Welfare Reform and Work Bill

Paul Scully Excerpts

Tuesday 23rd February 2016 Commons Chamber

[Debbie Abrahams]

May I just make these points? Then I will give way to the hon. Gentleman.

People on low incomes are often juggling to heat or eat, as we heard in this morning’s Westminster Hall debate on the bedroom tax. Being able to pay their rent is an increasing issue; 443,000 are currently affected. Having a secure, warm home with healthy, nutritious food are basic physiological needs. When these needs are not met, people’s health suffers both physically and mentally. This is particularly the case for children as they are developing. Being in work or well educated does not guarantee these essential needs; money does. Again, I make my key point: two thirds of children in poverty now are from working families.

The lack of evidence, to which my hon. Friend the Member for City of Durham (Dr Blackman-Woods) was alluding, is stark. Why was there no Government impact assessment of these proposals? We should look at the evidence from the United States, for example. It has been analysing the effects of its social security reforms, and that shows that programmes that focus specifically on parental employment failed; in fact, they had no effect or exacerbated children’s health issues. Conversely, programmes focused on supplementing the income of low-income families improved health.

[Paul Scully (Sutton and Cheam) (Con)]

Indicators are exactly that; they are not things that can be tackled, whereas this Bill seeks to refocus the Government position on the underlying causes and symptoms. Does the hon. Lady agree that far from being hidden, the figures that she seeks to include in this Bill will still be reported in the households below average income report?

[Debbie Abrahams]

The point here is about making the Government accountable for their policies that may in turn be affecting those measures.

I know the hon. Member for Gloucester (Richard Graham) wanted to intervene, too.

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[Neil Gray]

I welcome the hon. Gentleman’s contribution. In fact, the opposite appears to be the case. Those third sector organisations and disability groups with knowledge of this area say that the cut will actually hinder people’s ability to find work.

Baroness Grey-Thompson’s speech on 27 January highlighted perfectly the issues at stake, and I urge those Conservative Members who are struggling with their consciences to read it. She said:

“if this measure goes through, a disabled parent who is working and qualifies as having limited capability for work will, under universal credit—the flagship element of government policy—have no extra support in work compared with a non-disabled parent in otherwise the same circumstances. What will this mean for a disabled parent? Single disabled parents working 16 hours or more, living in rented accommodation and making a new claim for universal credit in 2017, will receive about £70 a week, or £3,500 a year, less than they would receive now on tax credits, despite the rise in the minimum wage…For hundreds of thousands of disabled people, keeping Clause 14 in the Bill will be devastating. It means that far from there being an incentive for disabled people to get into work, find work and contribute to society in the future, those with deteriorating conditions will be less likely to stay in work.”—[Official Report, House of Lords, 27 January 2016; Vol. 768, c. 1311.]

[Paul Scully]

On evidence, the hon. Gentleman suggested in an earlier intervention that WRAG was an intermediate group on the route back to work, but the fact that only one in 100 disabled people is finding work shows that it is a long-term group.

[Neil Gray]

What that shows is that the Government’s Work programme has been an absolute failure and that those who are on ESA WRAG take more time to get back into work and require extra support, so by cutting £30 a week this Government will cut their ability to find job opportunities, and that is shameful. I again urge Conservative Members to read Baroness Grey-Thompson’s 27 January speech in full before voting later.

In October 2015, the Disability Benefits Consortium found that seven out of 10 disabled people said that a cut in ESA would cause their health to suffer. Almost a third said that a cut to ESA would mean that they would return to work later. Shockingly, a third said that they could not afford to eat on the current amount they receive from ESA WRAG.

Scope is concerned that reducing financial support for disabled people on ESA WRAG will detrimentally impact on their financial wellbeing, placing them further from work, as disabled people have lower financial resilience than non-disabled people, with an average of £108,000 fewer savings and assets, and 49% of disabled people use credit cards or loans to pay for everyday items, including clothing and food. Mencap has said that households with a disabled person living in them will be hit much harder. A third of them already live below the poverty line, and the additional reduction in income will have a devastating impact on those who are in most need of Government support.

As the WCA does not assess employment support needs, the financial support that a disabled person receives also determines their employment support. Those two things are not related, and they mean that disabled people do not get the back-to-work support that they need, in answer to the point made by the hon. Member for Sutton and Cheam (Paul Scully). Evidence from disabled people’s organisations and official independent reviews have all highlighted the inaccuracies of the assessment, which means that disabled people do not get the right back-to-work support.

There is insufficient evidence, if there is any at all, for the Government’s assertion that reducing benefit support incentivises people to get back into work. The impact assessment contains no evidence whatever to show that reducing support to disabled people in the ESA WRAG will incentivise them into work. Reducing the financial support available through the WRAG will create a bigger distinction between the support received by jobseeker’s allowance claimants and those who are placed in the ESA support group. The IFS supported that argument by commenting that abolishing the WRAG component could strengthen the incentive for claimants to try to get into the ESA support group. Ben Baumberg, of the University of Kent, agrees with that claim. He stated that the removal of the addition could lead to an increase in the proportion of claimants who are placed in the support group, because being placed in the WRAG could be a risk to their health.

