Free School Meals/Pupil Premium: Eligibility

Stephen Timms Excerpts

Tuesday 6th February 2018 Westminster Hall

[Stephen Timms (East Ham) (Lab)]

I, too, want to refer to the work incentive, because improving it was supposed to be the fundamental advantage of universal credit. That was set out fully and ably by the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) from 2010 onwards. For example, the document “21st Century Welfare”, which was published in July 2010, states in chapter 2 that

“someone at the National Minimum Wage would be less than £7 per week better off if they worked 16 extra hours…A system that produces this result cannot be right.”

We all agreed with the right hon. Gentleman about that, yet the universal credit system, which is supposed to remove all these problems, will introduce a benefit trap far worse than anything in the legacy system. There is nothing in the legacy system under which someone earning a few hours of extra work will end up hundreds of pounds worse off because they have lost their free school meals.

[Alex Burghart]

Will the right hon. Gentleman give way?

--- Later in debate ---

[Stephen Timms]

I do not think I can, given the time limit, but I want to comment on the point that the hon. Gentleman made in his speech. He suggested that the answer could be an electronic card system and the contribution to school meals could be tapered away with the universal credit taper. I made that proposal in the Welfare Reform Bill Committee on 13 June 2011, when I moved new clause 3. I was making exactly the point that a fixed-income threshold for entitlement to free school meals is disastrous for work incentives. There is some merit in his suggestion that that would be a long-term solution, but I suggested it seven years ago, which I am afraid is a reflection of the failure of Ministers. Seven years on, they have not come up with a solution to this very serious problem.

The difficulty is that universal credit was never seen as a whole-of-Government initiative. When the Government that many now on the Opposition Benches supported introduced tax credits, it was a whole-of-Government initiative. Gordon Brown made sure of that. Under this Government, universal credit is a matter for the DWP, so the Minister present no doubt feels that it is not for him to worry about work incentives in the social security system. However, he should be worried about this issue, and I hope he will change his policy.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Education (Nadhim Zahawi)]

I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) and the hon. Member for High Peak (Ruth George) on securing this important debate. I thank all colleagues who have spoken today, including the hon. Member for Manchester, Gorton (Afzal Khan), my hon. Friend the Member for Brentwood and Ongar (Alex Burghart), the hon. Member for Eastbourne (Stephen Lloyd), the right hon. Member for East Ham (Stephen Timms) and the hon. Members for St Helens South and Whiston (Ms Rimmer), for Stockton North (Alex Cunningham) and for Bedford (Mohammad Yasin).

I worked closely with the hon. Member for Washington and Sunderland West on the all-party parliamentary group on water safety and drowning prevention. I hope we can continue to work closely today. May I also say how moved I was by her heartfelt speech in the debate on the Civil Partnerships, Marriages and Deaths (Registration Etc.) Bill last week? It really moved the whole House, and people beyond.

Today’s debate is timely, as we have considered the responses to our public consultation on changing the entitlement criteria for free school meals and the early years pupil premium. I will be publishing the Government response shortly. It is all part of the drive to ensure every child has the opportunity to make the most of their life, no matter where they live or their background.

Let me start by restating the importance this Government attached to providing hot, nutritious free school meals to the most disadvantaged children. We are committed to continuing to provide those meals to families in need. Last year, about 1.1 million disadvantaged children in our communities were eligible for and were claiming a hot free meal, which saves families around £400 per year, as we have already heard today.

Under the existing benefits-based criteria, children whose parents or guardians receive one or more of the qualifying benefits, such as income support, jobseeker’s allowance and child tax credits, can make a claim to a school and are entitled to receive a hot meal. However, the simplification of the welfare system through the introduction of universal credit means that a number of the benefits that currently entitle families to free school meals will cease to exist.

To ensure that any families moving on to universal credit in the early stages of roll-out in the pilot areas, which we have heard much about today, did not lose out on their entitlement, in 2013 universal credit was added temporarily to the list of qualifying benefits for free school meals pending the introduction of the eligibility criteria. The same temporary measure was introduced for the early years pupil premium when that additional funding for disadvantaged three and four-year-olds was first introduced in 2015, and for the free early years entitlement for two-year-olds, which my Department has consulted on separately. As planned, we now need to replace the temporary measure with clear eligibility criteria under universal credit as its national roll-out accelerates.

In setting the new criteria we have followed five clear principles. First, our approach must protect children from a sudden loss of a hot meal as a result of the changes. Secondly, our approach must be fair in how it treats children and families, and target our support most effectively to those on very low incomes. Thirdly, it must enable more children to benefit from these entitlements. Fourthly, it should be as straightforward as possible, both for parents to understand and for schools to deliver. Last, but by no means least, it must be consistent with the approach the Government have taken to determining eligibility for other passported benefits as universal credit is rolled out.

[Stephen Timms]

Will the Minister give way?

[Alex Cunningham]

Will the Minister give way?

--- Later in debate ---

[Nadhim Zahawi]

Let me make some progress. I want to share a lot of information with colleagues.

The proposals will not affect the criteria for universal infant free school meals, which will continue to be available to all pupils in reception, year 1 and year 2, regardless of income. I am sure the hon. Member for Washington and Sunderland West supports and agrees with that proposal.

Once roll-out of universal credit is complete, we will move to an earnings-based system, similar to the one introduced in Scotland. Any household earning below that earnings threshold and claiming universal credit will be entitled to claim free school meals for their children. We estimate that, as a result of the threshold, by 2022 about 50,000 more—not fewer—children will benefit from a free school meal, compared with the previous benefits system. That means we will be targeting our support more effectively towards low-income families and the most disadvantaged children.

It is only right that we set a threshold and do not allow every family on universal credit to be eligible. Let me explain why. As my hon. Friend the Member for Chippenham (Michelle Donelan) said, some families can earn more than £40,000 a year and still receive a small amount of universal credit. I think that is a good thing, because it ensures that they are incentivised to continue to work. Although it is right that those families receive some universal credit, free school meals should continue, in my and many people’s opinion, to be targeted at the most disadvantaged families and those on much lower incomes.

[Stephen Timms]

Will the Minister give way?

[Nadhim Zahawi]

Let me share this with hon. Members. If we do not set new criteria, the effect would be that about half of all school-age children would be eligible for free school meals. As my hon. Friend the Member for Brentwood and Ongar said, the additional cost would be £600 million for free school meals, or £6.2 billion if we include the pupil premium, which follows that. In contrast, about 14% of children are eligible for free school meals today. That would not be a good deal for the taxpayer, in my opinion, and nor would it be targeting public funding at those in the most need. We have to remember that we want to target money at the frontline of teaching in our schools.

[Stephen Timms]

Will the Minister give way?

[Nadhim Zahawi]

I am just going to address some of the issues colleagues talked about.