Universal Credit and Working Tax Credit

Steve Barclay Excerpts

Monday 18th January 2021 Commons Chamber

[The Chief Secretary to the Treasury (Steve Barclay)]

It is a privilege to close this debate on behalf of the Government. Let me begin by thanking right hon. and hon. Members across the House for their contributions. Many spoke with great passion. Having listened to the debate, it is clear to me that there is a heartfelt desire, shared on both sides of the House, to support those constituents impacted by the economic consequences of covid. That was reflected in the well measured opening remarks of the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), speaking from the Opposition Front Bench, and in the comments from my hon. Friends the Members for Sevenoaks (Laura Trott), for Barrow and Furness (Simon Fell) and for Guildford (Angela Richardson), among many others.

The Government are acutely aware of the harm that the crisis has done to people’s finances, including the most vulnerable in our society. At every stage of the pandemic, we have striven to support those who have found themselves at the sharp end. As the Minister for welfare delivery, my hon. Friend the Member for Colchester (Will Quince), outlined earlier, that is why we introduced a wide-ranging package of welfare measures worth over £7 billion this year. That included temporarily increasing the universal credit standard allowance and the working tax credit basic element by £20 a week—an increase that has boosted welfare spending by £6.1 billion. As my hon. Friend also pointed out, given the evolving nature of the pandemic, it is right that we wait until the Budget before making future tax and welfare decisions.

[Stephen Timms]

rose—

[Steve Barclay]

I will of course give way to the Chair of the Work and Pensions Committee.

[Stephen Timms]

Is it not unreasonable to force families who claim universal credit to wait until March to find out whether the rate of benefit will be cut by nearly a quarter at the end of March? Surely the Government need to announce their decision sooner.

[Steve Barclay]

I think what that ignores is that a quarter of the scheme is still to run, because there is still almost three months until the end of the financial year.

One should look at the package of measures as a whole. As a number of right hon. and hon. colleagues have pointed out, my right hon. Friend the Chancellor has allocated £280 billion in fiscal stimulus to help weather this crisis—I think the Chair of the Work and Pensions Committee has welcomed a number of these measures. As was further pointed out during the debate, and as Treasury analysis supports, the measures have overwhelmingly supported the poorest families most and reduced losses for working households by up to two thirds. That point was elegantly expressed by my hon. Friends the Members for Bexhill and Battle (Huw Merriman), for Meriden (Saqib Bhatti) and for Redcar (Jacob Young)—he correctly identified that the scale of Government support has been praised by many international observers, including the IMF, which has singled out the UK’s performance.

Let me briefly remind the House of some of the key elements of that support that relate most closely to this debate. The furlough scheme has protected the jobs of almost 10 million people, many of whom are on low incomes. Over 3 million people have benefited from self-employment grants. In addition to the temporary uplift in welfare payments, we have also suspended the universal credit minimum income floor and increased the local housing allowance rates for housing benefit and universal credit.

We have also supported those on low incomes through other measures, including council tax relief through the £500 million hardship fund, and the £500 payments for people on low incomes who have to self-isolate. Our covid winter support package includes the £170 million covid winter grants scheme and a £220 million expansion of the holiday activity and food programme for disadvantaged children. Those points were made during the debate, including by my hon. Friend the Member for Rushcliffe (Ruth Edwards). These measures have provided financial support to millions of families and individuals.

Beyond the state help that those measures have enabled, there can be no doubt that the best way to raise living standards is to keep as many people in work as possible and to support their wages. That is why my right hon. Friend the Chancellor has focused on our pledge to end low pay by increasing the national living wage by 2.2% to £8.91 an hour. Indeed, he has gone further, protecting, creating and supporting employment through our £30 billion plan for jobs—a point that my hon. Friend the Member for Stourbridge (Suzanne Webb) brought to the House’s attention very effectively. Measures including the furlough scheme, along with a raft of other initiatives designed to get people into work, have boosted jobcentre capacity, doubling the number of work coaches, and sit alongside measures such as the new £2.9 billion restart programme to help over 1 million unemployed people back into work.

As well as helping people to find jobs, we are creating new ones through a range of policies. They include our £8.6 billion investment in infrastructure, decarbonisation and maintenance programmes, and our £2 billion kickstart scheme for young people. Over the long term, we plan to unlock 250,000 highly skilled sustainable jobs that will boost our recovery under the Prime Minister’s 10-point plan for a green industrial revolution.

