Universal Credit (Children)

Priti Patel Excerpts

Tuesday 10th May 2016 Commons Chamber

[The Minister for Employment (Priti Patel)]

I welcome the debate and congratulate the right hon. Member for East Ham (Stephen Timms) on both securing it and making an incredibly thoughtful contribution. I want to put my tributes to him on the record, especially as I have spent time with him in Committee. He mentioned the early stages in the development of universal credit and the first Welfare Reform Act 2012. I was also on that Bill Committee and know that he made some notable contributions to the discussions on universal credit and on the changes that the Government were undertaking at the time.

I also want to thank Members from all parts of the House—my hon. Friends the Members for North Devon (Peter Heaton-Jones) and for Gloucester (Richard Graham), and the hon. Members for Edmonton (Kate Osamor), for Airdrie and Shotts (Neil Gray), for Lanark and Hamilton East (Angela Crawley) and for Banff and Buchan (Dr Whiteford)—for contributing to this important discussion. I will come on to the points that they made a little later.

Before I move on to the details of universal credit, it is probably worth setting out the Government’s commitment to—yes—universal credit and also to what has been at the heart of universal credit and our welfare reform changes. Universal credit has been revolutionising the welfare system by focusing on making work pay, and I will go into detail on the points that have been made about incentivising work.

For the first time, we are helping people not only into work, but to have personalised support while they are in work. We are seeking to transform individuals’ outcomes when it comes to employment support. We want to ensure that they are supported in work and have sustainable employment outcomes as well. That has been very much at the heart of our welfare reforms. When we discuss universal credit in the broader sense, it is important to recognise that it has been instituted and developed so that it is easier to start work and to earn more, and that is because of the personalised support that it offers. Under the old system, there was little or no support when someone started work.

Universal credit provides for a Jobcentre Plus work coach. As Members have said, work coaches are focused on providing support and in-work progression. Universal credit mirrors the world of work. Like most jobs, universal credit is paid in a single monthly amount. It aims to make work pay. It stays with the claimant after they move into work. On top of that, universal credit is part of a package of reforms that runs alongside the introduction of the national living wage.

There were comments about the delivery of universal credit. What we have seen is that the national roll-out is now complete and that the digital service for all claimants will start to roll out nationally from May. Once completed in June 2018, it will no longer be possible to make newer claims from legacy benefits. We have been very focused on the agile delivery of universal credit. Just yesterday, my right hon. Friend the Secretary of State re-emphasised the fact that we would rather have an agile delivery of universal credit than a big bang approach, which more often than not jeopardises the delivery of our benefit system. [Interruption.] Does the hon. Member for Pontypridd (Owen Smith) have something to contribute, or is he just chuntering for the sake of it? [Interruption.] It is a well-developed system, and I am sure he is shaking his head in acknowledgement. The fact is that universal credit is in every jobcentre. The vast majority of claimants are now receiving support that, obviously, did not exist under the legacy system.

[Nick Thomas-Symonds]

Can the Minister define agile delivery, and will she tell us how universal credit will take into account the 65 open risks that have been identified in the universal credit programme?

[Priti Patel]

The hon. Gentleman is talking about the risk register that was published many years ago. Let me explain agile delivery. This is a system that is adapting. It has adapted following feedback from work coaches. The delivery is the test of the system. All Front-Bench Members will be familiar with this, as we have been very public about it. We have taken the insights from the delivery so that we are supporting people. The reality is that universal credit is out there and is supporting people in work, and we are seeing positive benefits as well.

I am very conscious that a number of points have been made about child poverty, which, of course, was subject to much debate in the Welfare Reform and Work Act 2016. For the first time, the Government have a statutory obligation to report annually on worklessness and educational attainment, because they are two factors that have the biggest impact on child poverty and children’s life chances. Previous debates on poverty have focused purely on the symptoms of poverty, rather than on the root causes. We now believe that, through our commitment to ending child poverty and improve life chances, our two measures will ensure that there is real action in the areas that will make the biggest difference to poor children, both now and in the future.

We have also committed to publishing a life chances strategy, and it will set out a comprehensive plan to fight disadvantage and extend opportunity. It will include a wider set of non-statutory measures on the root causes of child poverty, including family breakdown, problem debt and drug and alcohol addiction.

When the strategy is published, I will be working not just with my colleagues on the Conservative Benches, but with all Members of the House, as this is such an important issue. The hon. Member for Edmonton talked about it, and I am alarmed to hear how high her constituency is ranked in terms of child poverty. We will need to develop the right ways to tackle these deep-rooted social problems and work collectively to transform children’s lives so that ultimately they too can reach their full potential. It is important that all Members work constructively towards that aim.

[Stephen Timms]

What is the Government’s current estimate of the impact on the number of children growing up in poverty of the implementation of universal credit?

