Amendment of the Law
Michael Meacher Excerpts(9 years, 8 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
The Chancellor did not deliver a Budget last week; he delivered a party political broadcast on behalf of the Tory party. The macro-economic state of our country, which is the real purpose of a Budget statement, was almost entirely absent. His speech had two purposes: first, to give the impression that the worst of austerity was now over and that the sunny uplands now beckon if only we vote Tory at the election; and, secondly, to shoot as many Labour foxes as he could squeeze into an hour on his feet. I want to show that he failed on both counts.
The Chancellor claimed that factors such as lower inflation enabled him to ease up on austerity by pulling back his target of a £23 billion surplus after the elimination of the structural deficit to a mere £7 billion. The fact is, however, that the pathway by which he might meet even this more modest target of a £7 billion cutback is, frankly, pure cloud cuckoo land. The rate at which the deficit has been cut by this Chancellor has averaged so far about £7 billion a year. The deficit still stands at £90 billion. Yet according to page 23 of the Treasury Red Book, the deficit will supposedly go down by £15 billion next year, then by a whopping £36 billion the year after that, then by £27 billion and then by £18 billion in 2018-19. These are, frankly, confetti figures. They have been manufactured and thrown about simply to produce a political feel-good factor that somehow austerity is easing off. This is the most enormous con being perpetrated on the British people. Either those figures are wildly wrong and will never remotely happen, or, if the Chancellor does choose to push them through, they will mean cuts in benefits and departmental expenditure on a scale of up to three to four times anything that has previously been experienced. I suggest that the nation will never stand for that. If he does press them, I think there will be an explosion on the streets.
The Chancellor also failed to shoot Labour’s fox that he is still determined to take the British state back to the 1930s. That was the cat he let out of the bag in his autumn statement three months ago. Page 75 of the Office for Budget Responsibility report on the Budget gives the lie to any idea that he has backtracked when it states that Government expenditure under the Chancellor’s latest twiddling of the figures
“would be the joint lowest level in consistent National Accounts going back to 1948”.
The truth is that almost all the vainglorious boasts the Chancellor made are either seriously misleading or not supported by the evidence. He claimed that the deficit was being cut this year, when in fact that is only due to the exceptional delaying of tax payments until the end of the fiscal year by the super-rich to take advantage of the reduction in the top income tax rate to 45%. Without that, which of course will not be repeated, the deficit would have risen this year, and on present policies, it will rise in future years.
The Chancellor promised the biggest increase in real spending for a decade in 2019-20. As others have said, however, that is only because of the rollercoaster boom and bust after massive cuts in 2016-18, which any Whitehall mandarin will tell the Chancellor is a crazy, not to say utterly irresponsible, way to manage public services. He claimed that national debt will begin to fall in 2019-20, but that is only because he is planning to pocket the £20 billion windfall from selling off the proceeds of bank privatisation, not because there has been any change in the fundamentals of debt inflation.
The Chancellor complimented himself on a nationwide recovery. The truth is that London and the south-east continue to pull away from the rest of the country. Manufacturing and construction still badly lag behind the financial sector. He claimed that Britain stood tall and was now beginning to pay its way in the world. The truth is exactly the opposite: the OBR is predicting that in 2014 Britain had its biggest current account deficit since 1845. I repeat that: not 1945, but 1845—nearly 200 years ago.
The Chancellor claimed that with rising real wages, albeit by a fraction and only because of the collapse in oil prices, prosperity was now returning to British households. The truth is that real wages are still nearly 8% below their pre-crash level, while at the top inequality marches on relentlessly. The ratio between the average FTSE chief executive’s remuneration and median pay in those companies is now on average more than 140:1. The Sunday Times rich list shows that the richest 1,000 people in the UK have actually doubled their wealth in the past five years, from a staggering £250 billion to an almost unimaginable £500 billion. I think the conclusion from all this is unavoidable: the real problems of the economy have not been addressed, we are investing far too little, productivity has collapsed and the UK continues to run up debts at an unsustainable rate.
Sanctioning of Benefit Recipients
Michael Meacher Excerpts(10 years, 7 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
I beg to move,
That this House notes that there have been many cases of sanctions being wrongfully applied to benefit recipients; and call on the Government to review the targeting, severity and impact of such sanctions.
I am grateful to the Backbench Business Committee for granting me this debate. The process of sanctioning benefit recipients is now being used on an enormous scale—almost 1 million sanctions a year. Even the right-wing Policy Exchange think-tank acknowledged in a report published last month that about 68,000 benefit claimants each year are having their welfare payments stopped unfairly. Given that the penalty for the first infringement is the loss of benefit for four weeks, for the second the loss of benefits for three months and for the third the loss of benefits for three years, the number of people being driven into destitution by administrative diktat is enormous. Even the Policy Exchange admits that 8% of that number should never have been sanctioned.
I presume that everyone accepts that fall-back sanctions have to be applied in extreme cases where there is deliberate and real non co-operation with the obligation to try to find work and where no good reasons have been found for such behaviour. Those sanctions should be proportionate and reasonable and not exercised punitively or with a view to achieving targets or objectives—whatever we call them—for removing people from the unemployment list.
From the evidence that I have collected from my constituency surgery, Citizens Advice, YMCA, the excellent Work and Pensions Committee report on this issue and the Library, it is abundantly clear that the standards that the DWP likes to claim always apply in sanctioning cases far too often certainly do not. I wish to cite a number of cases drawn directly from those sources.
A security guard at a jobcentre turned away a man with learning disabilities who had arrived 20 minutes early to sign on. The man then returned two minutes late to sign on and had his JSA sanctioned for 4 weeks.
A man was sanctioned for four weeks because he had not known about an appointment as the letter had been sent to an address that he had left a year ago, even though Jobcentre Plus was aware of his current address.
A woman claiming employment and support allowance had been diagnosed with cervical cancer and had given the back-to-work scheme provider a list of her hospital appointments. She was sanctioned for failing to attend an appointment on the middle day of her three-day hospital stay. The woman had two daughters but her ESA was reduced to £28 a week. She asked for reconsideration, but had heard nothing five weeks later.
A woman was sanctioned for failing to attend provider-led training when the receptionist had rung to tell her not to come in because the trainer was ill. She was subsequently told that she should have attended to sign the attendance register.
A woman whose ESA was sanctioned had her benefit reduced from £195 to less than £50 per fortnight because she missed a back-to-work scheme appointment owing to illness. Her sister had rung two days beforehand to say that she could not attend and arranged another date, when she did attend.
An epileptic man had his JSA sanctioned for four weeks because he did not attend a back-to-work scheme meeting as his two-year old daughter was taken ill and he was her sole carer that day. He rang the provider in advance, but was told this would still have to be noted as “did not attend”. During the four-week sanction he suffered hunger, hardship, stress and an increase in epileptic attacks, but he was not told about hardship payments or food banks or how to appeal the sanction decision.
Lastly, a man in Yorkshire and Humber was sanctioned for allegedly failing to attend back-to-work scheme events. He had in fact attended, and the provider had no record of any failures. His hardship request was not processed, his housing benefit was stopped, and he fell into rent arrears and had no money for food, gas or electricity.
These are not isolated or exceptional cases.
Sir Peter Bottomley (Worthing West) (Con)
Will the right hon. Gentleman allow me?
Mr Meacher
I will give way to the hon. Gentleman because I respect his concern about these matters, but I will not give way again because we are short of time, with the Government having put on two statements before this debate.
Sir Peter Bottomley
Is there any rational reason why in any of those cases the Jobcentre or others should not have reversed the decision if it was clear that the wrong decision had been taken? Why is it necessary to go through a full appeals system when clearly human inspection can say this is wrong?
Mr Meacher
I very much agree with that. Jobcentres Plus have the right to “reconsider”, which is a euphemistic term, and they sometimes do, but I agree that appeals often take three or more months, and are extremely bureaucratic, long-winded and difficult. Far more effort should be put in before the decision is taken to sanction, so that we get sensible decisions and long appeal procedures are not required.
Before I turn to what should be done to change policies and procedures that are patently not working properly, I want to make two wider points. First, everyone who can do so should seek work. The overwhelming majority of the jobless are desperate to find work. However, when 2.4 million people are on the dole queues today and there are only 558,000 vacancies, three out of every four simply cannot find a job whatever they do. A report in the Financial Times this week says that there are 3 million under-employed people who would be keen to work full time if only the jobs were available. The real problem in Britain today is not people failing to try to get work, but the Chancellor’s obsessional austerity policies that contract the economy and fail to provide the job opportunities that people are desperately looking for.
I do not object to the use of sanctions in the tiny number of cases in which they might be needed as long as they are proportionate and reasonable. However, I do object to the hounding of some of the most vulnerable people in our society, often for trivial, ill-considered or utterly unjustified reasons, and driving them into destitution when those who caused the financial crash and the longest recession in this country for 140 years get no sanction at all. It is a classic case of one law for the rich and another for the poor.
What should be done? Plenty. Sanctioning is being used on far too large a scale. The practice is not only unduly harsh and, obviously, causes severe hardship, but is often counter-productive. The YMCA cites three people’s comments about its effects. One says:
“I was unable to look for work as much as I could before”.
Another says:
“It stopped me from searching for work as I had no money to get to different employers”.
A third person says:
“My focus turned to survival rather than gaining employment”.
Citizens Advice makes the crucial observation—I think this was the point that the hon. Member for Worthing West (Sir Peter Bottomley) was making—that front-line advisers do not have sufficient time to get to know a claimant and understand their needs. That explains why there are so many reports of cases such as that of a person with no computer skills being required to apply for work online, a person with no driving licence who is required to apply for a job for which driving is essential, and a wheelchair user who is required to apply for a job that is physically demanding.
Benefit off-flow—a horrible bureaucratic phrase that treats human beings like counters—is, perversely, the key performance measure used by Jobcentre Plus. Disallowances—that is the euphemism used by the Department for Work and Pensions—are included in the off-flow data for people coming off the unemployment list, so staff have an in-built incentive to use them to achieve what they perceive their management expect of them.
