(9 years, 8 months ago)
Written StatementsAccess to Work plays a key part in building a disability confident Britain. In 2013-14 Access to Work spent £108 million to help 35,540 disabled people enter or remain in work, over 4,000 more than in 2012-13. I want to build on this by continuing to improve customer service, increase the numbers of disabled people helped, improve choice and control and reach out to under-represented groups such as those with hidden impairments including mental health conditions, learning disabilities and autism.
In December 2014, I announced operational improvements to the Access to Work scheme. The transformation of Access to Work operations is starting to bear fruit and I am pleased to announce that we are now meeting service standards.
This gives a platform for further reform. In 2015-16 we will start a process of offering personal budgets for those with ongoing awards for travel or support. This will give users more freedom over how they use their awards.
We also aim over time to transform the way disabled people interact with the service. A new project is underway to re-engineer Access to Work as a digital service, building on the email channels opened up before Christmas. We also intend to offer a video relay service option for BSL users later in 2015-16.
In 2013-14 the average Access to Work award was around £3,000, and half of users have awards below £1,000. However, 1% of users with awards over £35,000 per annum account for 15% of the budget. I want to ensure that Access to Work can help the most people it can in future. So as of October 2015, Access to Work will provide awards up to a limit set at one and half times average salary—a limit of £40,800 per person per year at October 2015. This will be uprated annually in line with the level of average salaries. I believe it is right that there is this explicit link to the labour market.
Anybody with an award higher than this level as of October 2015 will not be subject to that limit until April 2018. This is to help them and employers adjust to their new level of support. Specialist teams will work in partnership with these individuals and employers, for example advising on reasonable adjustments and greater use of technology. These individuals would also be invited to take advantage of a personal budget to help them manage their support in more tailored and efficient ways to meet their needs.
DWP have also been working closely with deaf Access to Work users and the Crown Commercial Service to develop a framework for translation services including British Sign Language. This will guarantee quality standards and set transparent rates from summer 2015. We will build on this by working with deaf people and stakeholder groups to undertake a market review of BSL interpretation provision to explore long term improvements in the market.
In this context, I can announce the removal of the currently suspended “30 hour guidance” from April 2015 which these wider reforms will render unnecessary.
Over 30% of Access to Work spending is on taxis for customers with mobility problems. This is a transformative service for customers and I want to ensure that improvements to customer service, reliability, value for money and accessibility standards for wider society can be driven by Government using their buying power to drive quality and performance. Starting early in 2015-16, we will look to pilot contracted services for customers across our largest towns and cities.
Self-employment is a flexible option for many disabled people. I am now able to announce that I have recently established a further specialist team to provide expert advice and support to disabled people who want to run their own successful businesses. Furthermore, to ensure disabled people have a clear understanding of how they can be supported to maintain their business and continue in self employment, from October 2015 eligibility will be based around the universal credit rules. These balance allowing a reasonable period for businesses to establish themselves, with ensuring that taxpayers money goes to support legitimate and viable businesses, offering Access to Work a more consistent and objective basis for awards.
I want Access to Work to continue to help more people with mental health conditions. The disability confident campaign is raising the profile of Access to Work’s mental health support service and DWP is exploring how referrals to the mental health support service could be more straightforward. We have also highlighted the mental health support provided by Access to Work by changing the pre-employment eligibility letter to reassure employers of the help available. This help includes not just the mental health support service but mainstream Access to Work support such as communication support at interviews, help with travel and awareness training for colleagues to combat stigma.
Finally, as part of my commitment to improve transparency, to complement the detailed scheme guidance published following my last statement in December 2014, we will publish summaries of the guidance for customers, including in easy read and BSL formats, and also illustrate good practice to employers with case studies to help them in becoming more disability confident in supporting disabled employees early in 2015-16.
We have invested an extra £15 million in Access to Work since 2012. User numbers are rising steadily. I hope that these changes to Access to Work will help many more to join them in staying in and getting into work with help from the programme in future.
[HCWS372]
(9 years, 8 months ago)
Written StatementsI am pleased to inform the House that the triennial review of the Industrial Injuries Advisory Council (IIAC) as a non-departmental public body and a Scientific Advisory Committee has now been completed and its findings will be published later today. The reviewers recommended that IIAC remain, as an arm’s length body sponsored by the Department for Work and Pensions. They concluded that it continues to meet the recognised principles of good corporate governance and of providing scientific advice to Government about the occupational nature of diseases in the context of the industrial injuries scheme. I will place a copy in the Library of the House and it is also available online at: http://www.parliament. uk/writtenstatements
[HCWS374]
(9 years, 8 months ago)
Commons Chamber6. What assessment he has made of the potential effect on people subject to the under-occupancy penalty of a reduction in funding for discretionary housing payments in 2015-16.
We have actually increased the funding for discretionary housing payments to help those who are affected by the removal of the spare room subsidy, and, as the Chancellor announced in the autumn statement, it will be protected in 2015-16.
Does the Minister agree with the Child Poverty Action Group, which has said that any degradation of discretionary housing payments will threaten to “cut the parachute cord” that keeps so many vulnerable families from the homelessness and destitution created by the foul bedroom tax? Will he give an absolute guarantee that the payments will be not only maintained in real terms, but possibly increased when necessary, and ring-fenced?
If the hon. Gentleman had listened to my answer, he would have heard me say that the level of discretionary housing payments relating to the removal of the spare room subsidy would be maintained in 2015-16, as the Chancellor said in the autumn statement. I listened carefully to the hon. Gentleman’s point of order about questions and answers last week. I think that my answer did relate to his question, and perhaps he should have listened to it.
What happens when district councils do not use the whole discretionary housing payment fund? Is it carried over? What steps is my hon. Friend taking to ensure that authorities spend the full amount that they are entitled to spend?
25. What has the Minister got to say to my constituent Mr Cocks, who has not only lived in his two-bedroom house in Denton for more than six decades, but was born there? This is not a house; it is his home. Last year he qualified for a discretionary housing payment, but he has been refused one for next year. Is this not yet another example of how cruel the bedroom tax can be, given that in a few years my constituent will be exempt from it anyway?
As I have said, the Government have made discretionary housing payments available to local authorities so that they can take specific facts into account, because they are obviously better acquainted with what is happening on the ground. What I would say to the hon. Gentleman’s constituent is that he should talk to his local authority.
Will my hon. Friend and his Conservative ministerial colleagues stop blocking the Affordable Homes Bill tabled by my hon. Friend the Member for St Ives (Andrew George) and allow it to be passed before the end of this Parliament, so that some of these issues can be resolved?
I am afraid that the estimated cost of the Affordable Homes Bill is about £1,000 million. As well as having to find the money to pay for it, the hon. Member for St Ives would have to identify the other benefits that would need to be cut to enable us to stay within the welfare cap to which both Government parties and the Opposition have signed up.
Each year, local authorities are spending nearly £200 million on adapting properties for disabled people. Then the Government come along and try to move them out of those properties by imposing the bedroom tax. Will the Minister now admit that that is a prime example of Tory welfare waste?
The hon. Lady still has not found anyone apart from herself to take up that slogan. She will know that £25 million of discretionary housing payment was made available specifically to support disabled people who are in adapted accommodation, so that the local authorities do not have to move them. That money is available, and local authorities should use it for the purpose for which it was intended.
7. What comparative assessment he has made of unemployment rates in the UK and other European countries.
14. What assessment he has made of the performance of the Health and Safety Executive in reducing road traffic accidents at work.
The Department for Transport leads on specific legislation relating to road safety, but the Health and Safety Executive does work with the Department for Transport and its agencies to produce joint guidance on driving at work. I understand from statistics produced by the Department for Transport that, in comparison with other countries, the UK remains one of the road safety leaders in the world.
More than three times as many people die when they drive for a living as they do in any other workplace. It is estimated that 20% of accidents are caused by sleepiness. Is it not time to use the expertise that the HSE has used so well in other workplaces and apply it to people who drive for a living, and reduce the death toll from driving?
I know that the hon. Lady has been interested in this issue for a number of years following a tragic death in her constituency in 2006 involving a driver with undiagnosed sleep apnoea. The Health and Safety Executive works with the Department for Transport and the Driver and Vehicle Licensing Agency and their medical teams to ensure that people driving, particularly commercially, are safe. They will continue that valuable work and I know that she will continue to raise the issue.
T1. If he will make a statement on his departmental responsibilities.
T3. Last week Maximus told me that a disabled constituent of mine, who had been waiting more than a year for her ESA claim to be processed, could not be given a date on which that would happen, because many more people had had to wait longer. That does not exactly fill us with confidence, given that Maximus is taking over the Atos contract for assessing personal independence payment claims, or could the Minister give us some meaningful assurance that things can only get better?
To be fair to Maximus, it took over the contract only eight days ago. I remind the hon. Lady that the company that it took it over from, which had well-published problems, was appointed by a Government of the party of whom she is a member. We have been sorting out that problem. Maximus has been in place for eight days and will improve the position, but the hon. Lady needs to give it a fair crack of the whip. It will not sort out all the problems in a week.
