a year worse off. So, while we welcome the changes introduced in the Budget this autumn, the Government have to recognise that many of the core issues with universal credit remain, and that the size of the cuts is key. Having sight of the progress assessment reports is important, not least because it is reasonable for members of the public who are at the sharp end of the cuts to know just what has been going on in the Department, and how much money has been wasted.

It is also important to consider the impact of universal credit on the self-employed. The Government certainly need to address that issue, particularly at a time when there is real economic uncertainty in the light of the Government’s failure on productivity. Universal credit assumes that people earn the equivalent of 35 times the national living wage per week after the first year, but of course that is often not the case for new businesses, particularly seasonal businesses such as those related to tourism, fishing and agriculture. The National Farmers Union has suggested that the Government could give people longer to get to that level of income. Of course, farmers’ income is always going to fluctuate. Someone on universal credit might average that amount over the course of a year, but there is no means for someone to be paid retrospectively beyond the one month cycle.

Moreover, universal credit will put further administrative burdens on business, since the reporting period is not in synch with that of HMRC. Labour would change the way in which self-employed workers are assessed to annually, rather than monthly, to account for their volatile working patterns. And of course the requirements that claims be made and managed online brings all sorts of problems; a farmer with poor broadband access, for example, might particularly struggle with the reporting requirements.

We have heard a great deal of testimony as to the effect of universal credit on people’s ability to pay their rents. While we acknowledge that the Government have made some movement on this, it remains to be seen how this will work given the delays in the system earlier this year. For example, some people in Croydon have had to wait up to 12 weeks for payments.

We welcome that the Government have changed tack, but I am sure that all of us want to see the publication of these papers. The Government have not moved nearly far enough. The issues with universal credit are causing serious problems for our constituents and need to be addressed. For these reasons it would be helpful if the Government could publish the project assessment reports, as directed by the Information Commissioner, so this House can carry out the scrutiny that this flawed programme desperately needs.

Oral Answers to Questions

Margaret Greenwood Excerpts

Monday 13th November 2017 Commons Chamber

[Mr Gauke]

My point was that the Scottish Government are delivering universal credit differently and in a way that I think is worse than the situation in England and Wales. The point about universal credit is that it will help people into work. I will give one brief example: I heard of an account last week of a single mother on income support not previously able to claim for her childcare costs but now able to do so under universal credit. She is taking up a job, working eight or nine hours a week, which she could not do previously—a first step on the ladder. That is an example of what universal credit is delivering.

[Margaret Greenwood (Wirral West) (Lab)]

A recent report by the Resolution Foundation using new data based on bank transactions shows that 58%—the majority—of new claimants moving on to universal credit as a result of leaving employment in the last year were paid either fortnightly or weekly in their previous job, which is a far higher percentage than in the economy on average, where about one in four of all jobs is paid fortnightly or weekly. The Government should ensure that no claimant has to wait more than 10 days, so will they end the six-week wait and ensure that universal credit mirrors the world of work for those who claim it?

[Mr Gauke]

Universal credit is replacing tax credits, and under tax credits 57% of claimants are paid monthly and 12% four-weekly—nearly 70%—so if we are to have a system that works for everybody, it has to be a monthly system.

Universal Credit Roll-out

Margaret Greenwood Excerpts

Wednesday 18th October 2017 Commons Chamber

[Margaret Greenwood (Wirral West) (Lab)]

This debate has been wide ranging, and we have heard Members from all parts of the House describe with real focus and urgency the unrolling fiasco that is universal credit under this Government.

Ninety Members put in to speak in this debate, reflecting the huge concerns across the House and in the country. Labour calls on the Government to pause the roll-out of universal credit and fix the problems that have been so clearly described today.

Universal credit was designed to simplify the benefit system and provide support for those on low pay and out of work. We in the Labour party supported those original aims, but, in fact, this new benefit is damaging the lives of many of the people it is supposed to support.

[Ruth George]

Does my hon. Friend agree that, when the Institute for Fiscal Studies says that a further 3 million working families will be made, on average, £2,500 a year worse off, universal credit is never going to work for working families?

