Employment and Support Allowance

Neil Gray Excerpts

Tuesday 18th April 2017 Commons Chamber

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

Earlier today, we were all gripped with anticipation for an hour or so as to what the Prime Minister would say at the Downing Street lectern. It was a closely guarded secret. Was she to speak about her own ill health, North Korea, Syria or perhaps even Northern Ireland? In the end, we heard a statement of opportunistic self-interest in calling for an early general election. This evening, we hope we will hear what we have been anticipating for months. We hope we will get some detail on what the Government are doing to honour their promises to long-term sick and disabled people who have been found unfit for work but are losing £30 per week from their employment and support allowance. I intend leaving plenty of time for the Minister to respond to this speech, so that she can finally set out the support that is going to be available for sick and disabled people who are, as of now, receiving £30 a week less than they were before 3 April. I noticed before the debate was due to start that she was walking into the Chamber on crutches. I hope that she has not done herself too much of a disservice and that she is able to take part in the debate in a full and meaningful way.

The ESA work-related activity group is for people who have been assessed as being unfit for work, but who must carry out some form of work-related activity—for example, training courses. There has long been an acknowledgement that people in receipt of ESA WRAG have higher costs associated with their illness or disability in carrying out that work-related activity than someone who is fit for work. That is why ESA WRAG has paid a higher weekly amount than jobseeker’s allowance: it is on the understanding that people will rely on ESA WRAG for longer and have higher costs.

Indeed, the Minister acknowledged that when she said:

“We must ensure a person’s liquidity is in place, so that they can afford the additional costs brought by looking for work, or by being poorly or disabled: higher energy bills; mobile and internet access costs; the cost of getting insurance; the cost of a special diet, in some cases; the extra travel costs that come with unpredictable itineraries; clothing and bedding costs; and the cost of specialised equipment—to name just some of those costs….

When that security and liquidity goes, often so, too, does a person’s dignity and wellbeing.”—[Official Report, 17 November 2016; Vol. 617, c. 462.]

Yes, Minister—indeed. Yet, as of 3 April this Government are going to pay £30 per week less to ESA WRAG recipients to bring their allowance down to the level of jobseeker’s allowance, at £73.10 per week. We do not yet know what the Minister is doing or has done to mitigate the £30 per week cut to ESA WRAG, which it is estimated will realise £640 million in annual savings for the Government in a short space of time. She hinted in the passage I just read out, and further on in that speech on 17 November, that she would take steps financially to mitigate the cut. I shall take some time to look at some more of what the Minister has said on this issue.

[Stephen Timms (East Ham) (Lab)]

Will the hon. Gentleman give way?

--- Later in debate ---

[Neil Gray]

I will of course give way to the right hon. Gentleman, who has contributed a great deal on this subject and from whom I am keen to hear.

[Stephen Timms]

I am grateful to the hon. Gentleman, who is making an important argument. Did he hear, as I did, the Minister give an assurance only three weeks ago in response to a question from the hon. Member for Enfield, Southgate (Mr Burrowes) that the Government will provide full mitigation for the losses incurred by ESA claimants in the work-related activity group? Has he yet heard any information at all about any mitigation, let alone full mitigation?

[Neil Gray]

I thank the right hon. Gentleman for that intervention. Several statements have been made, and I shall come on to speak about them, but we have not had any detail about how they are going to be realised. I hope that this debate can impress it on the Government that they should finally provide that detail, albeit sadly after the changes have been introduced.

[Jim Shannon (Strangford) (DUP)]

This is an important issue that has kept a good number of Members in the Chamber for the debate. Does the hon. Gentleman share my concern that some of those who are assessed and put into the work-related activity group should not be there in the first place? A number of my constituents fit into that category; is the same true for him?

[Neil Gray]

Absolutely. There are great problems in the assessment process. It is part of a wider problem with the system as it stands. To take away £30 a week from people who have been assessed as unfit for work and who are in the work-related activity group is certainly not the right way to go about things. We impress it on the Minister that these cuts should be paused.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

I congratulate my hon. Friend on securing this debate and raising these critical issues. Does he recognise that many of those in the work-related activity group will be people who move in and out of work as their conditions fluctuate? When they go back on the benefit during a period of ill health, they are going to find themselves in a very much disadvantaged position compared with before. This is just no way to treat people who are battling and living as best they can with often incurable, long-term, debilitating illness.