T6. Will the Minister tell the House how the outlook for women and their pensions has improved since 2010?
Has the Secretary of State seen the Citizens Advice report which shows that many ESA claimants are left with no money and are reliant on food banks after being told that they are too fit to claim ESA and not fit enough to claim JSA? Most have had to wait up to 10 weeks for a decision. Will the Minister look into this?
If the hon. Gentleman is referring to mandatory reconsideration when somebody is found fit for work, he will know that the average length of time taken to decide one of those is 13 days, not 13 weeks. He will also know that if someone is found fit for work, they are able to claim jobseeker’s allowance and they will receive support from the jobcentre to help them get back into work.
T9. In the past five years, how many people have moved from benefits into work? Is there any comparable five-year period since 1945 when so many people have moved off benefits into the world of work?
T10. Very good progress has been made both nationally and locally in getting unemployment and youth unemployment down. The answers today show that we should not stop there and put all that at risk. Instead, we should go further. Does the Minister agree that we should be doing even more to help, in particular, young people with disabilities or mental health conditions into work?
I am pleased to agree with my hon. Friend. I know that she has held her Norwich for jobs initiative, which my right hon. Friend the Employment Minister has had the opportunity to go and see. We are keen to make sure that we improve performance in getting people on ESA back into work, and my hon. Friend will know particularly that we are trying a number of things in the area of mental health to make sure that we are more successful in that area.
For international women’s day I visited Westgate community college to see the fantastic work that it is doing to improve the skills of women of all ages and backgrounds, but I was told that this Government’s sanctioning policy means that many women cannot feed their children, and also that some women have to come to mandated courses within two weeks of giving birth for fear of losing benefits. Is this how the Government treat women?
(9 years, 8 months ago)
Commons ChamberI will try to respond to the points raised in the debate but I will also endeavour to observe your strictures, Madam Deputy Speaker, to keep my remarks relatively brief so that the House also has time for the second important debate today. I will do my best to balance the two competing tensions.
First, I will respond to the point made by the Committee Chairman, the hon. Member for Aberdeen South (Dame Anne Begg), about the lack of a response. The Government have the greatest respect for the parliamentary process and engage with the Select Committee. She will know that, with the exception of this report, no response by my Department has taken longer than six months, but I fear that there is a very simple and straightforward answer as to the reason for the delay and I am afraid it will not mean an early response. The Committee report spends quite a bit of time talking about the removal of the spare room subsidy—as we have done today—and the Government response responds to the various points made. As the hon. Lady will know, we have a coalition Government—something I hope will not be necessary after the election—and that, despite our coalition partners having agreed on this policy all the way through the Parliament, they now towards the end of it do not agree. Unfortunately therefore, despite the fact that the response is broadly ready to go, we have not been able to secure agreement across the Government. I am afraid harmony has not broken out and, until it does, the Government will not be able to respond to the Committee. I am probably just as disappointed about that as the hon. Member for Erith and Thamesmead (Teresa Pearce).
While I can appreciate there may be problems on the bedroom tax, would it be possible for the Government to publish a partial response to our proposals, addressing all the other points on which there presumably is agreement across Government? Our Committee had a lot of very interesting things to say on a whole range of other issues.
That is an interesting point. Let me take it away and see whether it is possible to do that in the time remaining. I have explained the reason for the lack of response to the Committee and, as I have said, it is the only report from the Select Committee that the Department has not responded to within six months. I am sorry about that, but the blame does not lie with the Conservatives in the Government; it lies elsewhere. [Laughter.] I am just being honest here at the Dispatch Box.
I think the Minister accepts that the Liberal Democrats believe there should be automatic exemptions for some of the people currently receiving discretionary housing payment, and does he not accept that if we automatically exempt people who are currently getting DHP the net effect on the public purse is zero?
No, I do not, and I just remind the hon. Gentleman that the Liberal Democrats agreed to this policy and it remains the Government policy. I am sorry they have not stuck to it because I think it is a very sound policy. Let me set out why.
I was not going to spend a lot of time on this because the Committee did not, but I am afraid that the hon. Member for Bishop Auckland (Helen Goodman) made a lot of rather ridiculous assertions about welfare spending and I must take her to task on them. Being accused by the Labour party of wasting money on welfare is extraordinarily rich. The last Government increased spending on the welfare budget by 60%, costing every household an extra £3,000. The increase in welfare spending over this Parliament is going to be the lowest since the creation of the welfare state, and we will have made cumulative welfare reform savings of nearly £50,000 million over this Parliament, benefiting people across the country. In-work spending is stable and forecast to fall next year, even with employment at a record high. The out-of-work benefit bill is back to pre-recession levels, at 2.2% of GDP, and real spending on housing benefit fell between 2012-13 and 2013-14, for the first time in a decade. The overall case load has fallen, and housing benefit reforms have saved more than £6 billion during this Parliament, compared with what would have happened if we had continued with the policies of the Labour party. So I am afraid that the hon. Lady needs to go back and look at the record. If she does so, she will see which party has wasted money on welfare—and it is not the party of which I am a member. She needs to look in the mirror before she makes those kinds of silly accusations.
I should like to draw the Minister’s attention to the numbers provided by the Office for Budget Responsibility, which show total welfare spending in 2012-13 of £213 billion, and in 2015-16 of £219 billion. All the numbers that I quoted to the Minister were OBR numbers.
I am not resiling from the numbers. Welfare spending has gone up over this Parliament, but it has done so at the lowest rate since the creation of the welfare state. The reforms that we have made to various welfare policies will have saved £50 billion over this Parliament compared with what would have happened if we had not made those reforms, and I think that that is sensible.
We have dealt with some of the issues that we inherited from the Labour party, and our changes are largely supported by the public. One such change is the benefit cap, and public support for that is very clear. The Opposition are not so enthusiastic about it, but 73% of the public support it and 77% of them agree that it is fair that no out-of-work household should get more than the average working household. In terms of fairness, that seems a pretty unremarkable policy, and it is one that we support even if the Labour party is unenthusiastic about it.
Our reforms to housing benefit, including the removal of the spare room subsidy, are dealing with some of the issues relating to using the housing stock more efficiently and dealing with overcrowding. My hon. Friend the Member for Birmingham, Yardley (John Hemming) drew our attention to overcrowding, and to the fact that not all local authorities are good at dealing with situations in which smaller families want to move to a smaller property while other properties are overcrowded. He made a sensible point.
I tried to intervene on the hon. Member for Bishop Auckland (Helen Goodman) to ask her whether Labour would reduce under-occupation by adopting a policy that involved evicting people living in under-occupied accommodation. Does the Minister accept that if we do not remove the spare room subsidy, the only alternative open to Labour if it wanted to reduce under-occupation would be to go round evicting people from under-occupied properties, which does happen in certain tenancies?
The Opposition clearly do not have a sensible policy. I will comment on this briefly, because I want to move on to address some of the points made by the Chairman of the Committee and others. Labour’s policy to remove the removal of the spare room subsidy would cost about £0.5 billion a year. The Opposition have set out three ways in which they would pay for that, and when we had an Opposition day debate in December, I went through them in some detail to demonstrate that they simply would not work. They say that their proposal to ensure that the building trade paid its fair share of tax would raise £380 million, but we have already dealt with those changes in the 2013 autumn statement, so that policy would raise no money. Their proposed change to the stamp duty reserve tax, which they characterise as a tax cut for hedge funds, would actually fall on pension funds and retail investors—in other words, on people who are saving for their retirement. Their third proposal is to end the employee shareholder scheme, but that would save no money in 2015-16.
The shadow Secretary of State, the hon. Member for Leeds West (Rachel Reeves), has said that the first thing she will do when she walks into the Department for Work and Pensions as Secretary of State will be to change our policy on the removal of the spare room subsidy. If she did so, however, she would have to find £0.5 billion to pay for it and at the moment she has not set out how she is going to do that. The first thing her officials are going to say to her is, “Secretary of State, where are you going to find half a billion pounds?” Labour is unable to answer that question at the moment.
Hon. Members also referred to universal credit, with my hon. Friend the Member for Daventry (Chris Heaton-Harris), an experienced member of the Public Accounts Committee, being very supportive of that. He asked me a specific question, picking up on a point made by the Select Committee Chair; this was about rent arrears, with reference being made to a specific set of pilots. My understanding is that the difference was that for direct payments, where the money was being paid to the landlord directly, 99.1% of rent owed was paid, but the figure fell to 95.5% where people were managing the payments themselves. Over time, however, the impact of direct payments lessened significantly; half the arrears occurred in the first month, and by the 18th payment the figure for tenants who were being given the money and making those rent payments had risen to 99%, which is more or less the same as for direct payments to landlords.
