Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(3 years ago)
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Dr Coffey
The hon. Member just shows her effectiveness as a Member of Parliament in responding to her constituent and taking the issue up with us. If there are specific details that she would like to go into, I think the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham (Guy Opperman), will be more than happy to respond. It is right to say that universal credit is not paid to people who are of pension age, but I flag to her some of the issues addressed by my hon. Friend earlier when considering the backlog in paying out pensions.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
May I add my welcome to the new Ministers on the Front Bench today?
In the year before the pandemic, 380,000 sanctions were handed out by the DWP to the British people. Of course, there must be rules in any system, but since the Conservatives came to power in 2010, there has been a heavy focus on punitive sanctions, often for minor infractions, yet when the Home Secretary breaks the ministerial code by bullying, she gets off scot-free; when the Electoral Commission tries to investigate the Prime Minister’s flat refurbishment, it gets its wings clipped; and last week, when Mr Owen Paterson broke the rules on paid advocacy, this Government tried to do away with the rules all together. These are not one-offs. This is a pattern of behaviour. Does the Secretary of State appreciate that many people are comparing how the DWP operates with how the Conservative party behaves, and are asking, “Why is there one rule for the Government and another for everybody else?”?
Dr Coffey
Well, what can I say? The interests of the British public are best served when the Conservative party is in power and in government. We are seeing a rise in employment. We are seeing a universal credit benefit system that is more generous than the legacy system that was there. We are finally removing a lot of the thresholds that actually prevented people from working more than 16 hours per week. I am proud of not only our policies but our civil servants in delivering an excellent record in trying to make sure that money gets to the people who deserve it the most.
Jonathan Reynolds
People simply want to know that everyone in this country is playing by the same rules, and I think that is reasonable.
Let me turn to another crisis of the Government’s own making—the problems in the labour market we have seen over the past few months that left the pumps dry and the shelves sparse. As we left the single market it was obvious which sectors would be most disrupted: transport, logistics, and social care and the NHS. Regardless of how people voted, we have to make this work, which it clearly does not at the moment because of Government incompetence. This Government often claim they have a plan for jobs, but surely any credible plan would have tackled these shortages head on and got unemployed people the skills the economy needs to keep Britain moving. So, very simply, why was there no plan in place to prevent these problems?
Dr Coffey
Very evidently, the plan for jobs is working. We are seeing more people on the payrolls than was happening pre-pandemic. I hear what the hon. Gentleman says about some of the skills that may be required. I am conscious that many people who campaigned vigorously to stay in the European Union are still trying to use the excuse of leaving the European Union for why certain sectors are still under-supplied. The reality is that nearly 6 million people registered for the EU settlement scheme and they have an entitlement to live in this country if they so wish. I think there are some aspects of covid that are perhaps hindering people in coming back into the UK who are considering a return to their native countries. Let me say very clearly that we are working on this right across Government. We have the Prime Minister’s lifetime skills guarantee. We are encouraging people to consider swapping sectors, as is happening with aspects such as SWAPs—sector-based work academy programmes—for people who are unemployed. There are also the bootcamps for skills and the incentives to take on apprentices that have given been to employers right across the country. I can honestly assure the hon. Gentleman that the plan for jobs is certainly working.
Universal Credit and Working Tax Credits
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 2 months ago)
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Dr Coffey
I will not, because I am conscious that we are nearly an hour into this debate and many hon. Members will want to speak about this important matter.
Right across Government, we are investing to help people to get better-paid jobs, whether that is through digital boot camps, the lifetime skills guarantee, the £650 billion infrastructure programme that will generate 425,000 jobs, the £8.7 billion affordable homes programme expected to support up to 370,000 jobs, and the green jobs taskforce, which goes from strength to strength as we work our way towards net zero. I have referred to the extra funding through the health and social care levy, which will include support for care workers, but we will not stop as we help people to progress in work. This Conservative Government and Conservative party want people to prosper as we build back better and level up opportunity across the country.
Tackling poverty through boosting income is one element and we will continue to support people with the cost of living. We have kept the uplift in housing support through the local housing allowance rates, as I mentioned to the hon. Member for York Central (Rachael Maskell), maintaining it in cash terms this financial year. We spend over £6 billion on supporting childcare, which is equivalent overall to about £5,000 per family. As I said to the House, that can be up to £13,000 per family for people on universal credit.
We have increased the automation of matching benefit recipients with energy suppliers to make it easier for the warm home discount to be awarded almost automatically. I was very pleased to see that more mobile and broadband suppliers stepped forward with social tariffs for people, which is why I am delighted to let the House know that we are working with those suppliers to make it easier for them to verify the identity of people seeking those special discounts. I am also leading cross-Government action to do more on tackling poverty and the cost of living, which will help many families with their day-to-day costs.
We have heard that universal credit is flexible and that people are treated individually. I am very aware of the challenges on food insecurity. That is why we included the questions we did in the family resources survey so that we can start to think about how we can direct our policies specifically to those people. As my hon. Friend the Member for South West Hertfordshire (Mr Mohindra) was trying to get out of the shadow Secretary of State, the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), what is accurate—I am pretty sure to say—is that, in 2008, tax credits may have changed, but that was effectively for people in work. What we did not see was a boost in the unemployment benefits, so when the shadow Secretary of State criticises us for putting an extra £20 a week in the pockets of people who were newly unemployed, I do not think that his assertion is defensible.
One thing that the House may see in a couple of years is that, although in the last year of the last Labour Government we saw a reduction in relative poverty, that was largely driven by the fact that higher-paid people were unemployed—we saw a shrink in relative poverty simply because of a statistical anomaly. We have to deal with real-world facts and make sure that the provision of cash, by helping people with their income, is really the way to help them to get on in work but also to help them with the cost of living.