Much more could be done to prevent situations that cause sanctioning from arising in the first place because it is clear that in a great many cases people simply do not understand what is required of them. Regrettably, there is a toxic yet pervasive culture in Jobcentre Plus of “Sanction first; think later”, as is shown by the shockingly large number of sanctions against young people—there were 39,000 last year—that are subsequently overturned or, to use that wonderfully euphemistic word, “reconsidered”. Serious, thoughtful effort is needed to do everything possible to secure compliance, with which we all agree, without a sanction being necessary. There should be more common-sense discretion and much less of a rush to action: action should be taken only as a last resort.
Much more attention should be paid to the impact of sanctioning on claimants. An Oxfam report published last May estimated that 500,000 people were reliant on food aid—I suspect that that figure has now nearly doubled—and that more than half of people who turned to food banks did so as a direct result of having their benefit payments delayed, reduced or withdrawn altogether. In 21st-century Britain, can forcing hundreds of thousands of people onto food aid, which is usually associated with third-world countries, conceivably be justified when the root cause of the problem is the Chancellor’s failure to grow the economy and create jobs because of his obsession with prolonged austerity? I think not, which is why I submit to the House that there is an urgent need, as my motion demands,
“to review the targeting, severity and impact”
of sanctioning as it is currently applied.
Mr Meacher
The Minister talks, in his very earnest way, about the claimant commitment. He does not seem to realise that there is a complete disconnect between how the system is supposed to work and how it is actually working on the ground. We are not talking about a few isolated or exceptional examples. I quoted dozens of cases, as did hon. Members on both sides of the Chamber. He needs to take account of the realities, not a dream of what he would like to be real.
The Minister picked up on my remarks about the Chancellor. The most effective way to cut the deficit is not through prolonged austerity and sanctioning, but by expanding the economy and job creation. That is exactly what has been done in the United States, which is now 5% above pre-crash levels. Here, we are 1.5% below pre-crash levels.
The hon. Member for Birmingham, Yardley (John Hemming) made useful points about the appeal procedure taking far too long and being far too costly. There should be an attempt to combine it with the procedure for universal credit.
My hon. Friend the Member for Aberdeen South (Dame Anne Begg), the Chair of the Select Committee, talked about the very high numbers, contrary to the impression given by the Minister, of people being sanctioned. Some 5%—about 60,000 people—are still being sanctioned per month. The causes of sanctions are often unquestionably trivial, wrong and lacking common-sense discretion. She spoke about the need for another survey—not just the Oakley survey on how the system works—to consider the impact on claimants and whether they are more likely to seek work.
The hon. Member for Hornchurch and Upminster (Dame Angela Watkinson) made the important point that sanctions should be used only as a last resort. That is clearly not the case at the present time.
My hon. Friend the Member for Makerfield (Yvonne Fovargue) rightly said that people are impoverished by sanctions and less able to find work, and that they often do not understand the process being imposed on them. DWP staff should be incentivised not for the numbers they sanction, but for the numbers they get back into work.
My hon. Friend the Member for Bolton West (Julie Hilling) made an eloquent case about how people are not helped to find work, and that finding work becomes harder as a result of sanctions. She gave examples of how sanctions are often applied unfairly, as did the hon. Member for Banff and Buchan (Dr Whiteford), who spoke of the system not being fit for purpose, particularly in rural areas.
My hon. Friend the Member for Wansbeck (Ian Lavery) made a powerful speech, as always, which made a comparison with how sanctions work and the less eligibility principle of the Victorian poor law. He thought that no attention is being given to the impact on the victim, which is bad enough, but what about the family, the partner and the children who are being made to suffer?
My right hon. Friend the Member for East Ham (Stephen Timms) made a very effective case for comprehensive reform. For all these reasons, I am extremely unconvinced by the Minister’s reply. However hard he was trying to convince us that his heart is in the right place, the results on the ground do not merit that. For all those reasons, I hope the whole House agrees that we need another review. We need a review that considers the impact, severity and targeting of sanctioning, and we need a reduction in the number of cases where it is used.
Question put and agreed to.
Resolved,
That this House notes that there have been many cases of sanctions being wrongfully applied to benefit recipients; and calls on the Government to review the targeting, severity and impact of such sanctions.
amendment of the law
Michael Meacher Excerpts(10 years, 8 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
Listening to the Chancellor and then turning to the Office for Budget Responsibility’s analysis of the Budget is like being seduced by “Fifty Shades of Grey” only to be brought down to earth by a harsh and unrelenting textbook on morality and sexual ethics. Leaving aside all the election giveaways, the truth is that the underlying economics of the Budget are truly awful.
The economy is still, after four years of austerity, 1.5% smaller than it was in 2008, while the US economy is 5% larger. To put it another way, the UK economy is today 14% smaller than it would have been if growth had continued in the way already being achieved in 2010, when the then Labour Chancellor’s economic stimulus produced 2.4% growth over 12 months up to the third quarter of 2010. As a result of this Chancellor’s about-turn, in favour of fiscal consolidation and austerity, the UK has lost output totalling £210 billion. That is completely gone for ever, down the drain and irrecoverable, and it is equal to one-seventh of Britain’s entire GDP.
Even the deficit reduction, which was supposed to be the aim of the exercise, has worked disastrously. The Chancellor inherited a deficit of £149 billion and pledged to reduce it by £60 billion now and £20 billion next year. In fact, the deficit is projected to be £108 billion this year—nearly double what he promised.
Even more serious is that the Chancellor predicts a strong and lasting recovery, but the OBR believes that this so-called recovery is built on sand. Unemployment and spare capacity have fallen so quickly that the OBR thinks there is very little scope for rapid growth beyond this current year. Hence, it has cut its growth forecast for next year from 2.7% to 2.3%. That is a very ominous forecast. If the economy is still below the output level of 2008 and unemployment is still 2.4 million, the premature petering out of growth will speak volumes. The OBR also says that, given the current policies, Britain will continue to lose export share steadily over the next five years, although it already has the biggest deficit in traded manufactured goods in its history, at £110 billion 7% of GDP—and rising.
The whole honest OBR scenario is grim. The public finances are still terrible, none of the components for sustainable growth is present, the upswing is largely dependent on excessive consumer borrowing and yet another asset-price bubble boom and bust, and the recovery—such as it is—is expected to fade when it has hardly begun. One has to ask, almost unbelievingly, how the Chancellor could have got it so unutterably wrong.
Part of the answer, I think, is that the Chancellor seems to have genuinely believed, at least for the first two years, the dogma of expansionary fiscal contraction. That is the idea that the less a Government spend, the faster the economy will grow, because the public sector will no longer crowd out the private sector, which will then have the space in which to grow. Well, it is all right to believe that if you are a first-year economic student, but to believe it when you have the power to trash the British economy for three years—as the Chancellor has, in fact, done—is quite another thing. The theory is economic illiteracy, and we have suffered that for two to three years.
What prompts the private sector to invest is obviously the prospect of future demand, and hence the prospect of future profits. When the economy is stagnant or contracting, what incentive have private companies to invest at all? That, of course, is precisely why business investment today is completely flat—20% below the pre-crash level—and what does that tell us? What it tells us is that business itself does not actually believe in this recovery either.
But there is another explanation for all this folly, namely that the Chancellor and the Prime Minister are first and foremost ideologues, obsessed with the idea of shrinking the state to the smallest size they can get away with via the privatisation and outsourcing of everything that moves. For them—as opposed to all the people about whom Opposition Members have been talking—austerity was not a painful instrument of reform so much as a heaven-sent gift enabling them to realise their deepest prejudices. That is why, although the policy clearly is not working, the Chancellor is committed to continuing it, and indeed intensifying it, into the next Parliament.
So what should be done? I think it is obvious that what Britain urgently needs is a big and sustained increase in investment, which can only come—at least in the first instance—from the public sector, as the private sector, like the OBR, regards the recovery as far too fragile and risky. At today’s interest rates, the Chancellor could launch, at a cost of only £150 million a year, a major £30 billion drive of investment in manufacturing, public services and job creation which would bring the deficit down much faster, would shrink the dole queues—which are currently costing £19 billion a year—and would be sustainable. He could even finance it at no cost in public borrowing at all—by targeting a tranche of quantitative easing directly at manufacturing rather than the banks, by instructing the publicly owned banks, Royal Bank of Scotland and Lloyds, to prioritise their lending on British industry and not on overseas speculation, or by taxing the super-rich, who have monopolised more than 70% of the income gained since 2008, and, over the same period, increased their wealth by some—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. The right hon. Gentleman’s time is up.
Welfare Reforms and Poverty
Michael Meacher Excerpts(10 years, 10 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
I beg to move,
That this House believes that a commission of inquiry should be established to investigate the impact of the Government’s welfare reforms on the incidence of poverty.
I am very grateful to the Backbench Business Committee for giving the House the opportunity to debate this issue, which has been seriously neglected over the past three years. I am pleased to move the motion, which appears in my name and the names of Members from other parties.
It is clear that something terrible is happening across the face of Britain. We are seeing the return of absolute poverty, which has not existed in this country since the Victorian age, more than a century ago. Absolute poverty is when people do not have the money to pay for even their most basic needs. The evidence of that is all around us. There are at least 345 food banks and, according to the Trussell Trust, emergency food aid was given to 350,000 households for at least three days in the last year. The Red Cross is setting up centres to help the destitute, just as it does in developing countries. A study that was published two months ago shows that even in prosperous areas of the country, such as London, more than a quarter of the population is living in poverty. This point is really scary: according to the Joseph Rowntree Foundation, for the first time, the number of people in working families who are living in poverty, at 6.7 million, is greater than the number of people in workless and retired families who are living in poverty, at 6.3 million.
The Department for Work and Pensions published new data two months ago—it was pretty reluctant to do this, and one can see why—showing that the use of sanctions, which means depriving people of all their benefits for several weeks at a time, had increased by 126% since 2010 and, most strikingly of all, that 120 disabled people who had been receiving jobseeker’s allowance had been given a three-year fixed duration sanction in the previous year. Figures from the Department for Communities and Local Government—these are the last that I will quote, although there are many more that I could quote—show that there are now more than 2,000 families who have been placed in emergency bed-and-breakfast accommodation after losing their homes. The 5% rise in the overall homelessness figures last year included nearly 9,000 families with children, which is the equivalent of one family losing their home every 15 minutes.