That is important, because a key point of universal credit is about putting households on out-of-work universal credit in the same position as they will be in when they are in work: taking responsibility for paying the rent themselves. I listened carefully to what the hon. Lady said, because she made the comparison with the position in the private sector, where that is already the case, and then referred to the fact that in the social rented sector it was a change. It is a change, but the vast majority of the people who rent properties in the social rented sector are perfectly capable of managing their money, being given responsibility for it and paying their rent, just like everybody else. Some people will need some budgeting support and some support to move from the position they are in now to taking that responsibility, and that support is going to be delivered through our universal credit support delivered locally. A small minority of claimants may be unable to do that, and we have put in place alternative payment arrangements for them. That approach has been developed as we have rolled out universal credit carefully without our “test and learn” approach. She will know that we have also put regulations in place to enable us to share with social housing landlords the fact that someone is in receipt of, or has made a claim for, universal credit, so that they are able to put in place the appropriate support for vulnerable tenants.
A number of Members also referred, in the context of the removal of the spare room subsidy, to the amount of discretionary housing payment. That is one area where we are able to deal with some of the specific issues, for example, on significantly adapted accommodation. A specific amount of the discretionary housing payment, about £25 million, is for local authorities to enable people to stay in adapted accommodation. Of course, where properties have been specifically adapted for tenants with mobility needs, it does not make sense to insist that they move. That is exactly why we have made the money available to enable councils to deal with that, and I trust local authorities to make those sensible decisions. They have the facts at their disposal, will know the circumstances of people locally, will know the facts about the disabled adaptation grant that has been paid and are in the best position to make those decisions locally. I believe in localism and in trusting local authorities to make the decisions. Sometimes they might make decisions that people will characterise as wrong, but I am prepared to trust them to make sensible decisions.
On the availability of properties, it is also worth saying that in the social rented sector there are 1.4 million one-bedroom properties, with more than 130,000 new lets a year. So there is a significant amount of turnover; about 10% of the one-bedroom properties turn over each year. So if social landlords are properly managing and prioritising their housing stock, that should enable them, over a period, to enable people to move into smaller properties. Some 60% of social sector tenants are either single people or childless couples and require only one bedroom. Landlords are starting to respond to that, and we are seeing local authorities and housing associations now properly designing their housing stock to meet the demographic need of their potential tenants.
On a point of clarification, were those overall numbers that the Minister was quoting to the House inclusive of old age pensioners or not?
I know that the Minister is very busy in his Department and in the Forest of Dean, but I was wondering whether he would join me on Friday when I will be cutting the ribbon on some new properties built by Newark and Sherwood Homes in the village of Bilsthorpe. If he were able to come, I would be more than happy to let him take the scissors off me. If not, perhaps he could praise Newark and Sherwood Homes for the work it is doing in developing new homes in Sherwood and Newark.
I will have to stick to praising Newark and Sherwood Homes, and to allow my hon. Friend to retain control of the scissors, which he is more than capable of doing, so that he can open that new development on Friday. I am afraid that, at this point in the parliamentary cycle, one’s diary is quite full.
If we look at the affordable homes programme, 77% of approved homes are one and two-bedroom properties, which is up from 68% in the last round. New house building is now following that approach.
Finally, let me turn to the point about local housing allowance raised by the hon. Member for Erith and Thamesmead and others. The allowance was intended to exert a downward pressure on rents. That means not necessarily that rents will go down but that the pressure on rents will be less than it otherwise would have been. In other words, it might mean that rents do not rise as much as they would otherwise have done. The hon. Lady specifically asked about parts of the country where the pressure is higher. As she said, there is something called targeted affordability funding, which means that where rents are significantly diverging from benefit rates, we have increased LHA rates by up to 4%, which is, I think, the right approach.
I will conclude now as I am conscious of the time. I have set out for the Chair of the Committee the reasons why we have not responded to the report, and I have addressed a number of concerns, which was a challenge given the amount of time that I had. Our policies are working. They have driven the lowest rise in the welfare bill since the creation of the welfare state, and they are also helping to get people back into work, which is why we are seeing a record number of men and women across the country in work, and that demonstrates the success of our long-term economic plan.
Question deferred (Standing Order No. 54).
Department of Health
(9 years, 9 months ago)
Written StatementsLater today, I will publish Command Paper Cm 9014, the Government’s response to the fifth independent review of the work capability assessment. This is the fifth and final annual independent review, as required by the Welfare Reform Act 2007.
I would like to thank Dr Paul Litchfield for carrying out the review, and I welcome his findings.
Dr Litchfield looked at the changes that have been made to the WCA in response to the first four reviews and although he has recommended further minor improvements he also acknowledged that the WCA needs a period of stability. His recommendations relate to a range of issues including:
An increase in the number of people being placed in the support group, especially younger people;
the need to ensure that communications are as good as they can be, especially for more vulnerable claimants;
better support for claimants with learning disabilities.
The Government have accepted all but two of the 28 recommendations that fall within the scope of the Department for Work and Pensions. The recommendation on a specific allocation of mandatory reconsideration casework cannot be accepted as it would restrict the Department’s operational flexibility. The Department is exploring the impact of a geographical telephone number further and cannot accept this recommendation fully at this point. The 26 recommendations accepted include proposals to improve the mandatory reconsideration process, exploring the sharing of information between assessments and with other Government Departments, and working with the new assessment provider to improve online communications.
I strongly support the principle of the work capability assessment and am committed to continuously improving the assessment process to ensure it is as fair and as accurate as possible. Dr Litchfield's recommendations build on improvements already made to the assessment to achieve this aim.
[HCWS320]
(9 years, 9 months ago)
Written StatementsLater today, I will publish Command Paper Cm 9015, the Government’s response to the first independent review of the personal independence payment (PIP) assessment. The review was carried out by Paul Gray and published in December 2014. Paul is also chair of the Social Security Advisory Committee.
The Department for Work and Pensions has already made significant improvements to the PIP process, particularly in relation to waiting times. This response is therefore an important step in making further improvements to ensure the PIP process works as well as it can for all claimants. It will be the first of two, and focuses on the short-term recommendations made in the review. It sets out the action the Department will take, together with the assessment providers, to continue to deliver positive changes to support PIP claimants through the assessment process.
The Department accepts all the short-term recommendations in full except the recommendation to configure assessment rooms in a specific way. We believe we are able to deliver the principle of an open, engaging consultation without being prescriptive about seating arrangements, and will work with the assessment providers to deliver that.
The broad scope of some of the medium and longer-term recommendations, such as those which will require the commitment of other organisations and cross-government agreement, will require further consideration, particularly in light of the recent recommendation by the Smith commission to devolve disability benefits in Scotland. Having done further work to fully understand the wider implications of those recommendations, the Department intends to provide a subsequent response addressing them in due course.
[HCWS321]
(9 years, 9 months ago)
Commons ChamberI thank the Backbench Business Committee for approving this debate and my right hon. Friend the Member for Sutton and Cheam (Paul Burstow), my hon. Friend the Member for Broxbourne (Mr Walker) and the hon. Member for North Durham (Mr Jones)—but like my hon. Friend the Member for Broxbourne I will call him my hon. Friend for the purpose of this debate—for securing it.
I am afraid, Madam Deputy Speaker, that I will try your patience by congratulating my hon. Friend the Member for Broxbourne on his OBE, which he collected this morning. I can see from your furrowed brow that you were not aware of that, but you are now. He has been congratulated rather a lot today, but I felt that it would have been remiss of me not to do so from the Dispatch Box.
Order. One can never be congratulated too much, and it is right that the hon. Gentleman’s contribution should be acknowledged.
I am grateful, Madam Deputy Speaker, that you were also able to join in the congratulations to my hon. Friend and embarrass him still further.
It has been a very good debate. It is an important matter for our constituents because mental health conditions are very common, with one in six people being affected at some time in their life. That statistic has been mentioned a few times, including by my hon. Friend the Member for Windsor (Adam Afriyie) who put on record his contribution on the subject early in his parliamentary career. All Members made the clear link between mental health—whether good or bad—and someone’s employment position. Many Members also highlighted the fact that labour market outcomes are poorer for people with mental health conditions than for the population as a whole and those with health conditions in general. As my right hon. Friend the Member for Sutton and Cheam and others said, the vast majority of people with mental health conditions want to work.
I listened carefully to the statistics that my right hon. Friend quoted about people with severe mental health problems. In the spirit of trying to cheer him up a little, noting that he referred to some positive data from the Time to Change campaign about the changing views of employers on mental health, let me reassure him that although I am not in any way complacent, as the gap between those with a mental health problem working and those generally working is significant and far too wide, there was at least some improvement between the last quarter of 2013 and the last quarter of 2014, when the employment rate for those with a variety of common mental illnesses went up by 2.6%, with a further 70,000 people in employment. That is obviously positive and a step in the right direction. I will not overclaim for it, as it is just a step, but perhaps it shows that the good work of the organisations involved with the Time to Change campaign means that employers are open both to keeping people who develop a mental health problem in work and to employing people with mental health problems. We might be seeing the start of improvement in those employment figures, but I do not want to claim more than that.