Jonathan Reynolds
It is incredibly generous of the Secretary of State to take an intervention from me on the Front Bench, but if relative poverty is what we are measuring—although Conservative MPs have broadly run away from that measure since saying that they would accept it—I have to say that child poverty in the UK is heading towards 5 million under this Government.
If the Secretary of State wants a discussion about the legacy of 2008, rather than about what is happening today, let me say first that benefits had not been frozen for four years under the Labour Government, so they kept their real-terms value. Secondly, the Secretary of State says that she has put more money into the system, but take the money for housing that she mentioned on Monday. That was not more generosity; it was not a boost; it was funding the level of policy that the Government already had with the 30th percentile. They were not improving on it; they were simply putting in the money that should have been there from the beginning. That is the crucial difference.
Dr Coffey
The last Labour Government—admittedly that was quite a long time ago and many Members of this House will not have been serving here then—did not build enough homes. Prices were not tackled, money was not well spent and we were left with no money.
The shadow Secretary of State will be aware that I am not a fan of talking about relative poverty, because it is simply a statistical element. However, since 2010, there have been 60,000 fewer children in absolute poverty before housing costs. Children living in workless households were around five times more likely to be in absolute poverty last year than those in households in which all adults worked. We know that full-time work reduces the chance of being in poverty. Overall, there are also 220,000 fewer pensioners in absolute poverty.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 2 months ago)
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Dr Coffey
My hon. Friend is right to praise his local jobcentres. One thing we have done as part of the plan for jobs is increase the number of work coaches, and indeed the number of jobcentres, thus demonstrating to people—particularly those who have been out of work already but are coming off furlough—that we are ready to support them so that they can get back into work as quickly as possible.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
This morning, during her television appearance, the Secretary of State said that a person could make up for the Government’s £20 a week cut in universal credit by working just two extra hours a week. I am sure she is aware by now that she got that completely wrong: the taper rate would of course remove a proportion of those additional earnings, so the net earnings for those extra two hours would be far less than £20. May I therefore ask her if she now knows how many more hours a single parent working full time would have to work to make up for the money the Government is cutting?
Dr Coffey
Every single universal credit payment depends on the individual, so I cannot articulate that, but it is fair to say that a number of different levers appear when people work more hours, and that includes the lifting of the benefit cap. There are a number of ways in which people can earn more and keep more of their money when they are working more hours.
Jonathan Reynolds
The figure is 10 extra hours a week, so the cut would force that person to work 50 hours a week in total to get what he or she is receiving now. That is why I have said that reducing the taper rate will be our absolute priority in our replacement for universal credit, but it is also why we oppose the cut. It is why six former Conservative Secretaries of State for Work and Pensions oppose the cut. It is why every Labour Mayor, and even Conservative Mayors such as Andy Street, have spoken out against it. It is why the Government’s own analysis, leaked last week, says that the cut will be “catastrophic”.
This is a Government who half the time do not know what they are doing, and the rest of the time they just do not care. Is not the truth that the only way to get the Government to see sense will be the House of Commons voting to defeat them this Wednesday?
Dr Coffey
I do not know the basis of the hon. Gentleman’s calculation and his suggestion, but what I do know is that the Labour Government did nothing to help people in the midst of the financial crisis of 2008, whereas we have injected more than an extra £7.5 billion. We recognised the need for the temporary uplift, particularly for those who were newly unemployed and coming on to benefit for the first time. That is why we made the temporary uplift similar to that of the minimum paid through statutory sick pay. We will continue to do what we have been doing: investing in our plan for jobs, helping people back into work and helping them to make progress in work.
Pensions Update
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 2 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I thank the Secretary of State for advance sight of her statement and for our telephone conversation this morning after the Cabinet meeting informing me that it would occur.
I believe Governments should keep their manifesto promises. It may be out of fashion—it may even seem old-fashioned—but that is what I believe and that is what is right. Before I address this announcement, I want to make some observations about the triple lock policy itself. The UK state pension is low by international comparison. It compares better when pension credit and the NHS are folded in, and a lot better when occupational pensions are considered, but the core state pension itself is still very important for millions of pensioners. The last Labour Government drastically reduced the link between old age and living in poverty, but there can be no room for complacency. The triple lock and the issue of indexation of the state pension is fundamentally about what the value of the state pension will be in future for working people today when they retire. I reject the presentation of this issue as a source of intergenerational tension or unfairness, because we all have an interest in ensuring that there is a decent state pension in future.
We should never present increased longevity as a problem. The fact that people are living longer is a good thing and it has come about because we have an NHS, because the school leaving age is no longer 14, and because pioneering Ministers of the past, such as Barbara Castle, were prepared to fight for a decent pension and retirement system. There is no doubt that the triple lock has made a significant contribution to restoring the value of the state pension following the Thatcher Government’s decision to break the link with earnings in 1980.
Turning to the Secretary of State’s proposals, the Government’s case, which is that the furlough data and the pandemic have produced a statistical aberration, has to be considered by us alongside the other decision made today, which also breaks the promises in the Conservative manifesto. Of course, we know that the promise on international aid was also broken before the recess. It is more a triple let-down than a triple lock. This decision is not a one-off but a significant repudiation of the basis on which the Government were elected and it would be naive to say otherwise.
I say to the Secretary of State that we simply cannot take the Government on their word alone. Will they show us their analysis that has led to this decision? Will they explain why they could not assess the underlying levels of wage growth with the impact of furlough discounted? Will they publish the legal advice cited as the basis for this decision? Only then could any Opposition or any MP make a decision on what is being proposed.
Finally, while the Prime Minister is well known for making and breaking promises at will, and for frequently being economical with the facts, that does come at a cost. That cost is a lack of trust, so I hope the Secretary of State appreciates that pensioners and workers, as well as the Opposition, need fuller reassurance before any decision can be made on prospective legislation.
