Devolution of Welfare

Stephen Kerr Excerpts

Tuesday 9th April 2019 Westminster Hall

[John Lamont]

The hon. Gentleman makes a very important point about the importance of different Governments within the United Kingdom working together. Ultimately, and in this policy area in particular, we are helping some of the most vulnerable people in society, and it is imperative that we get it right. That is why this debate is so important.

I think it a good thing that more control over welfare is coming to Scotland, but it is clearly a challenge, and it is obvious that the Scottish National party Government in Scotland have significantly underestimated the challenge. Under the 2016 Act, 11 DWP benefits are being devolved to Scotland. The power to legislate for that has already been transferred. On 1 April next year, the Scottish Government are due to gain “executive competence”, which is essentially administrative control over the benefits. Those are significant new powers. Launching Social Security Scotland, the First Minister described it as an “historic moment”.

Although some of the benefits to be devolved are less substantial—they are of course hugely important to those who receive them—significant benefits will be taken on by the Scottish Government. They include PIP, carer’s allowance and DLA and, as a package, they account for about £3 billion, or just over 15% of total social security spending in Scotland.

The Department for Work and Pensions has been working with the Scottish Government to allow the change to take place. The Scottish Government have previously promised that they will be fully delivering these benefits by the end of the Scottish Parliament’s current term, which ends in 2021. In fact, the Scottish Government previously indicated that they hoped to complete the process by 2020, so the timetable had already slipped slightly. Given that the Scotland Act was introduced in this place in May 2015, the Scottish Government could have got ahead of the game and begun preparing for this process much earlier than they did.

[Stephen Kerr (Stirling) (Con)]

I compliment my hon. Friend on securing the debate. He has mentioned the investment that the DWP has already made in helping the Scottish Government to prepare to assume the devolved powers for these benefits. Does he know how much that has cost the DWP in addition to its usual expenses?

[John Lamont]

My hon. Friend makes a very important point, and I am going to come on to that shortly. Clearly, there is a cost implication of the Scottish Government’s failure to keep to the timetable that they have anticipated.

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[Ian Murray (Edinburgh South) (Lab)]

It is great to see you in the Chair, Mr Betts. If the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont) will allow me to refer to him as the hon. Member for Berwickshire, that might save us a little time.

This is a strange debate, because we have two parties—the Conservatives and the SNP—arguing when they are both culpable for why we are here. Since 2010 the social security system has been completely and utterly discredited by a deliberate narrative from the then coalition Government that welfare was a bad thing. They completely changed the narrative in this place, and indeed in the country, from social security being a safety net to welfare being bad. That is part of the problem we have today.

Between 1997 and 2010, the previous Labour Government created a system that lifted millions of pensioners, and millions and millions of children, out of poverty. We should be incredibly proud of that. Since then, most of that has gone backwards in the name of austerity, which has been a political choice rather than a necessity. Before Conservative Members, if they wish, pop up and go on about the employment statistics, which are welcome, most of the decline in terms of poverty comes from in-work poverty—people actually in work.

[Stephen Kerr]

Will the hon. Gentleman give way?

[Ian Murray]

I am happy to do so just once.

[Stephen Kerr]

Surely it is a good thing that there are now fewer children in workless households than ever before. That is good, isn’t it?

[Ian Murray]

It is a fantastic thing, but it is bad that most of those children are in poverty when they were not before. Social security is a sensitive subject, and we must be careful about the language we use.

I want to reflect on what the Smith commission has done. In response to the 2014 independence referendum, a commission was put in place that allowed all the parties to come together to find consensus about what the next stage of devolution to the Scottish Parliament should be in the devolution journey.

I am glad that Members across the House now extol the virtues of sections 24, 25 and 26 of the Scotland Act 2016, because while the Conservatives and SNP argued about the minutiae of what was not in the Bill, Labour were promoting changes at the Dispatch Box. We proposed amendments to put stuff into the Bill that could have been there, such as my amendment 31. The amendments that went through in the House of Lords gave Scotland the power to create its own social security system. The Scottish Government can top up any reserved benefit and create a new benefit in any devolved area; that is incredibly important. That is why it is so frustrating that the devolved powers have been delayed. I am delighted that the hon. Member for Berwickshire mentioned the WASPI issue, because it is a key aspect of the way the whole issue has been dealt with.

