I beg to move,
That this House believes that the Government should stop the planned cut in Universal Credit and Working Tax Credit in April and give certainty today to the six million families for whom it is worth an extra £1,000 a year.
I am not here to claim that Conservative MPs are heartless, lack compassion, or have insufficient regard for the poorest people in this country. I know that after the vote on free school meals, many Conservative MPs, mainly after comments made by other Conservative MPs, received a high degree of personal abuse, and I want to make it clear unequivocally that that is wrong. I am here to put forward a clear and, I believe, compelling case that reducing universal credit and working tax credit this April would be fundamentally the wrong decision. It would be a profound mistake for families, for the economy and for our ability to effectively tackle and recover from the covid pandemic.
Before putting forward that case, I wish to address the Prime Minister’s suggestion that Parliament is somehow not the right place to have this discussion. Opposition days have been a feature of our parliamentary system for many decades. They were used very successfully by the Conservative party when it was in opposition—for example, when the Labour Government were defeated over resettlement rights for Gurkhas in 2009, or over post office closures. All majority Governments, except this one, have accepted that if they cannot win a vote in Parliament on one of their policies, then they have to change that policy. This decision cannot be deferred until a Budget, because the Government cancelled the November Budget and have not brought forward a Finance Bill since March.
I put it to all Members that Parliament is exactly the right place to have a discussion of such consequence to the country. The Government cannot expect to preach parliamentary sovereignty one week, and run away from parliamentary scrutiny the next. Too often, the Prime Minister seems unwilling to abide by basic democratic norms and to accept proper scrutiny and accountability. We have seen in the US where that can end.
Let me also say at the outset that, throughout the pandemic, the Opposition have always sought to be constructive. The official Opposition want the national strategy to succeed. In that spirit, we welcomed the changes that the Government made to universal credit at the beginning of the crisis. The £20-a-week weekly increase, and the suspension of conditionality and the minimum income floor, were necessary steps to support people. Recognition must also go to frontline Department for Work and Pensions staff, who kept our social security system going through the early stages of the crisis, making sure that hundreds of thousands of new claimants received the support they needed. All those staff deserve our praise, from the civil servants working in the Department to the security guards I met recently, who face difficult working conditions keeping Jobcentre Plus offices open.
However, the fact that such urgent changes were required to provide a basic safety net is a telling assessment of where the social security system was when we went into the crisis. If we cannot properly support people in a time of need without emergency surgery to the system, it is not fit for purpose. The fact is that support for people in this country when they lose their job or cannot work is significantly lower than in comparable European countries.
I will address three points: how we got here; the case for reversing this cut to secure our economy; and, finally, the human impact if the Government refuse to change course.
Does the hon. Gentleman accept that a pressing reason to have a debate and vote on this issue today is the fact that all the evidence suggests that the restrictions resulting from the measures taken to deal with covid have hit the poorest in society hardest? Poverty is up, and those people who most depend on this kind of support are the ones who are most damaged at the moment.
I agree. Inequality, and the differential impact on people, has been one of the defining features of this crisis. I do not think anyone can avoid that. It is relevant to make that point in this debate.
We have to be honest about the state of our social security system going into the crisis. Since 2010, poverty has increased significantly in the UK. In addition, people who were in poverty in 2010 are now so much deeper in poverty than they were. This is not an argument about definitions. Conservatives themselves were the driving influences behind bodies such as the Social Metrics Commission, which came up with a new definition of poverty that was actually very similar to the one that has traditionally been used. The Government’s own estimate is that 4.2 million British children live in poverty. That is shameful, wrong and unnecessary.
The UK, along with Ireland, is an outlier compared with the rest of Europe when it comes to inequality. That means that the reality for millions of families is that they went into this crisis already under significant pressure. As the Resolution Foundation said in 2019, the 1.7% increase to universal credit that year was the first working-age benefit increase for five years. Last year, the real value of basic out-of-work support was lower than when John Major was Prime Minister, so anyone claiming that the system is too generous, or who is trying to resurrect the stigmatising rhetoric of George Osborne, simply has no case to make.
The hon. Gentleman is a reasonable man—I like him. He is making a sensible speech. While we are being honest about social security systems, is it still the Opposition’s policy to abolish universal credit, as it would have been had they won the general election in December 2019, although it is widely accepted to have been successful in flexing to expand in the current crisis? Is it still Her Majesty’s Opposition’s policy to abolish the entire system, and what do they propose putting in its place?
Yes, it is our policy to replace universal credit—not to abolish the welfare state, as some of those videos from Conservative central office have tried to make out today. After I address the causes and the question before us today, I will be happy to talk about some other problems that go beyond the core amount of universal credit, and about why replacing universal credit is the right policy. But before we get to that point, I have to stress that, if this cut goes ahead, it will leave unemployment support at its lowest level ever relative to average earnings. That is not just morally unjustifiable; it is economically incompetent. Cutting unemployment support in the middle of a recession is always the wrong choice, which is why no Government have done so since the great depression.
We believe that this uplift should stay in place during the crisis, and I do not think anyone believes that the crisis will end in April. I will make some points about long-term proposals near the end of my speech, as well as about why the whole system requires much more considerable reform than just tinkering around with the core amount.
The cost of paying for all this is significant: around £6 billion. That would vary depending on the levels of unemployment throughout the year, but any measure right now that cuts public spending or raises taxes in the middle of the biggest economic downturn for 300 years would be the wrong policy. Decisions will have to be made as we get into the middle of this decade to address the levels of debt that have been accrued by the Government during this crisis, but that is not the right choice now.
I want to focus on the point raised by the hon. Member for Sevenoaks (Laura Trott), because if the Government are seriously thinking about economic recovery, cutting universal credit is like pulling the rug from under the economy’s feet. This £20 a week is not saved by families; it is spent in shops and businesses across the country, stimulating the economy. We all agree that this pandemic and the unemployment crisis will not be over by April this year, and whatever protestations we have heard on social media or in the press—and, frankly, however people vote today—I know that there are many people on the Government Benches who agree with this case. The former Secretary of State for Work and Pensions, the right hon. Member for Preseli Pembrokeshire (Stephen Crabb), recently said:
“Withdrawing the uplift would reduce the spending power of people on lowest incomes. This will likely reduce consumption, meaning families going without essentials and household debts rising. It would also see a reduction in spending just when the economy needs it most.”
I could not agree more with that assessment. He is also right to draw attention to the levels of personal debt for some households.
As well as the real value of benefits being historically low as we went into this crisis, the pandemic has meant very real additional costs for most families. There are more meals for people to cook at home, and more days to heat their house. People have devices and lights on at times they would not normally, and have to buy what they need to teach their children at home. The clinically vulnerable have been forced to buy food locally, at a higher cost than in larger supermarkets. Everyone has experienced the pandemic differently, but for some the costs have piled on.
Citizens Advice told me this week that three quarters of the people it helps with debt who currently receive universal credit and working tax credit would have a negative budget if the £20 was cut. That means that they will have less money coming in than going out, and will not be able to cover basic essentials such as food or heating—and it will come at a time when one in three households has lost income because of covid, and 7.3 million people are behind on their bills.