Dr Coffey
I thank the hon. Gentleman for having read the statement and for recognising some of the challenges that we face. I accept that it is his role and that of the Opposition to suggest that the Government are not taking the right course of action. However, this is where I disagree with him. He referred to the earnings link that was dropped in, I think, the late ’70s or early ’80s. It was not reinstated by the Labour party until the late noughties and was not commenced until the coalition Government were in place. That is why we have followed the triple lock policy for the last decade, recognising that we wanted to restore the earnings link and to see an increase in pensions overall. We have made good progress on that, as I set out, with the £2,050 cash-terms increase in just over a decade.
We have used the earnings link since the policy came into effect a decade ago, and we have done this on the same basis. As for trying to mess about with different bits of earnings, the Office for National Statistics produced some data but we did not find it necessarily reliable, in terms of what could be considered as a substantiated basis to make the change. I have made the recommendation to the Government—that has been endorsed today and I hope that the House will endorse it in the forthcoming legislation—to set aside the earnings link, as we did last year, recognising the challenges of covid and the implications that that would have had last year directly on pensioners. There is the same fairness of approach here.
I do not intend, as is usual, to publish legal advice. That legal advice is quite straightforward. I would summarise it as “The best way to introduce this temporary set-aside is through legislation, just as we did last year.” I intend to take this forward on that basis.
As for making comparisons with other countries, I am conscious that we have a substantial amount of occupational pension here. We also have a whole fringe of pensioner benefits alongside it that are not necessarily available in many other countries. Just this year alone, which is about to come to an end, while the pension cost is about £105 billion, we are spending about £129 billion directly on pensioners. We have genuinely shown a measured approach to supporting pensioners during our time in office. We think this is a sensible thing that will be broadly welcomed by the public, recognising the balancing act that we continue to face.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 8 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
The economic forecasts that accompanied last week’s Budget painted a challenging picture for the Department for Work and Pensions over the next few years. Forecasts are not always correct but, if those are, we face a period of low growth and high unemployment. Based on what the Chancellor said about unemployment peaking at 6.5%, what would be the shortfall between the total number of young people out of work for more than six months and the maximum number of places available on the kickstart scheme?
Dr Coffey
I do not have that assessment to hand. The hon. Gentleman will be aware that the Office for Budget Responsibility significantly reduced its forecast in respect of the impact on unemployment, in recognition of the excellent provisions already made by the Government in the past few months and the ongoing measures set out in the Budget. We made a commitment to aim for a quarter of a million kickstart jobs to be in place by the end of this calendar year; we are well on track to doing that. We should recognise that kickstart is designed for those people who are furthest from the labour market. We will continue to use our excellent jobs army of work coaches, of whom we will have nearly 13,500 extra by the end this month, to help young people to get into work.
Jonathan Reynolds
I am grateful to the Secretary of State for her reply. I appreciate that that might not be information that she has to hand. Perhaps she could write to me with the specific figure because matching the scale of the challenge is surely what we all want to see.
In the Budget, the Government also chose to align the end of furlough, the end of the self-employment support scheme and the end of the universal credit uplift, so they all now come to an end on 1 October. She knows that we believe that the uplift should stay in place until we can replace universal credit with a better, fairer system, which, by the way, would be one where people are not worse off if they move on to it from the legacy system. Given that we all expect the end of furlough to at least have some impact on unemployment, would it not have made sense even to this Government to keep the uplift in place to at least help absorb the end of the furlough scheme? As it stands, just when people will again really need it, out-of-work support will be reduced to the lowest level in 30 years.
Dr Coffey
The hon. Gentleman asks a fair question about why these have all been taken in parallel. I think that it is to give certainty and direction to the country and to employers, particularly when it comes to the operation of the furlough scheme. As I have said before, this is really the time for those employers to get their workers ready again to go back into work, ideally sooner than before the end of September. Thinking about the temporary £20 uplift that was applied to universal credit, I think it is also fair to say that that is not the only way that we have supported people on benefits in the last year. There are also things such as the increase in the local housing allowance rate, which is on a permanent setting in cash terms. Those are the sort of other measures that we have taken, including to help some people on low incomes with the cost of living.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 10 months ago)
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Dr Coffey
We have provided an unprecedented economic support package to protect and create jobs through the pandemic. For people who need to change careers, our sector-based work academy programmes—SWAPs—offer training, work experience and a guaranteed job interview to get those people ready to start a job, allowing them to learn the skills that employers in that particular industry look for. Alongside that, our flexible support fund has been boosted by an extra £150 million so that work coaches can help to support individuals facing redundancy through retraining and overcoming barriers to work.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op) [V]
As we have heard, last week this House voted that the Government should not proceed with the £1,000 cut to universal credit set to take place in April. That position is now supported by 280 MPs, more than 60 charities and campaign groups, and the majority of the British public. I have listened to the Government today, as ever, but, as it stands, that cut is formally written into official Treasury documents, and the Prime Minister has indicated that he thinks the cut should happen, but last week the Under-Secretary, the hon. Member for Colchester (Will Quince), said that it was too early to make the decision. Will the Secretary of State clarify what is Government policy on reducing universal credit in April, what criteria will affect the decision, and who in Government will ultimately make that decision?
Dr Coffey
As has been explained several times to the House today, and previously by my hon. Friend the Member for Colchester (Will Quince), the Government introduced a raft of temporary measures to support those most impacted by the covid pandemic. The hon. Member is aware of the statement I made to the House, where I said that the situation would be reviewed in the new year, and that is exactly what I am doing. I am working closely with my right hon. Friend the Chancellor as we consider the options on how best to support people through the pandemic.
