Department for Work and Pensions: Members’ Representations

Wednesday 16th January 2019 Westminster Hall

09:15

[Kate Osamor (Edmonton) (Lab/Co-op)]

I beg to move,

That this House has considered representations by Members of Parliament to the Department for Work and Pensions on behalf of constituents.

It is a privilege to serve under your chairmanship, Sir David. I am grateful to have been allocated this debate. I wish to raise the serious and worsening effects that the practices and policies of the Department for Work and Pensions are having on those needing welfare support, and the ability of the advice sector and staff, including those in my office, to support claimants. I could raise numerous points, but I will focus on universal credit. I must praise the work of MPs, third-sector groups and the Work and Pensions Committee in exposing the unfolding catastrophe of universal credit, and repeatedly forcing the Government to rethink their approach. Universal credit’s three main objectives are to reduce poverty, to make work pay and to simplify benefits.

Why do I need to raise the serious and worsening effects of DWP practices and policies? Let us be clear: the challenges that our constituents face are immense. Since being elected, I have witnessed at first hand a Government Department that has been increasingly uncompromising and punishing of claimants. That has been ever so evident in the woeful implementation of universal credit and its callous roll-out.

[Janet Daby (Lewisham East) (Lab)]

I thank my hon. Friend for securing this significant debate. Does she agree that the five-week delay in universal credit is supporting people to get into debt rather than out of it, and that the Government should rethink how that is affecting the lives of real people?

[Kate Osamor]

My hon. Friend makes a valuable point, which I will come to later. I thank her for her contribution.

There is considerable anxiety among the 16,630 house- holds in Edmonton accessing at least one kind of social support that will be replaced by universal credit. By August 2018, around 2,750 households in Edmonton had been moved to the new system. Many of my constituents have reported multiple significant problems in dealing with universal credit, from understanding the new system, to the transition to universal credit, the excruciating application process, receiving payments, which are mainly late, and the ongoing support—in short, the entire system.

My constituents are not alone in their assessment of universal credit. The National Audit Office said that the universal credit programme was

“driven by an ambitious timescale”

and had

“suffered from weak management, ineffective control and poor governance.”

According to the Child Poverty Action Group, difficulties with claiming universal credit mean that currently one in five applications fails.

A vulnerable constituent of mine made a claim for universal credit in July 2018. It was initially incorrectly refused, even though he had provided all the necessary documentation. Only after challenging the decision was his application accepted in September 2018. Despite the appeal being upheld, he did not receive any universal credit payments until December 2018—almost five months after his initial claim. Let that sink in: it was five months after the initial claim, and he was an extremely vulnerable person.

[Emma Dent Coad (Kensington) (Lab)]

Does my hon. Friend agree that the bureaucracy facing claimants, including appeals, is too much to bear for people going through such difficulties, and that our constituency staff teams are constantly asked for help that they are unable to give?

[Kate Osamor]

My hon. Friend makes a valuable point. I will come on to the demand for the legal representation that vulnerable people need.

As I said, my constituent, who was a very vulnerable person, received his first payment five months after his initial claim, and that was only after the relentless persistence of my office. I cannot convey the hardship that my constituent went through in those five months. He was let down by a shoddy assessment of his application.

In areas such as Edmonton, with such high levels of inequality, the suffering has been more intense and more widespread. My role is to fight for equality for all. Achieving equality is not just the right thing to do; the evidence is clear that more equal societies are better, healthier and safer. Such societies have fewer health issues and social problems, are less internally divided, and are better able to sustain economic growth.

On 11 January this year, three single mums defeated the DWP at the High Court over issues with universal credit. They were missing out on hundreds of pounds a year because of the farcical way the DWP calculates income. Lord Justice Singh and Mr Justice Lewis ruled that the DWP had been wrongly interpreting the universal credit regulations. In their judgment, they described the universal credit income assessment process as “odd in the extreme”. Can the Minister confirm whether the Secretary of State will appeal that High Court judgment?

Universal credit is complicit in the Government’s punishing austerity policy, which has increased child poverty to 4 million and rising. The Institute for Fiscal Studies predicts a 7% rise in child poverty between 2015 and 2022. Some sources predict that, if policies remain the same, child poverty rates will reach as high as 40%. In a recent report, the UN special rapporteur on extreme poverty and human rights, Professor Philip Alston, expressed his dismay that one fifth of the UK population—14 million people—were living in poverty, 1.5 million of whom are destitute and unable to afford basic essentials. His report described the immense growth in food banks and the queues outside them, people sleeping rough on the streets, and the growth of homelessness. It is utterly unacceptable that in 2019 millions of people live without food security.