[Margaret Greenwood]

My hon. Friend makes a very strong point and I thank her for it.

Sir John Major recently called the roll-out of universal credit operationally messy, socially unfair and unforgiving. A former Government official, Dame Louise Casey, likened it to jumping off a cliff. Members are extremely concerned about what universal credit means for their constituents. Indeed, 12 Members from the Government Benches have written an open letter to the Secretary of State, calling on him to pause the roll-out, and their concern is widely shared around the House.

In response to concerns raised last week, we heard the Secretary of State reassure us that those who go on to universal credit are more likely to be working six months later than they would be had they been on legacy benefits, and that they are also more likely to be progressing in work. However, his statistics date from 2015 when universal credit claimants were, on the whole, single unemployed jobseekers, whereas the benefit is now being rolled out to people with much more complex circumstances. Furthermore, his statistics dated from before the cuts to work allowances were introduced in April 2016.

In response to concern from all parts of the House about what is happening now, the Secretary of State said that universal credit is about ensuring that our constituents are in a stronger financial position—

[Dan Carden (Liverpool, Walton) (Lab)]

rose—

[Margaret Greenwood]

I cannot give way, as I must make progress.

The reality, according to the Trussell Trust, is that food bank referrals have increased by more than double the national average in areas in which the universal credit full service has been rolled out. The Peabody Trust says that the arrears rate for its tenants in receipt of universal credit is three times that for tenants unaffected by universal credit. Half of families in arrears under universal credit have said that their rent arrears started after they had made a claim.

The Secretary of State said that if tenants have a reasonable expectation of receiving housing costs as part of their universal credit payment, the landlord should not take action and the tenant should not face eviction. If only it were that simple. Research by the Residential Landlords Association published in August found that 29% of landlords had taken action to evict a tenant on housing benefit or universal credit in the past 12 months and that arrears were the main reason for doing so. It also found that two in three private landlords were more reluctant to rent to claimants of universal credit because of their concerns about arrears.

The Secretary of State presented advance payments as the answer to the problems of delays in universal credit, but advance payments amount to only 50% of two weeks’ payments of the claimant’s estimated universal credit. He wants to raise awareness of advance payments, but if half of the claimants are already taking advance payments even before he has started, people are clearly struggling to get through the waiting period.

Organisations such as Citizens Advice have been sceptical that advance payments are the solution because they see the reality of what it is like to cope with no income for the six weeks or more wait without savings. As Members of Parliament, we are here to serve the people who live in our constituencies. It is our job to take the Government to task when they get it wrong, and on universal credit, they have got it seriously wrong—wrong in the design and wrong in the delivery. Let us look at the design first.

The flaws in the design of universal credit are many. The infamous six-week wait is a built-in pathway to problem debt. Universal credit is meant to mirror the world of work, but waiting six weeks or more to be paid does not, especially where people are used to being paid weekly or fortnightly by an employer. When I asked DWP what percentage of UC claimants receiving in-work support are paid monthly, the answer I received was:

“We do not have quality assured data on the payment cycles of universal credit claimants who are in work or for those who were in work before they claimed.”

Then there is the payment of the housing element directly to the claimant, not the landlord, putting vulnerable claimants at risk of eviction and exploitation. The difficulty in arranging alternative payments has also been described. The two-child limit means that a new baby in a family that already has two children will not have the same social security support as their brothers or sisters because the family will not qualify for tax credits or universal credit for that child, with the unacceptable implication that some children are valued more than others. There is the minimum income floor for the self-employed, who the Government assume, for the purposes of universal credit, earn the equivalent of 35 hours a week on the national living wage after a year, even though around half of self-employed people earn less than two thirds of median weekly earnings.

The cuts to work allowances will leave some families up to £2,100 a year worse off even after the changes to the taper rate announced last year. The failure to provide work allowances for second earners brings into question the effectiveness of work incentives under universal credit, particularly given the importance of a second earner to address in-work poverty. The withdrawal of severe disability premium in universal credit means that some disabled people can be up to £62 a week worse off if they move on to universal credit because of changes in their circumstances such as moving from a live to a full service area or claiming another benefit such as PIP.