Jonathan Reynolds
I put it to the Secretary of State that she must give clarity to the millions of families this cut will affect. If she wished, she could give that reassurance now. I also ask for clarity on reports that the Chancellor is planning on giving a one-off payment to universal credit claimants, ignoring those on other benefits, and leaving the hundreds of thousands of likely new claimants expected this year with lower levels of support. Does the Secretary of State agree that it would be not only unfair, but a very poor use of public money to pay a lump sum to people on universal credit now, while cutting unemployment support to its lowest level for 20 years, just as unemployment is set to peak?
Dr Coffey
I can only more or less repeat what I said before. My right hon. Friend the Chancellor and I are actively working on proposals on how we can continue to make sure that we support people most badly affected by the pandemic. This is part of the discussions that are still ongoing, and I can assure the House that we are actively considering it and hope to make an announcement when we can, in order to give that certainty, as the hon. Member points out, to a number of people.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(3 years, 11 months ago)
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Dr Coffey
My hon. Friend rightly draws attention to this important point. As a result of actions by this Government the UK is the first major economy to put climate risk and disclosure into statute for pension schemes, leading the way on this issue, having already legislated for net zero by 2050 and introduced ESG—environment, social and governance—legislation through 2018 amendments to the occupational pension schemes investment regulations. I genuinely look forward to when we manage to complete the Pension Schemes Bill to bring all that into effect.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Last week the Chancellor described the scale of the unemployment crisis in the UK when he said that we could be facing 2.6 million people out of work next year. The Government’s major announcement to tackle that was the restart programme, but analysis of the spending review document shows that restart will not get up to scale until 2022, a full year after unemployment has peaked, so what will the Government be doing next year, as unemployment peaks, to help people get through the crisis?
Dr Coffey
The hon. Gentleman is right to draw attention to our plan for jobs. He will be aware that there are a number of schemes already under way, including kickstart, JETS and the sector-based work academy programme. It will take a little time to contract for the long-term unemployment programme, but I assure him that, compared with the last financial crisis just over a decade ago under the Labour Government, we have acted far more quickly in getting these employment contracts in place, because we need to make sure that people do what they can to try to remain connected to the labour market.
Jonathan Reynolds
I am grateful to the Secretary of State for that answer, but last week the Chancellor said that this is the biggest economic crisis for 300 years, and he is right, so I cannot understand how those same spending review documents show the Government cutting universal credit next April—a £1,000-a-year cut, taken from 6 million families just when they need it most. No Government since the great depression have cut unemployment benefits during a crisis, so how can the biggest economic crisis for 300 years be the time to do so?
Dr Coffey
As the hon. Gentleman knows, the Government introduced a raft of temporary measures to support those hardest hit, including the furlough scheme, the self-employment income support scheme and the £20 UC uplift. The Chancellor has confirmed the UC uplift until March ’21, and it is right that we wait for more clarity on the national economic and social picture before assessing the best way to support low-income families moving forward. That is exactly what I put in the written ministerial statement last week.
Supporting Disadvantaged Families
Debate between Thérèse Coffey and Jonathan Reynolds(4 years ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I thank the Secretary of State for advance sight of her statement. The Opposition welcome any move that will stop children from going hungry over the tough months that lie ahead. I would hope that that is true of everyone elected to this Parliament, so I still cannot believe that the Government have had to be dragged kicking and screaming to the right place and to acknowledge that, in this country, in this day and age, no child should be going hungry. I am astonished that the Government can somehow pretend that we did not all hear hours and hours of justification from them, in this House just a fortnight ago, for why they thought the absolute opposite of what has been announced today.
In my 10 years in Parliament, I have never been so depressed as I was when I listened to the comments made on the Conservative Benches during the holiday hunger debate and on social media afterwards. That was not because of the disagreement on policy; debate and disagreement are what Parliament is all about. What I could not stand was the toxic commentary and the stigmatising of good people in hardship due to the economic mess this Government are themselves responsible for. I am talking about the unacceptable insinuations about money for children’s food being spent on brothels and drugs, with no evidence to back that up. I am talking about Tory MPs attacking businesses in their own constituencies that had stepped up when the Government would not do so, and using that compassion as evidence that financial support was no longer required for those businesses. I am talking about the same tired old clichés about state dependency at a time when it is the state itself that has had to close businesses and workplaces to deal with the virus. People who themselves have only ever known privilege were showing us that they did not even know how poverty was measured in this country, and in one case did not know the difference between the calculation of a median wage and an average wage. It was unedifying, it was ignorant and it was insulting to British families, so I ask the Secretary of State to start with an apology for that debate and that vote, because the tone of her statement today does not match the tenor of the debate.
Welcome as this statement is, the Government have, as at every stage of the pandemic, acted too late. Half term has been and gone, so let me thank the real hero of the hour: Marcus Rashford. I think the Secretary of State might have forgotten to mention him, but Marcus deserves immense credit for his campaign and for what he has achieved in such a short space of time. The depression that I and many others felt when we listened to the debate here in Parliament turned to joy when his activism unleashed the most incredible response from UK businesses over the half-term holiday. Even though they are facing extremely tough times themselves, they stepped up. That is because in a compassionate society it is a given that children should not go hungry, but why did it take that extraordinary outpouring of community support to make the Government see that?
Let us get to the heart of the issue. All of this is so important because the social security system in this country does not give people the support they need when they hit hard times. That is why this announcement matters so much. That is why furlough had to be invented. That is why the self-employed and contractors are in such a precarious position. In her announcement today, the Secretary of State once again referenced the £9.3 billion that the Government have put into social security since the beginning of the crisis. I ask the Government and all Conservative MPs to reflect on this question: if, after they have spent an additional £10 billion, there is still so much incredible hardship and unmet need out there, what does that say about the system that they have created over the 10 years preceding the crisis? I note, by the way, that there is still no sign of the Department for Work and Pensions’ review of food bank use, which was due out on 19 October, but we all know what it will say.