What impact have the so-called welfare reforms, which would more accurately be described as social security knock-backs, had on the families who have been affected? The best evidence comes from the Northern Housing Consortium, which carried out a survey three months ago of a representative sample of people living in social housing. It found that a third of families spent less than £20 a week on food and that the average spend on food per person per day was precisely £2.10. That is a third less than those families were able to afford three months before that. The proportion of households that had to make debt repayments of more than £40 a week had doubled and the average level of debt was £2,250. That might not sound a lot to us, but to people with that standard of living it is an enormous and daunting sum. A third of families had council tax debt, and households were having to spend 16% more on gas and electricity. Those are deplorable figures of profound impoverishment in an economy that is still the sixth largest in the world.
Andy Sawford (Corby) (Lab/Co-op)
I congratulate my right hon. Friend on securing this incredibly important debate. Does he also recognise the impact of 2.7 million people losing out through the Government’s changes to council tax benefit, many of them disabled people, veterans and some of the most vulnerable in our communities?
Mr Meacher
I have already made slight reference to that, but my hon. Friend is entirely right. The change is quite small, but its impact can push very poor families into deep poverty.
What are the causes of the emergence of absolute poverty? The biggest cause is the huge rise in sanctioning: depriving someone of all their benefit entitlement for a month in the first instance, for three months in the second instance and, on a third infringement, for three years!
David T. C. Davies (Monmouth) (Con)
Will the right hon. Gentleman give way?
Mr Meacher
I will not give way to too many Members, for the simple reason that many want to speak, but I will give way to the hon. Gentleman.
David T. C. Davies
I am grateful to the right hon. Gentleman for giving way. Does he not agree that it is vital that those who are not looking for work are made to realise that there will be consequences to those actions, particularly at a time when 1 million people have been able to come into this country from eastern Europe and find work here?
Mr Meacher
Those who come to this country are more likely to be employed and take out less in benefits than many of the indigenous population. The real point is that these people want work. Of course the hon. Gentleman is right that people should get work if they can, but there are 2.5 million people who have been unemployed for the best part of two years, and there are 562,000 vacancies—I checked that figure today. So four out of five of those who are unemployed simply cannot get a job whatever they do.
Hugh Bayley (York Central) (Lab)
The hon. Member for Monmouth (David T. C. Davies) does not seem to realise that many of the people who claim benefits, including jobseeker’s allowance, are people who work. I have a constituent on a very low income. He delivers newspapers to my constituency office. He has dyslexia, but he works because he wants the pride of keeping himself. He still needs to claim JSA, but he lost his allowance because his dyslexia meant that in one fortnightly period he applied for nine jobs, not 10. Can that possibly be right, when this man is already working and trying to pay his way?
Mr Meacher
My hon. Friend is entirely right. I have already made the point that the greatest number of people in poverty are actually in working families. That is a real indictment of economic and social policy.
The sanctions are very harsh. I accept that there must be some sanctions, but the scale is out of all proportion and remarkably harsh. They are often applied for trivial reasons, such as turning up five minutes late for a job interview or a Work programme. Of course, people should not turn up five minutes late, but to deny them benefits for a whole month for that reason is totally disproportionate. There are other examples from my own experience in my surgery or from Citizens Advice interviews. I will quote, very quickly, just a few of them:
“The jobcentre didn’t record that I had informed them that I was in hospital when I was due to attend an appointment and I was sanctioned.”
“I went to a job interview instead of signing on at the jobcentre because the appointments clashed.”
Presumably, that was the right thing to do, but he was still sanctioned.
“I had to look after my mum who was severely disabled and very ill, but I was still sanctioned.”
“I didn’t know about the interview because they sent the letter to my previous address. I’d told them my new address but I was still sanctioned.”
“I was refused a job because I was in a women’s refuge, fleeing domestic violence and in the process of relocating, but I was still sanctioned.”
This is a classic:
“I didn’t do enough to find work in between finding work and starting the job.”
The latest DWP figures are from two months ago—it would be handy if we had more up-to-date figures—and show no fewer than 580,000 persons sanctioned in the eight months to June last year. If the same rate has continued since then—it has probably increased—that means that more than 1 million have been sanctioned in the past 15 months and deprived of all benefit and all income. Given that the penalties are out of all proportion to the triviality of many of the infringements, and given that, as I have said, four out of five people cannot get a job whatever they do, the use of sanctioning on this scale, with the result of utter destitution, is—one struggles for words—brutalising and profoundly unjust.
There are other reasons for this deeply worrying rise in absolute poverty. One is the delays in benefit payments, which have increased substantially—the delays, not the benefit payments, unfortunately. Another reason is the impossibility for many poor and vulnerable people to comply with the new rules, even though they want to, that are being imposed. I will quote just one case from my surgery a few weeks ago. He is a disabled man who had his benefits reduced due to the one-year employment and support allowance rule, so his income is now £71 a week. He has been left in a three-bedroom house because his mother and other people looking after him have died and so has to pay £23 in bedroom tax, plus £6 a week—this is the point that my hon. Friend the Member for Corby (Andy Sawford) was making—in council tax due to the new council tax rules, leaving him with £42 a week. He asked to downsize to a smaller property, which is what the Government would expect him to do, but the local housing association, ironically called First Choice Homes, demanded that he pay two weeks’ full rent upfront, £197, before getting any housing benefit. He cannot do that, of course, and he is stuck in an impossible situation.
Another reason for the rise in absolute poverty is the impact of the bedroom tax, which applies to two thirds of a million households. I think everyone, probably even Government Members, will admit that it is Dickensian in its sheer social divisiveness. The housing benefit cap has now been imposed on a further 33,000 households. Both of those measures have forced tens of thousands of people out of their homes—we need to take into consideration what that means—even though two thirds of those affected by the bedroom tax are disabled. It is reckoned that more than 90% do not have smaller social housing to move into.
Another not insignificant cause of destitution—I will be very brief on this—is mistakes made by the authorities themselves. Last week, one of my constituents who had been sanctioned for a month was suddenly told that his sanction had been extended to a year. It was only intervention with the local DWP office that uncovered that it was actually its mistake. What happens for others who do not have the advantage of such an intervention? It now seems that up to 40,000 working-age tenants in social housing have been improperly subjected to the bedroom tax because of DWP error.
I will cite just one more reason for the unnecessary and cruel imposition of poverty, and I say that advisedly: the way in which tens of thousands of severely disabled persons have been judged by Atos, the French IT company, as fit for work—and therefore forced on to JSA at just £71 a week—when they are patently unfit for work. Very often, their GP has not been consulted to inquire whether there are other factors that need to be taken into account. The Chancellor’s policy of keeping 2.5 million people unemployed makes it impossible for them to find work, even if there were employers who would be willing to take them, and the 40% success rate of appeals shows how unfair the whole process is.
I conclude by asking just one simple question: is all this brutality towards the poor really necessary? Is there any justification in intensifying the misery, as the Chancellor clearly intends, by winding up the social fund and, particularly, by imposing another £25 billion of cuts in the next Parliament, half of that from working-age benefits? The whole objective of the massive cuts programme—to reduce the deficit—is one that I think we would all support. There is no disagreement about that across the House, yet after £80 billion of public spending cuts, with about £23 billion of cuts in this Parliament so far, the deficit has been reduced only at a glacial pace, from £118 billion in 2011 to £115 billion in 2012 and £111 billion in 2013. Frankly, the Chancellor is like one of those first world war generals who urged his men forward, over the top, in order to recover 300 yards of bombed-out ground, but lost 20,000 men in the process. How can it be justified to carry on imposing abject and unnecessary destitution on such a huge scale when the benefits in terms of deficit reduction are so small as to be almost derisory?
Mr Ronnie Campbell (Blyth Valley) (Lab)
Does my right hon. Friend agree that the Government might save a lot more if they showed the same energy and enthusiasm for getting those who evade their taxes and run to tax havens as they do for going after the poor, the sick and people on the dole?
Mr Meacher
I will come to that in just a moment.
People say that to carry on doing the same thing over and over again, but expecting a different result, is the first sign of insanity. The Chancellor is not insane, of course, but he is deeply punitive and sectarian. Frankly, I want to help him. There is another way.
Stephen Mosley (City of Chester) (Con)
I have listened to the right hon. Gentleman with great interest. What does he think about the assertion by those on his own Front Bench that they would be tougher on welfare than the Tories?
Mr Meacher
The thrust of what those on our Front Bench have said, as the shadow Chancellor has made clear on many occasions, is that we need public investment. We need to get jobs and growth. That is the alternative way: public investment in jobs, industry, infrastructure and exports to grow the real economy, not the financial froth, because that would cut the deficit far faster—that is the key point—than the Chancellor’s beloved austerity.
If the Chancellor is obsessed with fiscal consolidation, as I think he is, how about the ultra-rich—Britain’s 1,000 richest citizens—contributing just a bit? Their current remuneration—I am talking about a fraction of the top 1%—is £86,000 a week, which is 185 times the average wage. They received a windfall of more than £2,000 a week from the 5% cut in the higher rate of income tax, and their wealth was recently estimated by The Sunday Times—not The Guardian, but The Sunday Times—at nearly half a trillion pounds. Let us remember that we are talking about 1,000 people. Their asset gains since the 2009 crash have been calculated by the same source at about £190 billion.
My question, therefore, is: does the Chancellor believe that these persons, loaded with the riches of Midas, might be prevailed upon to contribute a minute fraction of their wealth in an acute national emergency, when one sixth of the work force earns less than the living wage and when 1 million people who cannot get a job are being deprived of all income by sanctioning and thereby being left utterly destitute? This is just a thought: charging the ultra-rich’s asset gains since 2009 to capital gains tax would raise more than the £25 billion that the Chancellor purports to need. I submit that it would introduce some semblance of democracy and social justice in this country if the Chancellor paid attention to this debate and thought deeply about what he is doing to our country and its people.