Paying universal credit to only one person in the household is a risky experiment, with scant regard as to what that might mean to victims of domestic violence and their children. There is an insistence that claims in the full service should be made and managed online, despite the fact that the most recent Government figures—from the Department for Business, Innovation and Skills in 2011—show that 5 million people in the UK lack basic literacy skills, 8 million lack basic numeracy skills and nearly 5 million had below entry-level IT skills. Many people on low income cannot afford internet access, or face increased difficulty accessing it because of the closure of libraries and jobcentres over the course of seven years of Conservative austerity. In any case, public libraries are not always the most appropriate places to fill in forms with personal information. We are all aware that broadband access can be even poorer in rural areas.

The list of design flaws is a long one. Then, of course, there are the failures in the implementation of universal credit under this Government. Not only have the Government designed a policy with the six-week delay built into the system, pushing many claimants into debt, but the Government are failing in the delivery too. The Secretary of State boasts that 80% of new claimants are paid on time, but this is hardly something to boast about. By this reckoning, we can expect that 80,000 people will have to wait longer than six weeks to receive their money over the next six months, and 40,000 will have to wait longer than 10 weeks. Surely the Secretary of State does not find that acceptable.

There is a crisis of problem debt, with 8.3 million people in the UK struggling with debt and £200 billion of unsecured consumer credit debts. On Monday, the chief executive of the Financial Conduct Authority warned that increasing numbers of young people are having to borrow to cover basic living costs. One of the most basic living costs of all is housing. Yet, young people aged 18 to 21 do not qualify for any help with housing costs in universal credit full service areas unless there are special circumstances. We now have a complicated patchwork of social security, where people with the same circumstances may have very different entitlement to social security depending on whether they are on legacy benefits or universal credit, and whether they live in a live or a full service area. Even DWP staff often find it difficult to know which benefit people should be claiming.

Despite all those issues, the Government have decided to accelerate the roll-out of universal credit to 50 jobcentres a month, at the same time as closing one in 10 jobcentres across the UK and a number of back offices. There are real question marks over whether the Department has the resources to deliver its universal credit programme, especially in the light of the 800 redundancies it has announced. Other problems include the online system struggling to accept evidence of people’s identity and childcare receipts when they are not on headed note paper. Citizens Advice highlighted the case of a mother who lost her job because she had to stay at home and look after her children when her universal credit was not paid in time.

The Government tell us they have a policy of test and learn when it comes to universal credit. Well, it is certainly testing people who have to wait weeks on end to receive their money. The testing is on real people and the consequences can be devastating, yet we see little evidence of learning—but there is still time and I urge the Secretary of State to learn, because the human cost of failing to take action would be great.

Universal credit was intended to be simpler, but we now have an incredibly complicated system where the nature of someone’s entitlement to social security has become a postcode lottery. It is vital that in the future we have a social security system that is robust enough to serve us well in the face of all the challenges before us, including the current insecurity of the labour market, the changing shape of families and the many challenges automation will bring as we move into the fourth industrial revolution.

Oral Answers to Questions

Margaret Greenwood Excerpts

Monday 9th October 2017 Commons Chamber

[Mr Gauke]

We must constantly learn from experience—this is about testing, learning and improving. We must ensure that awareness of the advances system is high, and clearly that has increased in recent months. My hon. Friend makes a point about jobcentre staff, and my experience of meeting such people up and down the country is that they are enthused by what universal credit can do for claimants to help them to get into work.

[Margaret Greenwood (Wirral West) (Lab)]

Twenty-four per cent. of new universal credit claimants wait longer than six weeks to be paid in full. Only one advance payment is allowed for a new universal credit claim, and the maximum award is 50% of the claimant’s estimated benefit, so how will advance payments really prevent families from getting into debt while waiting for their first universal credit payment?

[Mr Gauke]

The timeliness of payments has improved since the figures that the hon. Lady cites were compiled, and we continue to improve it. As I have said, 90% of claimants receive some support within the six-week period. Advances are an important part of the system to ensure that people get the support they need. It is incumbent on all of us not to worry people that they will be left without any support whatsoever, but to draw their attention to the fact that they can access funds when they need to—generally waiting no more than five working days or, if necessary, receiving them straight away.

