Personal Independence Payments

Stephen Timms Excerpts

Wednesday 15th March 2017 Commons Chamber

[Damian Green]

I am happy to reassure my hon. Friend that nobody who had an award from the Department for Work and Pensions will have that award reduced, and indeed that PIP is demonstrably a much better benefit than DLA for people with mental health conditions. Is there room for improvement? There is always room for improvement in life.

[Stephen Timms (East Ham) (Lab)]

This is a cut and it directly targets people with mental health problems. The regulation, which is taking effect tomorrow, inserts into the qualifying conditions for PIP, in the section about planning and following a journey, the phrase

“For reasons other than psychological distress”.

Why is psychological distress being carved out in this way, and a cut made as a result?

[Damian Green]

I am afraid that the right hon. Gentleman is simply wrong in his premise. A person

“with cognitive or sensory impairments who cannot, due to their impairment, work out where to go, follow directions or deal with unexpected changes in their journey ”

even when the journey is familiar, would score 12 points under descriptor F on mobility activity. I apologise for getting into the technical weeds here, Mr Speaker. Hence, that person would be entitled to the enhanced rate of the mobility component. That is the situation that pertains now, and that is why more people with mental health conditions are getting the higher rate of PIP—three times as many as did so under DLA—so it is simply not the case that this discriminates against people with mental health conditions.

Personal Independence Payments

Stephen Timms Excerpts

Tuesday 28th February 2017 Commons Chamber

[Stephen Timms (East Ham) (Lab)]

(Urgent Question): To ask the Secretary of State for Work and Pensions to make a statement on the cuts to entitlement to personal independence payment.

[The Secretary of State for Work and Pensions (Damian Green)]

Recent legal judgments have interpreted the assessment criteria for PIP in ways that are different from what was originally intended by the coalition Government. We are therefore now making amendments to clarify the criteria used to decide how much benefit claimants receive in order to restore the original aim of the policy previously agreed by Parliament, which followed extensive consultation.

I want to be clear about what this is not. It is not a policy change, and nor is it intended to make new savings. I reiterate my commitment that there will be no further welfare savings beyond those already legislated for. This will not result in any claimant seeing a reduction in the amount of PIP previously awarded by the Department for Work and Pensions.

Mental health conditions and physical disabilities that lead to higher costs will continue to be supported, as has always been the case. The Government are committed to ensuring that our welfare system provides a strong safety net for those who need it. That is why we spend about £50 billion to support people with disabilities and health conditions, and we are investing more in mental health than ever before, spending a record £11.4 billion a year.

Personal independence payments are part of that support, and they provide support towards the additional costs that disabled people face. At the core of PIP’s design is the principle that support should be made available according to need, rather than a certain condition, whether physical or non-physical. PIP is also designed to focus more support on those who are likely to have higher costs associated with their disability. PIP works better than disability living allowance for those with mental health conditions. For example, there are more people with mental health conditions receiving the higher rates of PIP than there were under the old DLA system.

This is about restoring the original intention of the benefit, which has been expanded by the legal judgments. It is entirely appropriate for the Government to act to restore clarity to the law, as Governments have done before and will no doubt continue to do in the future.

[Stephen Timms]

In a written statement published without warning on Thursday, Ministers announced the cuts to which the Secretary of State has just referred, which will take effect in two weeks’ time. Over the weekend, another Member in government said that this was to stop the payment of benefits to people

“taking pills at home, who suffer from anxiety”.

Why is so little notice being given, with no opportunity at all for parliamentary scrutiny of these substantial cuts? Will the Secretary of State confirm, as stated in the impact assessment published with the regulations, that people suffering from schizophrenia, learning disability, autism and dementia will be among those worst affected by the cuts? The cut is being achieved by taking the benefit away from people whose mobility impairments are the result of “psychological distress”. According to the wording of the regulations, they will no longer be entitled to benefit. Does that not directly contradict the Prime Minister’s commitment to treat mental health on a par with physical health?

[Damian Green]

I thought every part of that question was based in error, if I may say so. Nobody is losing money compared with what they were originally awarded by the DWP, so that part of the right hon. Gentleman’s question is simply factually incorrect.

Far from being slipped out, the Department made a huge effort to let people know that this was happening. I left a message for the shadow Secretary of State, the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), and I spoke to the Chairman of the Work and Pensions Committee, the right hon. Member for Birkenhead (Frank Field). I know that my hon. Friend the Minister for Disabled People, Health and Work also spoke to a number of colleagues, so the idea that this was slipped out is simply ridiculous.

The right hon. Gentleman talks about individual conditions, and I can only repeat what I said earlier: PIP is awarded not for conditions, but for the living or mobility difficulties that result from such conditions. All that the regulations do is to restore the situation to what it was in late November, before the two court judgments. This is not a new policy or a spending cut; this is simply restoring the benefit to what was intended when it was first introduced under the coalition Government.

Oral Answers to Questions

Stephen Timms Excerpts

Monday 20th February 2017 Commons Chamber

[Penny Mordaunt]

My hon. Friend has hit on a theme of the Green Paper. Much work is going on in this area, not only for those with mental illness but for those with a learning disability. One health trial is currently looking at discounting business rates for employers with good mental health practice.

[Stephen Timms (East Ham) (Lab)]

The Government’s laudable aspiration to halve the disability employment gap is completely meaningless without a date being attached to it. What is the Minister’s latest assessment of how long it will take to halve that gap?

[Penny Mordaunt]

The target of halving the disability employment gap is at the same time both hugely ambitious and hugely underwhelming. We should be working to ensure that everyone can reach their full potential. I have asked the Department—the right hon. Gentleman’s office will have been supplied with this information—to look at the local need in all our constituencies. How many people with a learning disability do we need to ensure can get into work? How many people with particular conditions are we focused on? We need to focus on those numbers, not on some arbitrary formula that will change with all sorts of other factors. The labour market survey will still contain all the measures it has contained in the past, but if we are really to crack this issue we need to focus everyone locally on the local numbers.

Jobcentre Plus Offices: Closure

Stephen Timms Excerpts

Monday 30th January 2017 Commons Chamber

[Caroline Nokes]

I reassure my hon. Friend that the DWP is doing exactly that. Outreach is an important part of our suite of products to enable claimants to be get back into work. We will continue to look at the best ways to deliver that in the best locations across the country.

[Stephen Timms (East Ham) (Lab)]

Closure of the last jobcentre in my constituency will require those who sign on fortnightly to pay an extra £6 a month in bus fares to get to a more distant jobcentre. Can the Minister reassure me that Jobcentre Plus will reimburse claimants with those additional costs?

[Caroline Nokes]

Where claimants are required to sign on more frequently than fortnightly we will look to reimburse costs, but I remind the right hon. Gentleman that across London the claimant count is down 24.6% since 2010. There are fewer people claiming and we are trying to work with them more intensively.

Oral Answers to Questions

Stephen Timms Excerpts

Monday 9th January 2017 Commons Chamber

[Damian Green]

Obviously I do not know the details of the individual case, but if the hon. Gentleman writes to me or the Minister for Disabled People, Health and Work, we will look at it. I can assure him, however, that in the vast majority of cases, work coaches do their best and work very hard to help people to make the most of their lives, and to get into employment. That is at the heart of what we do.

[Stephen Timms (East Ham) (Lab)]

After the big cut in employment and support allowance takes place in April and the new Work and Health programme is established, will the Department be spending more or less on employment support for ESA claimants than is currently the case under the Work programme and Work Choice?

[Damian Green]

I am happy to assure the right hon. Gentleman that as part of the changes there is an extra £330 million support programme for those in that group. We will target support more effectively to ensure that as many of them as possible can get back into work.