Mr Meacher
This has been an excellent debate, one of the best that I have attended. The evidence from all parts of the House about the impact of the Government’s welfare reforms on poverty was both compelling and systematic. With the exception of the Minister, at the end, it was relatively free of tribalism.
There was little disagreement about the need for a commission of inquiry, with an emphasis on the 4 million children growing up in poverty. The hon. Member for Stafford (Jeremy Lefroy), in a considered speech, said that the bedroom tax should be, if not abolished, at least conditional on enough social housing being built and that sanctions for technicalities are totally intolerable. I am grateful to him for saying that. We heard about the level of debt standing at 40% in Liverpool, and I am sure that the same applies in many other cities. We also heard evidence from the hon. Member for Birmingham, Yardley (John Hemming) about a range of issues that must be considered in detail, not just in terms of the framework of policy. I agree with that.
We heard a passionate speech about the housing crisis, the catastrophic drop in Government investment in housing and the price-to-income ratio that puts housing totally out of the reach of poorer people. We heard about the damaging effects of the Government’s switch—convenient to the Chancellor, of course—from RPI to CPI and that the loss of a discretionary social fund was forcing people back into the hands of loan sharks. We also heard about the DWP staff culture of looking for targets to achieve sanctions. Those are all important points.
There were significant disagreements. The hon. Member for Monmouth (David T. C. Davies) gave, I think, the traditional Conservative response, as one might expect, giving the Chancellor the overriding right to pursue an austerity policy irrespective of the impact on ordinary people. My hon. Friend the Member for Hayes and Harlington (John McDonnell) strongly opposed that because of the Government’s choice to put the burden on the poor.
I hope that all Members of the House will support the motion, because we need a commission of inquiry.
Question put.
Mr Michael Meacher (Oldham West and Royton) (Lab)
On a point of order, Mr Speaker. We have just had a very important debate and a very decisive result—the House has spoken strongly, by 125 to two. I do not think that anyone could deny that this is a critically important issue. Can we therefore be assured that the Minister will respond, either now or tomorrow, in order to answer the fact that Parliament has decided and the Government should take note?
Mr Speaker
I am grateful to the right hon. Gentleman for his point of order, but it is not a matter for the Chair. If the Minister of State wants to respond, he can, but he is under no obligation to do so. [Interruption.] No, the Minister does not wish to respond. The right hon. Gentleman’s point stands on the record.
Disabled People
Michael Meacher Excerpts(11 years, 4 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
Research published in March by the think-tank Demos and by the disability charity Scope, which my hon. Friend the Member for Glasgow North East (Mr Bain) mentioned earlier, revealed that by 2017-18, 3.7 million disabled people will collectively lose £28 billion as a result of the Government’s cumulative benefit changes. If Scope and Demos can do a cumulative impact assessment, why cannot the Government? That is a staggering expropriation from arguably the most deprived and disadvantaged section of the entire population and it is perhaps worth rehearsing quickly the range of the cumulative impact: the incapacity benefit reassessment; the reassessment of the personal independence payments; the overall cap; the universal credit; the time limitation of employment support allowance; the change to local housing allowance; the bedroom tax; the abolition of the independent living fund; the 1% cap on benefit uprating; the localisation of and 10% cut in council tax benefit; and the 1% cap on various benefits and tax credits. That is the range of it.
The study found that 123,000 disabled people faced three benefit cuts that will lose them an income of £18,000 in the five years to 2018. A group of nearly 5,000 disabled people will suffer a combination of six benefit cuts, losing a total of £23,000 each over five years. That works out as £88 per week per person, which for people on the breadline is absolutely huge.
The gratuitous harshness of the Government’s treatment of disabled people comes out mostly in the initial attack on and forthcoming abolition of the independent living fund. The ILF gave new life, engagement, mobility and participation to severely disabled people. Two years ago, the Government closed the fund to any new claims and now they will devolve it to local authorities. Let me ask the Minister some questions—and I expect a reply. Will that be ring-fenced when it goes to local authorities? Will it be the same level of expenditure, with no reduction in public spending of the kind that the Government slipped in when they made the switch from DLA to PIP or in the devolution of the council tax benefit?
Then we have Atos and the work capability assessments. Frankly, the ESA system is simply not working. A Citizens Advice study found that nearly half the Atos reports included inaccuracies that were so serious that they would have affected the decisions made and 70% of them included incorrect factual recordings of the history given. Reviews have found considerable variability in decision making, and there is a 42% success rate at appeal; the rate is much higher when the individual disabled person is represented. There is a very low employment rate among claimants 12 to 18 months after the decision.
The inherent problems that remain with the ESA are legion. The descriptors do not capture a person’s state of health in a way that reflects their ability to work, while medical evidence from those who have detailed, accurate and relevant knowledge is ignored. The assessors lack the time, ability and medical knowledge to understand an individual’s condition and how it relates to work and the assessment is irrelevant to work because no attempt is made to discover what work an individual is supposed to be capable of doing.
As so many disabled persons who have been through the process have said, the worst aspect of the employment and support allowance assessment is fear and insecurity. There is the belief that a test has been created for people to fail, no matter how sick they are; the stress that makes ill-health worse; and the stress and uncertainty of repeated assessments, which are like a sword of Damocles hanging over people perpetually.
My hon. Friend the Member for Gateshead (Ian Mearns) referred to Calum’s List. I thought 30 people had died; he says it is now 33. In nine cases, the family believe that stress triggered the death, and in 20 the person took their own life. Who is responsible for this bleak, unforgiving trail of misery? Behind Atos stands the Department for Work and Pensions, with its guidelines, regulations and descriptors, which underpin the Atos work; its targets—which are, of course, denied—for return-to-work decisions; and the sanctions to make sure that the assessors produce results.
Ian Mearns
One of the things that I find regrettable about this debate and previous debates that I have taken part in is that Government Members feel as though they are engaged in some sort of academic exercise; they are talking about statistics, rather than the impacts on real people.
Mr Meacher
I have certainly felt that. The Minister made an extraordinarily complacent and bland statement; he read out a speech that he was given by a civil servant as though he was seeing it for the first time. [Interruption.] I am referring not to the Under-Secretary of State for Work and Pensions, the hon. Member for Wirral West (Esther McVey), but the Minister of State, Department for Work and Pensions, the hon. Member for Fareham (Mr Hoban); we will judge the Under-Secretary in a moment. The speeches from those on the Government Benches have been extraordinarily disappointing, but I want to keep to the subject of the debate.
Behind the DWP stands the Treasury and the Chancellor, who have parcelled out targets for huge expenditure cuts, as we all know, without any prior investigation whatever of the extreme variability in human disability, let alone the wide differentials in job opportunities across the country. This is not an exercise in genuine social policy, but a preconceived shoehorning of the sensitivities of disability into the Chancellor’s unremitting cuts agenda.
If the Under-Secretary wishes me to be a little more positive, I will be, gladly. It is not at all difficult to see what needs to be done. We should make much more use of evidence and the claimant’s own doctor; significantly increase the time available for an assessment; improve assessors’ questioning technique, and preferably transfer that whole function back to the national health service; provide the claimant with a copy of the medical report and an opportunity to discuss inaccuracies with the decision maker; and, above all, greatly improve the descriptors.
I am sorry, but not surprised, that the Minister who spoke earlier has fled the Chamber; it is a pity. As he knows well—the Under-Secretary also knows; I spoke to her about this yesterday—for five months, I have been asking the Minister to meet a representative delegation to discuss these matters. I had to give the Minister a prior commitment—he seemed to need it for self-protection—that it would be a constructive engagement. It will be; we want to work with the Government to make things better, because we care about disabled people far more than we do about attacking the Government, although they deserve that we should. Given that the issue involves 1.5 million seriously disabled people, the reluctance of the Minister responsible, and his procrastination for so long a period as five months, is utterly scandalous. In the Under-Secretary’s reply to the debate, to which I shall listen very carefully, I expect her to tell us exactly when the Minister will meet us.
Atos Healthcare
Michael Meacher Excerpts(11 years, 8 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
I should say immediately that I have been informed that the Minister of State, Department for Work and Pensions, the hon. Member for Fareham (Mr Hoban), to whom this debate is directed, has unfortunately been held up at Glasgow airport because his plane has developed engine trouble. Obviously I am sorry about that, both for him and for me, but I suspect that the speech to be delivered by his last-minute stand-in, the Under-Secretary of State for Work and Pensions, the hon. Member for Wirral West (Esther McVey), will not diverge too dramatically from the one he would have delivered.
I am grateful for the opportunity to raise this matter in an Adjournment debate, although I very much regret that it has been necessary to do so at all. It is unprecedented in all my 40 years’ parliamentary experience for a Minister to refuse point blank to receive a delegation, on a matter of acute public interest and importance, of representatives of a major section of the population who have, in their view, been targeted extremely unjustly by Government policy.
On 31 January, I wrote to the Secretary of State asking whether a delegation could meet him in his office to discuss the reforms that urgently need to be made to the work capability assessments for disabled people. I reminded him in my letter of the debate in the House on Atos, which I initiated on 17 January. In my view, it was one of the best debates I have experienced in the House for a long time. It was free from rancour and partisanship, but it was critical, detailed, passionate and well focused on the need for reform. Nearly 30 Members spoke and, although Members on both sides of the House acknowledged that there had been some improvements, they were without exception deeply critical of the fact that the fundamental structures remained deeply flawed. That, they said, was causing profound upset, distress, indignation, anger and a real sense of helplessness, and was, in many cases, making sick people even sicker as a result of anxiety and fear.
Although many Members targeted Atos Healthcare, the French company to which the assessments have been outsourced, it was notable that not a single Member from any part of the House defended the position of the Department for Work and Pensions on the descriptors, the regulations and the guidance that had been handed down by the Government to that firm. It was for those reasons that I sought the meeting with the delegation, and it never occurred to me that it would not be readily and promptly granted by the Minister of State, the hon. Member for Fareham. Not having had a reply to my letter throughout the whole of February, however, I tabled a parliamentary question asking when the Minister was going to reply.