[Margaret Greenwood]

According to the Trussell Trust, food bank referrals have increased at more than double the national average in areas where the universal credit full service has been rolled out. Does the Secretary of State agree that the social security system should prevent people from having to visit food banks, rather than exacerbating need?

[Mr Gauke]

We are very keen to ensure that the advances system means that people can access funds so that they do not have to visit food banks. In recent months we have seen an increased use of that system, because we have done more to publicise it, and I want to go further on that. I think that is an important part of a system that, when we step back and look at it, is ensuring that more people are able to work and to progress in work, and that should not be forgotten.

Jobcentres and the DWP Estate

Margaret Greenwood Excerpts

Thursday 20th July 2017 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is an honour to serve under your chairmanship, Mr Evans. I congratulate the hon. Member for Glasgow South West (Chris Stephens) on securing what is and remains a really important debate—although we have had it several times already. He spoke powerfully of the intergenerational poverty and deprivation in his constituency. That was a theme picked up by the hon. Members for Inverclyde (Ronnie Cowan) and for Glasgow North (Patrick Grady), and my hon. Friend the Member for Glasgow North East (Mr Sweeney), who spoke of the impact of the closures on some of the poorest in the UK.

There was also a strong contribution from my hon. Friend the Member for Coatbridge, Chryston and Bellshill (Hugh Gaffney), who talked about the impact that the 250 job losses will have on the local economy in his constituency. Members also spoke of the disproportionate impacts on certain groups in society—most notably my hon. Friend the Member for Battersea (Marsha De Cordova), on black and Asian people, and my hon. Friend the Member for Midlothian (Danielle Rowley), on WASPI women.

From the Government Benches, the hon. Member for Ayr, Carrick and Cumnock (Bill Grant) said that there will be pain and that for some people there will be extreme challenges. I ask the Minister to reflect on that.

As we know, the Government have recently confirmed plans to close around one in 10 jobcentres in the UK by March 2018. Public consultations were held on just 30 of the 78 jobcentre closures proposed in January, and only 16 have been reprieved, with three additional closures now confirmed. We understand that 590 jobcentres will be retained, 109 will be closed, and 50 collocations will go ahead. The future of eight sites is still to be negotiated. Yet the Department for Work and Pensions has yet to provide details of when each office closure is to take place, even though some could be as early as this summer. Will the Minister tell us when the first centres are scheduled to close, and which ones they are? People have a right to know. Will he publish the current closure dates planned for each office, so that people can have as much information as possible to make provision as they need to for the change in circumstances?

Jobcentres provide really important services in our communities, offering services that are designed to support people should they be unfortunate enough to lose their jobs or become ill or disabled, as well as for those who have been disabled throughout their lives. It is often said that how a society treats its most vulnerable is a mark of its civilisation. Our social security system is precious and should be there for people in their time of need. However, it appears that the Government are eroding our social security system and failing to pay heed to the needs of individuals and communities, at a time when we face the uncertainties of Brexit, increased job insecurity with 1 million people on zero-hours contracts, a crisis in low pay and the Government’s introduction of in-work conditionality—sanctions for working people, as it is also known.

It is increasingly clear that the impact of the closures on claimants will be considerable and the effect will be most acutely felt by the most vulnerable in our society, such as the chronically sick, the disabled and those with caring responsibilities, along with those with poor or no IT skills. Where, then, are the equality impact assessments for the closures? We have asked for them, but they are still yet to be seen. The Government are disregarding the needs of communities at the very time when the world of work is changing rapidly. The Government are yet to publish the equality analysis for the closures. Can the Minister give an exact date for when the full equality analysis will be published?

The Secretary of State said it is reasonable to ask claimants to travel further to another jobcentre as that is what people in work have to do every day, but he does not take into account the fact that those people have wages to pay their travel fares. People claiming social security are more likely to have a health problem or disability. They are more likely to struggle to travel longer distances, and as a result are at greater risk of being sanctioned for being late. People with children may also find it difficult to travel longer distances. What assessment has the Department made of the impact of the closures on claimants’ travel times, and of the associated costs? Can the Government specify whether the travel time includes those who cannot afford public transport and have to walk?

