Universal Credit and Child Tax Credit: Two-child Limit

Neil Gray Excerpts

Tuesday 27th November 2018 Westminster Hall

[Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)]

I congratulate the hon. Member for Glasgow Central (Alison Thewliss) on obtaining the debate and on her tenacious campaigning on the issue over several years.

The policy is totemic, highlighting the callousness of conservatism at its core. By contrast, the previous Labour Government reduced child poverty from 3 million in 1998 to 1.6 million in 2010. That was a remarkable achievement, unprecedented in modern history—an amazing societal achievement for our country. It was not done by accident. If support for households had increased only with inflation, child poverty would have been 4.3 million by 2010. The reduction happened because of huge, sustained above-inflation increases in targeted support for families and children. That is how we were able massively to reduce child poverty in this country and it is why I am proud to be a Labour party Member of Parliament. It will always be the party that defends the most vulnerable in society. We can look towards the contrast between what was achieved under Labour, and the disgusting policy of the Tory Government with the introduction of universal credit, which the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) praised, saying it would allow the poorest families to make the same financial decisions as other families who are not reliant on welfare. That is clearly absurd, when we consider that approaching half the workers in this country earn less than £13,000 a year.

[Neil Gray (Airdrie and Shotts) (SNP)]

The hon. Gentleman is right to point to the record of the Labour Government; they have a strong record on the issue. However, does he regret the comments of his colleague, the right hon. and learned Member for Camberwell and Peckham (Ms Harman), when she was acting leader of the Labour party during the passage of the Welfare Reform and Work Act 2016, that she could not oppose the Government’s plan to reduce the benefit cap and would back the two-child limit?

[Mr Sweeney]

Let me make one point clear: the evidence is that we voted against the Third Reading of that Bill, when it mattered. The rhetoric at the time is irrelevant. Also, the Labour party is of course now under very new management, with a radical approach to abolishing the policy. The point is irrelevant.

A Government who react to children’s pain in the way that is the subject of the debate—by callously making a comparison with a market decision such as buying a car or a house—are not fit to govern. That is what we face when the Conservative Government take that attitude towards children’s pain. The children do not make those decisions. We have a duty to establish a welfare state that goes back to its founding principles of drawing a line below which no one will fall, and above which everyone can rise. That is the fundamental principle of the universal system of welfare in this country. While I want a UK Labour Government who fulfil their pledge to end the rape clause across the whole UK, we should use powers wherever they can be found to mitigate the policy and reduce harms in society where possible.

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[Neil Gray (Airdrie and Shotts) (SNP)]

I wish I had Andy Gray’s left foot, Mr Streeter. It is a pleasure to serve under your chairmanship, and to receive that footballing accolade. That was some light relief after a stark debate.

I welcome, congratulate and thank my hon. Friend the Member for Glasgow Central (Alison Thewliss), who secured the debate. She has been tenacious, dogged and diligent in her campaigning, and it has been a pleasure to be on the Benches with her as she has gone about that in the past three years, and to provide what support I have been able to give for her work. It has merited awards at all levels, although I know that is not why she does it. She does that work to make the lives of her constituents and of the people up and down these isles better. She recognises injustice when she sees it, and she seeks to tackle it. I commend her campaigning efforts, which continue today.

My hon. Friend’s speech, as ever, was detailed. She highlighted the fact that next year this abominable scheme is set to get even worse, as children will be targeted regardless of when they were born. She is right to challenge people—Ministers in particular—to state the circumstances in which those children will be living for the duration of their childhood and the ways parents should budget for them. I would love to see an 18-year family budget in front of me. She was also right to say that 73,500 households have already been affected, a large proportion of which already include people in work. The apparent principle behind this policy, which is to get more parents into work, is self-defeating as it is already happening. I suspect there is an ulterior motive that the Government do not wish to discuss.

My hon. Friend was right to mention the rape clause exemption, because that despicable, disgusting example of UK Government policy has meant that 190 women have had to note the names of children who were born as a result of rape. That we allow that to continue is a stain on us as a society. I find it extraordinary that the Minister can sit and listen to the stories that my hon. Friend read out and the examples from Turn2Us of people in desperate need of help, and then shrug his shoulders as if this is not an issue and nothing needs to be done. I suggest that he comes to one of our constituencies to hear how this policy is impacting on our constituents. Perhaps he could do a shift at Turn2Us and listen to people in desperate need of help as a result of policies that he continues to support. My hon. Friend was right to say that the children impacted by this policy have no say over events that control their lives. They have been targeted by austerity, which is shameful.

The hon. Member for Stretford and Urmston (Kate Green) was right to point out how incompatible this policy would have been if the Government had targets to reduce child poverty. No wonder that the new Secretary of State and Ministers were so desperate to attack Philip Alston personally for the initial findings in his report. I think they protest too much, because they know all too well the problems with child poverty that they are causing.