I have set out to the House the scale of support we are providing to people in this crisis, as well as our commitment to helping the most vulnerable and those on low incomes. Let me add that it would not have been possible to provide that support without the dedication of thousands of workers in the Department for Work and Pensions and on the frontline in jobcentres around the country. Let me echo the remarks of the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Colchester, the Minister for welfare delivery, by pointing out how well the universal credit system has coped with the enormous increase in claimants over the past months, a point recognised quite rightly by my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb), my hon. Friend the Member for Brecon and Radnorshire (Fay Jones)—I am sure colleagues will join me in wishing her a happy birthday—and my hon. Friend the Member for Gedling (Tom Randall).

Despite immense pressures, payments have still been issued swiftly and efficiently to millions of people through the universal credit system. It is clear that every Member of this House is concerned for the financial wellbeing of families and individuals in their constituencies and across the country. That has been reflected in the remarks from all sides of the House during the course of the debate. The Government, too, are acutely aware of the challenges people face. That is why we have spent £280 billion in response to covid, reflecting the Government’s and the Chancellor’s commitment to support individuals, businesses and our public services. As such, we will not move an amendment to this debate.

Question put.

Universal Credit

Steve Barclay Excerpts

Wednesday 9th July 2014 Commons Chamber

[Mr Duncan Smith]

I do know, actually. As we go along, we are developing universal credit correctly and stably, so that it rolls out properly. To repeat, we are rolling it out for singles in the whole of the north-west; couples development is now rolling out; and family developments are to come. Towards the end of this year, we will have rolled out universal credit to the north-west. I must say that that is the right way to do it: to make sure that what we produce is safe and delivers what we say it will, unlike tax credits and other problems that we got from the previous Government. I would like to know what the hon. Lady really thinks about the failure of her Government to deliver any programme correctly or safely.

[Stephen Barclay (North East Cambridgeshire) (Con)]

Does my right hon. Friend agree that there is a central contradiction in the figures from the Opposition? When the PAC last looked at this issue, the Labour Chair said:

“We believe strongly that meeting any specific timetable…is less important than delivering the programme successfully.”

Is it not right that we learn the lessons of the programmes that went wrong under the last Government, and that we get the programme right, rather than rush it?

[Mr Duncan Smith]

That is exactly correct. That is why, when the right hon. Member for Barking (Margaret Hodge) stood up, I explained to her that we are now doing what the Committee asked for. We are rolling out universal credit carefully: at every check, we make sure with the Treasury and the Cabinet Office that what we are producing works, and the next phase is then approved. We have approved all the roll-out plans for this Parliament, as was said by the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Wirral West. The strategic plan for this Parliament is exactly what the Chair of the PAC asked for, so we are giving her what she wants.

Oral Answers to Questions

Steve Barclay Excerpts

Monday 20th May 2013 Commons Chamber

[Mr Duncan Smith]

That is a very good question. My noble Friend Lord Freud is conducting those discussions, which are in line with all his discussions with the banking and finance sector in advance of universal credit coming in. The hon. Lady makes a very valuable point, and she is absolutely right. I will ensure that we press people very hard on this.

[Stephen Barclay (North East Cambridgeshire) (Con)]

My right hon. Friend will be aware that the Department suffered £1.2 billion of fraud losses last year and recovered just under £50 million. Will he look again at the scope for greater data sharing with the private sector, which is often targeted by the same fraudsters, to see whether risk-averse legal advice within the Department is hampering these recoveries?

[Mr Duncan Smith]

Yes. When we came into office, the fraud and error in tax credit loan bills stood at some £11.6 billion—money lost by the previous Government. Since then, we have published a new fraud legislative strategy, refreshed in February last year, and we are convicting and punishing more people. There were almost 10,000 convictions for benefit fraud in 2011-12, up more than 40% on 2009-10.

Amendment of the Law

Steve Barclay Excerpts

Tuesday 29th March 2011 Commons Chamber

[Mr Clarke]

I heard the Prime Minister, and I have heard the hon. Lady on numerous occasions. I even had a private meeting with her, along with Lord Rix, who co-chairs with me the all-party group on learning disability. She has not once said that there will be a change to the money that the Red Book anticipates will be saved by the removal of the benefit, or that the Government are changing their mind. If the Minister who winds up tonight’s debate says that, there will be joy among thousands of disabled people and their carers, but it has not been said yet.

What we are being told is that the Government inherited a financial crisis. I consider the views of my constituents on that and other matters, but the fact is that they are bored stiff with the blame game. They know about the deficit, but they also know about growth. They know that the Government said precious little about growth in the Budget, as has also been the case today.

Take, for, example, fuel. I argued that the VAT increase should be reversed, but the Chancellor expects drivers to be grateful for a 1p cut in fuel tax when VAT is going up by 3p in the pound. That will not allow the Government to ingratiate themselves with people who can no longer afford to fill up their tanks on the forecourt. If Government Members have some doubt about that, may I refer them to, of all newspapers, yesterday’s Sun? It indicated that one fifth of people had given up driving. If that represents growth, I do not understand the meaning of the word.