At the beginning of this crisis, the Opposition asked for five urgent measures to stop families falling into significant hardship: sharing the £20 increase in universal credit across legacy benefits; scrapping the savings threshold so that savers would not be punished; ending the punitive two-child limit; ending the benefit cap so that people could receive what the Government had already announced; and turning the universal credit advance into a grant, rather than a loan. Those five measures would have been a big step towards alleviating child poverty and giving people the support they need, and they are still required. Yet, unbelievably, instead of acting, the Government are still on course to cut universal credit by £20 in April next year, when we know the pandemic will still be affecting people’s livelihoods. That will be a cut for 6 million families. I ask the Secretary of State to spare Britain’s families that brinkmanship and spare us the inevitable U-turn after the event. On top of the announcement today, will the Government commit to not cutting universal credit in six months’ time? For once, will they make the right decision before it is too late?
Dr Coffey
I welcome the hon. Gentleman’s support for these measures, but I am somewhat disappointed by his approach. It is quite simply false to label this as anything other than a significant expansion of existing support measures and delivering on our manifesto commitments to support disadvantaged children and families. This summer alone, 50,000 children benefited from the holidays and activities fund and, as we have said, next Easter, summer and Christmas, that will be open to all eligible children who want to take part in it. Also, I think that an additional 2,500 breakfast clubs have been started during covid.
I would remind Labour Members that their proposal simply to extend vouchers for free school meals recipients over Christmas would have cost £40 million for the two-week period, and that only school-age children would have been eligible. By contrast, our new package of support, building on the £63 million earlier in the year for the local welfare assistance fund, is £170 million. It will last 12 weeks and support thousands more disadvantaged children and families. That is not to mention the commitment to extend the holiday activities and food programme, the Healthy Start vouchers and food redistribution charities. Recognising the Barnett consequentials, this represents more than half a billion pounds of support for children and families. That is happening in a much more targeted way, trusting our local councils, which can draw on the variety of information they have to ensure that we help the most disadvantaged and vulnerable people at this time.
It is that targeted approach that really sets this policy apart. We will work with councils up and down the country to ensure that every child is warm and well fed this winter.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(4 years, 1 month ago)
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Dr Coffey
My hon. Friend is absolutely correct, and I praise him for raising this issue on behalf of the many people he represents. This Government are committed to tackling fuel poverty, particularly among pensioners, and will continue to deliver winter fuel payments this year. I was pleased by the work done by my Department to make sure that those on pension credit, including in your constituency, Mr Speaker, received the £140 from the warm home discount scheme, without lifting a finger.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
As the Government place millions of people across the country under new covid restrictions, they will be asking many people to undergo significant cuts to their income. Last week, the Prime Minister said that due to the job support scheme and universal credit
“nobody gets less than 93% of their current income.”—[Official Report, 14 October 2020; Vol. 682, c. 368.]
Unfortunately, that is just completely wrong. The reality is that a person employed by a business that the Government are ordering to close could still lose a third of their income, and for an unspecified length of time. Their rent, mortgages and food bills will not be any lower, so how does the Secretary of State expect those people to get by?
Dr Coffey
The Government have taken unprecedented action in the design of their new schemes, recognising that some businesses right around the country are still experiencing a loss in demand. As a consequence, we have developed two different schemes, one of which is “a third, a third, a third” in terms of helping people with their cost of living. Where we believe, in conjunction with local leadership, that it is the right thing for certain sectors to be closed in areas, the two-thirds support of wages is important. Of course if people do come under a certain threshold, they may well be eligible for UC, which would help top up their ongoing income during these difficult times.
Jonathan Reynolds
Secretary of State, this is important, because it is the barrier to additional restrictions being introduced. As the Government know, people who are eligible for the job support scheme and may be losing only a third of their income are, comparatively, the lucky ones, as people in receipt of UC or jobseeker’s allowance will be left on just a fraction of their current income. With that in mind, I have a straightforward question for her: it is clear that we are not going to be out of this crisis by April next year, so will the Government do the right thing and scrap their plans to cut UC to an even lower amount next April?
Dr Coffey
What is different from the regime we had earlier in the year is that then the strong message was very much for people to stay at home and retail was closed, along with a number of different sectors. That is not the case anymore: we have now had to intervene in a much more limited number of sectors, often in conjunction with the local leadership. As a consequence, we will continue to review the best ways to support people through the welfare system, as well as through the plan for jobs and the measures that the Chancellor has introduced.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(4 years, 2 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
It is a tragic consequence of the pandemic that some families of NHS key workers have lost their loved ones to covid-19 after they contracted the virus while serving on the frontline. It is absolutely right that they receive compensation for that. May I ask the Secretary of State to justify the news that low-paid relatives who receive the compensation payment are to be stripped of their benefits? That is not the case with comparable payments such as the Grenfell and Windrush compensation schemes, so why are NHS families being treated in that way?
Dr Coffey
The hon. Gentleman will know that when people have a substantial amount of money—and I recognise the route he indicated on how they have received that—it usually takes them over the £16,000 threshold for support through the welfare system. He specifically referred to some other programmes, where it is absolutely acknowledged that there has been a complete failure within Government in that regard. I suggest to the hon. Gentleman that that is not the case regarding the NHS, but I am sure, as the NHS is a separate employer from the Government, it will continue to work with its employees and the relatives of people who have sadly died.
