Migration and Scotland

Debate between Philippa Whitford and Neil Gray

Tuesday 11th February 2020 Commons Chamber

[Dr Whitford]

rose—

[Neil Gray]

rose—

Universal Credit and Debt

Debate between Philippa Whitford and Neil Gray

Wednesday 5th June 2019 Westminster Hall

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

Thank you, Sir Henry. It is a pleasure to serve under your astute chairmanship, which has allowed a bit of latitude in the debate and for so many voices to be heard. I am very grateful to the hon. Member for High Peak (Ruth George) for securing the debate. She covered a lot of ground in her speech and I will try my best to sum up her contribution and the other important contributions that have been made.

The hon. Lady spoke about deductions being taken, apparently at random. I totally agree. She also mentioned carer’s allowance. She may not be aware that in Scotland we have looked to do something different on carer’s allowance. We are uprating carer’s allowance to better acknowledge, in some small way, the great work that carers do in our society. I encourage her to look at that.

The hon. Lady was right to say that universal credit has improved. There have been some improvements of late, and I am sure she would agree that the changes appear to acknowledge some of the problems that we have all been campaigning on, but do not go the full distance in terms of resolving the problems that are clearly still there—for instance, the two-child policy, the benefit freeze and the five-week wait. I will come back to some of those. She was also right to highlight the so-called major budget interventions that were made by the Government on universal credit. They do not come close to making up for the cuts that were made to it in the 2015 Budget, which made it almost unrecognisable from what was originally envisaged. I commend the hon. Lady on her speech.

The hon. Members for Waveney (Peter Aldous) and for Midlothian (Danielle Rowley) touched on the issue of separate payments. The Scottish Government and the previous Administration in Northern Ireland have looked to try to resolve that, and I would encourage the UK Government to look at that again and to stop insisting on charging for that.

The hon. Member for Oldham East and Saddleworth (Debbie Abrahams) is an authoritative voice on the subject, and it was good to see her here. She was right to draw on the evidence put forward by Philip Alston, the UN special rapporteur on extreme poverty. The UK Government have chosen to attack him personally, rather than to address the issues that he has quite legitimately raised.

My hon. Friend the Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) has possibly the greatest experience of us all on the impact of universal credit. He was right to raise the issue of the £2.5 million debt that Highland Council now finds itself in, and the £600,000 in administration costs that the UK Government should be paying up for. Of course, it is a triple whammy: UK Government austerity on public finances, UK Government austerity on personal finances and now the local authorities have that added burden on their services.

As the hon. Member for Strangford (Jim Shannon) did, I commend DWP staff, who try to resolve the issues we raise with them. They do their best to deal with those issues within the stringent policies implemented by UK Ministers.

The hon. Member for Great Grimsby (Melanie Onn) was absolutely right about advanced childcare costs—I have had many similar cases. I find it incredible that universal credit is paid in arrears, yet the bills that people have to pay on childcare must largely be paid in advance.

The hon. Member for Gloucester (Richard Graham) looked to paint a particular picture on universal credit. I encourage him to look at the Citizens Advice Scotland report and briefing that was available ahead of the debate. I think it would contradict and enlighten him greatly.

My hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) pre-empted much of what I have to say on the five-week wait. I appreciate her intervention. My hon. Friend the Member for Glasgow South West (Chris Stephens) dissected the DWP’s propaganda regarding universal credit that has been out of late.

I also commend the hon. Members for Easington (Grahame Morris), Bristol South (Karin Smyth), Makerfield (Yvonne Fovargue), Leigh (Jo Platt) and Merthyr Tydfil and Rhymney (Gerald Jones). This has been a very broad debate, with many good contributions.

As has already been highlighted, there are a number of issues at play on universal credit and debt. I am grateful to Scope, Shelter, the Child Poverty Action Group, StepChange and Citizens Advice Scotland for their briefings.

The first issue is the five-week wait. I appreciate that the Government have at least partially acknowledged that there is a problem, by looking to extend certain legacy benefits and to expand advance payments. However, much of the run-on for legacy benefits will not happen until next year, and no run-on help is available for those who are in touch with universal credit for the first time. Those fixes are not in themselves going to solve the problem, as the evidence from CPAG and Citizens Advice Scotland confirms. That is why I have asked Ministers to look at making what is now the assessment for an advance the first UC assessment, and making the advance essentially the first payment. If the recipient is shown to need the money at that point, why would the Government deny them that as part of universal credit, rather than financially penalising them for months after? I do not think there would be a major cost implication, other than to shift payments to the front end of the claim instead of further down the line.