We are doing a lot, but clearly there is also more to do. I want to pick up on a couple of points mentioned by the shadow Minister, the hon. Member for Stretford and Urmston (Kate Green). I absolutely agree with her comment early on in her remarks referring to employers who say that they would not employ someone with a mental health problem. She was absolutely right that if they employ a reasonable number of employees they almost certainly do, although they might not know that they do. Perhaps the employee does not know that they have a mental health problem either.
The statistics suggest that anyone who employs more than six people is likely to have at least one member of staff with a mental health problem. Perhaps they ought to look around their workplace, think about the people they employ who have a mental health problem and think about how well they support that person, not out of any sense of altruism, although it is of course the right thing to do, but, as the hon. Member for North Durham said, because it is the right thing to do for the business. The person will be more productive, will stay working for that business for longer and will be beneficial. That was a point well made.
Looking at the cast of characters in the Chamber, I recall clearly that three years ago my hon. Friend the Member for Broxbourne, the hon. Member for North Durham and my right hon. Friend the Member for Sutton and Cheam, who was then the Health Minister, participated in a debate in which my hon. Friend and the hon. Gentleman spoke about their own personal experiences. They were both nervous during the debate about how their comments would be taken outside this place. I followed it quite closely, and it was heartening to see that their remarks were taken positively, not just by the organisations that one would expect—those that are familiar with these issues—but more widely and, interestingly, among members of the public. They kicked off an interesting process and since then a number of other right hon. and hon. Members have talked about their own experiences both inside and outside the House. It is right that more Members are encouraged to do that.
The hon. Member for North Durham put it very well when he said that the more we talk about these issues, the more we are open about them, the more the House debates about them and the more we talk about mental health issues in the same matter- of-fact way—I mean that in the most positive sense—as we do about physical health issues, without making a huge drama about them, the more employees and employers will be encouraged to have those sensible conversations in the workplace.
Members spoke about a number of support mechanisms. My hon. Friend the Member for Halesowen and Rowley Regis (James Morris) mentioned the improving access to psychological therapies programme and the shadow Minister referred to the various talking therapies that are available. Those programmes have a proven record of delivering and were started by the Labour party when it was in government. They have been continued by us and expanded. By next month, they will have been expanded so that 15% of people who could benefit will have access, covering about 900,000 people a year. Next year, we will introduce for the first time access standards and waiting time standards in mental health services, and an £80 million investment will ensure that 75% of people will receive the IAPT treatment within six weeks, and more than 50% of people who are experiencing their first episode of psychosis will receive a treatment within two weeks. There is more to do, but I think that that is significant progress.
The hon. Member for North Durham talked about the work capability assessment and the performance of Atos in delivering that. With just a teeny bit of partisanship, I will remind him that it was his party’s Government who introduced the work capability assessment and appointed Atos as the contractor. We inherited that arrangement and spent quite a long time putting it right. I detected in what he said that he is not the biggest fan of Atos, so he will be pleased to know that it is exiting the contract to deliver that service in Great Britain. In fact, Maximus takes over next week, and ahead of that, in the next few days, Members will receive a communication from that company. The hon. Gentleman will be pleased to learn that one of the areas that Maximus takes very seriously and has itself highlighted, and where it is keen to improve WCA performance, is mental health. I hope that he will engage with Maximus, using his local expertise and his personal experience, to help to improve that performance.
I am glad to see the back of Atos, but the fact is that for the past God knows how many years, the key issue raised has been the people doing the assessments. I have no problem with people with mental illness going through an assessment, but people with no mental health experience whatsoever have been responsible for concluding whether those individuals are fit for work. I just hope that the new provider employs people with mental health backgrounds to do those assessments, because that would be a huge step forward. It would be better for the Government and, more important, better for the individuals affected.
The hon. Gentleman makes a perfectly good point. One of the things that Maximus plans to do is to increase the number of people it employs who are mental health specialists. I think it was the hon. Member for Huddersfield (Mr Sheerman), who is no longer in his place, who said that the people who undertake work capability assessments are not qualified, but that of course is not correct: they are all properly accredited health care professionals, although it is true that not all are mental health care professionals. Among other things, Maximus proposes to increase the number of mental health specialists it has, as well as the number of health care professionals with knowledge of specific health conditions, including but not only mental health conditions; and to ensure that it has across its organisation mental function champions to discuss mental health cases with other health care professionals, to bring that expertise to bear.
That is a welcome move, but may I make a little suggestion? If Maximus is going to employ people with mental health backgrounds to conduct assessments, will the Minister ensure that anyone going for an assessment who has a clear mental health condition—it is why they are on employment and support allowance, for example—is assessed only by someone who has that expertise? That will save a lot of time and money for Government and will help the individual.
It may not be that clear. Often, people going for an assessment do not have just a single health condition. It is important to remember that the assessment is not a medical diagnosis; it is about the impact of somebody’s health condition or disability on their ability to work. The assessor is not carrying out a diagnosis of a mental health problem; the assessment is about the impact of the condition on an individual’s ability to work.
The hon. Gentleman should look at the communication he gets from Maximus. I am sure that the company will be delighted—I mean that genuinely—to hear from him about his constituents’ experience, because it is genuinely committed to improving the performance of the work capability assessment. Of course, Maximus has experience in delivering health care assessments through other contracts around the world. The signs are positive for how the company will engage with the contract.
My hon. Friend makes an important point about individuals not having a single health condition, whether that is mental or physical. One of the challenges is the assessment of someone who has a fluctuating mental health condition, which might require a special form of assessment.
My hon. Friend makes a good point about fluctuating conditions in the context of assessments. One change in the work capability assessment has been a recognition that fluctuating conditions, including in the mental health space, must be taken into account. Claimants should be asked questions not just about their experience on that day, but about what a typical day looks like and the extent to which their condition fluctuates.
A number of Members, including the right hon. Member for Sutton and Cheam who opened the debate, referred to how my Department and the Department of Health are working together on improving people’s employment and health prospects. He referred to the pilots that we are undertaking. There are four broad pilots, one looking at the individual placement and support model, one looking at whether peer-led group work employment intervention can improve outcomes, another investigating whether a telephone support model is effective, and an online service pilot, which was one of the recommendations from the RAND study that he mentioned. Those pilots, as he knows, have started and are moving into the next phase, which involves a larger set of pilots.
One thing that we are keen to do, which is frustrating because it means that pilots take longer, is to get robust evidence bases for those pilots. As the shadow Minister said, if one wants to roll them out on a significant scale, with my Department and the Department of Health working together, and a substantial amount of money is to be invested, a good evidence base is needed to be clear about what the outcomes will be. It is important that there are sufficient numbers of individuals going through those pilots for a robust evidence base to be developed, rather than lots of qualitative data and anecdotal evidence suggesting that they were successful.
I agree that we need a robust evidence base on which the roll-out takes place, but individual placement and support has already been the subject of randomised controlled trials. There is a very good evidence base that should be used to roll it out.
The right hon. Gentleman is right about that. That is why the access to psychological therapies work is already under way and, as I said, is being rolled out further. One of the issues is how well the pilots can be scaled, given that some pilots require skilled mental health professionals, of whom there are a limited number—by which I do not mean a small number, but finite capacity—looking at models which enable us to scale the pilots up more quickly. We want to make sure that we have a good evidence base for pilots that look promising.
The hon. Member for Strangford (Jim Shannon) referred to some very specific experiences in Northern Ireland. It is worth putting on the record—he knows this because we have had this conversation before—that quite a lot of welfare and health services are devolved to the Northern Ireland Executive. It is right for him to raise his constituency experience here in the House, but the delivery of those services is not under my control or that of my colleagues in the Department of Health. Those services are under the control of the Northern Ireland Executive. I will be meeting the Minister in due course as we are keen for our experiences to inform how the Northern Ireland Executive rolls out those services, and vice versa. If we can learn from each other, we are happy to do so.
We understand that that is the situation. In my contribution I referred to the Prince’s Trust and some of its good work with vulnerable young people, which the shadow Minister also referred to. Is there any intention to roll out such work on the UK mainland to give vulnerable young people the help that they need at the coalface of their lives?
I do not have a specific answer that I can give the hon. Gentleman immediately, but I will take that point away and look at it further. I listened carefully when he was setting it out for the House and there were some positive aspects to that approach.
About a third of NHS mental health trusts in England are using individual placement and support. The Department of Health is grant funding the Centre for Mental Health to extend IPS further, and my Department and the Department of Health are working with the Centre for Mental Health to try IPS with schizophrenia. From his expression, my right hon. Friend the Member for Sutton and Cheam appears to be familiar with that programme. One of the aims is to encourage at a local level my Department and Jobcentre Plus to work closely with the health service, and there are examples of such close working.
The fit for work service was referred to by several Members, including my hon. Friend the Member for Broxbourne, who said that the longer people were out of work, the less chance there was of return. The fit for work service, to which the shadow Minister also referred, which is obviously at a relatively early stage, is about helping employers and employees manage the sickness absence programme.