Jonathan Reynolds
I find that answer lacking in reason and compassion. There was news this morning that the country’s largest food bank network has warned that UK destitution rates are set to double by Christmas. We know that the Government believe they deserve praise for the fact that universal credit has not collapsed like the test and trace system, but the real test of a social security system is whether it gives people the support they need. The food bank statistics prove that this is just not happening at the moment. Clearly that will get worse as the furlough scheme ends. We have set out our further suggestions on how to prevent the looming disaster. What are the Government’s plans to prevent it?
Dr Coffey
We have set out the unprecedented steps we took to ensure that vulnerable people would not go hungry as a result of the pandemic, focusing especially on children. While schools were closed to most children, free school meal vouchers were still in operation if schools could not provide a meal. Further support was given through the summer food fund, money was provided to food charities to help get food to people who were struggling, and 4.5 million food boxes were given to vulnerable people who were shielding. Together with the extra £9.3 billion in welfare support that has been given to households across the country, we believe that this is a strong way to have supported people in these difficult times.
Kickstart Scheme
Debate between Thérèse Coffey and Jonathan Reynolds(4 years, 2 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op) (Urgent Question)
To ask the Secretary of State for Work and Pensions if she will make a statement on the implementation of the kickstart scheme.
The Secretary of State for Work and Pensions (Dr Thérèse Coffey)
Yesterday, the Government launched our new kickstart scheme, as set out in the written ministerial statement and the letter sent to all Members of both Houses. This £2 billion programme will fund the direct creation of thousands of additional jobs for young people at risk of long-term unemployment, to improve their chances of progressing to find long-term, rewarding and sustainable work.
As we build back our economy and return fully to work, a lack of work experience can be a barrier to stepping on to the jobs ladder, which is why, through kickstart, employers will be supported to access a massive recruitment pool of young people who want to work and are bursting with potential. Employers from all industries and across the private, public and voluntary sectors are eligible if they can meet our simple criteria on the provision of roles. Employers will need to show that these are additional jobs which provide the experience and support a young person needs to improve their chances of permanent employment. These need to be new roles that do not simply replace staff recently made redundant.
Funding available for each job covers the relevant national minimum wage rate for 25 hours a week, the associated employer national insurance contributions, and employer minimum automatic enrolment contributions, as well as £1,500 for wraparound support. There is no limit to the number of jobs that can be created, and organisations of all sizes are encouraged to participate.
If a business wants to offer only one or two kickstart jobs, as set out in the online guidance, employers can contact their local employer support managers with an expression of interest, and we will work to link them to an appropriate intermediary. These intermediaries could include local enterprise partnerships, local authorities or business groups, ensuring the necessary support is in place to deliver placements effectively. We will continue to be proactive on involving employers and intermediaries following the scheme’s launch yesterday.
We have already undertaken substantial engagement on our labour market strategy. I want to pay tribute to our civil servants in DWP and the Treasury who have brought this scheme to fruition, and I particularly want to thank and recognise my hon. Friend the Member for Mid Sussex (Mims Davies), the Minister for employment, who has worked tirelessly with her usual passion for helping young people get on in life and who I know will continue to do so.
Kickstart is a key strand of our plan for jobs focused on young people and will be a boost for the British economy. I want to encourage businesses and organisations all to take advantage of the most ambitious youth employment programme in our history and help kickstart to become a flying start for our young people.
Jonathan Reynolds
Since the crisis began, we have been urging the Government to introduce a scheme based on the last Labour Government’s hugely successful future jobs fund to get as many young people into work as possible. We therefore welcome the kickstart scheme in principle, but we want assurances that it will be delivered in a way that maximises its impact. On that note, it is disappointing that it has taken until September for the scheme to be launched, and it is disappointing to have to summon Ministers via an urgent question just to ask basic questions on how the scheme will work.
In July of this year, there were already over 1 million young people not in full-time education or full-time employment. This is an urgent problem and we believe that the three key tests of this scheme are: whether the jobs it provides are real, quality jobs; whether it is available to support smaller businesses as well as larger ones; and whether it provides opportunities for long-term employment beyond the initial subsidised placement.
I ask the Secretary of State, first, how the Government will ensure that the jobs provided under this scheme are genuinely new, additional jobs. That is essential for the scheme to be a success, but how will it be evidenced? Secondly, given the existing scale of need, how will the Government ensure that the jobs that are created go to those who need them most? Even if, say, 200,000 new jobs were created, we could reasonably expect over 1 million young people to be eligible for those jobs. We need those jobs to go where they will have the biggest impact.
Thirdly, what feedback have the Government already received on the arrangements the Secretary of State has outlined for small businesses to participate in the scheme, given that the minimum number of jobs that can be created from a bid is 30? I hope she understands the considerable strength of feeling that already exists from small businesses in relation to that point. Fourthly, the jobs will be for a minimum of only 25 hours a week, but the Secretary of State has already brought back conditionality and sanctions, expecting people to look for work for 35 hours a week. If the Government’s expectation is that everyone should be working 35 hours a week, why are the jobs that the Government themselves are creating not for 35 hours a week?
Finally, while welcoming the scheme, I was alarmed by the Prime Minister’s presentation yesterday of kickstart as an alternative to providing continued targeted furlough support. The furlough scheme was there to ensure that people had jobs to return to when the alternative for many people would have been redundancy if their employers did not have the revenue to meet their payroll. Those circumstances still exist in some businesses—not in all, but in some—and that is why countries such as Germany, France and Ireland are continuing their furlough schemes until 2021. Needed as this scheme is, it cannot be a replacement in those sectors that do not have the ability to train and recruit new staff yet, and I strongly urge the Secretary of State to acknowledge that point too.
