Social Security and Pensions

Wendy Chamberlain Excerpts

Monday 6th February 2023 Commons Chamber

[Sir Stephen Timms (East Ham) (Lab)]

I echo the relief expressed by the hon. Member for Blackpool North and Cleveleys (Paul Maynard) about the uprating decision, and I am pleased to follow his speech. I will begin with some points about the way we uprate benefits and echo some of the important points made by the hon. Member for Amber Valley (Nigel Mills), whose contribution to the Select Committee I appreciate.

We now know that legacy benefits will be claimed by some people until at least 2028. The Select Committee, in its report last July, called on the Department to improve its IT systems and increase the speed with which changes can be made to legacy benefit and state pension rates, and the lack of progress has been disappointing. Annual uprating based on the previous September’s inflation is perfectly reasonable when inflation is stable, but it is not reasonable in the current volatile circumstances. The Committee called for a shorter gap—the hon. Gentleman echoed this—between the inflation reference period and the uprating date, preferably using inflation data from the previous quarter, or possibly more recent still.

In the past year, the lag has caused real hardship. Benefits were uprated last April by the inflation rate of the previous September: 3.1%. By the time the uprating took effect, inflation was nearly 10%. The result has been benefits at the lowest real-terms level for 40 years, and a big surge in food bank demand. Like the hon. Member for Blackpool North and Cleveleys, I applaud the fact that the Government are honouring their obligations this year, and that the uprating will be 10% in time for the new financial year. That should prevent things becoming substantially worse for many in the coming year.

But it is not going to make things much better. Trussell Trust food banks gave out 1.3 million food parcels from April to September last year—more than in any previous six-month period, and 50% more than before the pandemic. At the Liaison Committee in December, the Prime Minister said that he would

“work very hard to deliver”

lower food bank demand by the end of this Parliament. I warmly welcome his adoption of that goal, but it will be achieved only if social security support is increased in real terms. What is the right level for the social security safety net? The Work and Pensions Committee plans in the near future to launch an inquiry into the adequacy of benefit levels, a subject that the hon. Member for Amber Valley spoke about. It seems to me that the safety net is now so inadequate that it is damaging the economic recovery: it is too low to do its job properly.

[Wendy Chamberlain (North East Fife) (LD)]

The Chair of the Select Committee cites some damning statistics from the Trussell Trust. For all that food bank use is increasing overall, the inquiry by the all-party parliamentary group on ending the need for food banks, which the hon. Member for Blackpool North and Cleveleys (Paul Maynard) mentioned, has demonstrated that it went down when the £20 universal credit uplift was in place. Does the right hon. Gentleman agree that we should look at that?

[Sir Stephen Timms]

I absolutely agree. That was the one point at which food bank demand fell, and of course it went straight back up once the £20 uplift was removed.

The level of the safety net is now too low for it to do its job properly from the standpoint of economic efficiency. People are being forced to accept unsuitable jobs, with no prospect of training or advancement, simply in order to subsist. That is one reason why the UK’s productivity record is so poor, and we will not deliver economic growth until we tackle that productivity failing. Interesting cross-party thinking on the matter is under way, for example in the work of the Poverty Strategy Commission set up and chaired by the noble Baroness, Lady Stroud. Our Committee’s inquiry will be able to draw on that and other work.

It is clear that the immediately preceding Administration —the interim Government, as the hon. Member for Blackpool North and Cleveleys described it—would not have honoured those obligations. The right hon. Member for South West Norfolk (Elizabeth Truss) told us yesterday that her Administration was brought down by a left-wing conspiracy in the financial markets. It is not clear whether she regards my right hon. Friend the Member for Hayes and Harlington (John McDonnell) as having been responsible for organising that.

--- Later in debate ---

[Wendy Chamberlain (North East Fife) (LD)]

It is a pleasure to follow the hon. Member for Broadland (Jerome Mayhew), who made a thoughtful contribution, although obviously there are differences of opinion on some of the things he said.