I was tempted to advertise another service that we offer earlier, but I resisted. When my right hon. Friend the Member for Sutton and Cheam opened his speech with the story of Anne-Marie, I thought that it was a good example of where she and her employer would have benefited from the mental health support service, which is part of Access to Work, which is clearly not as well known as it ought to be. As he said, it has a job retention rate of around 92%. It assesses an individual’s need to identify strategies that they can use to cope with their mental health problem, looks at a personalised support plan, either for returning to or remaining in work, and gives employers advice. That is important, particularly for small employers that do not have the capacity to have occupational health support in place.
As it happens, tomorrow I will be speaking at a disability confident mental health focus event, which is being supported by Mind, Remploy and the Business Disability Forum, and hosted by Royal Mail, specifically to raise awareness about the mental health support service. A significant number of employers are coming, and I have named several employers, including Royal Mail, who are committed to this.
Leadership has been referred to, and I attended an event with a KPMG senior partner—I hope it is in order to mention the company given that I used to work for it, although it was a long time ago—who has been open about his own mental health problem. It was heartening that he referred to the fact that the senior management of that organisation had created an environment in the business where, as a senior member of the management team, he felt comfortable with being open about his mental health problem. I know from talking to other members of staff that the fact that he has been able to do that and has been well supported by that employer has had a powerful effect on encouraging others in that environment to be open about their mental health problems. So there are other employers who recognise that. The right hon. Member for Hazel Grove (Sir Andrew Stunell) is not in his place, but he referred to a Disability Confident event that he has run. My right hon. Friend the Member for Sutton and Cheam is also interested in this area, and I hosted a Disability Confident event in my own constituency a couple of weeks ago. I have written to all right hon. and hon. Members to encourage them to do the same in their constituencies, partly to engage with those small and medium-sized employers that might otherwise be unfamiliar with the campaign.
My right hon. Friend the Member for Sutton and Cheam wrote an article for PoliticsHome today entitled, “I don’t like Mondays—how work can affect mental health”. My only criticism of the piece is that he urged UK plc to take action. I know what he meant, but it is worth remembering that we are also talking about UK Ltd, because half the work force is employed by small and medium-sized enterprises, and they do not always have the human resources support or access to services that larger businesses have.
My hon. Friend the Member for Broxbourne referred to BT. The head of occupational health and well-being there, Dr Paul Litchfield, has produced two independent reports for the Government. I waited until he had concluded that work, and therefore had only one hat on, before visiting BT, where I had a very positive experience. The hon. Member for North Durham spoke very positively about its programme. He is right that BT puts a lot of effort into supporting employees with mental health problems, and not only because it is the right thing to do, but because it is absolutely in its business interest. It has a very high staff retention rate. It keeps almost everybody who develops a mental health problem at work, and the vast majority in their existing roles, although sometimes they have to change role. I heard four individuals give powerful testimonials about the support they had received from the company. I thought that it was incredibly positive that they felt so open in discussing some quite difficult issues they had had in front of their management chain. They clearly work in a very positive environment.
I will mention universal credit before drawing my remarks to a conclusion, because the hon. Member for Stretford and Urmston would think it remiss of me not to do so. I do not pretend that universal credit solves every problem on the planet, but I think that there are two areas where it is very positive for mental health. The first is the way that it has been set up, because it is about getting work coaches to engage with people earlier, looking at what support they need. If someone falls out of work and approaches the jobcentre—I think this is the thrust of the point made by the hon. Member for North Durham—we want the support to be delivered earlier in the process, rather than later. Universal credit has been set up in such a way that it is about having that conversation, looking at what someone can do and delivering support earlier, which I think will help. It is not the only solution, but I think that it will make things better.
I agree with the Minister, but will he also address the point I made about companies being paid by the Government to support individuals into work, even though that work is actually being done by the voluntary and community sector? If those companies are claiming to have helped those people and are getting paid for it, even though the work was actually done by the voluntary and community sector, that is a very serious issue.
The hon. Gentleman anticipates my remarks, because I had not yet got to that point. There are two points that arise from what he said, and he was supported in that by the shadow Minister. The first relates to the ability of smaller private sector companies and the voluntary sector to be subcontractors to prime providers, and we will consider how to make that easier as we look to develop what follows the Work programme. The second point—the central one—is about ensuring that Work programme providers are paid only when they have done the work. He raised a specific concern about a third sector organisation in his constituency. If he can give me a little more detail, I will look into it. If a Work programme provider has done nothing at all, it should not pretend that it has done so in order to claim a payment. Either it should not be paid, or it should effectively be subcontracting with the smaller provider. If the smaller provider is very successful, clearly we would want it in the programme, working with the prime provider. If he gives me some more details, I will absolutely task officials with looking into it. It is not very sensible for the taxpayer to be paying someone for work they have not done. Moreover, we should be making sure that the money goes to support those who are successful at getting people back into work so that they can improve their organisations and become more successful and sustainable.
Will the Minister also comment on, or ask his officials to look into, the report I received from the individual placements and support service in south Manchester that Work programme providers were being rewarded for work that was being carried out and funded by the NHS? It sounded as though the public purse was paying twice and the Work programme provider was getting a reward for very little, if any, activity.
Yes. I listened carefully to what the hon. Lady said, and I will look into that specific example as well.
My right hon. Friend the Member for Sutton and Cheam referred to the Work programme. It is true that in its earlier phase the success rates for those on ESA as opposed to JSA were not very impressive—one in 24, I think. However, more recent cohorts have been more successful, and about one in 10 people have been getting into sustainable work. Obviously we want that performance to continue.
It is very apposite, Mr Speaker, that you are in the Chair as I draw my remarks to a close, because I know—I do not think it is a secret—that you take a close personal interest in this area. I remember when you allowed a discussion on mental health to run for a fairly reasonable length of time in the last session of DWP questions. You feel that it is a very important area. You referred to the changes we had made in law to reduce the stigma for the many Members of Parliament who might have a mental health problem. Earlier I referred to the hon. Member for North Durham and my hon. Friend the Member for Broxbourne, who spoke very openly in the House about their experiences.
The Government take this issue very seriously. There is a lot of working across Departments, not just with my Department and the Department of Health, but with the Home Office, where, as Members will be aware, the Home Secretary has been pressing a great deal to make sure that police cells are not seen as places of safety for those who develop a critical mental health problem. Work is being done by other Ministers across Government. We are moving in the right direction, but we are not complacent. Although some progress is being seen in the unemployment figures, there is still a considerable gap, and there is more work to do. I think there is a shared sense of purpose across the House about the direction of travel, and I want us to continue to move in that direction through to the general election and beyond.
(9 years, 9 months ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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It is a great pleasure to serve under your chairmanship, Mr Owen. I congratulate the hon. Member for Liverpool, Walton (Steve Rotheram) on securing this debate. He takes a close interest in asbestos-related issues. A little while ago, we both took part in an Adjournment debate on other issues related to asbestos and safety.
I start by echoing the hon. Gentleman’s sentiments towards the late Paul Goggins. I remember very clearly the debate in the House on the Mesothelioma Act 2014 shortly after his sad death. I also echo the hon. Gentleman’s generous comments about my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), who picked up the baton on that occasion, although I do not echo his comments about football. Coming from Gloucestershire, which is a rugby-playing part of the world, I should probably leave the football dispute to other people. [Interruption.] It is probably not good for me to talk about rugby in your presence, Mr Owen, so we will move on.
This has been a very good debate, and it has been helpful in the context of yesterday’s written statement. I will answer some of the questions that colleagues have raised. Following some of the contributions, including from the shadow Minister, it is worth briefly placing on record that the scheme that was legislated for last year, the Diffuse Mesothelioma Payment Scheme, is of course not the only scheme in statute to address such difficult issues. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979 set up the first scheme. That had significant gaps in it, which is why the previous Government, with the support of the then Conservative Opposition, introduced the 2008 scheme in the Child Maintenance and Other Payments Act 2008, which deals with those who did not necessarily work in the industry, but were self-employed, or, in some cases, family members of those who worked in the industry. This scheme comes in the wake of that to deal with some of the issues that those schemes did not deal with.
It is worth putting on the record the scope of the schemes. Although the hon. Member for Strangford (Jim Shannon) mentioned them, the 1979 scheme and the 2008 scheme are both Great Britain schemes, so they do not apply to Northern Ireland. The responsibility for welfare policy lies with the Northern Ireland Executive. The 2014 scheme, which we are discussing today, is a UK-wide scheme and applies in Northern Ireland as well as England, Scotland and Wales.
To pick up the point raised by the hon. Member for Strangford, people in Northern Ireland have three years to apply for the scheme from the point of diagnosis, which is the same as in England, Scotland and Wales, so I do not think there is a difference in the way the scheme operates. However, he is right to point out that the previous two schemes do not apply in Northern Ireland.