The proposed cut to universal credit and working tax credit is not the only issue causing consternation in the country right now. I would particularly highlight the continuing injustice for those people on employment and support allowance and jobseeker’s allowance, who did not even get the uplift to begin with. That is unjustifiable and discriminatory, and I ask the Minister if he would mind specifically referencing that point in his speech. Reversing the April cut to universal credit is a specific, clear and unavoidable decision that needs to be taken, which is why it is right that we are bringing it to Parliament today.
Some of the speeches that we will hear today will no doubt say that we should focus on jobs and getting people back to work, and not on social security. The Prime Minister said something along these lines at the Liaison Committee last week, but Members will know that universal credit is an in-work as well as an out-of-work benefit—40% of universal credit claimants are in work—so that argument does not work at all. To be frank, it would be helpful if someone told the Prime Minister that. Universal credit is also means-tested, so if people go back to work and do not qualify for it, they will not receive it at all. If we want to have a serious discussion about boosting employment and making work pay, let us discuss work allowances, the taper rate and deductions, but let not the Government try to use that as an excuse to do the wrong thing on this cut.
Others might say that support should be more targeted and the basic allowance is the wrong element to target. In that case, the Government would, logically, scrap the two-child limit or the benefit cap, which disproportionately affect people in the most difficulty—larger families in areas with higher housing costs. However, when we put that forward, it, too, was rejected.
Finally, there has been a proposal for a one-off payment to compensate people affected by this cut. That is an awful idea. It does not address the real-terms reduction in support, just as unemployment is expected to peak. More than that, although 6 million families are affected by this now, that cohort will change in composition throughout the year. A one-off payment based on who is eligible now will fail to support some of the people who need that help the most. So please, Minister, ask the Chancellor to think that one through again.
I know it sometimes frustrates Conservative Members that we are still determined to replace UC altogether—I was asked that question earlier—but I say to them that, if they will not listen to those on the Opposition Front Bench, they should read the work of the cross-party Select Committee on Work and Pensions and read the report of the cross-party House of Lords Economic Affairs Committee, which is chaired by Lord Forsyth. They are clear and robust in highlighting the fundamental problems that currently exist: the five-week wait; the two-child limit; the erratic assessment period; the problems with paying for childcare in arrears; and the shocking design that means that many disabled people are worse off on UC. The last one of those is very personal to me and it simply is not right not to replicate how the severe disability premium worked under the previous arrangements. All this means that UC’s brand is severely tarnished. If everything was working as well as Ministers sometimes say, would we really be a country where food banks have gone from being a niche form of support, mainly for those without recourse to public funds, to a mainstream and essential method of keeping people fed? Would we have had the fundamental increase in child poverty, which is getting bigger with every year of Conservative government? Those questions deserve answers.
Throughout the crisis, the Government have often been behind the curve, never out in front, and they have left some decisions, such as on furlough extension, to the very last minute, in a reckless game of brinkmanship. That is heavily why we have, tragically, the highest death toll in Europe and the biggest economic downturn of any major economy. Let us not repeat that with this decision. We all know that families are looking at us, wondering what we will do to help make getting through this crisis just that bit easier. What they do not expect is the Government making it even harder. I hope that one thing we can all agree on is that the crisis has shone a light on some of the problems in the UK, problems that have made tackling the pandemic harder and provoked a discussion about what kind of society we want to rebuild when the pandemic is over.
If the ambition of Conservatives really is to level up the UK, it is hard to see how they can support a cut that would be so regressive to low-income families and which disproportionately affects the places the Government say they want to help. I am talking about families such Bethany and her child in Blackpool. She said to me, “I was made redundant due to coronavirus. As a single parent to a one-year-old, universal credit is now the only income I receive. If the Government does cut £20 a week, I will become one of the statistics needing to use a food bank. It devastates me to think that I will not be able to provide for my child should this decision be finalised.” Margaret, who has been volunteering at a food bank in Luton, says, “A young man came in for a food parcel. He looked thin and his face was grey. He sat down and he said that he thought he could last with no food until the universal credit came through, but he found that he couldn’t. He’d come in on a Wednesday and his universal credit was due on the Friday.” That is the reality before the cut has gone ahead. My inbox is full of personal accounts such as those. I urge every Member to look at what is in their inbox, read about the human cost of what it will be like for people if this cut goes ahead, address the worries people have about not being able to put food on the table, and think long and hard about the uncertainty and fear that all families face after 10 long, hard months of this pandemic.
I want to make a special appeal to the new MPs on the Conservative Benches whose constituents elected them in good faith for the first time in 2019. Many of those people are the first Conservative to ever be elected to those places. They have already made history and their success is a significant personal achievement. They will be remembered, but so will their votes. Most of all, when thinking about how to cast their vote today, I urge everyone to take a moment to reflect on what this cut will mean to the people who send us here: the uncertainty it will add in an already uncertain time; the loss it will bring when we have already lost so much; the fear it will cause when what people need is hope. So, for our constituents, for the economy and for the national interest, we need to cancel this cut and I ask every Member of the House today to support our motion to do so.
Before I call the Minister, I have three points to make. As people in the Chamber can see on the annunciator—I am not sure whether people can see it at home—there is a three-minute limit on Back-Bench contributions. For those who are contributing outside the Chamber, there is a timing clock, which you should be able to see on the bottom right hand corner of whatever device you are using. It would be a lot cleaner if Members could bring their contributions to a close before the three-minute limit is up, otherwise you will be interrupted by the Chair. For the convenience of everyone as well, the question will be put at 7.15 before we move on to the next business.
I welcome today’s debate. It gives me the opportunity to highlight some of the unprecedented support that this Government have provided to people right across our country who have been affected by covid-19. I can confirm that the amendment in the name of the Prime Minister will not be moved this afternoon.
Without doubt, this has been a challenging time for many. That is why, since the start of this pandemic, we have mobilised our welfare system like never before in modern times, with a wide-ranging package of measures worth more than £7 billion. Members across the House will raise the future of the £20 per week uplift to universal credit, which I will come on to shortly.
I want to start by talking about how well the Department and universal credit have stood up to the challenge of the pandemic. Many people have sadly lost their jobs as a result of the pandemic, or seen their incomes reduced. Universal credit and the Government’s investment in the welfare safety net have been there to help catch many of those affected. That has been hugely important for the 3 million more people who have made a benefit claim since March last year.
I am so incredibly proud of how thousands of work coaches in jobcentres up and down our country have responded at speed and scale to ensure that we have supported those additional people in their hour of need, especially as the number of people on universal credit rose from 2.9 million last February to nearly 6 million in November. Through our £895 million investment, we are well on the way to meet the Government’s pledge to recruit 13,500 new work coaches by the end of the financial year.
This morning, I chaired a meeting of the Northfield covid recovery strategy group with Becky from Northfield Community Partnership. We learnt this morning that, in Birmingham and Solihull, we will see an extra 430 work coaches, 24 of whom will be based at the Longbridge jobcentre. Does the Minister agree that that is a perfect example of how the Government are taking a proactive approach to making sure that we get people back to work as quickly as possible?
