Benefit Sanctions

Neil Gray Excerpts

Wednesday 2nd December 2015 Westminster Hall

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

I beg to move,

That this House has considered benefit sanctions.

I thank you for taking the time to chair the debate, Ms Dorries; it is a pleasure to serve with you in the Chair. I also appreciate the time that right hon. and hon. Members from across the House have taken to be present in Westminster Hall, especially given our sombre and difficult discussions in the main Chamber.

It is important to state that the Scottish National party accepts the need for some level of conditionality in the social security system and that sanctioning has been part of the system for many years. However, of great concern to us is the evidence that points to claimants being sanctioned in a hasty manner and at an increased rate, and the evidence that social security sanctions link directly to the exponential rise in the use of emergency food aid, or food banks.

We cannot allow conditionality and sanctioning to be a fig leaf for social security cuts. There is strong evidence that sanctions are being applied too quickly, with half of them being overturned on appeal. People cannot live off fresh air, so it is understandable that the Trussell Trust, the Poverty Alliance, Oxfam and others have directly linked increased food bank dependency to social security sanctions, delays in welfare payments and low incomes.

I will focus my contribution this afternoon on the report of the Select Committee on Work and Pensions entitled “Benefit sanctions policy beyond the Oakley Review”, which was published on 18 March this year, and on the written statement from the Secretary of State in response, dated 22 October. The report stated that

“expert and academic witnesses reported that the international evidence on the specific part played by the application, or deterrent threat, of financial sanctions in successful active regimes was more nuanced and far from clear-cut.”

Evidence from the University of Oxford and the London School of Hygiene and Tropical Medicine highlighted their comparative analysis of the social security sanctions systems applied in the European Union and in the USA, which indicated variable effectiveness in getting claimants back into work and that the UK’s system was one of the most punitive.

What was of great concern to me was the Committee’s view that it was

“concerned that support for claimants was likely to reduce or stop during a sanction period, as the claimant might stop engaging with JCP or the contracted provider.”

That correlates with the anecdotal evidence that I have from constituents, family members and friends who have decided against claiming the social security support to which they should be entitled because of the undue stress and aggravation that the system places on them, including sanctions, work capability assessments and threatening letters—often wrong—about alleged overpayments. We should not be getting ourselves into a place where people are becoming so exasperated by the system that they are self-denying the support available to them, whatever the consequences.

The Oxford and LSHTM research examined official data on sanctioning rates, employment rates and benefit off-flow from 2005 to 2014 in 375 local authority areas in the UK. The study found no relationship between local sanctioning rates and employment rates, but it found a strong relationship between sanctioning rates and off-flow, and that that relationship had become stronger since 2011, when there was an escalation in conditionality brought about by the introduction of the mandatory back to work schemes, followed by the changes in the Welfare Reform Act 2012.

For 2011 to 2014 the study estimated that for every 100 jobseeker’s allowance sanctions applied there was an associated off-flow from JSA of 42.4 persons. The study claims that only about 20% of those leaving benefit following a sanction reported having found employment, so what about the rest? Part of my primary concern is that the sanctions regime is being used as a fig leaf for social security cuts, whether direct or indirect, and that there is little evidence that the stated aim of Government regarding sanctions—that they push people into work—is playing out in reality.

That view is supported by Crisis in its March 2015 publication, “Benefit sanctions and homelessness: a scoping report”. The report highlights the fact that the number of JSA sanctions per 100 claimants has almost tripled between 2001 and 2014; that the average monthly number of JSA sanctions has rocketed from 35,000 up to October 2012 to nearly 85,000 thereafter; and that there has been a threefold increase in employment and support allowance sanctions between March 2013 and March 2014. I do not believe that all of a sudden, upon the election of the coalition Government and beyond, jobseekers and social security claimants became less compliant. Something else appears to be in play.

The Committee report was damning about the sanctions regime as it stands. The Secretary of State’s response was published in the House on 22 October. It focused on three main areas: the so-called yellow card sanctioning system; automated sanctions letters; and the at-risk or vulnerable groups. I will address each in turn.

The statement was a step in the right direction—we acknowledge that—but my colleagues and I none the less have significant concerns about the direction of travel. The Work and Pensions Committee called for a full and independent review of the sanctions regime, which we in the SNP have long called for, but the Secretary of State announced a trial yellow card system. A 14-day warning is welcome and a step in the right direction, but the introduction of the trial yellow card system shows that the existing regime is failing. Perhaps the Government will consider a real yellow card system, which would have not only a 14-day timescale for appeal, but a “first offence” warning without sanction. Perhaps the Minister will consider that.

I am also concerned that the Department will be reintroducing the automated system for sanctions letters, which will open the regime up to more mistakes being made than is already the case. I hope that the Minister will advise what support will be made to claimants to allow them to appeal quickly and at no cost to them. I would also appreciate the Minister’s guidance on how incorrect sanctions will be avoided under the automated system. At present, according to the Government’s March figures, 50% of the sanctions dished out are overturned on appeal. The Secretary of State said in his statement that the yellow card system would be trialled “early next year”, but no further detail has been forthcoming. Perhaps the Minister present will give this debate an exclusive and explain where, when and how the trial will work.

A commitment was also made to consider extending the at-risk group to include homeless claimants and those with mental health conditions, which would be important—that is important to all Members. I hope that the Minister will consider the issue carefully. My pitch today is for the Minister’s consideration to end in confirmation that people with mental health conditions and the homeless will be included in the at-risk groups and therefore exempted from the most excessive sanctioning levels. We want a root-and-branch review, but the immediate introduction of protections for those with mental health conditions and for those who are homeless will provide protection in the interim.

