Universal Credit Work Allowance

Debate between Owen Smith and Heidi Allen

Wednesday 6th January 2016 Commons Chamber

[Owen Smith]

No, I have given way to the hon. Gentleman once.

The Secretary of State used to say that universal credit was a watershed benefit. Indeed, he used to say that it would

“ensure that work pays, and more work pays, for everyone”.

The cuts to the universal credit work allowance have holed that argument below the waterline. The House of Commons Library briefing, which was produced yesterday evening and circulated to every Member, makes it clear that a single mother will have to work an extra 12 hours each week to earn an extra forty quid, at £3.30 an hour, after these changes. Before the changes, she would have got £92 for those extra 12 hours at £7.66 an hour. How on earth is this meant to increase her incentives to go out and work harder and work longer? It is absolute nonsense.

[Heidi Allen (South Cambridgeshire) (Con)]

I wonder whether there is something in the integrity of the people the hon. Gentleman speaks about, and whether they will raise their heads high enough to say, “Okay. It’s not great and it’s not the end result, but I am lifting myself and my children off a life of welfare dependency.” In that is a pride. I would like us to talk a little more in those terms and that language.

[Owen Smith]

I have a great deal of respect for the way in which the hon. Lady stood up for her constituents and spoke out against her party and Government Front Benchers on the tax credits changes because many thousands of people would be affected in her constituency. I point her to the document commissioned and chaired by the Secretary of State when he first conceived of universal credit: in his introduction, he demolished the argument she has just made. He effectively said that we could not expect people to work harder simply out of responsibility and moral obligation, and that we needed to introduce incentives. That was the underpinning rationale of universal credit. Unfortunately, these changes—the cuts to the taper rate, the cuts to the work allowance and the cuts to the childcare provision—are fundamentally undermining the initial premise. They are destroying universal credit. In 2020, 5,000 of the hon. Lady’s constituents will suffer lower incomes as a result of the changes to universal credit.