[Neil Gray]

My hon. Friend is absolutely right and, to her credit and in her typical way, makes her point well. The Government have suggested that there will be a 12-week window in which recipients of ESA in the WRAG may well be able to return to the previous rate; I suggest that that is not enough. If the Government will not reverse the cut, there should be a longer grace period to allow people the opportunity to return to work and to attempt to sustain that work, which is not always easy for some of these people to do.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

My hon. Friend is being generous with his time. Does he agree that despite the 12-week pause—this window that he has talked about and that the Minister has mentioned—the sanctions imposed on the people who are losing this money will push them further and further away from the prospect of work, further and further into poverty, and therefore further and further into social isolation and away from the job market?

[Neil Gray]

Absolutely. I thank my hon. Friend for that intervention, because that point has been made by the expert disability charities. They do not see this cut as an incentive for people to find work; rather, it hinders their opportunities for getting back into work, if they are able to do so as part of a timely process.

In November, in response to the debate on a cross-party motion on this subject that I introduced in this Chamber, the Minister committed to ensuring that a replacement system of support would be in place for ESA recipients in the WRAG before the cut was to take place, but we have no clarity over what that system is or will look like. She said that support would be provided and an additional £15 million invested in the flexible support fund, but, of course, the flexible support fund is a discretionary fund used by jobcentres to help those in receipt of unemployment benefits to find work. It can be used to help with the cost of travel to interviews, childcare, clothing or uniforms to start work. However, the flexible support fund has been heavily criticised by the National Audit Office, the Work and Pensions Committee and others, because of its complexity and under-utilisation.

There have been allegations that jobcentre staff have been pressured into not using the fund. It is also one of the best kept secrets in Whitehall as information about it is not available on the Government’s own website. What concerns me most is that there is no detail over how the flexible support fund, which will total only £83 million after the additional allocation, will directly support ESA WRAG recipients. Have jobcentre staff been told to target the flexible support fund on disabled people?

Another commitment made by the Minister was to secure better deals with service providers to help disabled people financially. She was going to broker deals with energy companies and telecoms suppliers to help sick and disabled people with their bills, but how many people will be able to afford a BT TV package or Sky broadband on even the higher rate of ESA WRAG? Even if she has managed to secure better deals on energy or insurance costs, we have not been told about them. How much will they aid disabled people? Will they make up the shortfall? Who are the deals with? When will they come into force? Will the Government promote them?

The Minister also committed to having personalised support packages in place by now—either a place on the Work and Health programme or Work Choice. Of course the Work and Health programme has yet to start and Work Choice is not new support. Additional places were also to be provided on the specialist employability support programme, which is a very small project, with only 1,700 members in 2015. Another idea was on job clubs, but we have not had any further detail on that. There is also the drive for work experience places with wrap-around support for young people, but again there have been no detail on whether this will be available for WRAG recipients.

Increased funding for the Access to Work mental health support service has also been mentioned. It has been launched, but is available only if a person is in work or signed off work sick, so it will not help those on ESA WRAG. All in all, we have had many different ideas. There have been different, tentative and ultimately detail-free announcements. In the end we have no detail and no way of knowing how the Government plan to live up to their promise of ensuring that ESA WRAG recipients are not punished financially or how they intend to halve the disability employment gap by 2020, as was promised.

[Hannah Bardell (Livingston) (SNP)]

I thank my hon. Friend for giving way and congratulate him on bringing this serious issue to the attention of the House. Does he agree that the Government are just piling on more pernicious cuts on top of—let us not forget—the closure of Remploy a few years ago, and a missed opportunity in the industrial strategy where there is very little talk of how they will close the disability employment gap? They need to be much more ambitious and much more helpful.

[Neil Gray]

I agree with my hon. Friend. Indeed I understand that submissions to that effect have been made to the Government’s consultation on the industrial strategy.

All of us—colleagues across this House, Members of the House of Lords, expert disability charities, which have opposed this cut, and disabled people themselves—are expecting detail from the Minister this evening. She has had two weeks’ notice of this debate. She will have known what I was going to raise because I have been asking the same questions for months. There can be no excuse for not being very clear and for not providing great detail on how her Government are honouring their many promises in debates past to placate their own Back Benchers.