The Minister said in her speech that she had worked with and listened to the likes of Scope and Macmillan, but they still oppose the cut, and she must say why she believes that to be the case. I was interested to read a story in The Guardian a few days ago, in which the hon. Members for Stafford (Jeremy Lefroy), for Stevenage (Stephen McPartland) and for South Cambridgeshire (Heidi Allen) were cited as possible members of a group of Tory MPs who are putting pressure on the Government on the matter. I am a less frequent reader of The Daily Telegraph, but I understand that they were also mentioned in that paper this morning. I read “ConservativeHome” even less frequently, but the hon. Member for South Cambridgeshire wrote very well there this morning. [Interruption.] On this occasion, it was a brilliant article. She said:

“What has suddenly changed in the lives of these individuals that they are suddenly fit enough or not fit enough to work? The beauty of this intermediate WRAG group is that it is just that, intermediate. On the road to returning to work, but not quite there yet. Recovering from chemotherapy, but needing to keep the heating on that little bit more. Many people who are ill are desperate to work, but need to be supported financially until their health improves. There are also structural and economic barriers standing in their way; reducing financial support only serves to create a further hurdle to be overcome. Many of these people have worked and paid in for many years before falling ill. They deserve better than this.

The voters who trusted us”—

that is, Conservative Members—

“to build a fairer society deserve better than this.”

I pay tribute to the hon. Lady and her colleagues who are thinking about supporting the Lords amendments. I desperately hope that those whom I have mentioned have been working on colleagues to join us in the Lobby later.

The issues at stake regarding ESA WRAG and universal credit work allowance are the very same issues as those with the cuts to tax credits, on which many Conservative Members honourably lobbied hard. The measure will impact on low-income families and on disabled people who are looking for work. The cut will, according to the organisations mentioned, including the Equality Trust and Citizens Advice Scotland, disincentivise people from going into work.

The Welfare Reform and Work Bill may well be the best example of doublespeak outside Orwell’s texts. The fact is that the Bill, as the Government would amend it, is unfit for work. The assessment of third sector associations, Opposition parties and the House of Lords is that the Lords amendments must remain. We have seen the Government forced through the courts into a welcome U-turn on the benefit cap for carers. They have also been told by the courts that the bedroom tax is discriminatory for disabled people. The UN is investigating the Government’s welfare cuts. Disabled people should not need the High Court to tell the Tories what is right and what is wrong.

This is our last opportunity to oppose the Government’s plan to stop measuring child poverty, and to oppose their shameful attempts to slash by £30 a week support for people who are unable to work because of ill health or disability—a proposal that is vindictive and woefully lacks the evidence base to support it. I hope that Members across the House will think carefully and consider the impact that their vote will have on the lives of people up and down these isles. Having considered that, there is only one course of action open to us today—to oppose the Government’s shameful proposals and support the Lords amendments.

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[Paul Scully]

I should like to speak to Lords amendments 1 and 8. In looking at child poverty, I am worried about the numbers for the income targets that we have discussed. My concern is that the Government are effectively just managing the situation, rather than tackling the problem. The Bill seeks to refocus our approach so that we concentrate solely on tackling the root causes of poverty, rather than wringing our hands and looking at the symptoms.

Between 2003 and 2008, the Government spent roughly £300 billion on child poverty, but the figures remained broadly unchanged. Such examples show that we need a different approach. We have heard that the reporting of incomes has had a perverse effect on child poverty. In a recession, poverty can decrease. Conversely, in periods of economic growth poverty can go up.

Let us concentrate on those root causes. The deadline for the elimination of child poverty has been discussed, but we need to think how we would meet an arbitrary deadline if we do not understand what we are trying to tackle. We need to understand the root causes of poverty, and focus on those.

The Minister has made a commitment to continue to publish the figures on low incomes in the annual report on households below average income. The report uses national statistics, so it is guaranteed on that basis. As I have said, we have heard the Minister’s commitment to publishing those figures every year. We have been asked by the Opposition if the figures can be reported alongside information on life chances. However, that reinforces the perverse consequences that can result, so it is important that we focus solely on what will help to eliminate child poverty.

Turning to changes to ESA, 61% of people in WRAG want to go back to work. The majority of people who are out of work want to go back to work, so it is important that we focus support and help people. We should offer a safety net for people who cannot go back to work, and we should do everything that we can to support people who can go back to work and want to do so. WRAG was set up with good intentions, but unfortunately it has not been effective enough. It is not right that we have a system in which only one in 100 people can find work, whereas one in five JSA claimants go back to work.

The intermediate WRAG arrangement has become a long-term waiting room, entrenching worklessness, because it focuses on the symptoms, not the root causes. That is why I am keen that we take the cash—up to £100 million a year by 2020-21—and repurpose it to address the needs of the people in that group.

I understand the concerns of colleagues about what will be in the White Paper and how the process will work, but as a member of the Committee considering the Bill I have seen the dedication of providers, disability charities and support groups, their commitment to the people they seek to help, and the skills and experience they have. That is why I know that the taskforce that is being set up will help to bring in the expertise of the charities, providers, support organisations, think-tanks and local authorities. I ask colleagues to have faith in the experience and expertise of those people, which will give us a solid basis on which to spend that money.

As the national living wage and personal allowances increase, we have an opportunity to tackle childhood poverty and bring people into work. We must make sure that work pays more than benefits, and that the system supports vulnerable people and is fair to people in work who pay their taxes.