I am pleased to contribute to this year’s debate. The Minister’s initial contribution was pretty factual and to the point, but these debates are always an opportunity for Members to comment generally on social security and uprating. I am pleased that this year’s debate is slightly less controversial than last year’s. Indeed, I think there has been relief on both sides of the House that the uprating will be in line with inflation. That means we have not seen the triple lock abandoned and benefits will be uprated in line with inflation. However, those conventions have been broken previously, so the challenge is that people are already behind as a result of previous commitments having been reneged on. But I am pleased to welcome this uprating.

In recent years it has become increasingly clear how important the social security safety net is as a public service. As I have said previously, covid has meant that some people who never expected to be supported by the state have had to access that support. That is the reality: we never know when we might need support. We might become injured or ill; the company that we work for might go under, maybe because it cannot get enough staff and cannot open its full hours, and therefore does not have the productivity it needs to keep going; or indeed, we might need to care for loved ones. Social security is, and should be, there to make sure that no one is left behind.

The hon. Member for Blackpool North and Cleveleys (Paul Maynard), who is no longer in his place, mentioned the all-party parliamentary group on ending the need for food banks. I co-chair that APPG, and have been very pleased to have the hon. Gentleman as part of our inquiry team. The final evidence session of our “Cash or Food?” inquiry is tomorrow, and I would be delighted if the Minister could attend our report launch on 22 March—I am grateful to the Under-Secretary of State for Work and Pensions, the hon. Member for Mid Sussex (Mims Davies), for her written response to our inquiry. We are looking at that issue because, as I said in my intervention on the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), the only time during the covid pandemic when we saw a decrease in food bank use was when universal credit had its £20 uplift. That suggests to me that people were using those additional moneys for the purpose of putting food on the table.

As I said, this debate is quite factual, but it gives us an opportunity to comment on Government policy and practice. I want to touch on something that the hon. Member for Glasgow East (David Linden) mentioned, which is universal credit for the under-25s. It may have been uprated by 10%, but it remains lower than for the over-25s, and I would argue that there is simply no good reason for that. Indeed, about 18 months ago I wrote to the Department for Work and Pensions on this topic in support of a campaign by One Parent Families Scotland. I was told, in terms that, frankly, I found quite patronising, that the reason for the policy is that the DWP believes young people are more likely to live at home—that was assumed even if they themselves are parents—and generally have lower earnings expectations.

That response totally ignores the experience of the majority of under-25s who claim universal credit. Of course, as parents we would hope to support our children as they take their first steps in the world, and to provide a safe haven to which they could return if necessary. However, that does not help the young people who need to leave home because they are looking for work and there are no jobs in their area; the young people who do not come from stable homes and need to support themselves; or the young parents who cannot stay in their family homes with their own children. I hardly want to deign to give a response to the statement about having lower earnings expectations, but I will say that no one who is out of work and receiving universal credit, or who, as has been pointed out, is in work and receiving universal credit, even at the full amount, is sitting idly by, wondering what to do with that excess income.

As many Members have said today, we are in a cost of living crisis. Universal credit is a safety net, and this Government policy assumes that young people deserve less safety than older people. That is the wrong message. Given the ministerial churn within the DWP and, indeed, elsewhere, I hope that we can review that misguided position. At the very least, I ask the Minister to review one aspect in his closing remarks: reinstating the higher rate for young parents, as it was under legacy benefits. Young parents are most likely to be struggling, and surely they and their children deserve the same support as a family where the parents are just a year or two older.

I will highlight a few other issues, starting with PIP. All of us in this place will have a caseworker who spends a lot of time providing support for PIP appeals, the vast majority of which are successful. It is a long, stressful application process, and we have assessors who simply do not understand the process or what applicants are experiencing, resulting in widespread mistakes that we as MPs end up dealing with. It costs the taxpayer more money to reverse those decisions than to get them right in the first place. The stress makes people who are already struggling even more ill, and as we know, very sadly, some people give up as a result. The system does not work. This issue is so important when the Government are currently looking at measures to deal with the economically inactive—I look forward to hearing their proposals. They want to get people back into work. Now is the time to bring those specialist assessors and the assessment process for PIP back in-house, and to stop lining the pockets of private providers with taxpayer money when they simply do not get the job right.