Payment of housing costs to landlords is a major issue for both tenants and landlords. My local authority, North Lanarkshire Council, is having serious problems with the inflexibility of the current system on when rent payments are made. That means that I have received loads of cases where council tenants are getting chased for rent arrears, when the delay is in fact caused by the DWP. The DWP has acknowledged that issue, but there is no date for when it will move from a four-weekly to a monthly payment system. I encourage the DWP to work with local authorities and other housing providers to establish a more flexible system that enables them to know for certain when rent is to be paid.

The benefit freeze has already been raised. It is having a major impact on indebtedness as part of universal credit. While most working-age benefits have been frozen for four years, living costs have risen sharply with higher than anticipated levels of inflation. There is not an expectation that the freeze will continue beyond this financial year, but the Treasury is going to more than recoup its estimated savings from the policy this year. Quite frankly, low-income families have paid more than their fair share towards this Government’s policies and the benefit freeze should have ended this year. What estimate have the Government made of the impact that their benefit freeze has had on low-income families and poverty levels? What other detrimental impacts has it had?

Direct deduction rates must be looked at again. The hon. Member for High Peak was right to focus on that issue. If only DWP policy were to match that of the Cabinet Office, as my hon. Friend the Member for Glasgow South West said, which advocates fairness in debt collection and an understanding of the impact that debt collection processes have on people. As the hon. Member for High Peak said, that could start with the DWP understanding what debt repayments are actually for, so as to better understand the circumstances that the DWP Ministers should have a duty of care to support.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

Does my hon. Friend not think it absolutely shocking that if a terminal patient accrues debt, that passes on to their family? People should be defined by their medical definition and not the arbitrary six months that exists at the moment.

[Neil Gray]

My hon. Friend is absolutely right. Of course, she will know that a different system is being created for that in Scotland. I ask the Minister to look at the definition of terminal illness that has been adopted by the Scottish social security agency, which I think would help to deal with some of these problems.

Currently, deductions for indebtedness can be up to 40% of the standard allowance, and the Government are looking to reduce that to 30%. If we accept that the standard allowance is barely enough for anyone to live on in the first place—figures from the Joseph Rowntree Foundation show that adults without children on UC receive only 40% of the minimum income standard, while adults with children get just 60%—reducing that by a third is just going to exacerbate indebtedness. Most people would struggle if their income was reduced by a third without warning or negotiation, but I also acknowledge that there is a debt, so some effort must be made to repay it. There should be an affordability test and discussions in advance of a deduction being applied, and the recipient should be afforded expert advice and advocacy during that process. That surely has to happen if the DWP is going to give people help and breathing space for indebtedness.

As part of the summer pilot, the Government should consult extensively with key stakeholders, the devolved Governments and the expert charities, and those in receipt of universal credit themselves, particularly disabled people, to make sure that the system is got right and that no one is further impoverished as a result of universal credit.

Speakers from across the House have demonstrated in this debate, once again, that universal credit is still not working. It is time for the Government to listen, to restore and expand the funding available to universal credit and to fix the inbuilt technical issues and flaws that have been raised today and previously, which are contributing to a rise in food bank use and the impoverishment of those both in and out of work.

Oral Answers to Questions

Debate between Philippa Whitford and Neil Gray

Wednesday 16th January 2019 Commons Chamber

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

4. What recent discussions he has had with the Home Secretary on the potential effect on Scotland of UK immigration policy after the UK leaves the EU.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

7. What recent discussions he has had with the Home Secretary on the potential effect on Scotland of UK immigration policy after the UK leaves the EU.

Welfare Reform and Work Act

Debate between Philippa Whitford and Neil Gray

Wednesday 21st March 2018 Westminster Hall

[Dr Whitford]

That is what I am saying; we are already mitigating £450 million in benefit cuts from this place. We are not here to talk only about Scotland; we are actually talking about the suffering right across the UK. Some hon. Members in this place like to imply that Scottish National party MPs do not care about people in the rest of the UK, but I have friends and family here, as many of us do. The source of the benefit freeze is the Department for Work and Pensions—this place—and it has to be fixed at source.

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

I commend my hon. Friend for her meticulous and erudite speech. Does she agree that the benefit freeze, even by its own measure, is going beyond what was predicted? That is suggested by the DWP’s own figures and the figures that the SNP has obtained from the House of Commons Library, which suggest that the increase in inflation means that £3 billion extra will be saved by the DWP from the benefit freeze.

[Dr Whitford]

Yes. That is exactly what I will move on to. Obviously, the former Chancellor, George Osborne, justified the benefit freeze because at the time inflation was 0.3%, but inflation now, due to Brexit and the fall in the value of the pound, is officially 3%, as measured last September. By 2020, low-income families will be over £830 worse off, just due to the benefit freeze. If we look at the cumulative cuts, an average family will be £1,300 worse off. But if we drill down into families that have three or more children, that builds up and becomes eye-watering.

Universal Credit

Debate between Philippa Whitford and Neil Gray

Tuesday 13th March 2018 Commons Chamber

[Neil Gray]

I agree with the hon. Lady, which is why we are looking to introduce some flexibilities in Scotland, where we have the minimal powers to do so.