A woman in my constituency, a nurse called Sandra, does a round trip of 80 miles a day to do her job. She fears for the future and, like me, regards the energy regulations in the Budget as being too little, too late.

[Stephen Barclay (North East Cambridgeshire) (Con)]

The right hon. Gentleman says that the measures are too little, too late. Why did his party set a 10-year target in 2000 and then miss it in 2010, only to set in 2009 a far more ambitious target for 2020 that no one expects any Government to reach?

[Mr Clarke]

If I had another six minutes I would be very happy to answer the hon. Gentleman, but if he does not mind, I will just make my own speech.

There is profound disappointment with the influence of regulators, particularly in the energy sector, for gas, electricity, oil and the rest. We are seeing the impact of that influence in what people are actually paying day by day, and in the job losses being experienced as a result.

As I said, my constituents are well informed, as the House would expect them to be. Mrs Agnes Baillie, from the lovely little village of Auchinloch, who is 85, knows what the change in the pensions inflation link from retail prices index to consumer prices index means, even if the Secretary of State does not—he skipped over that in his speech. She knows that from 2011 that change will apply to state second pensions, public service pensions and some private occupational pensions, that RPI is not CPI, and that both the Conservatives and the Liberal Democrats gave firm pledges in their election manifestos that they would not change the existing arrangements—they certainly did not say that they would change things to the disadvantage of current and future pensioners.

The Secretary of State scoffed at the mention of the banks, which is both astonishing and disagreeable. The banks’ behaviour is at the heart of the all the problems that we are dealing with, and we will not get the economy right if we do not address that; instead, we will get stagnation and lack of growth. Firms will be unable to get off the ground and young people will be unable to get on to the housing ladder if the banks are not challenged more profoundly than they have been so far.

The last words of the Chancellor’s Budget statement were:

“We have put fuel into the tank of the British economy.”—[Official Report, 23 March 2011; Vol. 525, c. 966.]

Is that at the expense of 80,000 people, including 2,000 disabled children who live in residential care homes? If so, it tells us a lot about this coalition Government and the values that they hold.

[Stephen Barclay (North East Cambridgeshire) (Con)]

First, further to a number of the speeches from Labour Members, including the hon. Members for Rochdale (Simon Danczuk) and for Birmingham, Erdington (Jack Dromey), who I am pleased to see are still in the Chamber, I shall first suggest that the difference between the parties is less than is claimed. Secondly, I shall highlight the fact that significant waste remains, and that waste cannot be cut too fast or too deeply. Thirdly, I shall highlight the disconnect between the House’s responsibility for setting a Budget and debating it, and the information available for effective scrutiny.

Is the gap between the parties as wide as Opposition Members claim? All parties would have spent beyond their means in this Parliament. The Office for Budget Responsibility says that under the coalition, national debt will be £1.31 trillion at the end of this Parliament. Had Labour remained in office, national debt would have been £1.38 trillion. A difference of £62 billion is not insignificant, but to put that in context, it is less than we will be spending in a year on debt interest by the end of the Parliament. It is therefore not credible to say, as a number of hon. Members have done, that public services will be put at risk. After all, the Government will spend £700 billion a year, which is 40% of gross domestic product—more, in fact, than Tony Blair was spending when he left office.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

Will the hon. Gentleman clarify that point? Does he not recognise that one crucial difference is the configuration of spending under Tony Blair? That spending went mainly on services, but under this Government, the money will be spent on massive unemployment.

[Stephen Barclay]

Had the hon. Gentleman bothered to be here for the whole debate he would have heard some of the points made by my colleagues, including the fact that £42 billion is being spent on debt interest this year alone.

The hon. Gentleman is quite right to ask where the money is going, which brings me to my second point: waste in spending. The focus is often on top salaries in the public sector, but in Cambridgeshire there is one station manager, or a more senior officer, for every four full-time firefighters, one police sergeant for every four constables, one inspector for every three sergeants, and one chief inspector or above for every inspector. There has been huge inflation in management costs.

Opposition Members may chunter, but let us look at what many of those managers do. The Ministry of Justice asked local authority youth offending teams to collect more than 3,000 bits of data on process, and yet outcomes were still not measured, so the YOTs still cannot say which prevention schemes work. There has been an inflation of management salaries, but often the same people are paid for the same performance. The chief fire officer of Cambridge earns £190,000—£60,000 more than the chief constable—and has three deputies on £150,000, £140,000 and £130,000 each. Perhaps Opposition Members were marching on Saturday to protect such salaries, but we need to look at productivity, and at what we get in return for those salaries and that inflation in management spend.