I thank the Minister for giving way; he knows I have to leave fairly shortly and I wanted to intervene in advance of that. After the announcement has been made, when does the Minister hope to have direct contact with the Minister responsible in the Northern Ireland Assembly so that we can co-ordinate the delivery of the compensation plan for the whole of the United Kingdom—Great Britain and Northern Ireland?
I referred to the hon. Gentleman’s point first because I know that he has other pressing business on behalf of his constituents, and he had the courtesy to let me know, so I wanted to deal with his point while he was still in the Chamber. As he knows, I plan to meet the Northern Ireland Minister with responsibility for welfare to discuss other matters to do with welfare in the wake of the Stormont House agreement. I will ask my officials to place this issue on the agenda and we can have a conversation about that to make sure it is clear how it will be implemented in Northern Ireland.
One point flowed through the remarks of the hon. Members for Liverpool, Walton and for Stretford and Urmston (Kate Green) and my hon. Friend the Member for Chatham and Aylesford. I will set out my understanding of the position, which is clear. There was a lot of discussion about the levy on the industry. The scheme is effectively demand-led: people make applications to it and the costs of the scheme are then recovered through a levy on the industry. The 3% that has been talked about is a cap. The insurance industry agreed that if the cost remained below that level, it would absorb the cost of the scheme and would not pass it on to other employers who take out employers’ liability insurance through increased premiums. That was important. The Government did not want the cost of the scheme to fall on employers across Britain: we wanted it to be absorbed by the insurance industry.
So the 3% is a cap, not a target. The costs of the scheme are calculated and then the levy is calculated to recover the costs of the scheme. The hon. Members for Liverpool, Walton, for Strangford and for Stretford and Urmston referred to Lord Freud’s written statement on 28 November last year. He set out the costs of the scheme in the first period of the year, how much that encompassed and how much would therefore be recovered from the insurance industry. That position is clear. [Interruption.] Let me finish this thought and then I will take a question.
Hon. Members seem to have envisaged, although it was not envisaged by the Government, that there would be a 3% levy, some of the money from which would be used for settling claims and the rest would form a pot of money that could be distributed as Ministers or others saw fit. However, it is a cap on the costs that land on the industry. The industry agreed that if that remained the cap, it would absorb the costs of the scheme and not pass them on to employers more generally.
Unlike me, the Minister did not sit through all the Bill’s Committee sittings when we were passing the legislation. It really was not our understanding, when his predecessor said that 3% is 3% and not going anywhere, that that meant it was a cap. We took it as a figure that would be reached, and it was also what was understood by the victim support groups.
I take the hon. Lady’s point that I was not the Minister at the time and was not present at those sittings. She asked me a written question following the written statement in November, and I made it clear in my answer that the 3% figure was the maximum percentage of the active employers’ liability insurance market to be levied on the insurance industry to recoup the costs of the scheme. I made it clear that the figure was a cap, rather than a set rate, and that the levy rate was based on the estimated costs of the scheme, extrapolated from the first seven months of the operation. The scheme is demand-led and calculations for the levy are done afresh each year. An upturn in applications to the scheme would result in a higher levy rate in future years, so the levy rate is kept under continual active review.
The Minister has used the words “levy” and “cap” interchangeably on numerous occasions, which is confusing. During the passage of the Bill, it was clear that we talked about a levy. The right hon. Member for Hemel Hempstead (Mike Penning) was the Minister at the time, and he talked about a levy. When is a levy a cap?
No, I do not think we are at cross purposes at all. It is a levy, but it is capped at 3%. The amount of the levy is set, based on the costs of the scheme. The costs are calculated and then the levy rate is calculated to recover the costs, and it was agreed that the cap would be 3%. That is the position that I made clear in my answer to the written question from the hon. Member for Stretford and Urmston. It is a levy that is capped at 3%. The deal was that the insurance industry would absorb the costs of the scheme and not pass them on to employers through employers’ liability premiums if they remained below 3%, which is why the 3% cap was set.
The Minister is trying valiantly to justify what he has picked up. It is not what was intended for the scheme and it is not what was said during the passage of the Bill. I understand that the cap is a maximum, but it was calculated according to what the industry said it could afford. The industry said 3% of this huge figure—about £1.4 billion or £1.5 billion—was the levy it would draw down. That was the amount that the industry thought would be needed for claimants, and that is why we get the figure of 80%, by the way. It was 80% because the industry thought it would be swallowed up by the 3% levy. I am sorry, but the Minister cannot have it both ways.
The commitment that the industry made was not in terms of what it could afford. It was about what the industry was going to absorb and not pass on to employers more generally. It was important that the costs of compensating sufferers of the disease did not fall on employers generally. We wanted the costs to fall on the insurance industry. It is worth reminding people that the insurance companies that pay the levy today are not necessarily the insurance companies that took the premiums for the policies in the first place. That is part of the problem, because of the long latency of the disease.
Governments have created all the schemes—the 1979 scheme, the 2008 scheme and this one—because of the long period between when someone has exposure to asbestos and the diagnosis of the disease. The impact of the disease over a very long period of time led to all the issues with employers not being in business—that generated the 1979 scheme—and the inability to trace either employers or their insurers. All such issues relate to that long period of time, which is why it is important that the costs are borne by the insurance industry, although they are not necessarily the same companies that took the premiums in the first place. That is why it was important for the Government to work on this in an agreed and proportionate way, so that we could get the scheme in place to ensure the benefits go to the victims of the disease. If the matter had got bogged down in a big argument and legal disputes, there would not be a scheme and there would not be any compensation for people. Both Lord Freud and my predecessor as Minister wanted to make sure that the scheme came into force, so that it could start benefiting victims of this disease.
Let me respond to a couple of questions that the hon. Member for Liverpool, Walton specifically put about the written ministerial statement yesterday, which I think was generally welcomed by colleagues, including my hon. Friend the Member for Chatham and Aylesford. Lord Freud made it clear at the beginning of that statement that we are going to monitor the progress of the scheme and the extent to which the assumptions about claim rates are borne out.
During the first months of the scheme, the number of claims is much lower than at other times. However, partly because the Employers’ Liability Tracing Office has been doing an increasingly good job of tracing insurance policies—meaning that sufferers of this disease can more easily, and rightly, pursue compensation from those from whom compensation is due—the costs of the scheme are lower than had been thought. Therefore, we thought it was right to increase the tariff from 80% of average civil claims to 100% from the date of the announcement. The regulations to bring the scheme into effect will become law next month, but as is usual in government the uprating will apply from the date of the announcement, in the same way that the scheme in the first place applies from the date it was announced, which was 25 July 2012.
That is a general rule in government. I know that it is always difficult, because when a scheme is set up there always has to be a starting point and obviously some people will always be on the wrong side of that starting point. However, it is a general rule in government that we have to start things from when we announce them, and not backdate them. [Interruption.] I hear the shadow Minister, sighing, but if she ever has ministerial responsibility—for various reasons, I hope that she will not have such responsibility—I think she will very quickly understand the logic of not backdating things, and if she does not then the conversations she will have with others in her party will soon persuade her of the wisdom of that approach.
I want to be clear, although I think it was made clear in the written ministerial statement yesterday, that the announcement yesterday means that the scheme will start from yesterday for those already diagnosed, even though that is ahead of the legislation coming into force. Again, that is the same argument that the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) made—I probably mispronounced the name of his constituency, although I always try to pronounce it correctly—when he referred to the starting point of the scheme. I know that he has tabled a number of written questions about this subject on behalf of his constituents, but I am afraid that that has to remain the position.
Both the hon. Members for Liverpool, Walton and for Stretford and Urmston, as well as my hon. Friend the Member for Chatham and Aylesford, talked about increasing the take-up of the scheme. We have been working with stakeholders, including the Asbestos Victim Support group, Macmillan nurses and other groups, to ensure they have information about the scheme, so that they can notify those victims who have been newly diagnosed. We will continue to consider what more we can do. For example, if someone searches for information about this subject on the internet, as is common now, we have made sure that the scheme will come high up on the search list, so that people can locate it. If anyone has any ideas about how better to communicate that information, I am very happy to listen to them. We think that we are doing a good job, but I guess that one can always do better at communicating.
I just wanted to check a point with the Minister. Is it his intention that everybody who suffers from this terrible disease gets the compensation they are due, regardless of dates, timings, or whatever? They have suffered and there is compensation in place, so should they all not get that compensation, regardless of some bureaucracy around the edges?
When one sets up a scheme, it has to have a starting point; we cannot extend it indefinitely. Of course, this scheme is not the first such scheme or the only scheme that is available for those who suffer from mesothelioma. There were two previous schemes—the 1979 scheme and the 2008 scheme—and the reason for developing the latter scheme is that there were obviously groups of people who were not covered by the earlier scheme. I remember that the 2008 scheme was specifically designed to cover, for example, family members of those people who had perhaps come into contact with asbestos fibres but who had not worked in the industry and had not been covered by the 1979 scheme; I think that it was the hon. Member for Wansbeck (Ian Lavery) who mentioned those family members. So, we can widen the scope of schemes, but we still need to have a starting point for a scheme. That always generates some concern, because wherever one starts a scheme there will always be somebody on the other side of the line. I recognise why those people will not be comfortable with that, but I do not think that it is an issue.