Of course I can predict one thing the Minister will say. The Scottish Government now have limited powers over some aspects of social security and she will claim that the Scottish Government can therefore mitigate this cut for the people of Scotland. I hope that I can pre-empt her reading out that nonsense by telling her that I am standing here defending employment support not just for disabled people in Scotland, but for disabled people up and down these isles. Secondly, the Scottish Government have already spent almost £400 million since 2013 mitigating Conservative cuts to social security in Scotland. At a time of austerity, when Scotland’s budget is being cut back to the tune of £2.9 billion in this decade, and the Scottish Government are having to divert depleted funds to mitigate Tory social security cuts, I do not think that telling Scotland to pay twice for disability employment support would be the strongest position for the Minister to take, and it does nothing to help or answer the questions of disabled people elsewhere. So perhaps she will stick to finding a credible argument to justify this cut and outline what additional support she will provide rather than deflect responsibility for it.

The Disability Benefits Consortium brings together 70 different expert disability charities and they have opposed this cut from the start. On the same day as the cross-party motion presented to the Backbench Business Committee was debated in November, they signed an open letter to the Government calling for the cuts to be stopped. They have criticised in particular the Government’s idea that somehow disabled people are disincentivised to work by receiving an extra £30 per week. The Government completely ignore the fact that the majority of sick and disabled people are desperate to work but struggle to find a job. The Government ignore the fact that a third of ESA recipients sometimes cannot afford to eat on the old ESA WRAG rate. Almost seven in 10 say that this cut will cause their health to suffer. The Government have done nothing to assess how this cut will impact on the mental health of recipients. Nobody could suffer a one third cut in their income and not see their health deteriorate in some way as a result, especially when they are already struggling to get by.

The people we are talking about today are people with disabilities or mental health conditions. They want to work, but they cannot. They are faced with the double indignity of wanting to work but being unable to find a job, and then being told that the financial support they are struggling to live on is a disincentive to find work. I am aware—not just from the debate in November when a number of Tory MPs followed MPs from eight other parties through the Lobby to call on the Government at least to pause these cuts, but since then—that all is not well on the Government side of the House in relation to this policy. I understand that the Prime Minister attended a meeting with concerned Tory MPs a few weeks ago and was told directly by them that she needed to do more. Perhaps we will get some clarity tonight as a result.

We need to hear from the Minister what she is going to do to live up to that quote about liquidity. What is she doing to ensure that disabled people, who are already struggling to get by, will be financially supported in addition to any enhanced employment support that may be forthcoming?

This will be one of the final debates of this Parliament. So far the Government have failed to listen to the disability charities, Opposition parties, the Work and Pensions Committee or the will of the House, given the vote in November. Perhaps in the coming weeks, Government MPs will hear more from the electorate about this devastating cut and come back in the next Parliament with a more serious response.

--- Later in debate ---

[Penny Mordaunt]

The WRAG issue was debated heavily last year and voted on in the House. The measures that were put in place to provide additional support to that group, which I will go into in detail, were debated at the time and confirmed in the Green Paper. So the issue was mentioned in the Green Paper, but it had been consulted on extensively beforehand.

On the point about the industrial strategy, we are very much engaged with the Department for Business, Energy and Industrial Strategy, and we are looking at what can be secured on this agenda from that strategy.

Help is available to enable people to live independent lives and ensure that those who can work have the opportunity to do so. This includes personal independence payments, the Access to Work scheme; local authority-provided social care support and aids and adaptations; NHS-provided aids; free prescriptions; free or discounted travel, for example to hospital appointments; the blue badge scheme; disabled students allowance; the disabled facilities grant; budgeting loans, cold weather payments through the social fund; and housing benefit. I shall not repeat the arguments that I made, as the hon. Member for Airdrie and Shotts has quoted me, but I will address some of the points on liquidity before moving on to his questions about the support package.

We have announced some additional funding for the flexible support fund in the coming years, which offers grants to support claimants with the associated costs of returning to work. Through the flexible support fund, Jobcentre Plus has a discretionary fund that is available to claimants. This includes barrier awards for individual claimants. Such awards could include travel and care costs to help people to attend training or the jobcentre itself. The funds can also be allocated to help claimants to move closer towards or into work—for example, for clothes to attend a job interview and start work, and much more. Each district manager is allocated a proportion of the national budget. There are very few national guidelines, and they have considerable freedom as to how to deploy the funds locally. This clearly helps with work and employment support-related costs.

As the hon. Gentleman will know, at Christmas we introduced a new procurement tool, which enables people quickly to purchase things, commission services and so on using the flexible support fund, so I take issue with the allegations he makes. Maybe the process has involved a lot of admin historically, but that is currently not the case.