Welfare Cap

Stephen Timms Excerpts

Monday 12th December 2016 Commons Chamber

[Justin Tomlinson]

I thank the hon. Gentleman for making that very important point. Large employers, with their well-resourced HR and highly educated personnel teams, are very good at making such changes—they are often small changes—to take full advantage of the disabled people who are looking to work and have the great skills and abilities needed to fill the existing skills gaps. Small and medium-sized businesses often do not have the necessary confidence and skills, and may not even be aware of the talent that is available.

The small employer pilot is so important because it is about going around industrial parks, business parks and shops to ask, “Where are your skills gaps? We will match them to the people who are looking for work.” We have had some really encouraging results from the pilots. I had a Disability Confident event in my constituency, and the Shaw Trust managed to place a further 22 people. We got small and medium-sized employers who had never thought about doing this to come forward and say, “These are our skills gaps. Please help find people for us.”

[Stephen Timms (East Ham) (Lab)]

The hon. Gentleman rightly makes the point that the rate of employment among disabled people has risen, but the overall employment rate has risen as well, so the disability employment gap has not been reduced. Why has there not been any progress on that issue?

[Justin Tomlinson]

The right hon. Gentleman has been very diligent on this issue, and he is determined to be proactive in supporting disabled people to have such an opportunity. The reality is that the growing economy is benefiting everyone, but perversely, the last time we had a recession, the disability gap actually shrank because non-disabled people came out of work at a quicker rate than the disabled people. If we had a recession, we would not celebrate the closing of the gap if people were also coming out of work.

Greater minds than mine will now have to decide what way to go. For what it is worth, I think the only thing that matters is that, as quickly as possible, more disabled people should have an opportunity for work year on year. We should be looking at ways to do that. When we came to office, the then Prime Minister said that we wanted to halve the disability employment gap, which meant employing about 1 million more disabled people. We should be trying to get to that target as quickly as possible, by looking at it annually. Stakeholders and charities are keen that we can demonstrate on an annual basis that we are making real, tangible progress. So far, with 590,000 more disabled people in work in the past three years, progress has been good, but there is still much more that needs to be done.

The final area I want to mention is disability benefits. As a Government, we now spend £3 billion more a year, which is welcome. That recognises the fact that under the old system of disability living allowance, only 16.5% of claimants accessed the highest rate of benefit, while under PIP, the figure is about 22.5%, because the system recognises hidden impairments better, particularly mental health ones. It is right that we are getting support to the most vulnerable people in society as quickly as we can.

However, I have an ask. Everybody in Parliament recognises that we have a growing challenge with mental health conditions in this country. Whether in relation to people in work, people trying to get into work or people in their everyday lives, about one in four people will have a mental health condition at some point. I suspect whoever was in government would, like our Government, look to committing additional funding to support people with mental health conditions. One of the challenges is that no one has quite resolved the best way to direct and provide such support. There are lots of different pilots, but we have a real opportunity in that the one way in which we are identifying people with mental health conditions is through the PIP benefit. However, we do not do anything with that information: we do not signpost people who have gone through the system and been identified as having a mental health condition to the traditional support offered by the NHS, local charities, support groups and so on. I am not looking to get people off PIP.

Oral Answers to Questions

Stephen Timms Excerpts

Monday 21st November 2016 Commons Chamber

[Damian Green]

I agree with my hon. Friend that those employees are often particularly responsible and have particular needs, if they have caring responsibilities. That is why the Government recognise the benefits of flexible working. We extended the right of workers to request flexible working from June 2014. We have also introduced older claimant champions in jobcentres, and we are working with employers to help to highlight the benefits of employing older workers. Aviva, which I have mentioned in the context of Andy Briggs, is launching a new pilot scheme this Friday specifically to support carers. I very much hope that other companies will follow its example.

[Stephen Timms (East Ham) (Lab)]

A year ago, Ministers committed to publishing an annual report on progress towards full employment, for the benefit of older workers and others. Does that commitment still stand, and if it does, when will the first of those annual reports be published?

[Damian Green]

Yes, it does. We will be publishing one next year, and I am happy to report in the interim to the right hon. Gentleman that there are more older people in employment than ever before. There are 9.8 million workers aged 50-plus in the UK. That is an increase of 1.5 million over the last five years, and I think that that is one of the strengths of our labour market.

Employment and Support Allowance and Universal Credit

Stephen Timms Excerpts

Thursday 17th November 2016 Commons Chamber

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

I beg to move,

That this House notes the Government’s plans to reduce the Employment and Support Allowance work-related activity component and the corresponding limited capability for work component in universal credit in April 2017; further notes that this measure will cut the weekly amount received by recipients with long-term health conditions or disabilities by £30 and that these cuts are due to take place before the promised Work and Health programme Green Paper can be considered or implemented; and therefore calls on the Government to use the upcoming Autumn Statement to postpone the cuts to Employment and Support Allowance work-related activity component and the corresponding limited capability for work component in universal credit until appropriate alternative measures to progress the commitment to halve the disability employment gap have been considered, in order to secure support for current and future claimants so that sick and disabled people are supported adequately when they are unable to work.

I thank the Backbench Business Committee for accepting my application for this urgent debate today. It was brought to the Committee at short notice and with my added time pressures ahead of the autumn statement, so I am grateful to the Committee. I am grateful also to the MPs from nine parties in this Parliament who supported the motion.

From April 2017, new employment and support allowance claimants who are placed in the work-related activity group will receive £29.05 less than do current ESA WRAG claimants. The Welfare Reform and Work Act 2016 legislated for this cut, and the Government promised

“new funding for additional support to help claimants return to work.”—[Official Report, 8 July 2015; Vol. 598, c. 333.]

This afternoon, I intend to set out why the Government should use the opportunity of the autumn statement, a new Prime Minister, a new Chancellor and a new set of Department for Work and Pensions Ministers to pause the cuts to ESA WRAG and the corresponding universal credit work allowance elements, at least until the new system that they are to propose has been scrutinised and implemented.

[Stephen Timms (East Ham) (Lab)]

I agree with the motion. Does the hon. Gentleman recall, as I do, that the Conservative party manifesto said that the target for increasing employment support for disabled people was to halve the disability employment by 2020, and does he share my dismay that that target has been abandoned?

[Neil Gray]

I sincerely hope that it has not been abandoned and that the Government will continue to work towards it. I will come to that later in my speech.

It is clear to me that it is not Opposition politicians but Government Back Benchers who are most influential in changing the minds of Ministers, especially when those Ministers currently have such a narrow majority, so I am pleased to have the support of at least five Conservative Members for this motion. In their actions in supporting this debate, they are indeed honourable, for it is not an easy thing to go against the current thinking of their party. I am aware that a number of other Conservative Members are expressing their concerns in private, and some have made more public statements of concern, such as the right hon. Member for Wokingham (John Redwood) and the former Secretary of State for Work and Pensions, the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith). I am not standing here today to lambast the Government. I am here to make a cross-party appeal to the Government: please press pause on these cuts.

Today is about this new set of Government Ministers having an opportunity to look at this issue again—to look at the timetable of events that have led us to this point and to look ahead to the impact that these cuts will have on nearly half a million sick and disabled people who have been found unfit for work. Yesterday, I attended an event in Westminster with Disability Agenda Scotland, which is an organisation of six disability charities north of the border. One of the speakers at the event really highlighted for me, and should highlight for us all, why this issue is so important.

John Clarke from Stirling spoke about his experience of trying to enter the employment market. He volunteered for 10 years in a charity shop. He took on all the responsibilities that an employee would be expected to take on. He did cash handling, was customer facing and turned up for his shifts in a timeous fashion at all times. He has been making a very meaningful attempt to find work. John has been trying to find paid employment, using the significant experience that he gained from his time at the shop to progress that, but has failed to do so.