The Government must open their eyes to the crisis that they have created for workers, people who are sick or disabled, landlords and tenants, and employers, and urgently halt and fix universal credit before any more of our constituents have to suffer. In Scotland, the Scottish Government are using some of their minimal new powers in this area to give people in Scotland more choice over the universal credit payments and enable them to manage their household budgets better. We of course want to do more, and we wish that the whole of universal credit had been devolved to allow us to do so.

[Dr Whitford]

Does my hon. Friend agree that the Secretary of State’s suggestion that women can apply for the exceptional alternative payment scheme is not enough? The evidence shows that this needs to be the norm.

[Neil Gray]

I fully agree with my hon. Friend. Again, I hope that the Government are looking at her private Member’s Bill, which is due to be given a Second Reading on Friday, and that they will do what is right and is needed so that all areas of these isles can bring about the changes that are required.

Turning now to early-day motion 1004 on the changes to national insurance contributions that come into force on 6 April, much of the comment in this area has been not about the regulations themselves, but about a policy underpinning one of the changes. That policy is the UK Government’s decision to introduce a new scheme to support parents’ childcare costs—tax-free childcare—and to close employer-supported childcare schemes to new applicants from April 2018. Parents will not be able to receive support simultaneously from both the current scheme and the new tax-free childcare scheme, but parents who wish to remain in the old childcare vouchers scheme will be able to do so while the current employer continues to offer such a scheme. There is no obligation to switch to the new scheme, but existing voucher schemes will be closed to new applicants from next month.

The delivery of affordable childcare is crucial for the development of children as well as for providing for families. Fundamental to that is that parents on low incomes need to be protected from the impact of enormous childcare costs. That is one of the major barriers to resolving the gender pay gap and the gender employment gap. Childcare continues to be expensive and inflexible.

We are deeply concerned about the UK Government’s plans to close the childcare voucher scheme to new entrants from April this year. The SNP wishes to support policies that deliver for parents, ensuring that they have the resources and flexibility they need to give their children the best start in life. The UK Government must support working parents by keeping the scheme going, alongside the tax-free childcare scheme, so that parents can choose what is most suitable for their needs and offers the most support for their family. We must also consider in more detail the impact that the introduction of tax-free childcare will have across all different family types.

One of the key problems is that this is an extremely complex area, and the interaction of two schemes with the benefits system is an additional layer of complicated bureaucracy for parents. For example, the Low Incomes Tax Reform Group highlighted in February that universal credit and tax credit claimants must seek advice before applying for tax-free childcare:

“If an existing tax credit claimant makes a claim for TFC, even if they do not claim any help with childcare costs through tax credits, their whole tax credit claim will be automatically terminated. If they live in an area where universal credit full service has rolled out they may find that they are not able to claim tax credits again and this is very confusing.”

That is a significant issue with the new scheme, so how are the Government making people aware of it? We know that the DWP is notoriously bad at awareness campaigns, as we have seen with the WASPI women—Women Against State Pension Inequality Campaign—or the massively under-marketed Access to Work programme. We also know that the UK Government’s benefit changes are already creating confusion for people. Figures from the Government Digital Service have revealed that claimants appear to be encountering significant problems with the Government’s Verify system for universal credit, with 48 out of 91 needing help at a jobcentre to set up an account.

In Scotland, the SNP Government have committed to almost doubling the funded early learning and childcare entitlement by 2020, from 600 to 1,140 hours, in a bid to transform the life chances of children in Scotland. Our universal childcare offer is unmatched in the rest of the UK. In Scotland, all three and four-year-olds, and eligible two-year-olds, will benefit from 1,140 hours. The full entitlement is estimated to save families over £350 per child per month, or £4,500 a year.

Before I conclude, I would like to touch briefly on the other two motions, which relate to devolved matters. On the free school lunches and milk motion, every child at a local council school in Scotland can get free school lunches in primary 1, 2 and 3, regardless of financial circumstances. Some children in funded childcare before starting school can also get free meals. That is a year more than is currently provided in England. The UK Government’s universal credit system requires arbitrary thresholds, which create a cliff edge for parents, as has been discussed. We continue to call on the UK Government to devolve powers and funding so that we can take control of universal credit in its entirety in Scotland and deliver it in the best way possible for the people of Scotland.

Finally, on the free childcare motion, we have committed to fully funding our transformative expansion of early learning and childcare entitlement to 1,140 hours by 2020, and we have a track record of delivering on the previous expansion from 475 hours to 600 hours.

In conclusion, in all these areas what is clear is that when issues are devolved we see better policy and better outcomes for the people of Scotland.