[Priti Patel]

I do not have information or data to hand on the current estimate, but the Government previously published figures on UC and child poverty. As other Members have commented on this, I will be very happy to write to them and to the right hon. Gentleman to update them on those numbers.

[Owen Smith (Pontypridd) (Lab)]

Does the Minister think that that figure will be more or less than the 200,000 additional children going into absolute poverty cited by the Resolution Foundation?

[Priti Patel]

As the hon. Gentleman has just heard me say, when we publish our life chances strategy and focus on tackling the root causes of child poverty—we are committed to eradicating child poverty, as well—we will be driving those numbers down.

[John Glen (Salisbury) (Con)]

Will my right hon. Friend ensure that when this life chances strategy is published, significant thought will be given to its integration with the lessons learned from the troubled families programme to ensure that the range of interventions across multiple Departments are integrated to give the best chance of success?

[Priti Patel]

My hon. Friend makes an important point. Of course, the point about the life chances strategy is that it will be a cross-government strategy. The focus will be integration and support. The troubled families programme has been very successful in transforming families and turning their circumstances around, supporting work and the right kind of outcomes. We are incredibly focused on and conscious of the need to integrate. Once the strategy is published, all hon. Members will see that completely.

The point about universal credit, of course, is that it removes barriers that prevent people from finding work and increasing their hours and earnings. Universal credit provides the right support to incentivise work and, in particular, removes some of the barriers that were in place, including the restrictions on hours worked, such as the 16-hour rule.

Not just in this debate but in others and in various Committees of this House, we have been very clear that universal credit claimants receive not only support from their work coaches but additional support for childcare costs. Our in-work progression trials have begun to test how work coaches can continue to provide tailored support to in-work claimants so that they can progress and, importantly, increase their earning capacity.

[Dr Eilidh Whiteford]

I know that the issue of in-work claimants is still at a fairly embryonic stage, but 40% of the DWP’s own staff are likely to be affected by that in-work conditionality approach. I know that various hon. Members have asked the DWP for answers on whether it will offer those staff the extra hours they need to avoid being sanctioned and having their tax credits and universal credit cut. Will the Minister comment on that now?

[Priti Patel]

We have been very clear that universal credit is there to secure employment opportunities and in-work progression for everyone who is on it. I come back to the wider support universal credit provides for families, which has been touched on. Parents on universal credit can claim back 85% of their childcare costs when they move into work, compared with 70% under legacy benefits. This is a significant change and means that a working family with two children can now receive up to £13,000 a year in childcare support under universal credit.

Interestingly enough, prior to the recent elections in Scotland, I met the Scottish Minister responsible for childcare to consider the development and uptake of the childcare policy in Scotland, which mirrors many of the programmes that we have in England. Affordable childcare is crucial for working families and I look forward to working with the new Government in Scotland to ensure that we can provide all possible relevant support.

Support for disabled children was also mentioned. We should all be clear—I recall debating these points in the Welfare Reform and Work Bill Committee—that there is clear recognition of the extra costs associated with disabilities. Universal credit will provide support for families with disabled children. Of course, the point about the disabled child addition is that it provides extra support for low-income families with a disabled child. We know that caring responsibilities are enormous for parents with disabled children, and we also know that those parents are less able to take up work. They therefore need greater support, and that is obviously what we are focused on.

[Mark Durkan]

The Minister refers again to additions and to giving extra support to children with disabilities. Of course, it is not extra or additional to what they would receive now; it is actually a reduction. Will she properly address the terms of the motion and not the fantasy world that she is trying to serve up?

--- Later in debate ---

[Priti Patel]

Let me be clear about this: the Government have been absolutely clear about protecting and supporting the vulnerable and about the support we provide for families with disabled children.

I also want to address some of the points raised about the Resolution Foundation report. It fails to take into account that the highest barriers to entering work for second earners in the current system are virtually eliminated under universal credit through, for example, increased childcare, the fact that there are no restrictions on the number of hours worked and the fact that there are work allowances for those households with children. The report also calls for a more radical focus on boosting claimants’ earnings and, of course, that is exactly what universal credit does. For the first time ever, people are getting personalised support so that they can progress in work and earn more. Universal credit ensures that people are better off for every extra hour they work. Our research shows that 86% of people on universal credit were actively looking to increase their hours, compared with just 38% of people on jobseeker’s allowance, and 77% of people on universal credit were actively looking to increase their earnings, compared with just 51% of people on JSA. That focuses on the type of support that universal credit gives through the personalised work coaches and the additional support that that provides.

I hope that I have made clear the case for universal credit. It is supporting people in work and transforming people’s lives. We already have evidence of that from the indications that I have given. I want to reiterate and emphasise that when it comes to dealing with challenging issues such as child poverty, the Government will be publishing our life chances strategy shortly. I look forward to working with all right hon. and hon. Members to tackle these fundamental issues, which are being supported by the implementation of universal credit.