I thank my hon. Friend for that intervention. He is absolutely right that not just in his constituency, but in constituencies up and down the country, our Jobcentre Plus network of dedicated work coaches have worked incredibly hard to process an unprecedented number of claims and they stand ready to help support people back into work. That is exactly why we have secured this additional investment from Her Majesty’s Treasury to, in effect, almost double the number of work coaches across our network across our country.
Work coaches are just one part of the jigsaw; the other is the universal credit system itself. Universal credit has, without doubt, stood up to the challenge of covid-19, whereas the previous legacy benefits system would have buckled under the pressure. Millions more were able to access financial support that is fairer and more generous than the legacy benefits system. We have made the processing of claims and paying people quickly the top priority for this Department. Over 90% of new claimants receive their payment in full and on time.
We have a modern, dynamic, agile, fairer welfare safety net that, in the face of unprecedented demand, ensured that millions of people were paid in full and on time. So what is Labour’s position? It is to scrap it.
Is it now the policy of the Department, as the Prime Minister suggested at the Liaison Committee last week, that people should move from legacy benefits to universal credit in order to gain the £20 per week increase? If that is now the policy, what about the position of those who have been receiving the severe disability premium, who are not allowed to move to universal credit?
I thank the Chairman of the Work and Pensions Committee for that intervention. I would be very happy to meet him, alongside the Minister for Disabled People, Health and Work, to discuss, in particular, those in receipt of the severe disability premium. Yes, it is the position of Her Majesty’s Government that we want more people to move over from legacy benefits, including working tax credits, on to universal credit, because it is a modern, more dynamic benefits system; it is the future. However—this is a very important caveat—I would encourage anybody looking to move over from legacy benefits to universal credit to first go on to gov.uk and check their eligibility, because it is important to note, as I know the Chairman of the Select Committee knows well, that on application for universal credit, the entitlement to legacy benefits will cease, so it is very important that people do check.
As I said, we have a modern, dynamic, agile, fairer welfare safety net that, in the face of unprecedented demand, ensured that millions of people were paid in full and on time. Therefore, it is quite astonishing that the position of Her Majesty’s Opposition is to scrap it—a system that, by any measure, has passed the most challenging of tests. This weekend they briefed to the papers with a press released entitled, “Cut to universal credit to hammer families in marginal Conservative seats”, playing politics with the lives of nearly 6 million vulnerable people rather than focusing on helping them through this pandemic. We will take no lectures whatsoever from Labour on universal credit. There is little doubt that had we relied on the legacy benefits system, we would have seen queues down the streets outside jobcentres and long delays leaving families facing financial disruption without support.
As the Minister has raised press speculation, will he comment on the news in the papers at the weekend that the reason he is here and not the Secretary of State is that the Secretary of State agrees with us and it is the Treasury that is behind the cut of £20 a week from April?
The reason I am here today responding to this debate is that I am the Minister responsible for universal credit and this is a debate about the £20 per week uplift to universal credit. The Secretary of State is in active discussions with Her Majesty’s Treasury, the Chancellor of the Exchequer, and, of course, the Prime Minister about how best to continue to support the most vulnerable, disadvantaged, lowest-paid and poorest in our society, as the Chancellor has consistently done throughout this pandemic.
Can my hon. Friend confirm that conversations are still ongoing and that one of the reasons for that is that this does need to be fully costed because it is a lot of money? I was hoping that the shadow Minister would lay out how Labour intended to pay for the uplift.
My hon. Friend is absolutely right. Maintaining the uplift would cost a huge amount of money—somewhere in the region of £6 billion. But it is not just about that. Throughout this pandemic, we have always looked at how best to support the poorest, most vulnerable and disadvantaged in our society. Because this is an ever-emerging and changing situation—that is the very nature of a pandemic—we have to keep everything under review. That is why the Secretary of the State, the Chancellor of the Exchequer and the Prime Minister do meet regularly to discuss all these issues. I want to make one further point because it was raised by the Chairman of the Select Committee: yes, we will continue the roll-out of universal credit, as we committed in our manifesto, ensuring that those on legacy benefits and working tax credits are moved across by 2022.
I will now turn to the specific issue of the UC uplift. The Labour party is quite simply wrong in its use of emotive language, saying that the Government plan to cut universal credit. The £20 per week uplift to universal credit and working tax credit was announced by the Chancellor as a temporary measure in March 2020. This additional support increased the universal credit and working tax credit standard allowances by up to £1,040 for a year. We took this approach in order to give those people facing the most financial disruption the financial boost they needed as quickly as possible. The agility and flexibility of the universal credit system allowed us to implement this vital increase rapidly, and was hugely successful in giving claimants—many of whom, incidentally, had not interacted with the DWP before—a foundation by which to navigate the uncertainty of the beginning of this pandemic, and in many ways lessen the drop in earnings.
The Chancellor has always been clear that this measure remains in place until the end of the financial year. I hear the calls from Labour and, indeed, from the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), for a decision now on whether the uplift to universal credit will continue post April, and I have sympathy with the argument that it would give claimants certainty. However, one of the evident features of a pandemic is uncertainty: if the hon. Gentleman is certain about what the economic and social picture will look like in April, then to be frank, he must have a crystal ball. The reality is that we simply do not know what the landscape will look like, which is why 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.
Why is that important? One word: agility. The poorest and most disadvantaged in our society are best served by a Government that have the agility to respond to emerging situations and the facts at the time. None of us in this House can say with any certainty what the economic landscape will be like in April, which is why we continue to work with Her Majesty’s Treasury on the best way to support those in receipt of benefits.
I will add one more thing, which is that I know my right hon. Friend the Chancellor well, and I put it to right hon. and hon. Members that, throughout this pandemic, he has consistently stepped up to support individuals’ jobs and livelihoods. This is the Chancellor who created the furlough scheme and the self-employment income support scheme; uprated universal credit by £1,040 this year; lifted the local housing allowance by £1 billion; protected renters from eviction; protected homeowners; gave grants to businesses; supported rough sleepers to get off our streets; funded the local welfare assistance scheme to the tune of £63 million; and set up the £170 million covid winter grant scheme. This represents one of the largest and most comprehensive support packages in the world.
I think everyone in this House must acknowledge the work that the Government have done to try to help people through the economic difficulties caused by the response to the pandemic. However, will the Minister accept that, even with the best will in the world, he cannot say that after April, everything is going to be rosy? We know there is going to be a long tail of businesses that have been damaged during this pandemic—damaged by the lockdowns—and people, especially those at the low-paid end of the market, are going to find themselves still in need of support. Therefore, it is wrong to say that somehow or other, things are going to be rosy from 1 April, and that the level of support required by the lowest paid in society will no longer be needed.
I thank the right hon. Gentleman for his intervention, but I do not think anybody is saying that. We are saying that the situation remains unclear, so the Chancellor of the Exchequer in particular needs the agility to be able to act on the information at the time.