I will just be clear about another point. Although people affected will be encompassed by the scheme from yesterday’s date, the actual payment to them from the scheme will obviously have to wait for the regulations to come into force next month. Nevertheless, those people will be eligible for the payment from yesterday.
My hon. Friend the Member for Chatham and Aylesford, and others, referred to the issue of research. I know that she has a long interest in this subject because her constituency is, as she said, a hot spot for this disease, given the industrial history of the local area. So she was interested in this subject even before she was a Member of this House. She referred to some research that is taking place in her local area and welcomed the fact that two insurance companies have put money into research. She made the point very well, that those companies had perhaps demonstrated a certain amount of leadership, and she was keen for others in the industry to follow their lead; I am sure that they will have noted that call.
As I say, my hon. Friend specifically talked about research. The Government agree with her: we also want to see more research in this area. The National Institute for Health Research is calling for mesothelioma research proposals. I listened carefully to the point that was made—I think it was by the shadow Minister—about a written answer that the Minister of State, Department of Health, my right hon. Friend the Member for North Norfolk (Norman Lamb), had given about this issue. I have not seen that written answer, but it sounded like he had talked about some research proposals that were awaiting funding. However, my hon. Friend the Member for Chatham and Aylesford referred to a shortage of research proposals. So I will ask officials to look at this apparent discrepancy. The shadow Minister said there were lots of proposals but no money, whereas my hon. Friend said that there were not really enough proposals.
Another hon. Member also referred to a shortage of research proposals; I forget whether it was the hon. Member for Liverpool, Walton or the hon. Member for Wansbeck. The general sense that I was picking up was that the number of research proposals did not seem to be in line with the tragically large number of people who are dying from this disease—it seemed out of kilter—so the points by my hon. Friend and other hon. Members about research were well made. We set up a partnership, including patients and clinicians, to identify research priorities in this area, and the results were published in December.
What then is available to my constituent, who was diagnosed before 25 July 2012, but died in November 2012?
The Minister has just over two minutes left to speak.
Given what the hon. Gentleman says, and it is obviously the reason why he has tabled written questions, his constituent is not eligible for this scheme. What I do not know without looking at the specific facts of the case—obviously, if he has not already done so, he can either write to myself or Lord Freud with those facts—is whether they will be eligible for one of the other existing statutory schemes. If the hon. Gentleman writes to us, we can then look into the case to see whether his constituent is eligible for the other schemes.
I will be very brief, before the Minister finishes his remarks. Given that the expectation, even from the industry, was that the cost of the scheme would equate to 3%—I do not think that is arguable; hence the levy—does he believe that some of the residual amount, or underspend, should be invested in research? It is really important that research is top of the agenda.
There are two separate questions there. I do not agree with the hon. Gentleman’s characterisation—I suppose it depends where you start from. His understanding was that the 3% was an amount that was going to be levied to generate an amount of money, some of which would be used for the compensation and then, effectively, others could choose to spend it, but that is not my understanding and not the Government’s understanding of the scheme.
However, his general point—I am trying to answer his question about research funding—is that there is a clear view that there should be more research in this area. I will undertake to go away and look at the gap in the general debate between—
Let me just answer the hon. Gentleman’s question; I hope the hon. Lady will forgive me for not giving way to her. As I was saying, I will look at the gap between the number of research proposals—my hon. Friend the Member for Chatham and Aylesford suggested there are not enough proposals, whereas the hon. Lady suggested there were quite a lot of proposals but not enough money. Let me look at what money is available from statutory funding sources; from the National Institute for Health Research and other funders in the area. It might be helpful if we can draw that funding information together, so that Members can see the overall picture of funding in this area. I would be interested to look at that and see how it is related to the need, based on the number of people who are sadly victims of this dreadful disease. That may be helpful to inform further developments—
(9 years, 9 months ago)
Written StatementsMy noble Friend the Under-Secretary of State for Work and Pensions (Lord Freud) has made the following written statement:
I am today announcing an increase to the tariff of payments made under the Diffuse Mesothelioma Payment Scheme which was introduced by the Mesothelioma Act in April 2014. I will shortly bring forward regulations to increase the tariff from 80% of average civil claims to 100% for those diagnosed on or after today’s date. While the uprating will apply to those diagnosed from today, the formal payment process will take effect when the regulations become law next month.
This uprating reflects our monitoring of the progress of the scheme. The number of claimants has proven to be below the level anticipated. I made it clear through the passage of the Mesothelioma Act that I planned to monitor the scheme to gauge the extent that the assumptions made when it was being set up had been borne out in practice and would also consider the impact on the insurance companies who pay for it.
It is already clear that the insurance industry, through its Employer Liability Tracing Office, is doing an increasingly good job at tracing insurance policies which means sufferers can more easily pursue compensators for a remedy. I am determined that this success is maintained, reinforced by regulation from the Financial Conduct Authority.
Following discussion with the insurance industry, I have agreed to introduce some additional administrative safeguards to ensure that we can all be confident that the scheme continues to act as we intended and remains a scheme of last resort. I am pleased to be able to agree to their requests.
This change reflects our ongoing commitment to sufferers of this disease and their families.
[HCWS269]
(9 years, 9 months ago)
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No one can doubt the attention that Community has paid to making that case for its members, who suffered great detriment as a result of the collapse of these pension schemes.
I know from the discussions that I have had that there was a strong sense that there would be further action, given the promises made by the parties that are now in government. Actually, given the current situation, the previous Government’s substantial intervention stands as the signal contribution from the state to alleviating the detriment suffered by members of those schemes. Since 2010, there has been no advance on the agreement reached under the previous Government. Of course, that agreement has virtues—up to 90% is a lot more than nothing. It is a big difference.
Community and Unite have acknowledged to me that the previous Government’s intervention made a substantial difference. Of course it did. Those who lost their pensions now receive up to 90% and a cap at approximately £29,300—I cannot remember the precise number; I think it is £29,348. That is a significant advance, but those people had a strong feeling that they would get more if there was a change of Government; perhaps that speaks to the differences between opposition and government. None the less, promises were made, and those who made them should account for why they have not been fulfilled.
I am listening carefully to the hon. Gentleman. He may be getting to this, so he will have to forgive me if I am jumping the gun. Given the tone of what he is saying, is he making a commitment on behalf of the Opposition to make a significant financial improvement to what is on the table?
That is the difference between what a responsible Opposition do and what appears to have happened before 2010.
The Minister says it is just words, but the words that those campaigning for the parties that are now in government used have not materialised into any action. The difference between the Government parties and Labour is not only that the previous Government actually acted, but that we are a responsible Opposition and we will not promise things that we do not intend to deliver.
It is a great pleasure to serve under your chairmanship, Mr Hollobone. I pay tribute to my hon. Friend the Member for Sittingbourne and Sheppey (Gordon Henderson) for securing the debate.
The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont)referred to my right hon. Friend the Minister for Pensions. I should be clear that my right hon. Friend, like the shadow Minister, was scheduled to be in a Committee considering regulations for an hour and a half, so he prudently ensured that a Minister was available from the Department to answer this debate. Due to the fact that the regulations were clearly excellent and that the Opposition had very few questions and did not challenge them, the Committee unexpectedly finished early. However, the Pensions Minister had secured my cover for this debate, which is why I am here and he is not. I am sorry that that is so disappointing to the shadow Minister.
I thank those Members who have contributed to the debate, as well as other Members and those outside the House who worked to establish the financial assistance scheme in the first place. The scheme ensures that people who were members of schemes that went into wind-up prior to the introduction of the Pension Protection Fund will get some financial help, which they otherwise would not.
It is also worth saying—the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East acknowledged this point—that I understand the views of all the pensioners who have been affected, but the fact is that the pension schemes that were wound up without sufficient funds in them to pay those pensions mean that those pensions effectively do not exist and have been lost. Without the financial assistance scheme, there would not be the funds to pay those pensioners either in part or at all, so they would be in a far worse situation. What we are discussing is the amount of help people can expect from the Government, and of course, there is no Government money; what we are talking about is the amount of money that taxpayers more generally are prepared to make available.
My hon. Friend the Member for Sittingbourne and Sheppey made the point about what people could expect. My understanding is that the financial assistance scheme has always promised that people would get 90% of their expected pension accrued at the point of winding-up, subject to a cap. That is obviously not the same as the amount that someone who had continued their working life would have expected had the scheme been fully funded. My understanding is that that is not what the Government ever promised. When the previous Government set up the financial assistance scheme, they promised 90% of what would have been accrued at the point of wind-up, and I think that is what has been delivered.