Within 24 hours, after waiting more than five weeks, I did receive a reply from the Minister of State. It emerged when I spoke to the Secretary of State earlier this week that he had never seen my letter. The Minister of State’s letter, which I have with me, bluntly stated that his diary did not permit him the opportunity to see this delegation, which I take to be “civil service-ese” for a flat no. Frankly, I was taken aback, so I sought out the Minister in the Lobby and, as soon as he saw me, he said: “I’m not seeing you”. When I protested, he repeated “I’m not seeing you” three times. When I insisted that this was unprecedented and totally unacceptable, he finally said, “I’m not seeing Spartacus”—and repeated that three times.
That provides the basis for my seeking this Adjournment debate today. Spartacus is a group—initially hundreds but now thousands—of sick and disabled people whose lives have been dramatically affected by the welfare changes and who have come together as a loose collective, call it what we will, to share their own narrative with a wider public. Crucially, this work, which I have read through in detail, is evidence-based, used the DWP’s own figures and reports whenever possible, and has never been challenged on accuracy either by the DWP or the wider public. Spartacus always aims to provide a calm, credible and plausible response to the Government’s proposals, highlighting where it feels the proposals will have a damaging effect on sick and disabled people and promulgating that to the wider public.
The movement crystallised initially around the so-called Spartacus or “Responsible Reform” report, which set out an evidence-based analysis showing that the DWP had misled the public by claiming broad support for the abolition of the disability living allowance and its replacement with the new benefit of personal independence payments when there was, in fact, almost no public support at all. On the launch day, literally hundreds of thousands took part and the report trended at No. 1 or 2 on Twitter all day. Since then, the report has been widely used and quoted by the Work and Pensions Committee and the Joint Committee on Human Rights, and in several parliamentary exchanges in this Chamber. I think that says enough about the auspices and credibility of this group.
In addition, the Spartacus group has produced, as I said, a detailed and lengthy review of the work capability assessment procedure based on the lived experience— set out at great length—of 70 or more claimants, with additional comments from MPs, the courts, professional bodies and medical professionals, along with the findings of several freedom of information requests.
In the light of all that, I find it inconceivable that a Minister would refuse to meet a representative or representatives from a group who have a very powerful case to make—one that is strongly supported by hundreds of thousands of sick and disabled people—and whose records show, I repeat, that they have always argued their case with evidence-based rigour and well documented analysis. It is not as if Ministers have not yet met members of Spartacus. In the last year or two, they have done so repeatedly. Kaliya Franklin, for example, one of the people I named for the delegation, met the Secretary of State at the Conservative party conference last year, and I understand that it was a productive and courteous meeting, as I would have expected it to be. Kaliya also met the Under-Secretary last year and I believe that the discussions on disability and work were fruitful.
Sue Marsh, another leading member of the Spartacus group whom I included in the delegation, discussed employment and support allowance and work capability assessments with the former Minister of State, the right hon. Member for Epsom and Ewell (Chris Grayling), for 45 minutes before they appeared on “Newsnight” together on 12 January. Both those disability activists had engaged in debate with the former Under-Secretary of State, the right hon. Member for Basingstoke (Maria Miller), numerous times on Radio 5 Live, Radio 4 and BBC TV. I simply cannot understand how the current Minister of State can conceivably, on the basis of any defensible argument, refuse this delegation.
Spartacus set out to engage with politicians. That is what it wanted to do: to create a movement with a credible voice that would be scrupulous in aiming for reasonable change, setting out reasonable demands that it believed were achievable. Yes, it does focus on the most damaging aspects of welfare reform and explain why they are harmful, as it might be expected to do, but it also offers alternatives which it believes will work and which are costed whenever possible. For the Minister to deny the engagement that Spartacus itself wants strikes me as bizarre and perverse.
Spartacus tells me that over the next few weeks it will produce a clear set of demands regarding ESA. Key to that will be the implementation of all—I stress the word “all”—the Harrington reforms now. Three years is long enough, and Harrington himself said in his year 3 review that progress had been too slow.
Of course, in trials in which all the changes are implemented, the rate of assessments falls from the current rate of between eight and 11 a day to perhaps four or five, but, crucially, this has led to nearly 100% accurate decisions. On the basis of that extremely important conclusion, I hope that Ministers will reconsider and agree to meet the delegation.
John McDonnell (Hayes and Harlington) (Lab)
The Spartacus report was put together following a great deal of academic advice from my local university, Brunel. The whole purpose was to engage constructively with the Government to improve the system, and to consider basic reforms. Those people thought they would enter into a consistent dialogue with the Government. The absence of a ministerial dialogue undermines the whole exercise.
Mr Meacher
My hon. Friend is right. That is the whole point. The purpose is not to abuse the Government, but to engage in a rational, thoughtful dialogue in which each side listens to the other.
I realise that I could omit Spartacus from my request, but I am not prepared to do so because I do not believe that Ministers should have the right to pick and choose who is to be included in delegations they receive. It is not as if Spartacus members were rude or offensive, or did not have a powerful case to make. I would understand the Minister’s refusal in those circumstances, but they are, in fact, rational, plausible and eager to engage, and they have an extremely compelling message to which Ministers ought to listen.
I hope very much that the Minister concerned, who has displayed highly uncharacteristic defiance and intransigence, will change his mind, but if he does not, I will certainly not leave the matter where it rests at present. I will renew my request to the Secretary of State in a letter that I will personally deliver into his hands, so that this time the matter is brought to his attention.
Let me end by saying that I think it is tragic that we are having to waste time this afternoon discussing the composition of a delegation rather than dealing with the real issue, which is that hundreds of thousands of sick and disabled people have been subjected to real hardship, suffering and fear because they have been so bitterly mistreated under these regulations. They should be listened to directly, and that is the request to which Ministers should now respond.
Mr Meacher
I have listened to all that the Minister says and I accept it, but the key point in this debate is: why is the Minister of State not prepared to see Spartacus? Spartacus is, by any standards, a leading organisation of sick and disabled people which is supported by thousands. Why is he prepared to see all the other organisations but not Spartacus?
Esther McVey
I will address that point later in this debate. What is key, and what the Minister of State felt was key, is a constructive dialogue. He has consistently said several things about the WCA since taking up his role. It has to be made clear—one would not necessarily take this from today’s debate—that he inherited the WCA from the previous Labour Government. We would not necessarily know that from listening to this debate. We have been committed to improving it. We want changes to happen, wherever possible, in collaboration with the people who know most about it and who are affected by it. The Minister of State made those points in the debate on 17 January, but it is worth reiterating them today. They are the core principles that drive much of the Department’s work on the WCA and will remain so. Since taking office we have made the WCA more sensitive and less mechanistic, successfully implementing a number of challenging reforms to it.
The independent reviews of the WCA are obviously one of our key drivers for positive change. Professor Harrington has had extensive interaction with a wide variety of stakeholders, including individuals, lobby organisations, MPs across all parties, and the staff in the Department for Work and Pensions and Atos who are affected by the changes resulting from his work. Professor Harrington listened to all of the concerns raised and made recommendations based on the evidence provided. His interpretation was that mental health conditions are difficult to assess and he recommended the positioning of mental function champions within Atos. We have listened and a network of champions is now in place to provide advice and support to other health care professionals. He also recommended that we put decision makers back at the heart of the system and ensure they are empowered to make independent and considered decisions, which we have done.
Professor Harrington spotted a gap in our relationships with clinical experts—
Esther McVey
I appreciate that the hon. Gentleman is keen to get his point on the record and, as I said, I was coming to that. The key reason I was mentioning constructive dialogue was that I was setting the question in the context of all the people the Minister of State has met, regularly meets and will continue to meet. We are determined to carry on that engagement.
As the point has been raised and as I believe that both the right hon. Member for Oldham West and Royton and the hon. Member for Hayes and Harlington (John McDonnell) voted for the work capability assessment and were in the party whose Government created the work capability assessment, let me say that it is this Government who are picking up the pieces, holding reviews and making it a far more workable benefit. That point has not been raised at all today.
The right hon. Gentleman talked about the letter and the correspondence. The letter was replied to within the 20 working days set out by Cabinet Office protocol. That is what I have been told today. It is clear that constructive—
Mr Meacher
I realise that the Under-Secretary has been brought in at the last minute, but that is not correct. My letter was dated 31 January and the letter from the Minister of State is dated 5 March, but I am not bothered about the technicalities of keeping to civil service rules about replies to letters. I want to know why Spartacus has been excluded when all the other organisations she has mentioned are being included. She keeps talking about constructive engagement, so why not engage with probably the most effective organisation of all?
Esther McVey
I will get to that. I have just had it confirmed that the letter was received on 5 February and the reply was set out on the date I mentioned.
Esther McVey
Actually, I was mentioning the constructive dialogue and what was important in the context of why my hon. Friend the Minister of State felt unable to meet that group. I understand that his diary was under immense pressure, but he had rescheduled things and was going to have a meeting, but he did not necessarily feel that the dialogue would be constructive because of the words used by Spartacus in this regard:
“The WCA is a statement of political desperation. The process is reminiscent of the medical tribunals that returned shell shocked and badly wounded soldiers to duty in the first world war or the ‘KV-machine’, the medical commission the Nazis used in the second world war to play down wounds so that soldiers could be reclassified ‘fit for the Eastern front’.”
Because of that wording, my hon. Friend felt that there would not be a constructive dialogue. What he was seeking from the many other people whom he had met was not just criticism—one has to take criticism on the chin—but a constructive dialogue to establish what those groups thought could be done better and how we could adjust the assessment. None of that had ever been forthcoming, for which reason—
Esther McVey
Please allow me to finish the sentence—for which reason he had not thus far had the meeting. However, if there were to be constructive dialogue and positive outcomes from the meeting, I am sure my hon. Friend would meet the group, but given the tone of the remarks that I quoted, he did not think that that would be the best way forward.
Mr Meacher
We have finally got to the explanation. I could have been given this a lot earlier. The Spartacus report is about 100 pages long—perhaps slightly under 100 pages. The quote that the hon. Lady has given was one sentence in it. I agree that it is strong language; it is the language of exasperation, hurt and anger, but the idea that the Minister should refuse to see a delegation simply because of the use of such language is absurd. Politicians are a bit tougher than that. If he disagrees with it, he can speak his own mind to members of the delegation directly. They have engaged constructively and they expect the Minister to respond.