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[Stephen Kerr (Stirling) (Con)]

It is a pleasure to serve under your chairmanship, Mr Betts, and to follow the hon. Member for East Lothian (Martin Whitfield), who made his usual thoughtful speech. I thank my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont) for securing this Westminster Hall debate.

I remember the conversation back in September 2014. The SNP had produced its blueprint for an independent Scotland, which it claimed was a White Paper, but, as it has transpired, was a work of pure fiction. Events have proven that beyond doubt. On page 339 of the document there was a timeline for independence, and it put independence day in March 2016. That is a total of 560 days from the date of the referendum to the date of independence: 560 days to set up an entirely new country from scratch. The timeframe would include all the negotiations on how Scotland would withdraw from and have a future relationship with the rest of the United Kingdom. On reflection, how extraordinary those dates and numbers now seem, and how ridiculous, particularly in the light of what has transpired in relation to Brexit.

Today’s debate is about the establishment of the devolved Scottish social security system. The Scotland Act devolved the powers and they passed into law on 23 March 2016. The Act delivered on the promise made to the Scottish people about devolving more power to our Parliament. It fulfilled the commitments of the Smith commission, to which all the parties in Scotland contributed and agreed. The noble Lord Smith of Kelvin has confirmed that all the commitments made in the commission’s report have been delivered, so the powers in relation to social security should be transferred to the Scottish Government on 1 April 2020, but the SNP will not touch them. It will cost more than £308 million to set up Social Security Scotland. The SNP claimed, just five years ago, that it would cost £200 million to set up the new Scotland that it falsely promised the people of Scotland. In February, the Cabinet Secretary for Social Security announced that the Scottish Government would not be in a position to introduce and own the devolved powers until at least 2024.

[Ross Thomson (Aberdeen South) (Con)]

My hon. Friend is right that the Scottish Government have not touched the powers. The nub of the issue is this: their only desire is to have the constitutional change of independence, which means using any mechanism at their disposal to attack the UK Government, bash Westminster, and use the politics of grievance rather than come up with solutions to help people.

[Stephen Kerr]

My hon. Friend is correct; there is no issue that it is beyond the SNP’s powers to politicise and use for its own nationalist agenda. Clearly, these things are more complex than they seem, and I accept that. I do not really want the SNP taking these powers and using them if it cannot handle them, because we are talking about the lives of the most vulnerable people in Scotland, who deserve to be protected from any possible incompetence on the part of the SNP. The SNP’s track record on IT systems alone is a horror story, and the farm payments fiasco is a warning.

[Neil Gray]

The hon. Gentleman warns of the problems that his constituents could face if this system is not delivered effectively. To his credit, he has been a critic of this Government on universal credit, so does he not think it a tad ironic to be speaking about the potential incompetence of the Scottish Government who are delivering a safe system when his Government have presided over the shambles of universal credit and personal independence payments?

[Stephen Kerr]

The hon. Gentleman is someone I respect, but we are talking about the Scottish Government’s willingness to accept powers that have been devolved to them, and their unwillingness to touch those powers speaks volumes about them. They will now take until 2024 instead of 2020. That is more than 3,000 days’ notice—six times the number of days the SNP told us it would need to set up the new Scotland that it promised the Scottish people in 2014. This is the sad state of affairs of the SNP.

The fact is that the SNP does not want to have to handle these powers, because they are difficult powers to handle. Welfare and benefits are expensive and complex; they need politicians to be grown up, to make difficult decisions and to show leadership. Let us be clear: the next time we hear SNP politicians in this place or elsewhere deriding welfare reform or bemoaning a decision that they view as disadvantageous to their constituents, they will be complicit. The SNP Government could have set up a social security system; they could have grasped the nettle and dealt with this, but, through either political cowardice or sheer incompetence, they have failed the challenge.

The people of Scotland are sick and tired of the SNP and its excuses. Devolution works. The powers are there. It is simply the nationalists who, through their wilful negligence, are leaving Scotland to stagnate.