Again, I commend my hon. Friend the Member for Glasgow Central, and thank her for securing this debate. It has been a good, positive and largely consensual debate, not least because no Conservative Member chose to speak. From the Labour Benches, the hon. Member for Bethnal Green and Bow (Rushanara Ali) was absolutely right and made an interesting speech, and I welcome her support for my hon. Friend’s campaign. The hon. Member for High Peak (Ruth George) made another helpful speech, and I commend her work as chair of the all-party group on universal credit. She gave good, if horrible, examples of the traumatic devastation caused by this policy. The hon. Member for Bury South (Mr Lewis) was right to point out the poor choices made by this Government. We made those points clear during a debate on the Budget, and that was reinforced by the intervention of my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown), who highlighted that between 2017 and 2025, £80 billion will have been spent by the Government on tax giveaways. That should give us all pause for thought.

The hon. Member for Midlothian (Danielle Rowley) was right to say that the policy will have a disproportionate impact on women and people from ethnic minority groups, and the hon. Member for Glasgow North East (Mr Sweeney) was right to point to Labour’s record in government, which I acknowledged, although Labour policy has perhaps been rather sketchy from then until now. My hon. Friend the Member for Glasgow East (David Linden) was right to ask how on earth, when discussing policy around the Cabinet table, nobody stood up and said, “Actually, you know what? I see where this is going. This is a disaster of a policy. This is disgraceful, not just from a social perspective but economically in terms of forcing people, including children, into poverty.” How did nobody round that table, or since then, speak up and say that this is wrong? I find that incredible. My hon. Friend was also right to highlight the religious discrimination at the heart of this policy, and I commend him for that.

This would not be a Westminster Hall debate if I did not sum up a good speech by the hon. Member for Strangford (Jim Shannon). The question why we should make these choices for families was at the heart of his remarks, which is absolutely right. This policy is not about people making choices about being in or out of work, as my hon. Friend the Member for Glasgow Central so eloquently put it; this is about limiting the choices of people on low incomes and their families, and about how many children they can have and what they do in their circumstances. The hon. Gentleman was also right to highlight evidence from Women’s Aid and Refuge. The list of organisations that the Government are ignoring and being tin-eared about could go on.

In conclusion, let me mention the work that the Scottish Government have done since 2010 to mitigate the UK Government’s disastrous austerity policies. Work on the bedroom tax involving more than £100 million a year has been mentioned, but something that is often forgotten about, and one reason why Scotland performs much better than the UK on child poverty levels, is the council tax reduction scheme. That scheme has cost the Scottish Government £1.4 billion in recent years—a substantial investment to ensure that people on low incomes do not suffer the burden of council tax in the same way as other people across the UK, whose council tax reduction scheme has been scrapped by the Government. In Scotland we have also utilised some of the flexibilities available to us for universal credit, which costs another £1 million a year.

[Ged Killen]

Will the hon. Gentleman give way?

[Neil Gray]

I am just about to conclude my speech and I am conscious of time.

The Scottish Parliament and the Scottish Government will continue to do all they can to ensure that we do the best possible, and the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) was right in his bipartisan and measured speech. He said that the Scottish Parliament cannot be a Tory mitigation Chamber; it has to be more than that. There must be a limit to saying that the Scottish Government must always paper over cracks that have emerged from Tory policies. We must go after the problem at source. Therefore, rather than having a party political fight with the Labour party—I am not interested in that—I want us to continue with what, for the majority of this debate, was a cross-party attack on the Government’s policies. If Scottish Labour Members continue with that focus, instead of attacking a Scottish Government who are already mitigating the effect and doing what they can to reduce child poverty in Scotland, we will have a fair debate. We must end this two-child cap and the benefit freeze, and ensure that the Government do what they can in terms of work allowances and universal credit. Until that time we will not stop campaigning against this Government, and I hope Labour Members will join us in that.

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[Alok Sharma]

Of course I will address the issues, but it is important to look back and see where we have come from to reach the policies that we are now putting in place.

Several hon. Members mentioned universal credit. I know that this debate is not about universal credit, but I am afraid I must point out that the legacy benefits system is not really fit for purpose. It is incredibly complicated, and as a result 700,000 households are not claiming—or are not able to get hold of—the full amount owed to them. Under universal credit, those households will be £285 better off on average per month. Likewise, 1.4 million people spent the best part of a decade on unemployment benefits under the last Labour Government, but that is changing.

I accept there has been discussion about finances, but I must say to SNP colleagues that, as Labour Members have pointed out, the Scottish Government have the power to create new benefits in devolved areas. They are able to provide assistance to meet short-term risk and they have the ability to top up reserved benefits from their own resources.

[Neil Gray]

Will the Minister give way?

[Alok Sharma]

I will, but I point out for the record that the hon. Gentleman did not give way when Labour colleagues wished to raise that precise point with him.

[Neil Gray]

The Minister points out that I did not give way, but of course I was at the end of my speech; I was winding up to allow him enough time to contribute to the debate. He says that the Budget interventions will make people better off, but the former Secretary of State, the right hon. Member for Tatton (Ms McVey), suggested that people on universal credit were £2,400 worse off. If the Government are suggesting that their intervention will make people £600 better off, does that not mean that people will still be £1,700 worse off as a result of their actions on universal credit?

[Alok Sharma]

Again, I must respectfully say to the hon. Gentleman and to other Opposition colleagues that it is one thing to say that they want to support their constituents and that I should be prepared to look people in the eye—but they too should be prepared to look their constituents in the eye and explain why they would not vote either for the additional £1.5 billion that we brought in earlier this year to support people on universal credit or for the Budget measures, which I will talk about in more detail.