John just happens to have a learning disability and is in receipt of ESA WRAG. He is not financially incentivised to be out of work because he is on ESA WRAG; he is desperate to get a job. He needs his ESA WRAG, because he has additional costs associated with finding work, but John also needs the Government to come forward with that additional package that the Prime Minister talked about yesterday—such as supporting employers, publicising Access to Work more widely and helping employers see that someone like him would be an asset, not a liability, to their workplace.

What is most concerning for me about John’s story is that he has a new volunteering role after moving on from the charity shop, but the jobcentre wants him to stop that so he can come in to carry out job searches. I put it to those on the Treasury Bench today—what is more beneficial to John, not just for his ability to get a job, but for his emotional wellbeing, his self-worth and his feeling of contributing to society?

This is where we come to the crux of the issue, and John summed it up so well. He said, “Everyone has needs and it is important that these needs are met.” That is the starting point from which the UK Government should be working. We cannot escape the fact that part of that need is financial. It is worth remembering that the rationale for paying some claimants more than others was considered by Richard Berthoud in his 1998 report on disability benefits. He found that the primary reason historically was that those who have to live for a long time on social security could not be expected to survive on the very low income available as a temporary measure for a short-term claimant.

Some people may argue that those who currently receive ESA WRAG, like John, will not be affected by the cut, but as people fall in and out of work, with many of those who receive ESA WRAG the subject of fluctuating conditions, they could well be affected. So if John gets a job after April next year, which I hope will happen sooner for him, and if, unfortunately, it does not work out, although obviously I hope it does, John will reapply for ESA, but will receive £30 per week less than he does now. That is a reduction in income of almost a third between what John receives now and what he would receive next year.

This cut will create two tiers of disability support and create an arbitrary cut-off for people to receive a reduced support rate, purely by virtue of their application date. The Scottish Association for Mental Health agrees. It says that this cut could provide a perverse disincentive to work for people with mental health conditions, who make up 49% of ESA WRAG recipients. It says that people who are currently in receipt of ESA may be affected by the forthcoming change in April 2017 if they have been claiming the benefit and move into work before they are well enough to do so.

Why should John’s peers who apply for ESA WRAG next year get two thirds of the support that John gets now and could continue to receive if, sadly, he does not find a job? John just wants a job. He is not incentivised to be out of work because of ESA WRAG payments. Such a suggestion is an insult to John and to the hundreds of thousands of sick or disabled people like him who want to work but struggle to get noticed in the employment market. The Government will add to that frustration and the feeling of rejection by telling them that the £30 a week lifeline is being pulled away because it somehow holds them back.

The payment of a higher rate of ESA WRAG compared to jobseeker’s allowance was supposed to acknowledge the longer time that someone in that position will take to find employment. It was also supposed to acknowledge the additional costs that someone with a long-term illness or disability incurs as they carry out work-related activity. Scope is particularly concerned at this aspect and says that this cut to disability support will have an impact on the financial wellbeing of sick and disabled people, leaving them further from work, not closer. Its research suggests that 49% of disabled people rely on credit cards or loans to pay for everyday items such as food and clothing.

New figures today from the StepChange Debt Charity show that a third of ESA recipients were running a budget deficit, and that figure could rise to over a half if they had a cut to their income, however small that cut. John’s experience shows us that it is not easy to tell ESA WRAG recipients to find work to make up for that cut. He has done everything he can to do that.

This leads me on to the timing issue before us. During the debates on the Welfare Reform and Work Bill, the Government at the time said that they would find new funding for additional support to help claimants return to work—new money and a new system, which was included in the work and health programme White Paper, now the Green Paper. I argued then and I repeat now, that the Government cannot cut away this lifeline support before the new system of support is in place, otherwise there will be a vacuum of support from April. ESA WRAG will no longer be available for new or returning clients, but the new system, which the Government hope will do a better job, will also be unavailable.

The Government need to get the horse back in front of the cart. They need to put these cuts on pause, at least until we can see what is coming forward. Their new system is still in Green Paper consultation form. The ESA cuts happen in four months. Even if the new system will be better, we have seen nothing more than consultation proposals, and we do not know when the new system will be implemented.

That view is supported by the Disability Benefits Consortium, which represents 60 disability charities. It has published an open letter today, which is signed by 74 disability charities and other organisations, including Action on Hearing Loss, Age UK, the National Autistic Society, Enable Scotland, Action for ME, Carers UK, the MS Society, the Royal College of Psychiatrists, Scope, Mencap, the Royal British Legion, Citizens Advice and dozens of others I wish I had time to mention individually, as they represent health conditions and disabilities that hon. Members’ families, friends and, certainly, constituents will have. Those organisations say that this cut will undermine the Government’s welcome commitment to halve the disability employment gap. Their survey of over 500 disabled people found that seven out of 10 said that ESA cuts will cause their health to suffer. More than a quarter said they sometimes cannot afford to eat on the amount they currently receive from ESA, and nearly half said that this cut will probably mean they will return to work later than they would have done.

The Government predicted that savings of £450 million a year would be realised from these cuts. Just two weeks ago, we saw the welcome publication of the health and work Green Paper, which sets out the options for the Government to create a replacement system. The budget for that for next year is £60 million, rising to £100 million by 2020-21. That does not equate to new money; it does not even match the cuts being made to ESA WRAG—a point echoed by today’s open letter from the charities, which cannot see where the additional support for disabled people to find work will come from, or how it will mitigate the effects of the cut.

There must also be concern on the Treasury Bench after the Supreme Court ruling on the bedroom tax. Letters, which have been published, between the Equality and Human Rights Commission and the hon. Member for Birmingham, Hall Green (Mr Godsiff) highlight the concerns the EHRC has regarding the Government’s impact assessments on these cuts.

--- Later in debate ---

[Jeremy Lefroy (Stafford) (Con)]

I pay tribute to the hon. Member for Airdrie and Shotts (Neil Gray) for introducing this debate and for assembling here a large number of right hon. and hon. Members.

My father became disabled when I was two weeks old, when he was 34. He worked for the rest of his working life until he was 65. It was only after he died that I found that at one point he had had to consider emigrating to Australia in order to get work, but thanks to the foresightedness of a church in Highbury in Islington—he was a vicar—he was able to work in the United Kingdom. Throughout my childhood, as we were growing up, we saw the gradual improvement of the situation for disabled people in this country. I pay tribute to Governments of all colours over the past 50 years for that, because it has been incredibly important. I saw, for instance, the significant improvement that Motability made to his life and his ability to do his work—he benefited from the scheme from its introduction. That is why I believe that the motion should be supported and that the cuts to the work-related component in both ESA and universal credit should be paused and reconsidered.

The Government’s argument, which I understand, is that they wish everybody in the work-related activity group to return to work as soon as possible, and they intend to put in money to support and assist them in that process. Three assumptions underline that argument. The first is that the cost of living for those on ESA is pretty much the same as that for those on jobseeker’s allowance; in other words, it covers basic living costs. The second assumption is that any additional costs relating to sickness or disability can be covered by the personal independence payment. The third is that people will not receive ESA for very long, because they will get back into work.

On the face of it, one can assume that those assumptions are well meaning, but I would challenge all three of them. On the cost of living, those in the WRAG tend to have mental health conditions, cancer or musculoskeletal conditions, and they are often housebound for long periods. That means that they face an additional cost for heating, because they are not able to go out searching for work all the time. Macmillan says that 28% of cancer sufferers say that they cannot keep their homes adequately warm. They also face an additional cost for food: some of the diets involved are expensive and there is no particular help available. There is also the cost of transport, as people go frequently to hospital and doctors’ appointments.

The argument has been put to me that those costs could be covered by PIP, but fewer than half of those in the WRAG are eligible for and claim PIP. In any case, PIP covers mobility and care costs; it does not cover heating or dietary costs.