By continuing the roll-out of universal credit, the Government are making it clear that the human cost of austerity is not a priority for them. In recent days, DWP Ministers have been talking of extra funding for universal credit—£1.5 billion to help people by allowing advances of up to 100% on day one, if individuals require it. Let us be clear: that is not extra money in the pocket of those barely getting by; it is debt, pure and simple. The gap between legacy and universal credit payments means that claimants who take up advances start their claims in debt to the DWP. Advances only complicate the process and should not be necessary in the first place.

To make matters worse, the Citizens Advice reported that claimants on universal credit were more likely to have debt problems than those on the legacy system. However, DWP Ministers seem to think that saddling claimants with debt from the start of their claim is a solution to the problem of poor design. The Government pledged an extra £4.5 billion for universal credit across the next five years in the last Budget. However, the benefits freeze is set to continue until April 2020, and there is no guarantee that it will not continue after that, no matter what soundbites emerge from the Secretary of State. The IFS has also made it clear that there are welfare cuts still to come of more than £4 billion per year until 2022-23, which spells more and more insecurity for those who can least withstand it. The Government continue to flatter themselves about ending austerity, but unless they restore humanity into the welfare system, I can only determine that it is a soundbite exercise.

In Edmonton, we are seeing the continued grinding down of local support services and the continuing impoverishment of the constituents who I was sent here as a Member of Parliament to represent and serve. Serving their interests and seeking to aid them is my primary goal, but the scale of issues with accessing universal credit means that Members’ offices are overwhelmed with pleas for help. I have seen an increase in the volume of cases, a large proportion of which are complex and need legal and specialist representation that is harder and harder to find. As a consequence of the DWP’s policies and approach, and in the context of austerity, I—like other MPs—am approaching the point when it will be untenable to make adequate representations on behalf of my constituents.

A key obstacle that my constituents face in accessing universal credit is the overemphasis that the system places on digitisation. According to Neil Couling of the DWP, the system relies heavily on digitisation to process claims and, as a result, less than 1% of claimants lose out. I find that hard to believe, because the reality of digital skills in the UK paints a very different picture. According to the Office for National Statistics, one UK adult in 10 has never used the internet, one in five lacks basic digital skills and 20% of disabled adults have never used the internet. Even a DWP survey reported that 30% of UC recipients found the online process either “very difficult” or “fairly difficult”, while 43% said that they needed more support with setting up their claim. Ipsos MORI’s 2018 UK consumer digital index agreed with DWP findings that an estimated 1.2 million benefit claimants have low digital capability or no digital capability. At times, my staff have had to set up email accounts and give basic IT training to my constituents.

In short, the design of universal credit is fundamentally flawed. It systematically disadvantages or excludes the millions of people in the UK without good digital skills. The over-reliance on digitisation has meant more and more people coming to my office because of issues that they face with universal credit or that originate in problems with universal credit. Given that 30% of universal credit recipients found the online process either “very difficult” or “fairly difficult”, and 43% said that they needed more support with setting up their claim, will the Minister accept that it is time to stop and rethink the over-reliance on the digital process?

Without a doubt, the benefits process is complex for anyone. Consequently, the DWP has helplines available under the legacy system to enable claimants and advice staff to uncover problems and find a solution. However, no such comparable arrangement is in place for universal credit. A working single mother in my constituency faced considerable issues when dealing with universal credit. A mother of three dependent children, she was wrongly advised by her work coach to end her claim for tax credit and claim universal credit instead. Unfortunately, the work coach had not grasped that universal credit was not available to claimants in Enfield with three or more children until 2019. As a result, my constituent’s claim was terminated. Although she had taken steps to apply separately for tax credit, her claim could not be processed because she was deemed to fall within the reclaim period for universal credit. Having just started a new job, she was reliant on benefit income to tide her and her children over until her wage arrived, but she was left with nothing.

She tried to deal directly with the DWP but had no success. She came to my office, but my caseworkers, too, were frustrated in their efforts to solve the problem. DWP staff incorrectly informed us that all third-party enquiries, including representations from MPs, would need to be made via an online portal, which could take more than a month to process, irrespective of the urgency of the representations. It was only after my office escalated the matter to the Secretary of State and to senior personnel on multiple occasions that matters were eventually resolved.

Universal credit left my constituent and her children in poverty. That could have been avoided if there had been key escalation points in place that she or my office could have used throughout the process. When problems emerge, the structures to remedy them are not fit for purpose. For what has proved to be a difficult system, why not introduce an escalation process such as a well-staffed helpline for claimants, Members’ offices and the wider sector? Will the Minister commit to making such changes to the system?

At the moment, the soundbite of the DWP’s approach is to “learn and adapt.” That is the height of privileged detachment. Can the Department really be serious? What are spoken of as problems to be solved as they come up are real people’s lives. What is perceived as a learning opportunity for Ministers is devastation for my constituents. I ask the Minister not to turn a blind eye to these problems, but to look back at universal credit’s three main objectives: to reduce poverty, to make work pay and to simplify benefits. Rather than ploughing ahead, is it not time for the Department to overhaul the system?