[Marsha De Cordova]

On the issue of the closures, it would be helpful if the Minister could talk about travel times and set out what mechanisms will be in place to support those with mobility issues or other disabilities, who will have to travel further. What adjustments will be made for those protected groups?

[Margaret Greenwood]

My hon. Friend makes a really good point, and it is important that the Minister responds to it.

What guidance does the Department intend to give staff on sanctioning people who miss an appointment because they have to travel further? We need to be clear about what sanctioning can mean to people. A first sanction means no benefits for four weeks. A second sanction means no benefits for three months. A third sanction means no benefits for up to three years. The system risks forcing people into destitution, crime or suicide, so this is a really important issue.

Let us consider the roll-out of the full service of universal credit. The DWP is reducing its estate at the same time as it is speeding up roll-out of the full service of UC. Over the past two years, the full service of universal credit has been rolled out to five new areas each month. This month, it has been extended to 30, and there are plans for it to be accelerated in October to 55 new areas per month. If the DWP feels able to announce such far-reaching plans to close jobcentres, it must surely have a clear idea of what the impact will be on work coaches, who are at the centre of its plans for employment support, but the Minister’s answer to a written question I submitted asking for the DWP’s assessment of the optimal number of universal credit claimants in a work coach’s caseload was vague to say the least. Will the Minister give us a clearer response today? What is his Department’s assessment of the optimal number of universal credit claimants a work coach can deal with, for both the live service and the full service? Or is his Department forging ahead with plans to close jobcentres without a clear idea of the number of staff needed?

The closure of jobcentres and the migration to online applications will make it harder for many people to claim social security. Many people do not have access to computers or mobiles, are unable to carry out transactions, or are not able to use the internet at all. A 2015 study by Citizens Advice Scotland found that 59% of respondents were unable to make an application for benefits online without help, and 30% of respondents were not able to apply for a benefit online at all. In Glasgow’s most deprived areas, almost half of respondents had never used the internet. More than half of clients did not have a computer or a device they could use to access the internet, and more than 40% of survey respondents could not use a computer at all. The Minister’s response, when questioned on claimants’ access to IT, has been to say that jobcentres provide access to PCs. If jobcentres are closing in large numbers, surely there will be less access to PCs for those who need to use them.

It is becoming clearer that the full digital service roll-out is experiencing major problems. Claimants are forced to spend increasingly long periods on the phone to try to resolve issues relating to their claims. A recent Citizens Advice report suggests that sometimes the only way to resolve a problem is to go to a jobcentre directly. The report calls for a comprehensive support package to be put in place, offering face-to-face help with all aspects of making and managing a universal credit claim. Will the DWP listen to Citizens Advice’s call for such a package? What is the DWP’s assessment of the effectiveness with which the full digital service is being rolled out? The process is called “test and learn”. Can the Minister please tell us what has been learned so far?

Let me turn to back-of-house offices. Front-facing jobcentres are not the only service the DWP is cutting. All but two back-of-house offices face closure, and staff are to be concentrated in a small number of hubs. That will have serious implications for staff, who will be forced to travel further or move. For some people, that will be practically impossible. Can the Minister tell us how many people will be made redundant, first, from the planned jobcentre closures, and secondly, from the closure of back-of-house offices?

Let me turn to the health and safety impact. The transfer of staff and claimants from jobcentres that are closing also raises health and safety issues. The closures will put more pressure on overstretched staff. The Minister said that work coaches are the central customer-facing role, but Jobcentre Plus staff dealing with phone inquiries about claims are also frontline staff. It can be extremely stressful to answer calls from people who are frustrated about a problem with their claim or delays in processing it. The Public and Commercial Services Union reports that staff are already being taken away from processing claims to answer phone lines, which leads to a vicious cycle: claimants are more likely to phone to ask what is happening to their claim because it has not been processed due to the delays. Apparently, among staff, it is known as the “cycle of hell”—a circle of inefficiency and stress, which they are struggling to get out of. Will the Minister tell us what steps he is taking to ensure the health and wellbeing of staff in DWP offices?