The final assumption, which is understandable, is that those in the WRAG will be able to return to work relatively soon, but that is not borne out by the facts. People tend to be in the WRAG for an average of two years, while the figure for JSA is six months. JSA is set at a level that assumes that people will be on it for only a few months, and it is very difficult to see how people can continue at that level without in the end getting into considerable debt. It seems to me that the assumptions, understandably made by the Government, do not hold up.

[Stephen Timms]

The hon. Gentleman will recall the commitment that was made to increase support for disabled people to get into work as a quid pro quo for the benefit cut. Does he agree, however, that it appears that the Government now propose to spend less on employment support for disabled people than has been spent on the failed Work programme? Surely they should be spending more, not less.

[Jeremy Lefroy]

I am not clear on the figures, but what I do know is that the Government are committed to providing support to people to get into work. That is absolutely vital, but I do not think it is a substitute for the additional financial help that has been given until now.

I welcome the Green Paper and the Government’s work on it. I welcome the work that my hon. Friend the Member for North Swindon (Justin Tomlinson) did on it, and the work of my hon. Friend the Minister for Disabled People, Health and Work, who is in her place, and everyone else at the Department for Work and Pensions. The excellent paper covers joint supporting, the promotion of mental and physical health, and occupational health support. I want all those things to be put in place, because I know that they will be of great benefit to many of my constituents. The Green Paper does not, however, cover the question of costs, and that is why I support the motion.

I want to make some constructive proposals for the Government to consider. I want them to consider modifying or postponing the changes while the proposals are consulted on and put into practice. Let us see them work: let us see people get into work more quickly before we actually remove the additional support. Let us also consider maintaining an element of support above JSA, specifically to cover the particular costs that people face, especially if they have been on the standard rate of ESA, as they will have been for a short period. It should not be indeterminate and indefinite. A discretionary fund has been used in other areas, so let us consider introducing one that is substantial enough to cover those additional costs for people in the WRAG.

I know that the Minister is listening. She has shown that in her responses to me both privately and publicly. I urge her to continue to listen, particularly to the points made by Members in this debate.

--- Later in debate ---

[Justin Tomlinson (North Swindon) (Con)]

It is a pleasure to speak in this debate, although I have a feeling of déjà vu, as I was talking about this subject only yesterday—no wonder “Groundhog Day” is one of my favourite films. I pay tribute to the hon. Member for Airdrie and Shotts (Neil Gray) for his proactive work in this area. When I was a Minister, I enjoyed engaging with him on a number of occasions. He always brought forward real experience and practical suggestions to challenge the Government and hold them to account in this important area. It is also good to see so many Members in the Chamber, on both sides of the House, to engage in this debate—it is a credit to them. That is important, because the Department has excellent Ministers who genuinely do listen, engage, act and influence the direction of policy.

I wish briefly to talk about the background to the current position. Yesterday I talked a lot about universal credit and less about the ESA WRAG, but today I will flip that around. The Government have introduced the national living wage, which has helped 2.75 million of our lowest earners, and we hope that it will rise to more than £9 an hour by 2020. We have increased the personal allowance from £6,495 to £11,000, taking the lowest 3.2 million earners out of paying any income tax. This country has the strongest economic growth of any developed economy, which is delivering record employment, with yesterday’s figures showing another 461,000 people entering work. We have also seen 590,000 more disabled people in work in the past three years—an increase of about 4%—although there is still much further to go.

[Stephen Timms]

I mentioned this yesterday, but let me remind the hon. Gentleman of the press release issued in his name by the Department for Work and Pensions on 29 June last year, which stated:

“The Government…aims to halve the gap between the disabled employment rate and the overall employment rate by 2020.”

Is he dismayed, as I am, that that commitment—he made the promise in good faith, I am sure—to a 2020 deadline has been abandoned by his successor?

[Justin Tomlinson]

I predicted that that intervention was coming, and it is an important point. The pledge was incredibly popular with stakeholders and focused officials’ minds. When I was a Minister, a lot of my work involved lobbying other Departments, so it was helpful when I was able to namecheck the then Prime Minister, as this was his personal pledge. I do not actually recall that press release, as my understanding was that we had not set the date because that was going to be determined in the Green Paper. Personally, I wanted to see significant progress year on year.

One problem with just adopting the approach in the pledge is that the number of disabled people in work could remain static yet in a recession the overall number of people in work could fall, meaning that the gap would close without any more disabled people benefiting. I wanted to set a target such as having 1 million more people in work by a certain date, which would mean that we would know that 1 million more disabled people had benefited. We were due to consult on that as part of the Green Paper process when I was in my ministerial role.

--- Later in debate ---

[Justin Tomlinson]

When I was a Minister, I was challenged on a whole host of issues, and that is what the charities are there to do. I feel that the extra support makes this approach worthwhile because only 1% of people are coming off that benefit. When people on ESA are surveyed, and when we talk to them in our constituencies, we find that the overwhelming majority are desperate to be given an opportunity to work.

[Stephen Timms]

rose—

[Justin Tomlinson]

I am running out of time, so I will try to wrap up. I have only two minutes left.

The Green Paper includes proposals for more personalised and tailored support, as well as quicker assessments. That is particularly important because 50% of people on ESA have a mental health condition, but typically wait nine months for an assessment. The Green Paper will address that by making sure that people are assessed quickly and given support before they navigate often difficult personal challenges when they take the step back into work.

There will be a place on the work and health programme or Work Choice for those who wish to take it—it is a voluntary opportunity. There will be additional places on the very popular specialist employment support programme. There will be job clubs run by peers—people with disabilities who have gone through the system and overcome their fear at the thought of going back into the process. That is often a big fear for people who have been out of work for a long time. There will be 200 new community partners; again, this is about utilising disability expertise. There will be increased access to work for young people with mental health conditions. There are further opportunities through the Disability Confident campaign.

My personal favourite, which I continue to champion, is the small employer offer. Time and time again, employers say to us, “We have skills gaps and we are struggling to find people to fill these roles,” but they have never thought to take on somebody with a disability because they lack the confidence to do so and do not realise that a huge amount of support is provided to help people to come into the workplace. Businesses that take that step benefit, more often than not, and I say that as a former employer who employed disabled people and benefited from doing so. I hope that the current small employer pilot will be expanded and will become a nationwide offer. It is making a significant difference.

The Chancellor was right to increase significantly the funding for Access to Work. On the fit for work scheme, we need to ensure that we provide advice at the beginning of a potential problem for people in work, not just at four weeks, because it is so much easier to keep people in work with suitable support than it is to get them back into work after they have dropped out. We have a fantastic ministerial team who are engaging with charities, with all their experience and knowledge, and the Green Paper represents a real opportunity.

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[Stephen Timms (East Ham) (Lab)]

I am glad to be following the hon. Member for Eastbourne (Caroline Ansell). I agree with her and other Conservative Members that these cuts should at least be paused. On 27 January, Lord Freud said in the other place:

“we are proposing to recycle some of the money currently spent on cash payments…into practical support”.—[Official Report, House of Lords, 27 January 2016; Vol. 768, c. 1316.]

That was the deal offered to us—there would be a shift from cash payments to practical support. The hon. Member for Enfield, Southgate (Mr Burrowes) and others are absolutely right to point out that that practical support will not be in place by next April, so that is a good argument for pausing the cuts.

Not only will the support not be in place next April, but as far as I can see, the Government are not even planning to spend as much on their new programme for supporting ESA claimants into work as they are spending on the Work programme which, as we have heard, has done a hopeless job for people claiming ESA. I thought that the whole point of this benefit cut was to give additional resources to support those people into work, but it appears that the Government are now talking about spending less. The £60 million to £100 million we have heard about is not on top of what is currently being spent; it is instead of what is currently being spent, which seems completely contrary to what we have been assured throughout this process.