Universal credit in its current form simply is not working; it is causing greater poverty, destitution and anxiety wherever it is rolled out. The Government need to commit to a root-and-branch review of universal credit. I look forward to the Minister’s reply.

11:17

[The Parliamentary Under-Secretary of State for Work and Pensions (Justin Tomlinson)]

It is a pleasure to serve under your chairmanship, Sir David. I pay genuine tribute to the hon. Member for Edmonton (Kate Osamor); although obviously I do not agree with all the points she made, it is clear from her time as an MP and formerly as a councillor, and from the issues she raised in her speech, that she is a passionate campaigner on the subject, particularly for vulnerable claimants in her constituency. I am not the Minister ultimately responsible for universal credit, which was the predominant focus of her speech, but part of my portfolio is to represent vulnerable claimants who go through the universal credit process, so I recognise some of the issues that she pointed up.

I will talk about some of the specific asks that have been addressed and on which there is much agreement, but first it is fair to remind hon. Members that there was cross-party support for the principle of universal credit: to offer personalised, tailored support. Stakeholders broadly support that principle. That does not mean that all is right, but we must not forget that legacy benefits were not the panacea of a utopian state in which everything was great. They were incredibly complicated, with six different benefits and three different agencies, and with the involvement of the DWP, Her Majesty’s Revenue and Customs, and local authorities. Frankly, anyone navigating them had to be a nuclear physicist, whether they were claimants, MPs or MPs’ staff members trying to support predominantly vulnerable claimants.

The figures bear out that point. We typically saw 700,000 claimants a year missing out on £2.4 billion of benefit support—about £280 each per month—that we had all voted to give them because we recognised that it was the right thing to do for those predominantly vulnerable claimants. There was a 90% tax rate for some claimants, and there were well-known problems with the cliff edges at 16, 24 and 30 hours. In our casework, we saw people who wanted to do the right thing and were trying to improve their opportunities in life, but the system was working against them. Universal credit was therefore introduced, as I said, broadly with cross-party support. It is right that we have looked at it all the way through as a test-and-learn, and that is why it is important that the hon. Member for Edmonton has raised her direct experiences and those of her office.

We have already made some significant improvements. We, rightly, made the changes to advance payments. Those payments were always there, but people had to know to ask and, unsurprisingly, very few people did. They are now, rightly, automatically part of the initial interview with the work coach and, unsurprisingly, the take-up rates of advance payments have significantly improved.

Initially, those payments were repaid over six months. That was, rightly, changed to 12 months, and then to 16 months. The repayment rate has also been reduced and we have strengthened the discretion to take into account particular hardships, to make sure we are not compounding a problem.

Those who are transferring over from legacy benefits, such as housing benefit, will get an additional two weeks-worth of housing benefit money, with no strings attached. That is additional money. As the regulations come forward, there will also be an additional two weeks for those on employment and support allowance, jobseeker’s allowance or income support, again with no strings attached. That is typically worth £237 on housing benefit and £200 on ESA, JSA or IS. Opposition Members often seek to oppose what the Government do, but this is something they should support.

We have scrapped the seven-day waiting period and strengthened the alternative payment arrangements, on housing costs direct to the landlord, for example. If a legacy claimant already had that provision, there will now be a presumption that we should have the conversation to see if that was the right arrangement. We have also looked at the frequency of payments, for those who have been used to a more frequent payment and might struggle with monthly payments.

There is the extra work allowance. We have made changes to the exemptions for the minimum income floor for self-employed claimants, and there are additional protections for those on severe disability premiums. But there is still more to do.

[Laura Pidcock (North West Durham) (Lab)]

The advance payments are still a loan, which is a crucial point that my hon. Friend the Member for Edmonton (Kate Osamor) made. My question is this, however: those people who are being managed through their migration to universal credit will have protections, but those people who have naturally migrated—often, but not always, through change of circumstances—will not have those protections. What is the justification for that? Many of my constituents are worse off.

[Justin Tomlinson]

As the hon. Lady said, that is to do with change of circumstances. The transitional arrangements were put in place for those who were transferring as part of natural migration, and we have, rightly, confirmed that that number will be ring-fenced to just 10,000 this year, so we can have a real deep dive to look at the levels of support that are needed. I will come back to that in a moment.

On the wider point about why transitional arrangements were not put in, that is because it was recognised that there would be a change of circumstances. We are seeing that a lot of people benefit, and some go the other way, but overall we are now spending an additional £2 billion on the current benefits compared with the legacy benefits, before the extra money goes in. That is more money going to the people who need that help.