Dr Coffey
I thank the hon. Gentleman for his sort of support for the kickstart scheme. I really think that across the House we should see this as an opportunity for us all to help young people in our constituencies. On the principles of the future jobs fund, we have actually taken some learnings from that, on where it worked and where it did not. He referred to the fact that it had taken so long to get here, but we had the pandemic in March and this approach was announced in July. We have worked tirelessly on it and, as I say, I pay tribute to my civil servants in that regard. This is actually quite a contrast to the financial crisis of the late noughties, because I think I am right in saying that that placement scheme did not get going until October 2009. It was a long time before that happened, so we have worked at pace.
There are other elements from last time that we have learned from. Hardly any private sector businesses were involved, and the criteria were so stringent in different ways that, frankly, that scheme was very limited. I know that it is not about setting targets for these things, but the consequence of that was that the future jobs fund achieved just over 100,000 placements, although the ambition had been higher. So we have simplified the criteria.
The hon. Gentleman points to the threshold for small employers to get involved, but it is exactly the same threshold that applied to the future jobs fund, where businesses could only get involved by going through their local councils. We are opening this up in a different way, and I think we will start to see local enterprise partnerships and chambers of commerce getting involved as intermediary bodies, as well as councils. There is also a lot of support for this from many of the mayoral combined authorities.
The hon. Gentleman mentioned the number of hours per week. The reason for this is that this is not just about rebates like the coronavirus furlough scheme. Young people will be expected, with their employers, to do more to prepare themselves for the world of work, and that may include work search in additional time. So that is another reason why intermediaries are going to be a key element in helping some of our small businesses to provide these placements, as well as the wraparound support that will be required. On the other elements to which he referred, I know that he has tabled several written questions and he will be answered.
Oral Answers to Questions
Debate between Thérèse Coffey and Jonathan Reynolds(4 years, 4 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I also pay tribute to all the frontline staff at the DWP for the way they have processed so many claims for support since the beginning of the crisis. It is important to recognise, however, that the universal credit they have been processing so far in this crisis is a significantly different product from usual. In particular, all sanctions and conditionality have been temporarily suspended. That suspension is due to end tomorrow. At a time when unemployment has risen sharply, the number of vacancies has dropped, people are shielding and schools have not yet gone back, threatening people with reducing their financial support if they do not look for jobs is surely untenable, so will the Secretary of State announce an immediate extension?
Dr Coffey
It is important that as the jobcentres fully reopen this week we reinstate the need for a claimant commitment. It is an essential part of the contract to help people start to reconsider what vacancies there are, but I know that I can trust the work coaches and jobcentre managers, who are empowered to act proactively with people. There will be some people right now who have not had to look for a job for the last 20 to 30 years, and they will need careful support, tailored to make sure they can start to look for the jobs that are available and which I hope will soon become available.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I congratulate my hon. Friend the Member for Stretford and Urmston (Kate Green) on her promotion to the shadow Cabinet.
The Government say that the aim of the benefit cap is to make people work more hours or move to cheaper accommodation. Neither of those options has been possible during the covid crisis, so what possible justification have the Government got for persisting with that policy, which prevents families from receiving what the Department for Work and Pensions itself believes to be necessary?
The Secretary of State for Work and Pensions (Dr Thérèse Coffey)
The benefit cap does play an important part, but the hon. Gentleman may not aware of the exemptions to it. New and existing claimants can benefit from a nine-month grace period when their benefit will not be capped if they have a sustained work history. Since 2013, nearly 220,000 households which were subject to the benefit cap are now no longer capped.
Dr Coffey
As I outlined earlier, we want to ensure that we have that ongoing local support between jobcentres and businesses. I know that in Beaconsfield the local jobcentre staff are working with the local enterprise partnership to explore how they can collaboratively support people back into work. I am sure that the company to which my hon. Friend refers will also be looking at the Employer Help website, which provides a range of guidance and advice, including on identifying transferable skills, promoting opportunities to work in different sectors of the economy, and supporting staff.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Last week, the Pensions Regulator introduced an interim regime to cover so-called superfunds, which are funds that aim to bring together several corporate pension schemes to be run collectively. This is a sensitive area, because breaking the link between an employer and their pension scheme means that the employer cannot in future be called upon to fill any deficits. Given that sensitivity, will the Secretary of State explain, first, why the Government have not legislated for this area in the current Pension Schemes Bill; secondly, why the regulatory requirements for these superfunds are so much lower than they are for a buy-out from an insurance company; and, thirdly, whether the Governor of the Bank of England is right to say that this lack of action by the Government is a potential risk to the UK’s financial stability?
Dr Coffey
The independent Pensions Regulator published guidance on an interim regime for pensions superfunds. I want to stress that this is an interim regime, and that the Government will continue to develop the permanent regime before legislating with full and proper parliamentary scrutiny in the usual way. Market participants are well aware that they should not assume that the interim regime will automatically transfer into the permanent regime.
Covid-19: DWP Update
Debate between Thérèse Coffey and Jonathan Reynolds(4 years, 6 months ago)
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Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op) [V]
I thank the Secretary of State for advance notice of her statement. May I add my thanks to the dedicated frontline staff of the Department for Work and Pensions for everything they have done and are doing during this crisis to ensure that we can process the unprecedented volume of claims that have been made?
I welcome the measures the Secretary of State has announced so far. The social security system we had going into this crisis was a safety net with too many holes in it, and it is good that the Government have recognised that. My questions for the Secretary of State are about how we can widen that net so that everyone who needs support gets it, and about the steps that will need to be taken as we move from response to recovery.
First, the Government have significantly increased universal credit, but people on legacy benefits such as jobseeker’s allowance and employment and support allowance have not seen a corresponding increase in their benefit. More than 100 charities have pointed out that that discriminates against disabled people in particular. When will those benefits be uprated?