In 1998, when I held the Minister’s post, I was responsible for the new deal for disabled people. That was followed by the Pathways to Work programme. On 1 July, the House of Commons Library produced the briefing note “Key Statistics on People with Disabilities in Employment”. It helpfully shows, with a graph, that the disability employment gap fell steadily but substantially from 1998 to 2010. In 2010, the new deal was replaced by the Work programme, and the steady progress on reducing the disability employment gap came to a halt. As the Green Paper candidly acknowledges at paragraph 1.22, there has been no progress in reducing the disability employment gap since 2010. The progress we have heard about from some Conservative Members, particularly the hon. Member for North Swindon (Justin Tomlinson), has not involved any progress at all in reducing the disability employment gap, which reflects the fact that the Work programme has been so disappointing for this particular group.

I think that the Conservative party recognised that it had a problem, so its manifesto for 2015 to 2020 announced a bold target of halving the disability employment gap. Achieving that by 2020 would be ambitious, because progress would have more than caught up with the rate that was steadily delivered between 1998 and 2010. Ministers said that they would achieve that bold ambition by committing the proceeds of the benefit cut that we are debating today. They told us that the details would be set out in a White Paper.

As the former Secretary of State ruefully observed yesterday, there has still been no White Paper. When launching the Green Paper, the current Secretary of State made this astonishing claim:

“The original commitment in the manifesto did not have an end date”—[Official Report, 31 October 2016; Vol. 616, c. 678.]

If one reads a commitment or a promise in a manifesto for 2015 to 2020, one is entitled to believe that what it says will be achieved will actually be achieved by 2020. The commitment was more explicit than that, because during one of the televised election debates, David Cameron—some of us still remember him—said:

“The gap between the disabled unemployment rate and the unemployment rate for the whole country is still too big. I want to see that cut in half over the next five years.”

He was explicit about that. The press release issued by the hon. Member for North Swindon—he told us that he could not remember it—was also clear that this was going to be done by 2020. That was what everyone in the disability organisations understood.

A month or so ago, I attended the launch, which was hosted by the right hon. Member for Chesham and Amersham (Mrs Gillan), of the National Autistic Society document “The autism employment gap”. Let me read what it says:

“The UK Government has made a very welcome pledge to halve the disability employment gap by the end of this Parliament, meaning they have to shift the disability employment rate from 47% to 64%.”

Just last week, the all-party group on multiple sclerosis, which is chaired by the hon. Member for North Dorset (Simon Hoare), published the report “Employment that works”, which referred to

“a 2015 general election manifesto commitment by the Conservative Party to halve the disability employment gap by 2020”.

However, when I asked the new Secretary of State about the timing of the commitment, he replied to me on 31 October, when he launched the Green Paper, that it was “premature” to set a date for achieving this goal. At least the Minister for Disabled People, Health and Work in her winding-up speech in yesterday’s debate did not claim that there never was a 2020 target when there clearly was.

To resume progress on reducing the disability employment gap—that reduction was delivered consistently under the new deal from 1998 to 2010—the Government need to resource the process properly, as they promised to do earlier this year. The point of making this cut in ESA was supposed to be that the proceeds would be used for that purpose. The Government simply need to keep the promise that they made to disabled people.

When a clear promise has been made to disabled people, is it really too much to ask that it is delivered? The problem with the Green Paper is not that the ideas in it are bad, as I understand the U-turn of abandoning the Work programme, but while the Government promise to increase the number of disabled employment advisers, that is only back up to the number there were in 2013 —it is no more than that. A clear promise was made in the Conservative party manifesto. It was understood right across the disability organisations, so I ask the Minister to tell us that she is determined to keep it.

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[The Minister for Disabled People, Health and Work (Penny Mordaunt)]

I, too, congratulate the hon. Member for Airdrie and Shotts (Neil Gray) and the Backbench Business Committee on securing this debate, and all Members on the tone in which it has been conducted. Even the hon. Member for Glasgow North East (Anne McLaughlin) has managed to restrain herself today, and we are grateful for that. On these important issues, the House is often at its best when it takes this tone, and on this issue, for all the reasons outlined by my hon. Friend the Member for Enfield, Southgate (Mr Burrowes), it is important that we have done so.

Good policy cannot be created in a vacuum; we must think about how something will be delivered, how it will work in practice and how it will affect those concerned. As the hon. Member for Neath (Christina Rees) said, the welfare state is a safety net, but if it works well, it should also be focused on helping someone’s future ambitions as well as their basic needs. Proof that we have listened and understood will be in our actions, and a person’s experience of the system and the support they receive is the only thing that will ensure confidence in that system. So we must deliver and we must deliver well.

We must understand the personal impact of a policy on a person, often someone in a complex situation, under considerable strain and challenge. I refer to the budgeting challenge for those who have suddenly had to stop work or who have lost employment because of their condition or ill health, or who are facing increased costs—or both; the challenge of preparing for employment, while focusing on recovery; the challenge as those new constraints restrict a person’s choices and flexibility just at a time when such flexibility becomes an imperative; the challenges faced by people who, as well as having their own issues to deal with, often have other responsibilities and priorities—carers, parents or people who are both. Even where recovery or the all-clear is achieved, these people will still have concerns about their illness reoccurring, their ongoing relationship with their employer and the possibility of having to go through it all again.

We must ensure a person’s liquidity is in place, so that they can afford the additional costs brought by looking for work, or by being poorly or disabled: higher energy bills; mobile and internet access costs; the cost of getting insurance; the cost of a special diet, in some cases; the extra travel costs that come with unpredictable itineraries; clothing and bedding costs; and the cost of specialised equipment—to name just some of those costs. Someone with a neurological condition will spend almost £200 a week on costs related to their disability. Someone with a physical impairment will spend nearly £300 a week.

When that security and liquidity goes, often so, too, does a person’s dignity and wellbeing. They may face the embarrassment of having to pay for a train fare with a pot of 2p coins because that is all the cash they have left; the stress of having no mobile phone credit; the strain of extra planning and budgeting; the knock-on effects of all that to an already stressful situation; and the pressure of not wanting their kids to be disadvantaged or to miss out on what others are doing or what they used to do—or of not wanting that for their grandkids, as the hon. Member for Glasgow North East mentioned.

Although I can answer the question from the hon. Member for South Down (Ms Ritchie) about benefit levels having a significantly negative association in terms of employment by waving a report by Barr et al. at her,9j I will not be relying on those arguments in my speech. I say that because of the obvious point—it was made by the hon. Member for North Ayrshire and Arran (Patricia Gibson)—that someone is more likely to get into work, make a success of it and recover from ill health if they are able to devote themselves to that. If a person has other worries or concerns, their energy and focus on those objectives will be diluted. Many who find themselves in receipt of universal credit or ESA will already have complex situations to deal with, and the delivery of our services should not add to that.

Yesterday, I outlined in detail how we will deal with those issues, but let me briefly recap. We will use funds to alleviate costs directly related to work, through the flexible support fund. May I just correct my hon. Friend the Member for South Cambridgeshire (Heidi Allen) as the figure is not £15 million—it is an extra £15 million that we have put in because of these changes, and this is currently standing at £83 million? In addition, we will have national and local schemes, such as the Jobcentre Plus travelcard, but I am also negotiating deals with third parties to help with expenditure not directly related to employment: broadband costs, phone charges, energy costs and insurance.

We are extending our hardship fund, as per the announcement yesterday, to new groups. That will be new money from the Treasury over the next four years with immediate effect. For thoroughness, I will mention personal independence payments, which will help to cover costs for 53% of the people we are concerned about today.

[Stephen Timms]

Will the Minister give way?