[Justin Tomlinson]

The hon. Lady raises a very important point about getting the job right. Thankfully, the vast majority of the millions of claims are right first time round, and for those where it sadly goes wrong, on the vast majority of occasions, that is because of missing additional supportive evidence. As such, will the hon. Lady join me in welcoming the Government’s move to a system where, at the mandatory reconsideration stage, rather than waiting for claimants, the assessors have now started proactively contacting them to identify the missing evidence and help them find it? That has seen the number of those able to be sorted quickly more than double.

[Wendy Chamberlain]

I am happy to support any improvements to the process, but what the hon. Member has done is to point out just how complex these processes are and how difficult they can be for people to navigate. It is only when there is a proactive approach that we start to get things right.

[John McDonnell]

Part of the problem is the run-down in recent years of advice centres and other agencies that can assist people to get the paperwork right, and to ensure representation at the appropriate stage.

[Wendy Chamberlain]

I agree with the right hon. Gentleman. Scotland is not immune from that: with more and more ringfenced spending for Scottish Government priorities, local authorities have less and less discretionary spend to put into areas such as advice and support.

I want to touch on carer’s allowance. It will not surprise Members that I want to talk about carers; I am pleased to say that my private Member’s Bill, the Carer’s Leave Bill, passed its remaining stages in the Commons on Friday and is off to the other place. According to the Government, carer’s allowance aims to help carers keep a link with the workplace, but one challenge I had with my Bill was finding constituents who would benefit from carer’s leave, because so many of them had been forced to leave the workplace due to their caring responsibilities. Simply put, carer’s allowance does not work. Carers need to be allowed to work more before they lose that allowance—that would not cost the Government more, but it would get more people back into work. I would be very interested to hear the Minister’s response to the hon. Member for North East Bedfordshire (Richard Fuller): he is no longer in his place, but he raised that very point. At Prime Minister’s questions in December, I asked the Prime Minister how the Government can believe that £132 per week in earnings is sufficient to live on such that people lose their carer’s allowance, especially when the caring never stops.

The state pension was the subject of a general debate last week. I do not necessarily want to reiterate the points I made on that occasion, but we do know that pensioners face real challenges. In the past year, I have probably done about three letters—articles—to my local paper to encourage people to take up pension credit. As other Members have mentioned, I wish the Government would pledge to follow the ombudsman’s recommendations on compensation for WASPI women, which, as we move into stage 3, would provide some degree of comfort to those campaigners. I refer Members to my early-day motion 814 on that.

When we talk about the pension increases, we need also to talk about errors that mean people do not necessarily get what they are entitled to. The LEAP—legal entitlements and administrative practices—exercise is looking at historical underpayments, and it seems to be forever increasing its remit and timescales. Perhaps one day it will finally look at underpayments to divorced women. Dividing pensions on divorce is incredibly complicated, and the Government have been deliberately blinded by not including that group. I know that the former Pensions Minister in the coalition, Steve Webb, has spoken out about this issue before. I urge the Government to listen to him, if not to me.

I raised this issue at business questions on Thursday: will the Government please tell the truth to the House about what is happening on universal credit national insurance credits? That is another issue where pensioners could go without because of internal DWP failures. Without honesty and openness, we cannot know the extent of the problem or how it will be fixed.

Every Member here knows—simply because of the number of constituents our caseworkers help every day —that there are fundamental problems with how the DWP functions. Sometimes it seems as though it has become a routine part of the process for DWP staff to send people to their MP, and that is simply not good enough. I welcome the uprating orders, but I hope that the Minister will give us some answers on everything else.