Esther McVey
I hoped the right hon. Gentleman would reject and condemn such language so that the group can start on a clearer, more open way forward and have a discussion in a positive light with, as I said, constructive dialogue. That would be a positive place to start.
Those comments are at odds with what Professor Harrington himself has stated. He has said that, although there is more to do, the work capability assessment is the right concept and the Department can be proud of what it has achieved so far in improving the assessment. Our response to the latest independent review made it clear that we agree with his views and that we are committed to continue to improve the assessment.
Esther McVey
I think that we all suffer frustration; I do because I inherited something that was clearly unworkable and that we have had to spend more than two years trying to get right. We will continue trying to get it right. That is what we are doing and I ask the hon. Member for Hayes and Harlington to concentrate on that.
Finally, we have also invited the right hon. Member for Oldham West and Royton to have a constructive talk with Atos to look at what we could do. I believe that he declined an invitation to discuss the changes that would improve the position. He dismissed the Atos invitation as something that would not achieve anything and he condemned the work capability assessment and Atos. I believe that we all have something to learn from this and that we must all work together constructively.
Mr Meacher
I refused that offer because the descriptors, the regulations and the guidance had been passed down to Atos Healthcare, as the agents of the Government, from the Department for Work and Pensions. It is the Department that is responsible, not Atos Healthcare.
Esther McVey
Then I would say that there is much for us all to learn, whether that means the right hon. Gentleman agreeing to meet Atos or the Department agreeing to meet Spartacus, but I conclude that the approach must be constructive, because I believe, as we all do, that we want to get this right for the most vulnerable people in society.
Question put and agreed to.
Atos Work Capability Assessments
Michael Meacher Excerpts(11 years, 10 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
I beg to move,
That this House has considered the matter of Atos work capability assessments.
I warmly thank the Backbench Business Committee for enabling me and cross-party colleagues to introduce this debate on Atos work capability assessments. There is enormous concern about the issue both in the country and in this House, as witnessed by the fact that more than 30 Members wish to speak on a Thursday. To try to ensure that they can all do so, I propose to speak for no more than 10 to 15 minutes. I hope that colleagues will accept that, for reasons of pressure on time, I do not propose to take interventions.
As knowledge of the debate has spread, I have been sent nearly 300 case histories, many of which make heart-rending reading. I cannot begin to do justice to their feelings of distress, indignation, fear, helplessness and, indeed, widespread anger at the way they have been treated. Nor can I easily contain my own feelings at the slowness, rigidity and insensitivity with which Atos and the Department for Work and Pensions have responded—or very often not responded—to the cries of pain that they have heard repeatedly. I have time to cite briefly only three examples which show how extreme is the dysfunction and malfunctioning of the Atos assessments.
The first example concerns a constituent of mine who was epileptic almost from birth and was subject to grand mal seizures. At the age of 24, he was called in by Atos, classified as fit for work and had his benefit cut by £70 a week. He appealed, but became agitated and depressed and lost weight, fearing that he could not pay his rent or buy food. Three months later, he had a major seizure that killed him. A month after he died, the DWP rang his parents to say that it had made a mistake and his benefit was being restored.
The second example, also from the Oldham area, concerns a middle-aged woman who was registered blind and in an advanced stage of retinitis pigmentosa. She was assessed at 9 points—well short of the 15 that are needed—and her incapacity benefit was withdrawn. On review by a tribunal, the Atos rating of 9 points was increased to 24.
The third case—I could have chosen from hundreds of others—also comes from the north-west and concerns an insulin-dependent diabetic with squamous cell cancer, Hughes syndrome, which involves a failed immune system, peripheral neuropathy, which meant that he had no feeling in his feet or legs, heart disease, depression and anxiety. Despite his life-threatening condition, he was placed in the work-related activity group.
Those and myriad other examples illustrate incontrovertibly that Atos’s current work capability assessment system is drastically flawed, and for several reasons. First, Atos is an IT firm and it uses the so-called Logic Integrated Medical Assessment, which is often described as “rigid” and “tick-box” because computer-based systems make it difficult for health professionals to exercise their professional judgment. Because such a mechanistic system has little or no regard for the complexity of the needs of severely disabled or sick persons, the British Medical Association and others have condemned the current WCA as “not fit for purpose”.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
Will my right hon. Friend give way?
Mr Meacher
Despite my hon. Friend being my colleague in Oldham, I really must keep strictly to what I said, but I very much hope that she will be called.
Secondly, assessed persons regularly felt that the opinion of their own doctor or of other specialist medical personnel who were treating them was either ignored or overridden. That is all the more serious when Atos’s practices simply do not adhere to the guidance for doctors set down by the General Medical Council.
Thirdly, because of the failure of so many initial assessments, the appeal procedure is grossly overloaded and hugely expensive. No less than 41% of decisions are appealed, of which 38% are won. At £60 million in a single year, the appeals have cost the taxpayer more than half of the £110 million that was spent on the original assessments. Moreover, the National Audit Office has castigated the Department for failing to penalise Atos for what it politely calls its “underperformance” and for not setting “sufficiently challenging” targets.
Fourthly, there are concerns about the responsibility for work capability assessments, in particular that of the Atos chief medical officer. Professor Michael O’Donnell joined Atos from the American company, Unum, formerly UnumProvident, which had a very poor reputation in the US, where it was described as an “outlaw company” by the US authorities, partly because it was regarded as a “disability denial factory”. In that situation, the responsibilities of the Minister and the Secretary of State need to be established clearly.
Against that background, it is frankly not good enough for the Minister to respond to the debate by saying that there have been three Harrington reviews, and that the Department is doing the best it can to improve procedures. The fundamental issue is this: how can pursuing with such insensitive rigour 1.6 million claimants on incapacity benefit, at a rate of 11,000 assessments every week, be justified when it has led, according to the Government’s own figures, to 1,300 persons dying after being put into the work-related activity group, 2,200 people dying before their assessment is complete, and 7,100 people dying after being put into the support group? Is it reasonable to pressurise seriously disabled persons into work so ruthlessly when there are 2.5 million unemployed, and when on average eight persons chase every vacancy, unless they are provided with the active and extensive support they obviously need to get and hold down work, which is certainly not the case currently?
I therefore want to conclude by asking the Minister five specific questions to which I want a specific answer before the end of the debate. First, it is true that Harrington has produced minor adjustments—implemented at a glacial place—but the underlying system remains largely undisturbed. The BMA and the NAO have therefore called for a thorough, rigorous and transparently independent assessment of the suitability of the work capability assessment. Will the Minister now implement that?
Secondly, will the Minister accept that the current criteria and descriptors do not sufficiently—or even at all—take into account fluctuating conditions, especially episodic mental health problems? How will he rectify that?
Thirdly, will the Minister provide full and transparent details of the Atos contract? They should not be hidden by specious claims of commercial confidentiality when Atos is the sole provider of what is clearly a public service. Better still, given that Atos has failed so dramatically, why does he not in-source the work back into the NHS?
Fourthly, how will the Minister ensure that the medical expertise of disabled persons’ doctors and related professionals is fully taken into account before assessments are completed?
Lastly, I want to provide a full dossier to the Secretary of State so that he fully understands what is being done today in his name, and to bring a small delegation to see him from some of the excellent organisations of disabled people who have heroically battled to highlight and tackle the distress and pain caused by Atos. Can I please be assured that the Secretary of State will see such a delegation?
I repeat that I am sincerely grateful for this debate, for the co-operation of colleagues from all parties, and for the detailed responses I have received from so many hundreds of victims of Atos, but I assure the Minister of this: the debate is important, but it will certainly not be the end of the matter.
Mr Meacher
I cannot remember attending such a compelling and powerful debate, combining passion, analysis and a very powerful demand for radical reform. It is absolutely clear that the consensus of the whole House is that the current Atos system has failed irretrievably and needs to be replaced by a wholly new and fair system.
I have to say that the Minister’s response just now was extremely disappointing. He gave no assurance whatever that the present failed, mechanistic, tick-box system used by Atos will be replaced, or that the evidence of GPs and other medical personnel who know the disabled person will be taken into account. He could thus give no assurance that the original decisions will be made any more accurate or fairer. As a consequence, the appeals system, already overloaded, is going to remain choked.
My hon. Friend the Member for North East Derbyshire (Natascha Engel), the Chair of the Backbench Business Committee, made the forceful point that when Atos works for another employer, such as the NHS or Royal Mail, it produces very different results in terms of fitness for work—which strongly suggests the very uncomfortable truth that perhaps the DWP is entirely prepared to accept the results that we all deplore if that is only way of getting hundreds of thousands of people off benefits.
That is not just the view of the Opposition. I think that the mood of the House was caught by one of the Minister’s very senior colleagues, who said—I noted it down at the time—that the reputation of Atos was so damaged that it was necessary to park it to one side and move off in a different direction. That is exactly what is needed.
This issue is a test of the Government’s accountability to the House. In my opinion, the incontrovertible message conveyed by today’s debate is that until the Government and the DWP listen to, and act on, the unanimous view that has been expressed today—I have never seen such unanimity across the Benches—and introduce a wholly different system, the House will not let the matter go.
Question put and agreed to.
Resolved,
That this House has considered the matter of Atos work capability assessments.
Colin Traynor
Michael Meacher Excerpts(12 years, 2 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
Speaking in the House of Commons is rather like the apocryphal story of waiting for the 77 bus: you wait a very long time, and then two or three opportunities come along almost immediately.
I sought this debate in order to raise the case of one of my constituents, Colin Traynor, who was epileptic. He was assessed as fit for work, yet died less than four months later. I raise the issue knowing that, tragically, this is far from a unique case, but I believe that there are some particularly disturbing aspects of Colin’s treatment at the hands of Atos Healthcare and the Department for Work and Pensions that deserve official attention and reform.