[Penny Mordaunt]

I am going to make some progress. We offer personal budgeting support for those who are transferring to universal credit. That could include money advice, with a mix of online, telephone and face-to-face support. I am also looking at extending that service and considering what further support I could give.

For the sake of the record, I remind the House that the changes to WRAG due in April next year will not affect those who are already in receipt of ESA and universal credit or the equivalent. Further safeguards mean that they will not lose the extra payment even if they are reassessed after April and placed in the WRAG. I hope that that will reassure the hon. Member for Edinburgh East (Tommy Sheppard), whom I cannot see here, and the two constituents that he mentioned yesterday, Dean and Lauren.

[Penny Mordaunt]

Bear with me. In response to the hon. Lady and my hon. Friend the Member for Eastbourne (Caroline Ansell), we aim to protect existing claimants who temporarily leave the benefit—for example, to try out work—and who then return. We will introduce draft regulations in due course to set out the detail. Nor will the change affect anyone whose ability to work is significantly limited by their health condition or disability. They will be in the support group or the universal credit equivalent.

On that point, let me recognise the concerns that have been expressed about the binary nature of the work capability assessment and how someone’s fitness to undertake a particular type of work is not an indication of how close to the labour market they might be. We need to take into account several other factors, including their skills, in making that assessment. That is why the Green Paper focuses on the work capability assessment and its reform. I hope that that will be welcomed by all Members, particularly the hon. Members for Strangford (Jim Shannon), for Glasgow East (Natalie McGarry) and for East Kilbride, Strathaven and Lesmahagow (Dr Cameron), who mentioned it.

We have sought to get people to fit the system rather than to be part of a system that recognises the importance of personalised support. Everyone’s circumstances will be different, as will their multiple challenges.

[Stephen Timms]

I am grateful to the Minister for giving way on that point on personalised support. We understand that on employment support, she proposes to provide up to £100 million a year. Will she clarify whether that is in addition to the funding currently being provided through the Work programme, or whether it is a replacement for that?

[Penny Mordaunt]

The amount of money and how we spend it will be directed by, and based on, the needs of people who currently need the support. The situation was very different a few years ago, and it will not be like that. The right hon. Gentleman mentioned Labour’s success in this territory, but I gently point out to him that the disability employment gap closed under Labour because unemployment rose. I gently say to him that a consensus on tone has been set this afternoon, and that is important.

I am going to do something unusual and make some asks of this House, although it is usually the other way around. If the Green Paper is to deliver all that it must, we must all play our part, whatever our political hue and on whichever side of the House we sit. All the organisations and experts in our constituencies need to be involved, too, including the patient and peer support groups that we are not currently engaged with, and all the organisations that the hon. Member for Gateshead (Ian Mearns) alluded to in the case of his constituent Simon, who faced a domino effect. I am grateful to the hon. Member for Foyle (Mark Durkan) for alluding to the fact that we have a massive opportunity in the Green Paper, not only in terms of what we do for employers and healthcare, but for our own processes in the DWP.

We have designed the consultation process to facilitate discussion at a very local level, with facilitators’ packs and other support, and I ask all MPs to help to facilitate local meetings, bringing together organisations from across their constituencies. That way, we will get a good result from the Green Paper not just in the policies that will come out of it, but in starting local conversations about how it will work. On 5 December, we will hold an event in Parliament, where there will be a pack for every Member and every constituency to facilitate such dialogue.

Autumn Statement Distributional Analysis, Universal Credit and ESA

Stephen Timms Excerpts

Wednesday 16th November 2016 Commons Chamber

[John McDonnell]

The hon. Gentleman clearly has not been listening. We introduced a fiscal credibility target, which would have built in the flexibility that we need—and actually, which his colleagues would have benefited from as they sought to deliver the goals set out in the manifesto upon which they were elected. That is the critical problem—that this fiscal target has become unworkable. Next week, most probably, we will see that not only will it be reset, but large elements of it will be scrapped; and some of those political disputes within the Government will be seen to have been completely unnecessary if only the Chancellor, at that stage, had listened not just to us, but to some of his own colleagues.

On the Government’s own economic metrics, the fiscal framework has failed. I remind the hon. Member for Horsham (Jeremy Quin) that the former Chancellor’s target was to eliminate the deficit by 2015. The deficit remained at over £45 billion in the first six months of this financial year. I remind the House that his target was to reduce the debt. The debt now stands at £1.7 trillion and has increased over the past six years, according to the latest estimate, by £740 billion. I believe that the biggest failure was to ignore the needs of the real economy and use the fiscal framework to constrain investment. The failure to invest on the scale needed to modernise our economy resulted in stagnating productivity.

In the face of all the evidence that the fiscal framework was not working and not achieving its target, the decision to set a target for the framework not just to eliminate the deficit, but to produce a multibillion-pound surplus by 2019-20 demonstrated to many of us how far the former Chancellor’s politics was overriding sound economics. The result of his setting targets even more removed from reality was that he imposed on his own colleagues the task of scrambling round to find a scale of cuts that, in many instances, undermined what chance they had to implement the policies on which they were elected and their long-standing ambitions, some of which could have secured cross-party support.

That was no more evident than at the Department for Work and Pensions. For the Treasury to demand cuts to universal credit that would take, on average, £2,100 out of the incomes of people who were doing all that was asked of them—working all they could to come off benefits, bringing up their families, contributing to society—flew in the face of all that the universal credit system was meant to be about. The same can be said of the cuts of nearly £30 a week to employment and support allowance. That is an extremely significant cut to the incomes of disabled people who are also doing all that has been asked of them—seeking work to lift them off benefits, and overcoming their disabilities and conditions.

[Stephen Timms (East Ham) (Lab)]

On the ESA cut, does my right hon. Friend recall that at the time it was being taken through the House, we were assured that the Government would introduce an ambitious plan to reduce—indeed, to halve—the disability employment gap by 2020? Does he share my dismay that that goal has been abandoned completely?

[John McDonnell]

I recall my right hon. Friend advising the Government of the unreality of their proposals at the time. What worried us all was that, on the one hand, benefits were being reduced, but the support was not being put in place by which those people could gain work and supplement their incomes.

I understood the motivation of the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) when he resigned. The overriding demands of the Treasury were undermining the policy goals he was seeking to implement. He rightly objected to a further burden being placed on the social security budget, especially at a time when new, long-planned systems were at the early stages of introduction. I understood then his sense of frustration, and I understand now why he and many of his hon. Friends have called on the new Chancellor to look again at the burden that is being placed on the welfare budget and the threat, above all else, that it poses to the successful roll-out of universal credit and the policy of supporting disabled people into work.

The planned cuts are more than a threat to the implementation of policies long advocated and cherished by many Government Members. More importantly, they are a threat to the livelihoods, living standards and quality of life of millions of low earners and some of the poorest and most vulnerable people in our communities. The Government have sought to judge themselves on their own set of economic metrics: eliminating the deficit, reducing the debt and adhering to a cap on welfare spending. On all their own metrics, they have failed. However, there is an alternative and very basic set of metrics on which a Government should be judged—whether they ensure that their population is adequately fed, decently housed and kept warm in winter, and has sufficient income through employment or a support safety net to have a decent quality of life.

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[Damian Hinds]

I was in the middle of talking about how wages have been rising. If the hon. Lady will forgive me, I thought that she was challenging me on that point, so I will continue to make it. According to recent data on earnings from the Office for National Statistics, the lowest 5% of workers saw their wages grow by more than 6% in 2016, the highest growth for that group since that statistical series began nearly 20 years ago. Based on the Office for Budget Responsibility’s forecast at the Budget, almost 3 million low-wage workers are expected to benefit directly by 2020, with many more benefiting from the ripple effect on income distribution.