[Jack Dromey]

On productivity, the Prime Minister hailed local government as the most efficient part of the public sector. Can the hon. Gentleman square that with demanding up-front, front-loaded 28% cuts, the consequences of which are being felt in my constituency?

[Stephen Barclay]

The hon. Gentleman mentioned productivity, but I urge him to read what the independent National Audit Office says about the health service. Spending doubled, so of course waiting lists went down—we would expect that—but the NAO found that health productivity fell dramatically. The spending fell to many of the best-paid staff such as consultants, so productivity did not match funding.

On procurement waste, the NAO says that Firebuy, an arm’s length body set up by Labour, cost twice as much to set up and run as the savings that it made. On NHS procurement, the NAO found that

“NHS…trusts pay widely varying prices for the same items.”

One NHS trust bought 177 types of surgical gloves.

The huge waste in the opaque spending in local budgets needs to be addressed. For example, Cambridge fire service spends £1.77 million, an increase of £600,000, on what it defines as “other services and supplies”. It cannot explain what that spending is. Cambridgeshire police define £7 million of spending as “other”.

[Kwasi Kwarteng]

What was the cause of all that waste in the first place?

[Stephen Barclay]

I would attribute it to a number of factors. Let me give an example. I have mentioned local spending in Cambridgeshire, but a national organisation, Ofcom, is an arm’s length body run by a former adviser to Gordon Brown and Tony Blair. He was paid £1.5 million over the last four years, and he reduced his head-count but managed to increase his staff budget. Last year he spent £9.8 million on 180 different consultancy providers. Ofcom even managed to spend £200,000 on newspapers and magazines, but it has only 800 employees, which works out as more than one free newspaper a day for every member of staff. Seven Ofcom staff managed to claim in expenses more than the average wage, with one racking up £5,500 on taxis. I do not know whether they took taxis to the protest on Saturday, but that is the waste that we hear about.

My local police bought six Land Rover Freelander cars for senior officers at £28,000. Bobbies on the beat are far cheaper than the management tier, and I suspect that they make more arrests. We should look to protect front-line services, not to make cuts in them when there are other significant costs.

My final point is on the disconnect in terms of the information that the House has when it sets Budgets. I do not believe that we are effectively scrutinising what happens. In 2009-10 we spent £1.5 billion on consultants and £700 million on arm’s length bodies, without any central data being collected. So we know there is waste. Gershon, Green and many others have looked at the matter, and I welcome the steps taken by the Front-Bench team in setting up the Major Projects Association, even if at the moment it only has 38 members of staff. In 13 years in office, however, the Labour party did not even define what a major project was, which is why we have such wide variations in Government.

Despite all the differences in the headline figures and some of the scaremongering we have heard, I hope that we do not lose sight of how money is spent. We cannot cut waste too fast or too deeply. It is clear that there is waste in our system, and unless we have good-quality data with which to benchmark, standardise and give visibility to the problem, our debates will end up returning to the soundbites that we have heard too frequently over recent days.

Oral Answers to Questions

Steve Barclay Excerpts

Monday 18th October 2010 Commons Chamber

[Steve Webb]

The hon. Lady is very knowledgeable about housing matters and I welcome her to her new role. She may not be aware that we will spend more money in the next two years on support for mortgage interest for people who are out of work than the previous Government planned to do. They planned to cut support to 2%, which would have led to many more homelessness cases.

[Stephen Barclay (North East Cambridgeshire) (Con)]

15. If he will remove eligibility for child benefit in respect of children not resident in the UK from non-UK EU nationals working in the UK.

[The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller)]

This is a matter for my right hon. Friend the Chancellor of the Exchequer, but the main purpose of child benefit is to support families resident in the UK. However, child benefit is classed as a “family benefit” under EC social security co-ordinating regulations. When an EEA national works and pays compulsory national insurance contributions in the UK, that person is entitled to UK family benefits, even if their family remains in another EEC country.

[Stephen Barclay]

I note the Minister’s reply, although at the 2003 European meeting agreeing the eligibility for child benefits, the British Government were represented by the Secretary of State for Work and Pensions, which suggests that the Department has an interest in this matter.

Would the Minister, together with colleagues, agree to set out in the Library within the next month her proposals for reforming a system under which the British taxpayer not only pays child benefit to non-UK European families who do not work and whose children live abroad, but pays up to four times as much in benefit as the children get from their own Government?

[Maria Miller]

I can understand my hon. Friend’s frustration about this matter, but I reiterate that it is a policy area for the Treasury and it is also an issue that we have inherited. Many other nations are as concerned as he is about this issue and I am sure that my colleagues in the Treasury will be looking at it in detail.