The Secretary of State said on 6 July that the DWP is actively recruiting. That is welcome, but I would be grateful if the Minister could share with us the DWP’s current assessment of Jobcentre Plus’s performance on staff retention. Will the DWP publish statistics on the turnover of Jobcentre Plus and back-of-house office staff?

[Mike Gapes in the Chair]

In the debate on 6 July, my hon. Friend the Member for Lewisham, Deptford (Vicky Foxcroft) rightly raised the issue of the safety of young people who travel from different parts of south London, in the context of increasing youth violence. PCS raised similar concerns with me in relation to other major cities. Problems are likely to arise when services are merged in one office in an area with a gang culture. That serious issue is likely to affect staff and claimants, so it is important that the DWP listens to and acts upon the concerns of staff in such cases. Will the Minister give an assurance that he will do that? What support is DWP offering staff to ensure they maintain their emotional and physical wellbeing at work?

It is important that there is sufficient room space available in the remaining jobcentres so claimants who have to disclose personal information can do so in privacy. Has the DWP carried out a health and safety assessment of the impact of the planned closures? If not, why not? If it has, will it publish it?

My concern is that acceleration of the roll-out of the full digital services of universal credit, together with the programme of the rapid closure of jobcentres, will put intolerable pressure on staff and create chaos for claimants—especially the most vulnerable. The Government’s answer to any criticism of cuts to social security is that work is the best route out of poverty. Why, then, are they closing jobcentres on such a scale, when they offer services that are specifically designed to help people find employment?

[The Minister for Employment (Damian Hinds)]

It is a delight to serve under your chairmanship, Mr Gapes. I congratulate the hon. Member for Glasgow South West (Chris Stephens) on securing the debate. He and others will be aware that this subject has already been debated extensively in Parliament. There has been an Opposition day debate, a Westminster Hall debate, an Adjournment debate and a Back-Bench business debate. There was another Westminster Hall debate yesterday, specifically on south Wales. The issue has been raised at DWP questions and Scotland Office questions. There have been two urgent questions and a substantial body of written questions.

Today’s debate has been wide-ranging. We heard a full exposition from the hon. Member for Glasgow Central (Alison Thewliss) and a very interesting speech from the hon. Member for Wirral West (Margaret Greenwood). In the time left, I will do my best to cover as many of the points that have been raised as possible.

The Government are committed to maintaining our record of protecting the most vulnerable while supporting everyone to fulfil their potential and play their full part in society. That includes reforming the welfare system by making work pay, supporting those unable to work and examining our assets to ensure that we are deploying resources effectively. On 31 March 2018, the DWP’s 20-year private finance initiative contract with Telereal Trillium, which covers the majority of the DWP’s current property portfolio of some 900 sites, comes to an end. That date provides an opportunity—indeed, an imperative —to review which office locations we need and how our estate is to be managed in the future. We have sought to do that in a way that delivers better value for the taxpayer and makes best use of the space available, while continuing to deliver vital support to claimants and pursuing our reform agenda.

[Margaret Greenwood]

Will the Minister give way?

[Damian Hinds]

I am sorry, I will not. The hon. Lady will have to forgive me, but I want to answer as many questions as possible.

To give some context, the DWP occupies about 1.5 million square metres of office space, but the way it operates is significantly different from 20 years ago, meaning that at least 20% of that space is under-occupied. The falling claimant count and the increased use of online services in recent years mean that 20% of the money the Department spends on rent goes towards space we are not using. By paying only for the space we need and the services required to operate from it, we anticipate saving £140 million per year over the next 10 years. To be clear, this is not about reducing services—the hon. Member for Wirral West alluded to that—but about taking the opportunity to stop spending taxpayers’ money on empty space and instead spend more to support those in need.