At the same time, universal credit is transforming the welfare system to ensure that it always pays to work more and to earn more. That is in stark contrast with the pre-2010 system, in which in-work poverty increased by 20% between 1998 and 2010, despite welfare spending on people in work increasing by £28 billion. Evidence is already showing that people move into work faster under universal credit; for every 100 people who found work under the old jobseeker’s allowance system, 113 universal credit claimants have moved into a job. We estimate that universal credit will generate around £7 billion in economic benefit every year and boost employment by up to 300,000 once fully rolled out.

Most important of all, universal credit will drive progression, delivering sustainable outcomes for low-income families. Unlike tax credits, with the 16-hour cliff edge, it supports part-time and flexible working—as well as full-time working—adjusting on a month-by-month basis according to household income. The work allowances are just one element of a much wider system of support and incentives. The personalised work coach support, the smooth taper rate and the reimbursement of 85% of childcare costs as soon as someone starts working, even for a small number of hours, are all key to making work pay for universal credit recipients.

In this morning’s employment figures, we saw that the employment of disabled people is up by 590,000 in the past three years. The disability employment rate has gone up by 4.9% in that time, and the gap has been narrowed by two percentage points. We were talking about this earlier, and it is welcome news, but there is much, much more to be done, as only half of people with disabilities are in work, compared with 80% of the non-disabled population.

[Stephen Timms]

I am glad that the Minister has raised the question of the disability employment gap. Former Ministers—two of them, the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) and the hon. Member for North Swindon (Justin Tomlinson), are in their places this afternoon—promised that a quid pro quo for the cuts in employment and support allowance would be halving the disability employment gap by 2020. That was in his party’s manifesto, and the former Prime Minister, David Cameron, committed to halving the gap by 2020. Why has that promise now shamefully been abandoned?

[Damian Hinds]

We are committed to working towards halving the disability employment gap. The right hon. Gentleman is reading somewhat more into things than he can or should. We are absolutely committed to doing that, but there is a long way to go, and he will know better than most how hard it will be. But the figures we have announced this morning show that the employment rate for people with disabilities is up by almost 5%. That is welcome news that I had hoped would receive a more positive response from the Opposition.

[Stephen Timms]

I am not reading any more into the promise that was made than what was set out very clearly. In the election campaign David Cameron made it clear that the commitment was to halve the disability employment gap by 2020. There was a press release in the name of former Minister for Disabled People, the hon. Member for North Swindon, saying that it would be by 2020. Why has that promise now been so shamefully abandoned?

[Damian Hinds]

We are working hard on this. When my colleague the Minister for Disabled People, Health and Work sums up at the end of the debate, she will no doubt elaborate on that more. To be able to do everything we can as a Government, we need employers to do more as well, as the right hon. Gentleman will recognise. A whole-society approach is required to address this great challenge. Progress is being made but more is needed. He should have no doubt about the Government’s commitment to doing everything possible to achieve that.

One reason why so much more needs to be done is that we still have that yawning gap despite all the progress that has been made—despite the regulatory reform, the medical advances, the advances in assistive and adaptive technology, and, critically, the fact that we know that so many people with disabilities want to move into work and that so much talent is not currently being fully utilised. We know that being in work can have wider benefits for the individual, beyond the purely financial. There is clear evidence that work is linked to better physical and mental health, and to improved wellbeing. That is a key theme in our recently published Green Paper “Improving Lives”, and a driver behind the changes to the employment and support allowance and universal credit that were announced in last summer’s Budget.

ESA was originally introduced—I am happy to acknowledge the bipartisan parts of this debate—in 2008 by the then Labour Government. The expectation at that time was that the Atos-run assessment process would place the clear majority of claimants into the work-related activity group, leaving a relatively smaller number in the support group. Over time it became clear that that was not the case, with around three times as many people in the support group as in the work-related activity group. At the same time, fewer than 1% of people were leaving that benefit for work each month.

That is why we are introducing changes to encourage and support claimants to take steps back to work and to fulfil their full potential. From next April we will no longer include the work-related activity component for new ESA claims, or the equivalent element for people on universal credit with a health condition or disability. I stress that that is for new claims after April next year; there will be no cash losers among those already in receipt of ESA or its universal credit equivalent, and there will be further safeguards meaning that they will not lose the extra payments even if reassessed after April and placed in the work-related activity group.

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[Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)]

I shall be as brief as possible and certainly intend to be well under that limit. I shall not follow the hon. Member for Ross, Skye and Lochaber (Ian Blackford) down a memory-lane trip involving independence or leaving the single market. I will say, however, that I am a huge admirer of him. Many of my ancestors are buried in his constituency, so I like to claim a little bit of union with him, even though he would not want to admit it. I shall visit the area as often as possible to ensure that I give the hon. Gentleman the best support I can for him to stay up there as long as possible.

I rise for the first time in, I think, nearly seven years to speak from the Back Benches, and I do so to speak on an issue that is very close to my heart. I want to explain why that is the case to my colleagues. Let me start by welcoming both Ministers to their new roles on the Front Bench, and I congratulate them on continuing to commit to the changes and reforms necessary to improve the quality of life for so many people who would otherwise be left behind.

In passing, let me note one or two figures. The number of children in workless households has fallen to record levels—down to just under 11% from the 20% that we inherited. A child in a workless household is nearly three quarters more likely to be in poverty than a child in an in-work household. That is an important point, because that dynamic is critical—a point to which I shall return. The fall in income inequality has been mentioned, and it is falling because more people at the lower end are going back into work.

There is another important issue about disability. We have committed to, want to commit to and must stay with the position of wanting to see more people with disabilities in work. We want the gap to be at least halved, which I think is feasible. I shall explain in a few moments why I think that it is feasible.

[Stephen Timms]

Will the right hon. Gentleman give way?

[Mr Duncan Smith]

In a minute, but let me finish this point first.

A lot of the work of the Green Paper was done when I was in the Department. It was a White Paper at that stage, and I hope it gets speeded up and becomes a White Paper again fairly soon. After five reviews of the inherited employment and support allowance, I would be the first to acknowledge that although we have stabilised it and it is better than it was, it is a very difficult area, as we all know. If every Member was prepared to be reasonable, we would all recognise that these things need to change.

Let me clarify that the main single thing that I wanted to see change and I still want to see changed is this artificial idea that people are either too sick to work or unable to work. There should be a greater nuancing in people’s lives, and universal credit now opens the door to a much more flexible process that allows even those diagnosed and reasonably said to be “not capable of work” to be able to work—and if they wish to work, they should be allowed to do so as far as they possibly can, with the taper used to take benefit money away gradually. I think that might improve the quality of life for many people. I know that this is a submission in the Green Paper, and I hope the Minister will bear it in mind.

Let me return to the point that when universal credit was set up by my noble Friend Lord Freud, who worked very hard on it, and me, the idea was that it was not just about money, but about human interface. The people in jobcentres now stay with individuals as they go into work to help advise them and be with them. This will be a more human interface, so that people can be helped through to gain extra hours, which opens the door for people with limited capabilities to work to be helped in a way that would not have been possible if we had stayed with the original system. All this is very good and very positive.

There are two critical elements. First, when people step into work, the barrier must be reduced by improving the amount of money that can be held from benefit before it is tapered away. The second element is the taper itself, which is the simple process by which people have their income reduced. I say to the Minister that those two elements, notwithstanding all the other stuff such as improved childcare and everything else, are at the heart of what delivers.

The Institute for Fiscal Studies and others recently looked at what the dynamic effect of universal credit might be as it rolls out. The IFS was very clear: it said that the effect was a 13% improvement in all elements—going back to work, staying in work, taking more hours and earning more money. I know from my experience in the Department that every time one benefit has been substituted for another, it has almost always been worse on arrival than the previous benefit before people engage with it and improve it. This is the first time that a benefit being rolled out is a net improvement on a previous benefit.

