Universal Credit Roll-out Debate

Full Debate: Read Full Debate
Department: Department for Work and Pensions
Wednesday 18th October 2017

(6 years, 5 months ago)

Commons Chamber
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Simon Clarke Portrait Mr Simon Clarke (Middlesbrough South and East Cleveland) (Con)
- Hansard - - - Excerpts

It is the hallmark of a fair welfare system that it includes a strong and effective way of helping people who are out of work to find employment, and, by doing so, allows them to enjoy the dignity, confidence and self-reliance that comes with the ability to provide for themselves and their families. In that regard, we should never take the Government’s achievement since 2010 for granted. There are 3 million more people in work, unemployment in my constituency has halved, and our national unemployment rate is half that of the eurozone.

None of that happened by accident. It happened as a result of the hard work done by companies large and small, and as a result of carefully calibrated Government policy. That progress could—and, I believe, would—be undone in an instant were the shadow Chancellor ever to have an opportunity to unleash his programme of hundreds of billions of pounds of unfunded spending, and nationalisation with Parliament determining “fair compensation” for shareholders, all in the context of a crippling loss of investor confidence and a run on the pound. Despite the progress that we have seen, however, there is further to go, and that is precisely why I support universal credit. Its purpose is to deliver fundamental reform, and to replace a contradictory, and sometimes impossible, set of conflicting benefits with a single simplified payment.

The key question to ask about any policy is “What incentives does it create?” In the case of universal credit, the policy aligns the incentives so that work always pays. In my constituency, too many lives have been blighted for far too long by joblessness. I challenge Opposition Members to go to a ward such as Park End or Hemlington, and then tell me that it is wrong to end the perverse situation that we inherited whereby some people were losing £9 out of every extra £10 that they earned, which left them with virtually no incentive to work.

Ruth George Portrait Ruth George (High Peak) (Lab)
- Hansard - -

What would the hon. Gentleman say to the nearly 7,000 families in his constituency who currently claim tax credit, and who, according to the Institute for Fiscal Studies, will be £2,500 a year worse off under universal credit?

Lindsay Hoyle Portrait Mr Deputy Speaker (Mr Lindsay Hoyle)
- Hansard - - - Excerpts

Order. I am more than happy to allow interventions, but if Members who choose to intervene want to look a colleague in the eye when that colleague drops off the list of speakers, let them do so, because that is what is going to happen.

--- Later in debate ---
Ruth George Portrait Ruth George
- Hansard - -

Does my hon. Friend agree that, when the Institute for Fiscal Studies says that a further 3 million working families will be made, on average, £2,500 a year worse off, universal credit is never going to work for working families?

Margaret Greenwood Portrait Margaret Greenwood
- Hansard - - - Excerpts

My hon. Friend makes a very strong point and I thank her for it.

Sir John Major recently called the roll-out of universal credit operationally messy, socially unfair and unforgiving. A former Government official, Dame Louise Casey, likened it to jumping off a cliff. Members are extremely concerned about what universal credit means for their constituents. Indeed, 12 Members from the Government Benches have written an open letter to the Secretary of State, calling on him to pause the roll-out, and their concern is widely shared around the House.

In response to concerns raised last week, we heard the Secretary of State reassure us that those who go on to universal credit are more likely to be working six months later than they would be had they been on legacy benefits, and that they are also more likely to be progressing in work. However, his statistics date from 2015 when universal credit claimants were, on the whole, single unemployed jobseekers, whereas the benefit is now being rolled out to people with much more complex circumstances. Furthermore, his statistics dated from before the cuts to work allowances were introduced in April 2016.

In response to concern from all parts of the House about what is happening now, the Secretary of State said that universal credit is about ensuring that our constituents are in a stronger financial position—