Secondly, there are now 100,000 families who will not be able to receive this increase because they are still limited by the benefit cap. The Government say the benefit cap exists to force people to work more hours or move to cheaper housing, both of which are clearly impossible during the crisis. Almost every organisation, from the Institute for Fiscal Studies to the Resolution Foundation and the Child Poverty Action Group, believes it should be temporarily suspended. Does the Secretary of State agree?
Thirdly, anyone who has been saving for a housing deposit, for a rainy day or for a substantial item could find themselves ineligible for universal credit because of those savings. Those people paid into the system when they were in work; should it not be there for them now? I do not believe we should punish those savers, and I believe those saving limits should also be suspended.
Fourthly, the Government say the two-child limit exists so people supported by social security have to make the same family choices as those who are not, but this crisis shows how absurd that claim is. People could not have been expected to make family choices three years ago based on the likelihood of a global pandemic shutting down our economy. The Government have suspended sanctions during the crisis, but the two-child limit is effectively an 18-year sanction on the third and fourth child in a family. Surely it should go too.
Fifthly and finally, those people who are eligible for support from universal credit will still have to wait five weeks for their money or take an advance that will be deducted from future payments. Many people do not appreciate that if they claim universal credit before they receive their final salary payment, their income means they have no entitlement for their first month and could have to wait as long as nine weeks for any payment. Since it was introduced, the five-week wait has been the single biggest driver of housing arrears, short-term debt and food bank use in the country. It should not exist at all, but in this crisis it is particularly egregious, and it simply must go.
May I also raise a very specific issue with the Secretary of State? It has come to light that the universal credit regulations treat maternity allowance, which is received mainly by low-paid women, as unearned income but statutory maternity pay as earnings, which are disregarded by the work allowance. That could result in a low-paid pregnant woman being as much as £4,000 a year worse off. Why is that? Will it change?
I turn to preparations for the recovery. As the Cabinet Minister responsible for the Health and Safety Executive, what conversations has the Secretary of State had with it about the process by which workplaces will be made safe when people are asked to return to work? When the lockdown began, most MPs were inundated with questions from constituents still in work about whether their workplace sounded safe. That simply will not do when lockdown ends. There must be a clear process agreed by the workforce and management, not least because a failure to do so would likely result in significant litigation.
This crisis has confirmed in terms what the UK’s unequal and unfair labour market really means. Although some people have been able to work from home on full pay, others have faced having to go into work and risk their health, or have lost their job through no fault of their own and will receive social security or sick pay set at just a fifth of the UK’s weekly median income. More than 4 million British children grow up in poverty, living in poor accommodation and perhaps without the internet connections many of us take for granted. The lockdown will have a severe impact on their wellbeing. Many have likened our response to coronavirus to fighting a war. If that is true, the aftermath should be equally so, with a renewed national effort to fight the inequality, poverty and insecurity that should have no place in this country at any time.
Dr Coffey
I thank the hon. Gentleman and welcome him to his position. We are in an unusual place today—literally, as he is appearing virtually for our first exchange in a statement—but we will be seeing each other again next Monday at questions.
On legacy benefits, I should stress that the increase to working tax credits and universal credit is only temporary —until 12 months from when it was applied. There are two things here. First, we have a digital UC system. The working tax credit system is digital. It is far more straightforward and it was quick to change that. It would take quite some time to change the legacy benefits system—I am talking about several months—with the process we have. When we make changes to benefits, they tend to happen four or five months before the actual changes come through, because that is how long it takes our computer systems to work.
Secondly, the statutory sick pay weekly rate is about £95. The change to UC is about £94. We anticipate and hope that people will be on UC for a quite a short time while we go through this significant emergency. It was, as I pointed out, straightforward to change that. There are other things that people will benefit from, including the work we have been doing on mortgage holidays, on stopping renters being evicted due to issues connected to covid-19, and on electricity pre-payment. No utility supplier will restrict supply due to issues at this time.
On the benefit cap, I said in my statement that it is not the intention to change fundamentally the process, principles or application of universal credit. I am conscious of the benefit cap, but we are still talking about a potential yearly income outside London of £20,000, or £23,000 in London, being given to benefits claimants. I am conscious that that could effectively be something like a £25,000 to £30,000 take-home salary after we take into account taxation and similar, so I do not think it is necessary right now to change the benefit cap. What I do want to point out to the hon. Gentleman is that claimants may benefit from a nine-month grace period, where their UC will not be capped if they have a sustained work record.
On the savings threshold, there is no universal credit eligibility where people have savings of £16,000. UC is designed to help the poorest in society. I am conscious that, if any changes were contemplated, they would have taken some time to process. We have decided to focus our efforts on those who are the poorest in society. I should also say that money saved for taxation payments, such as by the self-employed, will effectively be treated as business assets, and so would not be included for consideration or be deemed personal savings.
On the five-week wait, there is no intention to change that. In fact, in terms of the largest number of people who have claimed, this will be our biggest payment week going ahead. I am aware of what the hon. Gentleman says about people who have been paid in the last month. My understanding is that there is a phasing issue in terms of the calculation of universal credit payments that people would be entitled to with regard to the standard allowance. One of the benefits of having the advance is that it is designed to spread an annual income over 13 payments, instead of 12. For people who are going through that right now, my recommendation is that they should consider getting the advance. As I say, the total annual payment will be spread over the year.
On universal credit regulations relating to maternity allowance and statutory maternity pay, I will look into that for the hon. Gentleman and write to him. I know that quite a lot of consideration has been given to the different rates supporting people in maternity, but I will write to him on that.
On people only receiving statutory sick pay, I point out to the House that that is a legal minimum, but one of the purposes of the furlough scheme was that people, instead of being made unemployed, had this opportunity. Of course, if people are sick, an employer is entitled to do statutory sick pay. I should also point out that the furlough scheme can be applied straightaway for people who have been shielded and cannot go to work and cannot work from home, and we are encouraging employers to do so.