Let me turn to points where I think there is agreement. We talk about office casework. We all have busy offices and have to prioritise casework and supporting our constituencies. I am very proud to have been rated third out of 650 on theyworkforyou.com on helping constituents. I absolutely understand the importance of casework. One of my staff specialises in this area, has visited the jobcentre with me and talked to the partnership manager. We all have a partnership manager, who is the point of contact for escalating cases.

I know the hon. Member for Edmonton was due to visit the jobcentre in December 2017, and that that visit was cancelled. I encourage her and her staff to take part in such a visit. It is really important, and they are there to help. Where we have specific cases that do not seem right, there is an ability to escalate; MPs can talk to the senior people in the respective jobcentres and they can help take that forward.

I have a lot of sympathy with the point about digital by default. The principle was to mirror the world of work, because most workplaces now expect staff to have a reasonable level of digital engagement. However, that is not the case for all people. Not all people on universal credit will end up in work—even if that is their ultimate aim, not everybody is going to, and not everybody will do that overnight. We need to improve communication in order to advise about alternatives; claimants can access support via the telephone, face to face, or through home visits. We need to do better at promoting that and it is certainly something that I will continue to push on.

We also need to look at the issue of consent. One of the complications of the General Data Protection Regulation is that we now need implicit consent. I regularly meet stakeholders, particularly housing associations and local authorities, who say, “We represent many of your vulnerable claimants, and we want to help. We have the resource to help, and we have teams, but unless we know that one of the people that we are working with is about to be migrated or has come on to universal credit or is accessing an advance payment, how can we help?” We have got to find a way, and I think that should be done in the same way as with advance payments—through making asking for implicit consent an automatic part of the initial interview, in order to get those support organisations working with claimants. There is a resource there that wants to support claimants and we should be doing everything we can to match them up.

We made a significant announcement on putting citizens’ advice into every single jobcentre throughout the country. It will be an independent organisation, and we will cover the costs. That will start in April, and I welcome it. As part of the test-and-learn with the 10,000, I want to look closely at exactly how much time is available to vulnerable claimants. Is it enough or are there other things that could be done? I think we should look very carefully at that.

[Janet Daby]

Advance payments still take five days. Does the Minister agree that that is just too long? What are people expected to do during that period?

[Justin Tomlinson]

Actually, if somebody is in particular hardship, they can get access to money within a couple of hours, so that is an option. I am not sure how well that has been communicated, but that rule is in place for those who genuinely need it.

We should continue to work with stakeholders. I am very receptive to meeting stakeholders. Throughout the week I meet different groups that will often come and challenge the Government, and hold our feet to the coals. It is right for them to do that, because they are identifying issues. There are a number of cases where a stakeholder with particular expertise has then helped to rewrite and deliver our training. For example, on the very important issue of domestic abuse, I have been working very closely with Women’s Aid, Refuge and Mankind. They went over all the training documents and sat through a typical claimant’s experience to identify whether things are in place. We are looking to bring further improvements based on their expertise.

[Kate Osamor]

I just wanted to put on the record that I was never a councillor.

[Justin Tomlinson]

Apologies.

[Kate Osamor]

Also, on my visit to the jobcentre, there was a threat of closure and at the time, the visit got dropped, but it was not because I did not want to go there.

Will the Minister answer my question about whether a helpline will be put in place?

[Justin Tomlinson]

I am sorry that the hon. Lady was not a councillor. I was a councillor before, and I enjoyed it very much. I am sorry that she missed out on that opportunity. I did not pass judgment on the visit—I just said that it would be good if she could make that visit. As a Back-Bench Member, I personally benefited from such a visit.

I brought in a national helpline on personal independence payments when I was a disability Minister. The issue here is a little different. There were national, one-size-fits-all rules on PIP. Universal credit is personalised and tailored, and people need to speak, in effect, to the work coach. What is in place is a partnership manager in every single jobcentre who should be the MP’s point of contact. By coincidence, we recognised earlier this week that we suspect that not all MPs know who their partnership manager is. The Minister for Employment responsible for UC has committed to share that information and to make sure that we all have the details of those points of contact, because they are there to help.

Finally, to pick up on a few points, income inequality has fallen under this Government, having risen under the last Labour Government. The average income of the poorest fifth in this country is now up by £400 a year in real terms, while that of the richest fifth is down by £800. There are 1 million fewer people in absolute poverty, including 300,000 children. There is still much more to do. I pay tribute to the hon. Member for Edmonton and her wealth of experience; she gave a very constructive speech. I hope she can see that many of the points raised are ones that we are actively looking to address, and that is absolutely vital for all claimants and, in particular, for vulnerable claimants. I thank you, Sir David, for the opportunity to set out what the Government are doing.

Question put and agreed to.

11:30

Sitting suspended.