My right hon. Friend the Chancellor has an unenviable task, but I repeat the point that I made just a moment ago: he has a proven track record of stepping up to support the poorest and the most vulnerable and disadvantaged throughout this pandemic, and I have absolutely no doubt that he will continue to do so. Throughout this pandemic, the Chancellor has consistently acted with the necessary agility to support and wrap our arms around those who need it. The Chancellor has always said that, sadly, we cannot save every job or every business. That is why getting Britain back to work is the relentless focus of the Secretary of State, myself and the entire ministerial team at the Department for Work and Pensions. That is key to our national recovery and is why we are investing billions of pounds to secure the economic recovery. Through our plan for jobs we are injecting billions of pounds-worth of support and have launched a range of employment schemes and programmes.
To conclude, we have demonstrated during the pandemic that this Government are committed to supporting the most vulnerable in our society and to ensuring that people have the right level of support. Through universal credit and our plan for jobs, we are supporting people of all ages to gain the right skills and experience to support them back to work. We know how quickly things can change with this virus—the new variant has led to increased challenges—but there is now also real hope from the rapid vaccine roll-out, which promises to have a hugely positive impact on the way ahead and the effort to get back to normal and to get our economy growing again. As the Government have done throughout this crisis, we will continue to look carefully at the changing impact of the virus on public health and on our economy, to help to inform how we can continue to support people and give them the tools that they need to move into the workplace so that the country can build back better after the pandemic.
I am pleased to have the opportunity to go into detail about why the SNP has been at the forefront of the campaign, led by the likes of the Joseph Rowntree Foundation, Save the Children and others, to keep the £20-per-week uplift to universal credit and extend it to legacy benefits.
I commend the UK Government for taking the action that they did to uplift universal credit by £20 per week. It has undoubtedly been an important step in protecting some—but not all—social security recipients, who otherwise would have fallen either into poverty or deeper into poverty during this pandemic. It was the right thing to do and it is right that it is now kept. Indeed:
“The universal credit uplift should continue for the foreseeable future. I would encourage the UK Government to make that commitment now and provide the reassurance many people are looking for.”
Those are not my words, but those of the hon. Member for Moray (Douglas Ross), leader of the Tories in Scotland, back in October.
What has changed since October? Both the health and the economic aspects of the pandemic have got worse. The need is still there, and I will tell the House part of the reason why. This is where I have to take slight exception to the Labour Opposition motion. It says that they want the UK Government to
“give certainty today to the six million families for whom it is worth an extra £1,000 a year.”
Although I support the motion, the uplift is worth a thousand pounds per year extra only if taken in isolation; actually, the Joseph Rowntree Foundation has calculated that, if we look at cuts to social security since 2010, even with the £20 uplift, families unable to find work will receive, on average, £1,600 less per year in social security support than they would have done in 2011. That is even with the uplift. Those with children will receive £2,900 less. The contrast is even more stark for larger families with three or more children, who will lose £5,500 each year. That is part of the reason why this initiative is so important.
The UK Government seem intent on cutting the temporary uplift at the end of March, meaning that families will be a further £1,000 per year worse off. That would give the UK Government an unenviable record: if they go ahead with this cut, they will be responsible for cutting out-of-work support to its lowest level since 1992 and its lowest ever level relative to average earnings.Social security spending is normally counter-cyclical, so expenditure automatically rises during an economic downturn while revenue from taxation falls. This Government are trying to cut support during an economic downturn, when more people need greater support.
Let us remember what that means to the people who need the support: the 6 million households, in every constituency in the UK, but also the millions more on legacy benefits—disproportionately sick and disabled people—who have been cruelly denied the uplift. Last week I chaired an evidence session of the all-party parliamentary group on poverty, which I co-chair with the hon. Member for Thirsk and Malton (Kevin Hollinrake). We heard powerful testimony from two women on legacy benefits who have not benefited from the uplift. I want to read some of what Michelle told us, because it should be heard today by colleagues across the House and Ministers on the Treasury Bench, especially the Chancellor. It should be heard because when she spoke, Michelle had millions of others behind her in the same position.
“My name is Michelle and I am currently a single parent to 2 children aged 12 and 7. I have been in receipt of legacy benefits for 7 years. Prior to this I was a working woman with a career in finance, a tax payer. Due to my health issues I currently receive the legacy benefits of income-based employment and support allowance, child tax credit and of course child benefit. April 2020 saw a rise of 1.7% to legacy benefits.
Living on social security is incredibly challenging for families; it provides less than minimum expectations of living. During the pandemic those challenges have been magnified with social restrictions and home schooling. £20 sounds so little but it means so very much. I became interested in why we had not received it.
In November of 2020 I emailed my...MP about the £20 uplift and legacy benefits, she in turn enquired with the Department of Work and Pensions about the situation. I was pleased to have received a response from both, but still somewhat downhearted at how little they understood the situation.
The main recommendation from my MP and the DWP was to consider applying for Universal Credit at this time to obtain the £20 uplift. Is the suggestion that people on legacy benefits request to be migrated to Universal Credit a feasible option you might ask? For me, to risk weeks of zero income for my family would be totally impossible and have knock-on effects of missed bills and potentially surviving on whatever charity we have not already exhausted. I cannot, as a responsible mother, take that risk.
I was also informed by my MP that ‘those on legacy benefits may have benefitted from other support such as mortgage holidays and income protection schemes’. She also mentioned increases to housing allowance. I am eligible for none of these and have no options to move home—I do not qualify for a council house despite being in an overcrowded home in poor repair that I can barely afford. I cannot afford to rent nor would I likely be accepted. These suggestions are not a solution to the problems we face.
As it stands, being prohibited from accessing the £20 uplift pushes me further into using credit for everyday expenses such as the weekly food shop and utilities. Therefore I pay interest on food, heat, water, light, shoes.
So what would £20 a week, equivalent to just under a...month of benefits which I calculate at £1,040 in total (over 10% of my income), mean to my household? It is hard to pick just one thing, there are numerous options. Food is usually one of the few bills parents have the ability to reduce in hard times, so to give more food security and reduce the reliance on cheap processed food would be a big benefit. Being able to keep the house warm would help my arthritis and the asthma suffered by my son and I so that it does not flare up in the damp. I could buy equipment for home schooling, or repair the kitchen tap, or not have to rely on hand-me-down clothes from friends and family who have already a shortened life from being worn. I could afford hair cuts for all of us.
Ultimately the £20 uplift would go directly towards the health and prospects of a generation of children, my children, who have so much potential, resilience, imagination and compassion due to their circumstances and the times we live in. And all we need to do is to support their parents to get those children to a point where they can build a good life for themselves. This will not happen if for the sake of £20 they are hungry, or cold or their needs aren’t met. The £20 uplift is the foundation of hope for children.”