Universal Credit Roll-out

Debate between Philippa Whitford and Neil Gray

Tuesday 24th October 2017 Commons Chamber

[Neil Gray]

The hon. Gentleman knows better than just to regurgitate the Whips’ interventions notice, and he knows that the Scottish Government are responsible for 15% of social security powers and that they have already mitigated more than £400 million of Tory cuts. How much more does he expect the SNP Scottish Government to clear up this Tory Government’s mess?

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

Does my hon. Friend recognise the figures that show a 17% increase in rent arrears, a 15% increase in the number of people getting into debt with loan sharks and a 87% increase in crisis grants from the Scottish Government in universal credit areas?

[Neil Gray]

My hon. Friend is absolutely right. The evidence is there for the Government to see.

Is the 3% uplift in employment rates really worth the rise in in-work poverty we see in universal credit areas, the crippling rise in rent arrears or the disgusting rise in foodbank use? There is no data on the quality of the jobs the 3% are managing to pick up, but we know that work coaches are forcing universal credit claimants to sign conditionality forms that force them to take any job, regardless of its security or suitability, and that the threat of sanctioning is forcing them to take it. We know that in general there is a rising prevalence of insecure and low-paid work, which is crushing morale and harming the UK’s productivity rate. The threat of sanctioned destitution is forcing people into accepting precarious and unsustainable work.

Oral Answers to Questions

Debate between Philippa Whitford and Neil Gray

Tuesday 13th December 2016 Commons Chamber

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

3. What his priorities are for the development of the Government’s industrial strategy.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

6. What his priorities are for the development of the Government’s industrial strategy.

State Pension Age Equalisation

Debate between Philippa Whitford and Neil Gray

Wednesday 2nd December 2015 Westminster Hall

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

It is a pleasure to serve under your chairmanship, Mr Davies. Indeed, it is a pleasure to follow the excellent contribution of the hon. Member for Heywood and Middleton (Liz McInnes), in which she cited examples of her own constituents who are affected.

I am grateful for being able to take part in this debate, and I congratulate the hon. Member for Worsley and Eccles South (Barbara Keeley), whose contribution touched on much of what she rightly said in a previous Westminster Hall debate on women and low pay, in which I had the privilege of summing up for the Scottish National party. She also touched on some of the points made by my hon. Friend the Member for Kirkcaldy and Cowdenbeath (Roger Mullin) in a debate on guaranteed income for retirees led by my hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford). She made a great speech and set out the issues well. My right hon. and hon. Friends in the SNP agree with equalisation, but we do not support the unfair manner in which the changes have been made, and we want to see action on that. A transitional period is required to protect retirement plans for women. I thank the WASPI campaign and constituents in Airdrie and Shotts who have contacted me about this issue by email and on social media.

There are now three categories of people who are affected by the two legislative changes: women born between 6 April 1950 and 5 April 1953 will, under the 1995 Act, have a pension age of between 60 and 63 by March next year; women born between 6 April 1953 and 5 December 1953 will, under the 2011 Act, have a pension age of between 63 and 65 by November 2018; and men and women born between 6 December 1953 and 5 April 1960 will have a pension age set by the 2011 Act of between 65 and 66 by October 2020. What a guddle.

The 2011 Act has affected around 5 million people in total—approximately 2.6 million women and 2.3 million men, who now have to wait longer to reach pension age. It is clear that women did not get a fair notice period and were not allowed enough time to prepare. Most of those affected by the 2011 Act have had only about five years to prepare. Pension planning should be lifelong and should not be made on the hoof as people approach retirement.

[Dr Philippa Whitford]

Will my hon. Friend give way?

[Neil Gray]

I am afraid I do not have time.

The lack of time to prepare is simply unfair. Age UK has said that the revised timetable for retirement allows

“insufficient time to prepare for retirement”,

as my hon. Friend the Member for Banff and Buchan (Dr Whiteford) also said during the passage of the 2011 Act. With all due respect, it is for that reason that I have to disagree with the hon. Member for Gloucester (Richard Graham). These women are being financially penalised and let down on what they were promised for retirement.

Another issue is that women will be worse off than men, yet again. According to the Pensions Policy Institute, only 65% of women in the 55 to 59-year-old range and only 34% of women in the 60 to 64-year-old range are currently economically active. That means that women are in a poorer position to compensate for the changes through work, and it will be more difficult for them to save and plan for their retirement. More women are excluded from the scope of auto-enrolment, as well, so women will lose out further. Based on Department for Work and Pensions analysis published in 2013 and 2014, we can estimate that setting the threshold at £10,000, rather than the 2014-15 earnings limit of £5,772, excludes about 1.6 million people from the scope of auto-enrolment.

I sincerely hope that the Government will revisit the inequalities currently experienced by women born in the 1950s. The Minister can take steps today by agreeing to the terms of the WASPI petition and bringing forward the review from 2017 as a matter of urgency.