The Crisis report that I quoted earlier suggests that not only are homeless people disproportionately at risk of being sanctioned, but that sanctions in themselves increase the risk of homelessness as claimants are forced to cut back on housing costs. Clearly, homelessness only pushes people to the margins of society and further from the labour market, so we have strong evidence that sanctions force people into temporary and long-term destitution.

Where is the evidence to suggest that the stick is forcing people into work, which is what the Government claim as they apply the sanctions? How does removing people’s ability to pay their bus fare to a job interview, to buy an appropriate interview outfit, or to buy the food that they need to think clearly help a jobseeker into work? My argument is that it does not. Sanctioning simply pushes people further from the labour market and into destitution. Indeed, it would appear that the Government are struggling to justify sanctioning as well. In August this year it was discovered that in order to convince the public of sanctions’ worth, the Government had used fabricated quotations from fictitious people talking about their positive experiences of the welfare and sanctions system.

We cannot ignore the clear and absolute need for a full and independent review of the sanctions regime. There is little or no empirical evidence to suggest that sanctioning aids people into work that is relevant to their abilities and desires—never mind well paid or secure work—while there is a plethora of evidence that the existing set-up is driving people towards food banks and poverty. The Government cannot stick their head in the sand about the consequences of austerity at all costs and the impact of sanctioning social security claimants.

In conclusion, I appeal directly to the Minister: if she cannot listen to me or the SNP, will she please listen to the cross-party Select Committee, or to the likes of Oxfam, the Poverty Alliance, the Trussell Trust, Crisis and a swathe of other third sector organisations about their concerns about sanctioning, and will she instruct an independent review of the system? While such a review is carried out all sanctions should be halted as a new system is agreed.

I thank you, Ms Dorries, for your time this afternoon and I thank right hon. and hon. Members for their consideration.

--- Later in debate ---

[Priti Patel]

We know from claimants that the principle of conditionality and the claimant commitment have a positive impact on behaviour. Nearly three quarters of people on JSA and over 60% of those on ESA say that sanctions make it very clear to them that they will follow the rules, in terms of the claimant commitment and their discussions with work coaches. Those rules will also help them to gain employment, so they understand the discussions and dialogue that take place with them with regard to conditionality.

[Neil Gray]

Further to that point and the helpful intervention from the Labour shadow Minister, does the Minister not accept that, when a claimant has been sanctioned, that removes their ability—for a long time, because these are often cases involving people who have very little means—to access the services and job interviews and all the other issues associated with getting back into work? Does she not accept that and see, in a number of cases, that it is clear that the sanction has damaged the claimant’s ability to get back into work?

[Priti Patel]

Specific to individuals who have been sanctioned, first, there is a proper process on sanctioning, so we must not lose sight of that. That process includes a tailored claimant commitment and an action plan, so that individuals know what is expected from them, and importantly, the support that they will access and get from jobcentres and work coaches. The hon. Gentleman also mentioned mental health, which I will come on to. With regards to the proper process on sanctions, we have safeguarding and hardship payments, and those provide the support arrangements for people who are subject to a benefit sanction.

--- Later in debate ---

[Neil Gray]

I thank all Members for their contributions. They have all been fair, but also have shone a light on what is going on for many hon. Members locally. My hon. Friend the Member for Ayr, Carrick and Cumnock (Corri Wilson) made an impassioned speech based on her knowledge of the system from her working life. That brought great scope to the debate.

My hon. Friend the Member for Coatbridge, Chryston and Bellshill (Philip Boswell) made another fantastic speech, elaborating on local issues that we share, as we represent neighbouring constituencies. I am sorry that given the circumstances, which are understandable, he could not elaborate further, particularly on issues such as fuel poverty. I know he was very keen to get across points about that.

My hon. Friend the Member for Rutherglen and Hamilton West (Margaret Ferrier) made good points about how any one of us who might find ourselves relying on social security support at any point in our lives would respond to being sanctioned. She also mentioned the Bill being promoted by our hon. Friend the Member for Ochil and South Perthshire (Ms Ahmed-Sheikh), which I fully support.

I greatly appreciate the comments of the Labour shadow Minister, the hon. Member for Islington South and Finsbury (Emily Thornberry). I thought that her position was rightly very close to that held by the SNP. She reiterated that the research showed that just 20% of the 42% of people who had left JSA after being sanctioned had reported finding work. I thank her for her supportive comments and for her flexibility over how the debate happened this afternoon.

I also thank the Minister. I appreciate her personal comments to me, but also the way she made her contribution. She acknowledged that the points that Opposition Members have been raising are important, and I welcome that. She mentioned hardship payments. We have to realise that they are at a level far less than the normal income that people are used to. Even though people are receiving those payments, we have to consider the impact on their lives in the short, medium and long term.

The Minister said that circumstances had to be taken into consideration, but she stopped short of saying that the at-risk groups would be expanded to include people with mental health conditions and the homeless. I hope that we can work on that over time. She said that 60% of ESA claimants say that they wish to get back into work. My experience is that far more would work if they could, but they feel that they have been unfairly assessed. The cuts to ESA that are to come will hinder people who need that extra support to get back into work, particularly those with mental health conditions. I hope that the Minister will take that issue away and consider it with colleagues.

I thank the Minister, my colleagues, the Labour shadow Minister and you, Ms Dorries. I look forward to making further progress on these matters in the coming weeks and months.

Question put and agreed to.

Resolved,

That this House has considered benefit sanctions.