I thank Michelle for being willing to share her experience last week and for agreeing to forward her words for me to read to you today. They speak of what happens to families who are not given adequate support, of the difference that £20 per week could, should and would make to those on legacy benefits, and of what will be ripped away in April from those on universal credit. When the discussion opened up, Michelle went on to say that even if the health effects of the pandemic are back under control by the end of March, which is likely to be a stretch, the economic impact for families on low incomes—like Michelle’s—will be felt for months, possibly years, to come.
Michelle will be paying back credit and interest on credit for months, even years, because she needed to purchase the minimum required to ensure that her children could learn at home and to pay for food and other essentials. That shows the deep holes in the social security safety net, both prior to and during the pandemic, that people are relying on credit cards for food, heating and clothes—basic essentials.
As I have said in this Chamber before, the uplift and social security rates in general should not be determined by the pandemic; that should be determined by what people need to live. The Office for Budget Responsibility expects more than 800,000 people to become unemployed in the second quarter of 2021, after the job retention scheme stops again. Will living costs be any less for those households? Will it be any easier for them than it is now with the uplift in place? Absolutely not.
Social security is supposed to be there for any of us when we need it, insuring us against hard times—like the NHS when we are ill. What Michelle and millions of others are telling us is that social security is not adequate to support families, who are having to rely on credit cards to buy food, heating and clothes. By holding off taking the decision any longer, the Government are letting down those families who have no certainty, no security and no means to plan.
Instead of analysing the needs of recipients and permanently uprating universal credit and legacy benefits by £20 a week, the Government have been flying kites about providing a one-off £500 grant, but only for some. That is the UK Government trying to do as little as they can get away with in an attempt to get through a difficult political situation. That would not in any way replace the long-term security that the uplift provided and will do nothing for those newly unemployed after the grant has been applied. Making the £20 per week uplift permanent and extending it to legacy benefits is the least they should be doing, particularly as it will not even make up for the cuts since 2010.
The UK Government have a choice: make the cuts to social security since 2010 a little less worse by making the uplift permanent and extending it to legacy benefits, in turn saving many families from poverty; or cut that lifeline further, making out-of-work support the least generous that it has ever been, impoverishing millions. Today, it appears that we may not even have a vote, most probably because if we did, there would be a significant rebellion by Government Back Benchers. If Ministers do not plan to oppose the motion, they must honour it as quickly as possible. They owe it to Parliament, but, most importantly, they owe it to Michelle and the millions of families such as hers on universal credit and legacy benefits who need this help as soon as possible.
I am pleased to be able to contribute to this debate. I am proud of the Government’s response to the pandemic, supporting individuals and businesses by pumping in £280 billion of help, which the IMF and other global authorities have hailed as real and sound support for businesses and households. I was therefore disappointed to hear the Opposition spokesperson describe the £20 increase in universal credit, which has been an absolute godsend to so many during the pandemic, as turning into a cut. That is not the case, and it is important that everybody outside this place understands that.
The measures we have put in place are temporary, to support individuals and the country at large during the pandemic. Once the pandemic comes to an end and we return to some normality, of course the Government will not be subsidising 80% of employee wages, and of course the Government will not be paying businesses not to open. In the same way, we will go back to the same welfare support we have always offered; we have always made sure that those who deserve it get what they need to be supported.
If the Labour party is going to continue this extended increase in universal credit, will the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) tell us how it will be paid for? Will it be a 1% increase in income tax on everybody else who works? Will it be the axing of the £2 billion kickstart scheme, which will pay a six-month salary for those between the ages of 16 and 24, to give young people a chance to get into the workplace? Will it be the end of the £3 billion restart programme, which will provide support for 1 million unemployed people to find work? Will it be the undoing of the doubling of the number of work coaches in our jobcentres to 27,000, which would cost £1 billion? That is three items that the Opposition could axe to fund the £6 billion, or will it just be chucked on top of the national debt, which was already in difficulty but has now got out of control as a result of the pandemic? This would end up being paid for by young people, who have already suffered during the pandemic. To chuck more debt on to those young people is completely unfair and unjust.
The hon. Member for Stalybridge and Hyde made a personal plea to new Conservative MPs from previously Labour-held seats. I have one too: please stand firm behind the Chancellor. Since 2010, there are 200,000 fewer people in absolute poverty, with 1,000 new jobs created a day and 1.2 million fewer workless households. If we turn every single temporary extension of help into a permanent one, we will not get the Treasury delivering the temporary measures that we badly need. I support the Government, I support universal credit, and I very much hope that the Opposition back down.
The problem is that the Government have lost the capacity to listen—to listen to their own Back Benchers, to the all-party Work and Pensions Committee, to people claiming universal credit and to the public. That was clear in the contemptuous dismissal of my Committee’s report on the five-week delay between applying for universal credit and receiving the first regular payment. The Government response to that report was published last week. In our meetings, we studied the evidence, sifted the material and listened carefully to what Ministers said in response. It is clear that the five-week delay is forcing people to food banks and pushing them into rent arrears. Social security is supposed to protect people from those things, not induce them as it does at the moment.
On a unanimous, all-party basis, my Committee recommended new starter payments equivalent to three weeks’ worth of standard universal credit, to tide people over in those difficult first few weeks. The Government’s response simply dismissed that recommendation and all the recommendations. Of course, the Government can reject our recommendations. They could carry out their own analysis and reach different conclusions. We recommended that the Department should do its own research on the impact of the five-week wait on food bank demand, rent arrears and claimants’ mental health. The response was:
“The Department will not be conducting nor commissioning any research.”
That was it. The Government do not want to know. They have lost the capacity to listen.
How can it be right that people have to wait until March to find out whether universal credit will be cut by almost a quarter at the end of March? How are struggling families supposed to plan? What justification can there be for having left jobseeker’s allowance and employment and support allowance unchanged? Those claiming them are in exactly the same position as people claiming universal credit. People receiving the severe disability premium have not been allowed to switch to universal credit, even if they wanted to. Why have Ministers singled out disabled people for such harshness?
If the cut goes ahead, it will push child poverty up to levels we have not seen since 1997. There is no justification for going back to £72 per week. There was one very telling point in the briefing circulated by the British Association of Social Workers: the sharp increase in children in care, up from 60,000 to 80,000, with the enormous cost that that imposes, began when the cuts to benefits began. It is a false economy. The £20 a week should be left in place.
The performance of universal credit during this crisis has been one of the truly stand-out successful parts of the Government’s response to the pandemic. The fact that our welfare system did not topple over in the way that some had predicted is to the enormous credit of the whole DWP organisation, and not least of the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Colchester (Will Quince), who has spoken from the Front Bench today. When it comes to the totality of our financial response to covid-19, I would challenge anyone to point to another country where there has been such an extensive range of support to protect families’ incomes. The measures that the Chancellor has put in place are historic and effective, and the evidence shows that they have reduced the impact of the crisis on those on the lowest incomes, with the poorest working households protected the most.
I appreciate that the kind of extra spending we have seen in the past year is beyond the capability of almost any Government to lock in permanently, but the question for us right now is whether the end of March this year—just 10 weeks away—is the right moment to begin unwinding this support, and specifically to remove the extra support for universal credit claimants. I do not believe that this is the right moment. I have been clear about the importance of the £20 per week uplift in supporting family incomes right at the bottom of the income scale. It is made an enormous difference to those who sadly lost their jobs during this crisis, but also to all those on the lowest wages who carried on working throughout the pandemic. We forget that more than a third of all universal credit claimants are working: they are the workers we support.