The labour market is in its strongest position for some years: the employment rate is 74.8%, the joint highest figure on record, and since 2010 unemployment has reduced by 913,000 and the overall number of people claiming the main out-of-work benefits has fallen by more than 1.1 million. In Glasgow over the past four years, the claimant count has come down from 27,890 to 16,800. The DWP estate is bigger than it needs to be, is not flexible enough to deal with the needs of the Department’s customers now and in the future and, in some instances, is of poor quality, preventing improvements such as digital innovation and more interactive ways of working with customers.

The Department is not transforming its estate in isolation. In June 2013, the Government published their first overall estate strategy, which was expanded in October 2014. The strategy aims to ensure that all Departments are working towards an effective and efficient Government estate that provides value for money to the taxpayer, delivers better, more integrated public services and acts as an enabler of growth. In January this year, we announced proposals to rationalise the DWP estate. The proposals encompassed most of our Jobcentre Plus offices, processing centres and head office buildings. Our announcements on 5 July finalised those plans for the majority of sites.

In our processing centres, the changes move towards creating larger, modern, digitally enabled centres, with teams working on several areas coming together to deliver a joined-up, efficient service to our customers. The focus is on creating an estate with a much improved working environment, with more opportunities for our staff to develop, learn new skills and progress.

Significant investment starting in 2018 will include the opening of a new processing centre in Glasgow, which will allow us to bring together colleagues from smaller, older sites across the area into a new property fitted out to create an efficient, effective working environment that allows the DWP to align more closely with other Departments working in the area. With the existing large processing site in Northgate, that will result in a DWP presence of more than 2,000 staff in Glasgow. In total in Scotland, we will keep a substantial processing presence, with large sites in locations such as Falkirk and Kilmarnock expanding to bring further jobs into those areas.

That investment will continue with a new purpose-built site in the Treforest area to the north of Cardiff in south Wales, which will bring together colleagues from smaller, older sites across the region into a new building and provide about 1,600 jobs in one of the most deprived areas in the UK. We are also working on similar large processing sites in Bristol, Birmingham and Hastings. Together with the changes to how we work in some of our remaining properties, that will create a processing estate that will be able to support the Department well into the future, while remaining flexible enough to deal with changing needs over the coming years.

The changes in the jobcentre network focus on three things: first, moving some jobcentres to shared Government premises to allow for better, more efficient use of space and a more co-ordinated service; secondly, moving some jobcentres to new buildings because the quality of the existing property is not up to scratch or is unable to meet the needs of our customers now and in the future; and thirdly, merging smaller and underused jobcentres to create larger operations that offer a better, more joined-up service to our customers. The changes include around 40 new opportunities to collocate jobcentre services into local authority or community premises, which will result in about 80 collocations in total.

In Scotland, we have 95 jobcentres, which is more jobcentres per head of population than in England. The changes will result in 11 jobcentres merging into nearby offices, three jobcentres moving into shared offices with local authorities and councils, and one jobcentre moving into an improved building in the same town. The resulting 85 jobcentres across the country still leaves Scotland with significantly more offices per head of population than England.

In Glasgow, we have 17 jobcentres, which the hon. Member for Glasgow South West acknowledged in his opening speech was more per head of population than in any other major city in Great Britain. Even with the reduction to 11 jobcentres, Glasgow will continue to have more per head of population than other cities. We consulted on three moves in Glasgow—Maryhill, Castlemilk and Bridgeton—and held a further consultation on Broxburn. The changes will enable the Department to offer a more efficient service while delivering value for the taxpayer.

The changes have been developed working closely with local leaders, using their local knowledge of the area, travel network, customers and community needs. Distance and journey times were calculated using a variety of methods to ensure accuracy in our planning, including online tools and timetables, as well as information collected on local public transport routes. Most importantly, that was all used to inform discussions with local staff, with their experience and knowledge of their areas.

Any change with an impact on DWP employees has involved consultation with them and their trade unions. In most cases, staff consultation began with an announcement back in January, followed by three to five weeks of discussion when we considered the impact of any changes on their offices. We have consulted the public on any jobcentre mergers that may mean customers will have to travel a little further. There is no statutory requirement for such consultation, but we were committed to making the decisions in consultation and have conducted public consultations on all proposed closures of jobcentres that fall outside the ministerial criteria.