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

Thank you very much, Mr Betts. It is a pleasure to speak in this debate with you, my Finance Committee colleague, in the Chair. I congratulate the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont) on securing the debate, as it gives us an opportunity to talk about the great work being done by the SNP Scottish Government—

[Stephen Kerr]

Will the hon. Gentleman give way?

[Neil Gray]

At least let me get started.

With support from other parties and brilliant stakeholders in Scotland, we are working to build our new social security system. I welcome the fact that the hon. Member for Berwickshire, Roxburgh and Selkirk has a newfound interest in this area. Until now, he does not appear to have had much of an interest in the work and pensions brief since arriving in this House. A quick look at his speaking record shows that he has never mentioned universal credit or employment support allowance, and has raised personal independence payments—[Interruption.] I will not be shouted down, Mr Betts. The hon. Gentleman has raised personal independence payments just once, which, given the case that I and other colleagues have in this area, I find surprising.

If other search terms are entered, however, the number of mentions made by the hon. Gentleman rockets up. “The Scottish Government” gets 242 mentions, “the Scottish National party” gets 37, “the SNP” gets 116 and “independence” gets 43. That is quite the contrast. Those speaking records perhaps speak not just to his intentions today, but more to what he regards as his purpose in this place: not so much being part of a bloc of Scottish Tories holding this shambles of a British Government to account, but trying to do the job that he left as an Opposition Member of the Scottish Parliament.

I will tackle some of what the hon. Gentleman said and highlight some of what he conveniently forgot to say. I note that he did not once mention how the Scottish Government could safely deliver the new system any faster. I think we were right, having learned from the unsafe and disastrous delivery of universal credit and the personal independence payment, to take our time, do this properly and deliver it safely for our constituents who depend on it.

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[Neil Gray]

Yes, I do. The hon. Gentleman is a former Member of the Holyrood Parliament, so he knows how quickly legislation can progress through Parliament, and he knows the steps that need to go through in order—[Interruption.] I will not be shouted down. The hon. Gentleman knows how legislation goes through Holyrood, and knows that these things take time. Sadly, we are now, thanks to the intransigence of DWP Ministers, in a position whereby certain things are being delayed. I go back to the point that the hon. Gentleman had never mentioned universal credit and had mentioned PIP once before today’s debate. I am very surprised at that. He does not seem to have a problem with the delay—

[Stephen Kerr]

Will the hon. Gentleman give way?

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[Mike Amesbury (Weaver Vale) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Betts. It was almost a “Get the popcorn out” moment there.

I thank the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont) for securing such an important debate. He is on record as saying:

“Devolution has been a good thing for Scotland”

because it has

“the potential to bring power and decision makers closer to the people.”

That principle is a rare example of something that I can agree on with him. It is a historical reality that the Labour party and the late Donald Dewar were the architects of this landscape—a legacy that has strengthened the voice of Scotland and democracy in the United Kingdom. My hon. Friend the Member for Glasgow North East (Mr Sweeney) made me realise my age when he pointed out that he was just nine years old at that time.

To Labour Members, two things are clear from this debate. First, devolution of powers alone is not enough; we need an Administration willing and able to use the powers available to them, with a defining mission to reduce poverty and the political drive from the centre to get on with it and not to delay, delay and delay. Secondly, while devolution of particular policies may be a positive step, as we can all agree, it does not absolve the Conservative party, which conceived, developed and delivered a poor, failing policy here in Westminster, of responsibility for its effects elsewhere.

The Tory Government, as has been pointed out by Opposition Members, have used social security as a vehicle for cuts, with more than £37 billion taken away from UK citizens since 2010—£3.7 billion taken away from Scottish citizens. The effects and consequences of universal credit, as was rightly pointed out by most Opposition Members who have spoken, are a direct result of the Conservative party’s designing and pressing ahead with a policy that is deliberately under-resourced, cruel and unfair. That policy is causing hardship across the United Kingdom, and Labour Members are all too familiar with the effects on our constituents.

Those effects continue to be felt strongly in Scotland, but they have not been mitigated by the SNP-led Scottish Government, even though they have the power to do so. That is a cause for great regret and disappointment for Scotland’s Labour Members of Parliament and Members of the Scottish Parliament.