The truth is that the labour market is a horrible place for many people right now. Opportunities for people to find new work, increase their hours, boost their earnings and improve their family finances have been massively curtailed by the economic impact of the public health emergency, and that is the context for this discussion about cutting back the £20 a week uplift. That is why I believe the uplift is so important right now, and why I believe it must be extended for a further 12 months. I am not blind to the public expenditure pressures facing the Chancellor, and I have no qualms about defending difficult decisions when they are based on a clear plan with clear justifications, but the truth is that I do not believe we have such a plan right now. There is no decision yet, even with the proposed change being less than 12 weeks away.
People need certainty about their family finances for the coming year, so I find myself in agreement with the motion before the House tonight. I want to see the Chancellor commit to a further extension to the uplift, to 12 months, to enable us to put the pandemic well and truly behind us and to provide an opportunity for economic activity to pick up and for labour market opportunities to improve. I hope that the Chancellor and the Prime Minister are listening.
I support the motion. My constituents have felt the impact of the pandemic particularly harshly. We have seen some of the highest rates of infection in the country, and the unemployment rate has shot up almost 12%, which is double the national average. As of last August, 16,000 households in Edmonton relied on universal credit and another 11,000 households remained on legacy benefits such as employment and support allowance. Those 11,000 households have been ignored by the Government and have received no £20 uplift. The Government must reconsider that arbitrary decision.
Every week I hear from constituents who are struggling to get by, even with the uplift. The £20 may be nothing to the Cabinet or to the Prime Minister, who complained that he could not afford to live on a salary of £160,000 a year, but for thousands of families across the country, that £20 a week is the only thing that stands between them and the food bank, or being able to pay their rent or heat their home. One of those people is my constituent Sarah, who claims universal credit and has a seven-year-old child. Universal credit only just covers Sarah’s rent and bills. If this cut goes ahead, she will have to choose between falling behind with her rent and staying warm. That is a choice no one should have to make.
That is why it is important to understand the uplift in context. It barely made a dent in the cuts to benefits the Government have made over the last 10 years. Even with the £20 uplift, UK unemployment and in-work benefits rank as some of the least generous in Europe. Only last week, the Prime Minister was asked by my right hon. Friend the Member for East Ham (Stephen Timms) about the £20 cut. In response, the Prime Minister said that he wanted to focus on jobs, not on welfare. Can you imagine how my constituents felt, hearing such a callous reply? This is not a choice between helping people in work and helping the unemployed, because people both in and out of work are claiming universal credit. Many are in low paid work, or may be unable to work due to illness or disability.
This motion argues for a change in priorities. By making this reckless cut to universal credit, the Government will be taking money out of the pockets of the people who need us the most during the biggest recession for hundreds of years. I ask the Minister to cancel the cut and to apply the £20 uplift to the thousands of people in receipt of legacy benefits.
I am proud of the incredible package of support that has been put forward by the Government to assist families and those struggling during these times. It has been as unprecedented in its scope and reach as this pandemic has been challenging. Over £280 billion has been brought forward to support people’s jobs and incomes through this emergency, and the package has been praised by the IMF as
“one of the best examples of co-ordinated action globally”.
That support includes the topic of today’s debate. The uplift in universal credit amounts to £1,000 extra a year. My views on this are on the record. I am glad to stand with my colleagues in the Northern Research Group when we say that now is not the time to consider any reduction in the uplift in universal credit. This uplift was brought in to help people through the extreme challenges of the pandemic, and those challenges have not passed. Indeed, as furlough ends, we may be entering even more challenging times.
More and more people have been pushed into the category of just about managing, and more and more people are now using universal credit than ever before. Indeed, the system and its flexibility is the unsung hero of these times, providing a safety blanket for so many. The uplift is not a handout, but rather a genuine hand up to those who need it and are trying to do the right thing. Alongside the rest of the support package offered by this Government, it has been compassionately delivered in the face of an incredibly challenging backdrop.
We have to recognise why we are here. This pandemic has fundamentally shaken society and given us reason to look again at ourselves and how we help our neighbours. The community response to covid has been remarkable. In my own constituency, the energy and dedication of local community resilience groups is something to behold. We see that same energy again in the volunteers, doctors and staff who are supporting the vaccination effort.
For all that, the virus risks taking communities like mine backwards, and we simply cannot allow the impacts of it to stretch beyond health and entrench disadvantage as well. This is even more the case as we look to recovery and levelling up post pandemic. It is absolutely right that decisions on spending are taken at the Budget—this is the normal and appropriate way of doing things—but I gently ask my hon. and right hon. Friends to consider these views carefully. The uplift is making all the difference.
Yesterday, I received an email from a constituent who had never used universal credit before and told me that she had never expected to, but she called it life-saving. This Government have done so much to support families through this crisis, but we should remember that phrase and we should be unafraid, at the Budget, of maintaining the uplift while the effect of this pandemic is still being felt. Doing so will be in keeping with the agile and comprehensive support the Government have delivered to families since the start of this pandemic.
Today is blue Monday, when people feel at their lowest ebb, and the actions of this true blue Government will add to that despair. The Government were elected on a promise to level up, but are cutting help at a crucial time—in the middle of a pandemic, with rising unemployment and restrictions not yet lifted. People worried about their finances and pushed to the edge by covid will see how much the Tories really care today in the way they are holding this debate and in their denial about wider universal credit problems.
This system has been running for eight years, but it costs more than the legacy system and actually helps fewer people. A third of applicants last year got nothing—turned away at the point of need. It has caused food bank usage to rise dramatically, and food banks tell me that the last thing people require in their support needs is a cut from Government now. Last year, more than 300,000 people got their first payment late, and that figure will be substantially higher this year according to the Government’s own figures. This is a Government whom the UN has shown have created a system that requires people to experience poverty, much of it through in-built delays to payments. Delays are not free: rent does not stop and the need to eat does not stop. The Government’s solution for the people facing those delays is debt. Last year, half a million people seeking help were told they could only have a loan, with the universal credit deficit in the Department for Work and Pensions reaching £1 billion.
Extra funds are available to help, if the Government fixed the problems. The National Audit Office has shown that more than £1 in every £10 spent on universal credit is erroneous in one way or another, and the Government have not done enough to fix that problem.
In Southwark, a third of the people on universal credit are in work. The constituents I have seen include a woman whose entire first monthly payment of universal credit was £17.68. I have been helping a man whose combination of furlough and universal credit does not even cover his rent and bills. These are people required to use a food bank from my constituency office in the heart of central London.