I therefore make this recommendation. That figure of a 13% improvement was made on the basis of the original work allowances. In the spirit of general collective view and belief, I say that if we really want to see the right thing happen to people out there who try to get into work and stay in work, the allowances are critical. I recommend and hope that my colleagues in government will think very carefully again about the decision to reduce those allowances. I recognise the problem with the deficit, and we of course want to reduce it. I am not asking for more money; I am asking for wiser spending. I wonder whether we could revisit the idea of a tax threshold allowance and look to see whether getting the money to the lower five deciles would be better served by universal credit. Some 70% of those people will be on universal credit, whereas only 25p of a tax threshold allowance will actually go to the bottom five deciles.

I urge the Minister to speak to his right hon. Friends and say, “Look, we have a very good opportunity to do something that is really bold and right for those whose lives we really want to improve—those that the Prime Minister rightly said was her target group.” It is a very Conservative thing to do to help people who are doing the right thing to improve their lives. Even if the Government cannot do it all, they should look at two elements: lone parents and those with limited capability for work. This would answer the problems surrounding the WRAG, too. I urge Ministers to do just that. It is the right thing to do, and it will be the thing to do that changes lives and improves the quality of those lives.

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[The Minister for Disabled People, Health and Work (Penny Mordaunt)]

May I associate myself with the sentiments expressed by the shadow Chancellor about the late Debbie Jolly? She was a noted researcher and sociologist, as well as a tireless campaigner. I am sure that our comments will be just two of the many tributes that will be paid to her.

I thank all right hon. and hon. Members for their contributions to this debate. It has been a lean-but-fit Opposition day debate, and I will try to make my reply lean and fit as well.

Let me answer the question asked by the right hon. Member for East Ham (Stephen Timms) about the disability employment gap. I am sure he is aware of the evidence the Work and Pensions Committee has taken on the complexity involved in measuring and tracking progress on the gap. I am taking a much more low-brow approach. All Members will shortly receive an invite to an event in this place on 5 December, when they will receive information not just about the Green Paper and how they can get involved in the consultation at local level, but about the focus on unmet and existing needs in their local area. We will crack this—getting services to focus on what we need to do not just to halve the gap, but to close it completely—by, for example, looking at exactly how many people with learning difficulties there are in their constituency for whom roles need to be carved out.

[Stephen Timms]

Will the Minister give way?

[Penny Mordaunt]

I am sorry, but I am very short of time.

The welfare state is a safety net, but—done well—it should anticipate, empower, be seamless with other services, be unbureaucratic, have commons sense and compassion at its heart, and be focused on helping someone in their ambitions as well as on their basic needs. In the last quarter, there have been many tweaks to the system, some so dry and small that they have not registered with the House. Others have registered, such as the decision to stop reassessments for those with degenerative conditions, the increase in the number of groups able to access hardship funds, and our concerns—they have been expressed by the Secretary of State for Work and Pensions today—about sanctions on people with mental health conditions.

We will continue to work methodically through the improvement plan: reducing the number of people having to go to appeal to get the right decision; ensuring that our programmes work better and improving them; ensuring we have the reach we need; and building capacity and expertise in our organisations. That will build on the substantial reforms already carried out by my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith) and my hon. Friend the Member for North Swindon (Justin Tomlinson). I pay tribute to them for the work they have done.

The proof that we have listened and understood will be seen in our actions. A person’s experience of the system and their support is the only thing that will assure confidence, but I hope this debate will afford me the opportunity to reassure colleagues on both sides of the House about the specifics that have been raised. To deliver well, we must understand the impact of a policy on people who are often in complex situations and under considerable strain and challenge. There is the challenge of budgeting for those who have suddenly had to stop work or have lost employment due to their condition, ill health or accident, or the challenge of facing increased costs, or both.

Hon. Members have pointed to three concerns. First, there is a person’s liquidity—their ability to afford the additional costs of looking for work and being poorly or disabled. Someone with a neurological condition will spend almost £200 a week on costs related to their disability, and hon. Members on both sides of the House have raised concerns about that. Secondly—this is often exacerbated by the first—there is a person’s dignity and mental wellbeing. Thirdly, there is the obvious point that someone is more likely to get into work and make a success of it, as well as to recover from ill health, if they are able to devote themselves to that. If they have other worries or concerns, their energy and focus on their objectives will be diluted. Many who find themselves in receipt of universal credit or ESA will already have complex situations to deal with, and the delivery of our services should not add to that.

Let me briefly touch on each of those three concerns. To inform our view of the income needed by the range of people we are considering, we have relied heavily on the work of third parties, most notably Macmillan and Scope. Personal independence payments will be able to help some people with some of those costs, but not with them all. More is therefore needed, and more will be provided.

First, there is the flexible support fund, a discretionary fund that is used by work coaches to provide local support for the costs related to getting into work, such as travel to and from training and travel costs when in work. As part of the enhanced offer, we have committed an additional £15 million to that fund over the next two years. The partners we work with are aware of the fund and signpost people to our work coaches, so that they can access it.

Secondly, we have schemes such as the travel discount scheme for those on ESA, universal credit and jobseeker’s allowance. Thirdly, we are continuing our work that focuses on sectors such as energy costs and insurance. In relation to April’s changes, we are doing new work with key providers, such as mobile and broadband providers, to see whether they can offer further help. Where there is existing help, we must ensure that our clients know about it. We are building on the excellent work that Scope has done through the Extra Costs Commission to drive down costs and utilise the consumer power of this group of people.

In the context of this debate, I am working to provide a greater number of ways to reduce a person’s personal outgoings by next spring by using funds to alleviate the costs directly related to work, negotiating better deals on expenditure not directly related to employment and extending the hardship fund with immediate effect. That will use new money from the Treasury over the next four years.

Happily, my hon. Friend the Member for North Swindon helpfully outlined the measures in the Green Paper, which will be key to supporting those who are in the WRAG. That support may not seem relevant to some hon. Members, who understandably have focused purely on liquidity, but we have a duty to do more than provide what can only be limited financial support. We must also provide a way through to the workplace for the many who want to be there. No Government support can ever compensate for a pay cheque and the financial resilience, health and wellbeing that come with it. That is why, in the last Parliament, we increased the benefits that contribute to the additional costs of disability and care and the elements of ESA that are paid to people with the most severe work-limiting conditions and disabilities.

The changes that we deliver in April will provide more support to those people—something that I hope all will welcome. Alongside that, we will ensure that the focus on personal liquidity, dignity and the ability to focus on one’s health and work ambitions is maintained. We will invest in helping a person out of their situation, rather than helping them endure it. We will support people’s ambitions as well as their basic needs. We will enable them to build their future, as well as helping them in the here and now.

Question put (Standing Order No. 31(2)), That the original words stand part of the Question.

Under-occupancy Charge

Stephen Timms Excerpts

Monday 14th November 2016 Commons Chamber

[Mr Speaker]

The hon. Member for Hexham (Guy Opperman) is also a proud product of the University of Buckingham in my own constituency, which is another consideration to boot.

[Stephen Timms (East Ham) (Lab)]

The bedroom tax has always hit disabled people especially hard. More than any other single measure, it has driven the increase in food bank use and in penury that we are seeing in communities up and down the country. Surely it is now time, finally, to abandon this hated measure.

[Damian Green]

I just do not agree with the underlying analysis of the right hon. Gentleman. I know that he has considerable expertise in this area, but the fact is that, across the social rented sector as a whole, approximately two thirds of claimants are disabled. It was initially estimated that under two-thirds of those potentially affected by this measure could be considered disabled. That fact shows that there is no disproportionate impact of the type he claimed.