Here are the facts of Colin’s brief life. He suffered from grand mal epilepsy from the age of 14 months. Although he was prescribed medication, his condition was never controlled. According to the detailed letter written by his parents a few months ago, which I have with me,
“he was unable to do normal things that some of us take for granted such as go out to work, drive a car and even socialising with friends.”
Colin’s mental awareness was affected, as he
“found it very difficult to communicate verbally with others; it could take him a while to process a question that was put to him”.
In 2008, Colin, then aged 25, was asked to attend an interview at Oldham jobcentre, which was designed to
“find out whether Colin would be willing to find employment.”
Colin welcomed the interview because it gave him hope that he might actually find an employer who would be willing to take him on, which he very much wanted. However, according to his parents’ letter:
“After doing everything possible to try and find employment for Colin, Remploy informed him that his condition was so severe that he was deemed unemployable. After 9 years of trying to find employment in the hope of living a little bit of normality in his life, Colin eventually came to terms with the fact that he would never be able to work.”
Then, in August 2011, Colin received a letter asking him to attend for a medical assessment on 4 November 2011. In his parents’ words:
“Colin was confused as to why when 3 years before that he was deemed unemployable”.
Let me quote at some length from a second part of the parents’ letter, which sets out exactly what happened:
“The medical assessment works on a point scoring system. Colin was only given 6 points in total; he would need 18. On 19/12/11 Colin received a letter stating that because Colin had not scored enough points in the medical assessment, he would have his incapacity benefit cut by £70 a week. This caused Colin a lot of stress and anxiety. He was worried about losing his home, not being able to pay his bills and even worried about not being able to afford good food to eat. He was informed that the decision would have to go to an appeal and could take as long as 9 months. He was told there was nothing more they could do, and he would just wait for the outcome of the decision. From the period of December 2011 to April 2012 Colin’s health deteriorated, his seizures increased due to the stress and he also lost a lot of weight. On the 3rd of April 2012 the stress and anxiety that Colin was suffering from resulted in Colin having a massive seizure and it took his life. Colin died at home on his own and he was only 29 years of age.”
The next day, Colin’s mother informed the DWP that he had died owing to his condition—as she put it,
“the same condition that DWP were expecting him to work with”.
On or around 19 April, a fortnight later, Colin’s mother contacted the DWP again to ask for a decision on Colin’s appeal. She was told that Colin’s file was at the bottom of the pile. On being told that he was dead, the DWP official, very shocked, said that she would find the file and bring it to the adjudicating officer’s attention immediately. The following day, Colin’s mother received a telephone call from the DWP saying that it had overturned the decision in Colin’s favour, and that he should never have been assessed in the first place.
Many people, including me, would conclude on hearing that story that this young man died at least in part owing to the procedural rigidity and heartlessness of a Government Department and its agents. That is certainly the view of Colin’s parents, and I want finally to quote the end of their letter. It ends with just one sentence:
“We as a family”
—it is signed by the mother, the father and the sister—
“hold the Government, David Cameron, Iain Duncan Smith personally responsible for the death of our son… and brother.”
Nothing is going to bring Colin Traynor back to life, but I believe that the Government owe it to his memory, and that of hundreds of others who have lost their lives in similar circumstances, to make fundamental changes to the work capability assessment procedures which are taking such a terrible administrative toll in fear, intimidation, distress and death.
First, the mechanistic nature of computer points-based assessment should be ended. It is reaching obviously wrong conclusions in a vast number of cases. The Conservative hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart), to whom I pay tribute, has established that 29,000 claimants who originally scored zero in the test were later granted the benefit on appeal. In his words:
“it seems that some people are not failing by a couple of points. They are failing completely—then going to a tribunal—then passing completely.”
I simply say that a system that reaches such widely wrong decisions in such a huge number of cases when it may be a matter of life or death does not deserve to survive, and should be scrapped.
Secondly, a revised and new system should be able to distinguish at the outset, by means of a much more personal and sensitive interview, those who, by any standard, cannot possibly be fit for work. It is highly significant that in Colin Traynor’s case the DWP finally admitted that he should never have been assessed as being able to work in the first place. The tragedy, which is unforgivable, is that that happened only after he had been dead for a fortnight. That alone ought to compel a fundamental rethink of the procedures, so that this never happens again.
Thirdly, the fact that so many Atos assessments are overturned at tribunal appeals shows that these procedures are deeply flawed. We know the statistics: 40% of people appeal against the decisions, and 38% of those appeals are successful. That means that more than one in seven of all the original decisions are reversed on further systematic examination at tribunals. Last year, some 1,100 claimants died under compulsory work-related activity for benefit, and a number of those found fit for work and left without income have committed, or attempted, suicide. I simply say that a record of failure of that magnitude clearly indicates that the system is so faulty that it needs wholesale replacement.
Fourthly, it is unacceptable that those who are deprived of benefit, thus putting their life and well-being at risk, should have to wait six months or more for their appeal to be heard. If Colin Traynor’s appeal had been heard promptly, he would almost certainly be alive today.
The least the Minister should confirm today is that the Atos medical testing contract should be suspended—as the National Audit Office demanded last month—until new and more sensitive and discerning procedures are put in place that end this dreadful catalogue of distress and death, which shames the Government. I hope the Minister will respond positively on each of these heartfelt points.
Mr Meacher
Irrespective of whether the distress, of which the parents were aware, was made known to the authorities, the crucial point in this case is: how can a 29-year-old who had been subject to grand mal seizures since he was 14 months old, and for whom Remploy had desperately tried for three years to get a job and could not do so, have been regarded as employable?
Mr Hoban
I do not want to get into the details of Mr Traynor’s case, because there is an opportunity for the right hon. Gentleman and Mr Traynor’s family to go through those with the regional director. I will come on to deal with the process in a bit more detail. Mr Traynor was asked questions during the course of his assessment by an Atos employee, which led to that conclusion. As I said a few moments ago, it was not until Mr Traynor submitted an appeal that he provided us with further evidence. The Department had asked for that evidence earlier and it had not been supplied.
I wish to make a broader point that comes out of this and other cases, which is that it is important that claimants provide information to support their claim at the earliest opportunity, so that we make the right decision first time around. I am sorry to say that we often find that evidence to support an application is provided only at the appeal stage. Not only is it the responsibility of all of us, as Members of Parliament, to help our constituents, but it is the responsibility of groups advising people with complex conditions, be they disability awareness groups or Citizens Advice, to ensure that when they work with people they encourage them to submit the evidence at the outset, so that we get these decisions right first time.
The right hon. Gentleman asked why Mr Traynor was referred for a work capability assessment. The reassessment of claimants entitled to the old-style incapacity benefit is a key part of our reform agenda to create and deliver a 21st-century welfare system by ensuring that those people who can work are given the correct help and support to do so. We do not believe that it is acceptable to write people off to a lifetime on benefits because they have a health condition or impairment. A claimant on incapacity benefit may not have had to speak to anyone in the Department about their health condition or work options for as long as five years. People are left on their own with no support or sense of how and when they may return to work.
The employment and support allowance regime recognises the importance of work and is designed to help claimants move towards employment with the right help and support. We therefore need to ensure that people currently receiving incapacity benefits are supported in preparing for a return to work where some form of employment is a possibility. The reassessment of 1.5 million existing incapacity benefits claimants started nationally in April 2011 and is expected to take three years to complete. Claimants are being reassessed using the work capability assessment process. Claimants who are assessed as having limited capability for work will be moved to ESA and will be placed in either the support group or the work-related activity group. The Department does not aim to reduce the levels of support for the most severely ill or disabled people, so claimants in the support group will be paid a higher rate of benefit. Claimants in the work-related activity group will be expected to undertake activity to support their return to the labour market.
That process is based on the Government’s fundamental belief that many people with health conditions are able to sustain and progress in employment. Indeed, evidence points to the negative impacts of being without work and suggests that appropriate work is generally good for people, regardless of whether they are disabled or have a health condition. In the context of Mr Traynor’s condition, the respected book “Fitness for Work”, published by the Faculty of Occupational Medicine, clearly sets out that
“most people with epilepsy are capable of normal employment without need for supervision or major restriction”.
That is supported by Epilepsy Action, which states on its website that many people with epilepsy do go out to work, that their epilepsy does not disrupt their work in any way and that nearly all jobs are open to people with epilepsy. I pay tribute to the hard work of organisations such as Epilepsy Action, which work not only to support their members but, crucially, to inform employers and tackle misconceptions about epilepsy.
Of course, no two individuals are the same and it is essential that the work capability assessment is capable of looking at individual circumstances and dealing with the wide variety of health conditions that individuals may have. That is why the work capability assessment was developed in consultation with medical and other experts, alongside representative groups. The working group, and that of a subsequent internal review carried out by the Department, includes an expert in neurological disability and rehabilitation to ensure that it deals effectively with conditions such as epilepsy.
The right hon. Gentleman commented that Colin was confused as to why he had been called back for reassessment. I will set out why we are going through the reassessment process and say a little about the process that happens when someone is called for assessment. Guidance to staff refers to the fact that claimants are not already identified as vulnerable but might become so at any point during their IB reassessment process. Following the letter to the claimant advising them that incapacity benefit is changing and that we will be assessing their entitlement to ESA, we call them to ensure that they understand the process and provide them with the opportunity to ask about anything about the process that might concern them. The ESA50 and the accompanying letter encourage claimants to provide full details about their conditions and offer face-to-face help to complete the form if they feel they need it. Once returned by the claimant, the content of the ESA50 is scrutinised by Atos, which can refer to a claimant’s GP for more information or advise departmental staff about any vulnerability if it believes it is necessary to do so.
The right hon. Gentleman suggested that the points were awarded by a computer, but the medical assessment conducted by an Atos Healthcare professional is a confidential, face-to-face discussion about the claimant’s condition that affords both parties the opportunity to identify and respond to any vulnerability that might prevent the claimant participating effectively in the IB reassessment process. Prior to making a decision about a claimant’s entitlement to ESA, the decision maker calls the claimant to provide them with an opportunity to offer any additional evidence. We recognise the concerns that people called for reassessment might have, which is why we have tried to ensure that there are steps in the process to explain to them what is happening, reassure them and give them the opportunity to make their points and express their concerns about the process.