And the Tory response to these circumstances is to cut help. It is extraordinary. We see their true blue values in the wider debate on tackling poverty—values that led to the ludicrous insinuation from the hon. Member for Mansfield (Ben Bradley) that Government food vouchers were being used in “crack dens and brothels”, and the suggestion from his Tory colleague the hon. Member for Redcar (Jacob Young) that they were being used to buy alcohol, when they simply cannot be. More than 9,000 people in Redcar are on universal credit and deserve better representation. By contrast, their previous MP has been working in a food bank and setting up a book bank to help local children.
Then, of course, there is the Leader of the House, who has attacked UNICEF and charities helping children in Southwark. The fact that UNICEF and the UN are highlighting and seeking to alleviate poverty in Britain should shame our Government and secure action, but instead the Government attack the messenger. They pretend that their system is working, when it is failing people even with the uplift. They pretend that Labour would scrap the lot, putting out trash information because the truth is too painful for them to admit. They pretend to care. If they really did, they would be hammering on the Minister’s door and demanding an extension of help today, not a cut.
It is a pleasure to follow the hon. Member for Bermondsey and Old Southwark (Neil Coyle). As a new MP, I am fascinated by the workings of this House and how Opposition day debates operate in attempts to further the political aims of the Opposition. These debates can certainly be passionate and emotive, but Opposition contributions seem at times to lack a grounding in reality, and they tend to whip up anxiety and despondency. I prefer instead to look at the details and facts—[Inaudible.] The evidence shows that the Government’s measures so far through the pandemic have been truly groundbreaking. [Inaudible.]
Our country went into 2021 with soaring covid infection rates, the highest excess death rate in Europe, and having had the worst recession of any major economy. Whatever happens with the vaccination programme, we face many more months of restrictions and the economic impacts will be felt for years to come. Yet the Chancellor and the Government cannot see how wrong it is to take away £20 a week from families who, having been hit by 10 years of cuts to social security and incomes, are now struggling with the extra costs of food and bills in the middle of the worst economic crisis in 300 years. It is a disgrace that today’s debate is even necessary.
This cut to universal credit will hit millions of the poorest families across the country. In my constituency in west London, 44% of children are living in poverty. The cut will hit thousands of families in Ealing North, where over 4,300 households with children received universal credit in August last year, up by more than 1,800 since the start of last year.
The mother of one of those families, Clare, wrote to me on Friday night about today’s debate. She kindly agreed that I could read out a few sentences from her email. She explained that
“the £20 weekly boost is such a lifeline for us, especially for my family. I am a single parent and have an autistic son who is extremely vulnerable.
I also have severe COPD and this extra amount has allowed us to buy some good reading books and nice food which we could not afford without the £20 boost.
My son needs constant care, and just for him to have the books to read gives me some free time to relax and have some time to catch up on chores, and also my sleep as my son only sleeps 4 hours max at night.
I have also been able to bake some nice meals that are nutritious where I could not afford most of the ingredients before the extra was put in place.”
Families such as Clare’s and others across the country need that extra help. The Government must cancel this cut, extend the uplift across legacy benefits and show that they understand the impact that their approach to social security has on people’s lives.
The outbreak has confirmed how inadequate our social security system has become and how challenging it is for so many people to get by from one week to the next. The fact that the Government felt they had to increase universal credit by £20 a week at the outset of the covid crisis shows how insufficient it already was. Beyond the outbreak, we are clear that the system should be replaced with one that offers a proper safety net and decent support for all. Cancelling the £20 cut to universal credit will not right all that is wrong, but it will be a lifeline for millions as we come through this crisis.
Thank you, Mr Deputy Speaker. It is nice to be able to get through at last.
As a new MP, I have been fascinated by the business and workings of this House, and by how Opposition debates operate in an attempt to further the political aims of the Opposition. These debates can certainly be passionate and emotive. Contributions from Opposition Members seem at times to lack a grounding in reality and seem to be an attempt to whip up anxiety and despondency. I prefer instead to look at the details and facts behind these debates.
The evidence undoubtedly shows that the Government’s measures so far through the pandemic have been truly groundbreaking, with a range of measures worth more than £280 billion, including £6 billion in increases to welfare. In addition, there was £1 billion in catch-up funding for schools and vulnerable children, a £500 million hardship fund and £170 million to support food poverty this winter. It is simply untrue to characterise the Government as uncaring and as trying to plan cuts, as the motion says. As a Conservative, I believe that the way out of poverty is through work. The Government support that and have gone further than any Government, with a £30 billion plan for jobs. No past Labour Government compares.
Poverty is complex and multifaceted. It is not simply about welfare spending. It is about attainment, opportunities, addiction, social capital and mental health. The Labour party looks to an ever-increasing welfare state. I do not. I look towards supporting people to be free from the state and to work for themselves, and to supporting and catching them in a safety net when needed. That is precisely what the Government have done. They have supported the poorest households the most, and I am very proud of that. They have reduced the impact of the crisis on income losses by up to two thirds. This is a fantastic achievement. The temporary emergency uplift in universal credit of £1,000 a year will be considered by the Government, and the next steps will be set out fully in the Budget on 3 March 2021. To say anything different is opportunistic.
In Derbyshire Dales, many have impressed upon me that the Government support during the pandemic has been impressive. The Government have gone further than any peacetime Labour Government. I certainly will not vote for this Opposition motion.
Ten months ago, the shutters came down on businesses across our economy. People’s whole way of life changed overnight. The impact was unprecedented.
In answer, we needed an unprecedented response, and the Government delivered, as my hon. Friends have said, through a £280 billion support package. That support helped businesses across the country survive and save jobs through grants, the furlough scheme, the self-employed income support scheme and Government-backed business loans. That support helped families pay their bills and put food on the table through the council tax hardship fund, the covid winter grant scheme, increasing Healthy Start payments and establishing a £220 million holiday activities and food programme. That support gave people security over the future of their home through a six-month mortgage holiday and a temporary ban on eviction for renters.
The Government’s response has been praised by international bodies such as the IMF as one of the best support packages in the world, but even that was not able to save every job, so we invested billions to help people get back into work through apprenticeships, the kickstart scheme and one-to-one coaching. We have doubled the number of work coaches and injected billions of pounds into the welfare system, boosting universal credit and working tax credit by £1,000 a year for 12 months.
The Leader of the Opposition says he wants to scrap universal credit, yet today his party is arguing to keep this temporary increase. Surely it cannot have both. Labour’s proposal today would cost £6 billion per year. How would they pay for it? Would they increase income tax by 1% for 30 million taxpayers and put 5p on fuel duty? Would they increase VAT to at least 21%? Or would they raid one of our job creation schemes or existing support packages, or one of the new commitments we have already made—the commitment to increase the national living wage, worth £345 a year to someone working full time, or those to help 3.5 million families pay their council tax and to maintain the increase in the local housing allowance?
Those are big commitments, which are important to families up and down the country, including those who receive universal credit and working tax credits. It is right that we have made them and that we support people further, but how we do that should be properly considered and costed in the Budget.
I support the motion. The Government should hang their head in shame for leaving people on universal credit living under the shadow of a potential cut in their benefits at the end of March. We face the worst recession of any European country, to a large extent due to the Government’s shambolic handling of the covid-19 pandemic. The Prime Minister’s failure to provide a clear strategy, some economic certainty and the adequate financial support that millions of people desperately need is a failure of leadership and of Government policy.