My hon. Friend referred to the cap, whereby when someone was entitled to a higher pension, the FAS caps the amount of assistance paid. That cap was put in place to target the payments on the lowest-paid pensioners. The cap was £26,000 for anyone who began to be paid before April 2007. It is increased annually and is now £33,454, and the amount paid depends on the level of cap in place when the payments begin. For example, a person whose payments began in 2012-13 would have a cap of £31,873, which is more than twice the average occupational pension in the UK in the same period.
When the changes to the PPF cap legislation were made, the Minister for Pensions said that he was considering whether a similar change could be made to the financial assistance scheme. He continues to keep the matter under review and is having discussions with his Treasury colleagues about whether that is doable and affordable. No doubt he will keep the House fully informed on the progress of those discussions.
One point made by my hon. Friend the Member for Sittingbourne and Sheppey and others was about indexing what was accrued before 1997. The FAS reflects the statutory requirement on all schemes, which is to index post-April 1997 accruals in line with the consumer prices index, capped at 2.5%. My hon. Friend did not think that was in line with the PPF, but in fact it is. The PPF has the same indexation post-April 1997, which is CPI, capped at 2.5%. The PPF also pays 90% of the expected pension, so the FAS is in line with the PPF. It would be difficult to argue that the FAS, largely funded by the taxpayer, should be more generous by paying to index pre-1997 accruals than the PPF, which is partly funded from a levy on pension schemes.
If we did index the pre-1997 accruals, that would not be inexpensive. It was estimated in 2010 that providing indexation on all assistance to all FAS recipients in line with the retail prices index, as it was then done, capped at 2.5%, would cost an extra £845 million of taxpayers’ money. That would be the net present value. If we accept that the money available is limited, a choice has to be made. We could provide more generous indexation, which would benefit those pensioners who live longer, but the cost of doing that is that we would pay a smaller percentage of pensions at the beginning. I think the scheme has made the right judgment.
I want to cover one point on the cost. I listened carefully to my hon. Friend and I have heard the point before about the value of the assets of schemes transferred into the FAS being broadly similar to the cost of the scheme. That is not right. In December 2007, the Government announced a significant extension to the FAS. That was funded by a combination of the money transferred in from schemes that were not wound up, which was an estimated £1.7 billion, and an increase in the taxpayer contribution, taking the total taxpayer contribution to the FAS to £12.5 billion. The net sum from the taxpayer to stand behind this pension promise was nearly £11 billion. I think that is very significant.
The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East is right to say that the promise was made by the previous Government, but of course this is an ongoing commitment, which is being met and stood behind by the present Government. It is an ongoing commitment for taxpayers today and it is a very significant cost. It clearly is not covered by all the assets being transferred in, because if all the assets being transferred in matched the cost of delivering the promise, there would of course be no need for a financial assistance scheme in the first place. The whole point is that the assets in the pension schemes do not, for all sorts of reasons, fund the promises that were made.
On the issue of funding, I listened very carefully to the hon. Gentleman, who seemed to be giving the impression that the Opposition were going to do something significant. I simply wanted to probe him on that and be clear that he was not making any financial commitments. I am not aware that my party made any financial commitments that we have gone back on. Indeed, the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop), who is no longer in his place, referred to Equitable Life. I will be brief on this, Mr Hollobone, because I am getting slightly off the subject of the debate, but as the point was made, let me say that my party did make some commitments on Equitable Life—I followed that very closely, because I have constituents who were affected—and we have delivered on what we promised to do for Equitable Life annuity holders. I have had lots of correspondence with Ministers and with my constituents, and we absolutely have delivered on that, so I do not quite know what point the hon. Gentleman was making.
I was not sure, either, where the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East was going with the promises that my party makes. I was listening carefully and I did not hear any specific promise that we were alleged to have gone back on. We have stood behind the very significant commitment that the previous Government made, which is an ongoing commitment, and we have done that in the context of inheriting a very difficult financial situation—in the words of the former Chief Secretary to the Treasury, there was no money left.
This is a significant commitment. It was the right commitment for the previous Government to make, and this Government have honoured the commitment even in the very difficult financial circumstances that we inherited. We are right to have done so, but it does mean—this is where I agree with the hon. Gentleman —it is difficult to justify putting even more taxpayers’ money into a scheme to do the things that my hon. Friend the Member for Sittingbourne and Sheppey and his constituents want. I completely understand that, but we have to recognise that other taxpayers would have to foot the bill.
I accept everything that my hon. Friend the Minister has said, but does he not accept that there is a principle involved? The principle is very clear: the Government of the day misled people into believing that their occupational pension would be safe and was safe to invest in. That is what the parliamentary ombudsman, the High Court and the Court of Appeal decided—that those pensioners had been misled—and therefore it is morally wrong for any Government, of whatever complexion, to use finance as a reason for not giving those people justice.
Following on from that point, I think, having read through the detail of the case, that what my hon. Friend says is exactly why a financial assistance scheme was set up in the first place, and very significant amounts of taxpayers’ money were put into it. As I said, the total commitment from the taxpayer is now about £12.5 billion and about £1.7 billion has come in from the schemes that were not wound up. That is a very significant commitment from the taxpayer in order to provide protection for pensioners who are not getting support from pension schemes because those schemes were not adequately funded to meet the promises that had been made.
My hon. Friend said that a number of pensioners in the schemes covered by the FAS have died over time and that in some way reduces the cost. It does not, because the calculation of the total cost will have taken into account the age profile of the pensioners and the expected number of deaths—that is the rather brutal science in which actuaries are involved. That factor will have been taken into account in the costings, so no extra money arises from the fact that some pensioners in schemes covered by the FAS are, sadly, no longer with us.
My hon. Friend made a point about workers who became pensioners before the FAS was first announced, in May 2004. As is normal with all Government schemes, assistance payments are not backdated to before the announcement date, so anyone who became a pensioner before May 2004 gets assistance from that date only. The same applies to the PPF: it does not pay compensation for any period before it was introduced.
I listened carefully to my hon. Friend’s point about overpayments. Because a scheme does not know at the beginning of the winding-up process the exact value of the assets it has and what each member is entitled to, it pays interim pensions—its best guess of what the member will get when the scheme does wind up. At the end of the winding-up, the scheme balances its payments, paying less in the future if a person has been overpaid during the winding-up period. Where possible, the FAS balances overpayments and underpayments once it has the full data, which is the same as the approach taken by schemes. During the winding-up period, the FAS tops up any interim pension to 90% of the expected pension, based on data provided by the scheme. I understand that it used to be 80%, but in response to representations from the various groups, the then Government raised the limit to 90%. That narrows the margin for error, so if there is an error in the data provided by the scheme, that increases the chances of having to recover an overpayment.
The reason why the overpayments are not simply written off is because the FAS is largely funded by the taxpayer. The Department uses the guidance “Managing public money”, which is issued by the Treasury. That is the same guidance used when, for example, the Government overpay benefits and have to recover them. The FAS does what the schemes would do to recover overpayments: it turns the amount that has been overpaid into a notional annuity and deducts it from the assistance due, so that over the individual’s lifetime, they will receive the correct amount.
I listened carefully to my hon. Friend, and I think he said that one of his constituents did not receive good communication from the FAS about the fact that they had been overpaid and that the overpayment would be recovered. I am sure that my hon. Friend will correct me if I am wrong. If that is the case, there is no excuse for poor communication. If I have correctly understood that that came as a surprise, it would be helpful if he wrote to the Minister for Pensions, if he has not done so already, so that we can look into that breakdown of communication.
May I clarify that point? My constituent’s complaint was that he is aware of other people in similar situations whom the PPF contacted to negotiate a repayment plan to ensure that it recovered the money over time, but he was not given that opportunity. I have already written to the PPF to ask why it did not negotiate, and why it immediately stopped his pension entirely. That was his point; he was not given an opportunity to negotiate and say, “Right, I will pay off x amount per month.”
I am grateful to my hon. Friend for that clarification. He has already written to the scheme, so I will draw his comments to the attention of the Minister for Pensions. It may be helpful for the Minister to look at the case and perhaps write to my hon. Friend about it, because it is difficult to go into the specifics of an individual case in an Adjournment debate.
My hon. Friend rightly raised the subject in his role as Member of Parliament for his constituents. He acknowledged in his speech the assistance he has received from those in his constituency who have campaigned on the matter. I recognise that he and those whom he represents are probably disappointed by what I have had to say. However, I hope he understands that, given the very significant contribution that taxpayers rightly continue to make to the financial assistance scheme, there is a limit to the amount of support that taxpayers can give. I fear that it will not, therefore, be possible to deliver the things that he has requested, given the circumstances that we still face in the public finances because we are dealing with the legacy that we inherited from the previous Government.
I thank all hon. Members who took part in that important debate for covering all the issues pithily and succinctly. The next debate is not due to start until 11 o’clock, so I will suspend the sitting until that time. However, if the participants arrive a few minutes early, we will start when they arrive. The sitting is, therefore, suspended until about 11 o’clock.