[Stephen Kerr]

It is a great disappointment that in a debate on such an important topic, the SNP Members—who are the Scottish Government—did not even bother to turn up. Only the hon. Member for Airdrie and Shotts (Neil Gray), their spokesman, has been here for the whole debate. They have come in and out like a magic roundabout, but they have not stayed for the debate. Does the hon. Gentleman agree that that is a shame on the SNP?

[Mike Amesbury]

The hon. Gentleman has made his point.

Mitigation is essential, and a lack of it is a cause for unnecessary hardship and continuing poverty. It certainly shames both the Westminster and Holyrood Governments that that continues. Although legal powers to run benefits in Scotland will pass to the Scottish Government in April 2020 as a result of the Scotland Act 2016, the SNP-led Administration have wilfully delayed using those powers in full until 2024.

The spend accounts for some 16% of welfare, or £3 billion. As has been pointed out by Government Members, the SNP is a party that claims it can create an independent state in 18 months. Twice, SNP Ministers have asked the Department for Work and Pensions to delay devolving social security, in 2016 and 2018, which means that, over the next five years, we will have a ludicrous situation in which SNP Ministers will, effectively, send millions of pounds down south to pay the DWP to run social security provision in Scotland.

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[Alok Sharma]

I thank the hon. Gentleman for his intervention. Over the past few years we have been working constructively, and we want that to continue. My hon. Friends definitely want that. They come in to see me and the Secretary of State regularly to raise issues, and it is right that we continue in that spirit.

Many lessons have been learned in the first wave of devolution, such as in the transfer of accountability of carer’s allowance, where the DWP continues to pay carer’s allowance on behalf of the Scottish Government but under the same rules and rates as for people in England and Wales. It is vital that we consider these lessons as we move forward with the next wave of delivery.

[Stephen Kerr]

Will the Minister give way?

[Alok Sharma]

I will not, if my hon. Friend does not mind, because time is short.

The hon. Member for Weaver Vale (Mike Amesbury) criticised the Government’s delivery of universal credit. I believe it is working, and we have put in an extra £6 billion to support the most vulnerable in the past two Budgets, which unfortunately he has not been able to support in votes. I point him to the summary of a Public Accounts Committee report from 2005 on tax credits, which says:

“In April 2004, the Committee reported on the severe problems following the introduction of the New Tax Credits, which meant that several hundred thousand claimants were not paid on time.”

I gently point out that we all want to get the system right, and I am not sure that constantly criticising is the best way forward.

As colleagues have noted, the Scottish Cabinet Secretary for Social Security and Older People recently announced the Scottish Government’s delivery timetable for their replacements to the current disability, carer’s and industrial injuries benefits, as well as replacements for winter fuel and cold weather payments. The timetable proposes that the Scottish Government will progressively take over responsibility for delivery from April next year, with the final cases being transferred by 2024. That reflects the pace that the Scottish Government believe that they can commit to and is achievable.

On timing, it will be for the Scottish Government to keep it under review. The Scottish Government’s plans involve considerable work for DWP in both supporting them to achieve their ambition and, as necessary, continuing to deliver benefits on their behalf. We share the Scottish Government’s commitment to a safe and secure transfer, and our priority is as seamless a transfer as possible from the person receiving the benefit’s point of view.

My hon. Friend the Member for Berwickshire, Roxburgh and Selkirk raised a number of issues in his remarks. He spoke of his concerns about the Scottish Government’s delivery plans, the continuity of provision for his constituents and the cost to the public purse from the DWP continuing to deliver devolved benefits on behalf of the Scottish Government. We will, of course, continue to work with the Scottish Government, and costs arising from the DWP’s delivery of services on behalf of the Scottish Government will be reimbursed by the Scottish Government.

Many other points were raised, and if colleagues want to write to me I will be happy to respond to them. A number of colleagues mentioned WASPI. It is for the Scottish Government to determine how to use their powers to make further payments, including to fix issues for those individuals.

The devolution of welfare powers represents a significant constitutional change that will require substantial work by both Governments to ensure that the people of Scotland are well served. We are committed to working constructively with the Scottish Government. I look forward to the future and seeing the Scottish Government successfully delivering their new social security benefits for the people of Scotland.