[Neil Gray]

Will the Minister confirm whether the flexible support fund will be better directed towards recipients of ESA WRAG?

[Penny Mordaunt]

Yes. I will come to that point shortly. I also briefly mention the social fund, which can help with non-work-related costs.

We looked at several ways of potentially ring-fencing funds to this group, but in all cases we felt that it would be subject to legal challenge, so this is by far the simplest thing to do. We can monitor how this is being used and see where the money is going. The flexible support fund and the social fund are the only real route to be able supply additional funding to help people, whether that funding is cost-related to work and moving closer towards getting into work, or whether it is other costs associated with the cost of living.

We have also looked at what we can do to reduce a person’s outgoings. I thank my officials, who have done a huge amount of work with telecoms and energy suppliers to establish what support is on offer, and to encourage new offers and some low tariffs. That work has concluded and the Department for Work and Pensions will signpost claimants—not just WRAG claimants, but others—to services that help to reduce those costs. For example, tariffs are available, particularly to those on ESA, that package up broadband, phone and other costs at a low tariff of £10 a month.

When work coaches meet claimants, they will be able to offer signposting to services that help claimants with budgeting and saving money on household bills. That will be supported by a fact sheet that can be given to claimants. The fact sheet is already in operation and has been distributed through our operations arm. It is a one-stop shop that has all the information in one place, as well as signposting to local services. That is a big step forward. The leaflet, “ESA40”, which is sent to all ESA claimants at the beginning of their claim journey now includes a link to the Money Advice Service and its free support on saving money and household bills. This links into the work that the Department has been doing to follow on from the Extra Costs Commission, and it is a big step forward for the Department.

When ESA was introduced by Labour in 2008 as “a radical reform package”, the work-related activity component was intended to act as an incentive to encourage people to participate in work-related activity and, therefore, return to work quicker.

[Penny Mordaunt]

That very much depends on an individual’s circumstances. We have looked at a range of circumstances that someone might find themselves in—for example, someone who might need also to apply for PIP. We have looked at the time lag between someone, for example, coming on to being a new claimant for ESA and their actually being able to access that benefit. We have looked at a range of scenarios that someone might find themselves in. However, this support is available to anyone in that circumstance. Indeed, some of it is available to all claimants—for example, the social tariffs, which is a big step forward for the Department.

[Neil Gray]

The Minister stated in November:

“When that security—

that is, money and liquidity—

“goes, often so, too, does a person’s dignity and wellbeing.”—[Official Report, 17 November 2016; Vol. 617, c. 462.]

Is she therefore confident that the measures that she is putting in place, and the tariffs that are going to be available, will compensate people for this £50 a week?

[Penny Mordaunt]

I hope that what I have said, and what the hon. Gentleman has quoted me as saying in previous debates, at length, would give him some confidence that I really do understand that we have to do both things. We have to ensure that people are able to pay their bills. If we want them to focus on getting well and on moving closer to, or going back into, the workplace, then putting additional stresses on them is not remotely helpful. That is why we have undertaken this new work in the Department to see whether we can reduce someone’s outgoings, and why we have worked with our operations arm to ensure that this is not something that just sits in a drawer but is being offered to people. These budgeting conversations are happening. So yes, I am confident that this will be acted on throughout our Jobcentre Plus network, and we can monitor how progress is being made.

I mentioned the original intent of the work-related activity component in acting as an incentive. The hon. Gentleman will know that we have recently consulted on radical reform of the work capability assessment. As the hon. Member for Strangford (Jim Shannon) mentioned, it is deeply flawed. We have had many consultation responses on that area, and it will be a major focus of the forthcoming White Paper.

I want to provide some reassurance about the additional support that will be in place, and is in place. All the support that is outlined in the Green Paper is currently in place. That includes recruiting 300 disability employment advisers; the capacity to have one-to-one health and work conversations with a Jobcentre Plus work coach to raise someone’s confidence and help them to manage their health condition; additional places on Work Choice and the work and health programme for all eligible and suitable claimants who wish to volunteer for it; additional places on our specialist employability support programme to support those, in particular, who are furthest away from the jobs market; increased funding for the access to work mental health support service to provide support for in-work claimants; jobcentres reaching out to small employers to identify opportunities and to help match people to jobs with the new small employment offer; and the community partners, who are now all recruited and in place.