Although we believe that the need for, and the principles of, the work capability assessment are right, the system we inherited from the previous Government contained flaws that undermined its effectiveness. We have therefore moved swiftly to put things right and are committed to improving the work capability assessment continually to ensure that it is as fair, accurate and efficient as possible.
We recognise that many people with a health condition want to work and can do so with the right support. In June 2010 we appointed Professor Malcolm Harrington, a highly respected occupational physician, to undertake independent reviews of the assessment. He has completed two reviews and is currently undertaking the third. His reviews set out a series of recommendations for improving the assessment. We fully endorsed the recommendations and are committed to making the changes as quickly as possible. For example, we have: improved the standards and consistency of decision making through additional training and better use of evidence; improved the way we communicate with claimants by providing personalised statements, summarising key advice clearly and implementing the customer charter; and made changes to the claims process to better support the claimant at each step of the process and ensure that they understand what is required of them.
Professor Harrington has also worked with charities to propose alternatives for the majority of work capability assessment activities, although I understand that, in relation to epilepsy, nothing has been received in relation to consciousness. We are confident that the improvements we are making to the assessment following these reviews will ensure that we increase the number of decisions that are right first time and improve the service provided to claimants.
It is important to state that Atos does not make the decisions on benefit entitlement; decision makers in the Department make the decisions after considering the advice Atos provides and any other appropriate evidence, including information from GPs, consultants and so on. The Department makes millions of such social security benefit decisions each year, the majority of which are not appealed. In fact, between October 2008 and May 2011 the Department made more than 1 million decisions following receipt of a work capability assessment from Atos. Only 9% of those decisions were overturned.
Let me talk about what we are trying to do to improve the appeals process. We want to encourage claimants to provide all the evidence to support their claim at the earliest opportunity. The Department for Work and Pensions now interacts more with claimants at an early stage to ensure that decision makers get more decisions right first time. We are also introducing a mandatory reconsideration process for benefits, so that when a claimant queries a DWP decision, they will be given an explanation by telephone and helped to identify any additional evidence that could change it. Claimants will still be able to appeal after the reconsideration if they wish.
This debate was initiated as a result of the unfortunate case of Mr Traynor and we extend our sympathy to his family, but it also highlights why we are right to introduce the additional stage in the process where a decision maker contacts the claimant to seek additional evidence before they make a final decision. The introduction of mandatory reconsideration will build on that. We will continue our programme of reassessing existing incapacity benefit claimants over the coming years.
Mr Meacher
I am grateful to the Minister for giving way. He has largely been talking about process. Clearly, the Government are trying to improve the process. However, the fact that there have been three reviews by Professor Harrington suggests that the process is pretty flawed.
May I return to my original question? Whatever improvement there has been in the process, how can someone subject to grand mal epilepsy seizures virtually from birth have been construed, at any stage in his 29 years of life, as able to work? He wanted to work; he probably came to the original work capability assessment eager to work. But how could he be accepted for working when Remploy and others considered that he was unemployable?
My last point is that Mr Traynor probably would not have died if he had not received the deduction of £70 a week in his incapacity benefit. How would that get someone into work? It simply produces extreme stress and anxiety.
Mr Hoban
Let me deal with those points. The right hon. Gentleman asked why Professor Harrington had done three reviews. The legislation, passed when his party was in government, actually required five independent reviews to be carried out. Professor Harrington is now conducting the third of those reviews. That is why it is happening. The reviews also demonstrate a commitment to learn, develop and listen to the experiences of claimants and the groups that represent them.
I will try not to go through the fine detail of Mr Traynor’s case; I am not sure that Parliament is the right place for that. However, having looked at the assessment form that was completed through a conversation with Mr Traynor, I should say that it was clear that the number of fits that he had during the day were relatively few across the course of the year. That was the information used to determine whether he was capable of working; it was then superseded by the letter from his GP and the epilepsy specialist nurse. Based on the original information supplied, the conclusion appeared to be right. Later information led to the reassessment of the conclusions made at that original assessment. I am sure that the north-west director will go through that in more detail with the right hon. Gentleman and Mr Traynor’s family.
We will continue to learn lessons from employment and support allowance, incapacity benefit reassessment and the work capability assessment. We are applying those lessons to the introduction of the personal independence payment, particularly around appeals and reconsiderations, to encourage claimants to provide all evidence to support their claim at the earliest opportunity. I reiterate that point. It would improve the whole process if we encouraged claimants to provide as much information as possible at the start of their application rather than leaving that to the appeal process. That is one of the learning points to come out of the debate this evening.
Question put and agreed to.
Amendment of the Law
Michael Meacher Excerpts(13 years, 8 months ago)
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Mr Michael Meacher (Oldham West and Royton) (Lab)
The Government’s main jibe at the Opposition throughout this debate has been, “What is the alternative to the cuts?” I will spell out what I think that alternative should be. Of course the deficit has to be brought down —we all agree on that—but slashing public expenditure by £80 billion in four years is probably the most risky and counter-productive way of doing that. The Chancellor has largely ignored the other three ways.
First, there are the proceeds of economic growth. The estimate of the independent Office for Budget Responsibility for growth over the next five years, albeit recently scaled down, has growth at 1.7% this year, 2.5% next year, then 2.9%, 2.9%, and 2.8%. That means that, on the Government’s own estimates, there will be an increase in the national income of £185 billion. Governments always take about 40%. That means that there will be extra Government revenues over the next five years of £74 billion. That is half the current Government deficit of £146 billion, and nearly three quarters of the Government’s estimated structural deficit of £109 billion. Therefore—on their own estimates, I repeat—the Government would halve the budget deficit in five years without making a single public expenditure cut. I am not against such cuts, and I think there should be some, but I am simply pointing out that there are alternative and far better ways of dealing with the problem.
The reason why the Government have chosen to focus obsessively on benefit and public expenditure cuts is not because they are economically necessary on the scale that they say, but because of their overriding ideological objective of chopping back the welfare system and shrinking the state. That is what it is really about.
The second way to reduce the deficit is obviously through tax increases, but the Government have chosen to minimise that option and maximise the cuts option—the balance between the two is 77% and 23%. Thatcher never went beyond 50:50. The Chancellor has ostentatiously avoided any tax rises that might disturb the rich. The non-dom loophole has not been closed; it would bring in an extra £3 billion. The promised £2 billion to be saved in tax avoidance is really pretty small beer, given that even Her Majesty’s Revenue and Customs admits that avoidance will cost £16 billion this year and most independent experts think that the figure will be £50 billion. The tripling of the Government’s bank levy, which was recommended by the International Monetary Fund and would bring in another £6 billion, has simply been passed over.
Moreover, the Chancellor has simply turned his eyes away from any fiscal innovation that might produce a fairer Britain where all of us are in it together. A financial transaction tax at a modest rate of 0.05% would raise about £30 billion. An empty property tax would raise £5 billion, and a land value tax, which would be a great deal fairer than the council tax, which it could replace, would raise more than £30 billion. A minimum tax levy on high earners would put a cap on avoidance and raise more than £10 billion.
The Chancellor really ought to be less timid. The public want taxes that will hurt the rich, and particularly bankers. I do not think the Government realise that. Any permutation of the taxes that I have mentioned could raise at least £30 billion a year—probably rather more if the Chancellor chose, but of course he will not, because the Tory party gets half its funding from the bankers.
Then there is the third option for reducing the deficit, which is a jobs and growth strategy. The cost of putting a million people on the dole, which is what the Government are planning to do, is probably about £6 billion depending on the level of benefits involved. Instead of throwing a million people on the scrapheap, which will substantially worsen the deficit, the Government could invest in a million jobs to provide the social housing and transport infrastructure that are so desperately needed; to develop the green technologies that the green investment bank was supposed to fund if only the Government had not shrivelled its powers; to deal with the rising child protection case load; to train a more skilled work force; and to care for a growing ageing population, to mention just some of the service jobs that could be provided. There would be a significant net gain in deficit reduction for many reasons, not least because of instead of a million people being a drain on the Exchequer, they would contribute to it.
The real cause of the financial crash has not been addressed at all. It is astonishing that three years on, nothing has been done to address the massive flaws in the banking system’s structure and its use of derivatives, bonuses, lending practices, offshoring and speculation. The Budget sets out £80 billion-worth of spending cuts that are not economically necessary on such a scale, will do lasting damage to the social fabric and do not deal with the real—
Welfare Reform
Michael Meacher Excerpts(14 years, 1 month ago)
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Mr Duncan Smith
I can give the undertaking to my hon. Friend that all those issues will be reviewed with that team. If there is an issue about that, and if it affects anybody, we will want to try to bind that into the whole assessment. The assessment’s objective is not to penalise people. The truth is that when we undertook the flow—putting people through a process that the Opposition undertook when in government—we learned a lot. We found that a large number of people who went through it have come out the better for going into work. No one ever saw them, cared about them or discussed anything with them, so we are trying to ensure that we give them help and support, not to penalise them.
Mr Michael Meacher (Oldham West and Royton) (Lab)
Is it fair and reasonable to impose a fixed arbitrary limit on the total level of benefits that a family can receive, irrespective of the level of rents in inner-city areas, when that rent could well constitute 70% of the £500 per week ceiling? A family cannot possibly live on the remaining 30% alone.
Mr Duncan Smith
The right hon. Gentleman refers to the benefit cap, as announced last week. I think that it is fair. It is fair for us to offer an explanation to the public, most of whom work for low incomes and pay their taxes. They do not want to see somebody on benefits disincentivised from work because of the very level of money that they receive. I repeat what I said in the statement: to net-out £26,000, somebody in employment would have to earn about £35,000. So, I do not think that the measure is effective, in the sense that we are bearing down too hard. It is fair.
On housing, over the next few years we will manage the process with the changes to housing benefit. After all, over the last five years of the right hon. Gentleman’s Government, housing benefit costs ballooned by £5 billion a year, and they were set to balloon to £20 billion a year. I have one last point for him: his Government had the lowest number of houses built at any time since the 1920s. I wonder whom he blames for local authorities having had to place people in those expensive houses.