The scale of this crisis is massive and growing. In my constituency of Birkenhead, I represent two of the most deprived council wards in the country. Over 12,000 of my constituents claim universal credit, a 51% increase since the pandemic began. Countless others are in receipt of legacy benefits, and joblessness continues to soar. Every day, more people join the ranks of the unemployed. Even those who have kept their jobs are struggling to make ends meet; furloughed workers are forced to survive without a fifth of their pay packet each month.
My resolve on this issue has been strengthened by the deluge of messages from my constituents. The £20 uplift is a vital lifeline; it is as crucial to people’s financial health as the vaccine is to their physical health. So many constituents have told me of their fear and despair for their very survival if it is taken from them, but still the Government have refused to make the uplift to universal credit and working tax credit permanent or to confirm that it will be extended beyond April. At the same time, I believe that those excluded from the original uplift—those on legacy benefits—should also get a £20 a week rise.
Let me be clear: if, during the worst economic crisis in living memory, the Government go ahead and cut the £20 that has enabled so many people to get by, it will be a scandal. The Resolution Foundation estimates that if this cut goes ahead, the bottom fifth of earners will lose 7% of their income. Similarly, Citizens Advice predicts that 75% of the people it helps with debt issues will not be able to cover basic costs if the uplift is cut. It will mean more children going hungry, more families being unable to heat and light their homes, and more households facing the threat of eviction. It will mean human suffering on an epic scale in Birkenhead and across the country. By doing away with the uplift, the Government would take over £12 million from Birkenhead’s economy, with cash-strapped families spending less in our local supermarkets and independent stores.
“Build back better”? That is a hollow phrase masking economic vandalism. We must not let this Government pave the way to a new pandemic where poverty becomes the next deadly virus.
I am proud to state clearly once more that the support the Government have provided to people and businesses during the pandemic has been unparalleled and unprecedented. It is one of the most comprehensive packages of support provided by any Government anywhere in the world, with £280 billion committed in support for jobs and incomes. The emergency response has included the furlough scheme; Government-backed loans; support for the self-employed; mortgage holidays; protection for renters; support for people with housing costs; and a £500 million council tax hardship fund. We extended the energy price cap, and provided a £750 million package to support charities and £1 billion in catch-up funding for schools and vulnerable children. The Government have increased the living wage, raised the national insurance threshold to boost pay, and, of course, provided a £7 billion injection into the welfare system to support millions of households.
We are the party of jobs and job creation. We know that work is the best route to recovery. We have put in place a £30 billion transformative plan for jobs to create jobs and enhance skills, because we know that work, not welfare, is the route to recovery and out of poverty. The Chancellor will make his economic announcements, including those involving universal credit, at the Budget in March. That is entirely right and proper. Long-term decisions of this nature have to be taken in the context of a range of economic levers and situations, and, of course, in the context of paying for them.
As this is an Opposition day debate, let us reflect just for a moment on an Opposition who want to abolish the universal credit system without which our welfare system would have collapsed, let alone coped with 1 million more applicants. They once told us that they would abolish boom and bust, and they opposed every measure to get the nation’s finances back on a sound footing after the financial crisis. And let us not forget that it was only a little over a year ago that they were campaigning to make Jeremy Corbyn our Prime Minister and John McDonnell our Chancellor.
There is no legislative impact from today’s vote and it has no bearing on policy or decision making. What my constituents need is a Government who will deliver real support and real change. That is what this Government are doing. That is what we will set out at the Budget in March.
We in Plaid Cymru have called consistently for the addition to universal credit to be made permanent and for it to be extended to legacy benefits. That is the bare minimum social security response required, with so many people experiencing such hardship. Millions of people in Wales and across the UK are facing many more months of want, with no guarantee that the pandemic will be over by March when this artificial deadline is to be imposed.
The Minister said he cannot predict the circumstances in April. Neither can I. That is exactly why the certainty of the uplift should be continued. It is no surprise that the Government want to dodge yet another U-turn, having been forced to extend free school meals after the swindle of food hampers for hungry kids and all the rest of it. But for the Government to cut the vital support that universal credit provides just to save face would be morally reprehensible. The Secretary of State should have the courage to say, “The facts have changed, I have changed my mind.”
If this cut goes through, over a third of Welsh households will be more than £1,000 a year worse off. This month the figure for universal credit in Arfon is up again at just shy of about 5,000; so less money for children in Arfon, and less for the basics of food, heating and clothing, piling further deprivation on to children already disadvantaged, possibly for life, by the disruption to their education. In Wales, even before covid-19, nearly a quarter of all people living in the country were in poverty, rising shamefully to three in 10 children.
The Government intend social security spending in Wales to be cut by around £250 million; less for Welsh parents to spend, but also £250 million taken out of the Welsh economy, so less for local businesses already reeling from covid.
It would be indefensible for a Westminster Government to harm the children of Wales in this way at the best of times. Doing so during the worst pandemic in memory, and after a decade of vicious austerity, is unforgivable. To lift Wales out of poverty, we urgently need the power to repair the deep cracks in our welfare system caused by years of both blue and red austerity. This deliberate cut and all the other welfare failures over decades are further proof that Westminster is not up to the job. We in Wales urgently need full powers over welfare to be devolved to our Senedd.
I congratulate the Minister for welfare delivery on his opening statement and on the work that he and his Department have done to make sure that our most vulnerable have the safety net that universal credit provides. I also take this opportunity to congratulate and give credit to my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith), who pioneered universal credit. It is worth repeating, as the Minister said, that if we had relied on the old system, the likelihood is that it would have fallen over during the global pandemic, so that credit needs to be recognised. Following on with that theme, we can look back to March, when the Chancellor was so proactive and reactive to the global pandemic to ensure that our residents and constituents had the support that was necessary. These were unprecedented times and I congratulate the Chancellor on that.
In my constituency, I have 2,800 people on universal credit. That has more than doubled compared with pre-covid times. The temporary universal credit uplift was part of the armoury of support that the Government have given. One point that I want to stress to the House is that language is really important. If we as a Government and policy makers introduce things temporarily, but there is an expectation that it will be permanent, that will have a significant impact on finances.
At the Budget in just over six weeks is absolutely the right time to be having this conversation. We cannot look at policy making on a stand-alone, piecemeal basis, as the Opposition motion proposes. The £280 billion-worth of measures that have been introduced since the start of the pandemic is unprecedented. One thing that really worries me is how we will look to afford it. It is worth reiterating that we as politicians and Members of the House are purely custodians of other people’s money—the taxpayers. We need to remain pragmatic, and the continued economic uncertainty means that leaving these decisions to 3 March is appropriate. I will leave it at that, Mr Deputy Speaker, and I look forward to the rest of the debate.
Universal credit has significant design flaws going back to its inception in 2012, but drastic cuts in social security spending in 2015 added to that. By the beginning of the pandemic last year, approximately £33 billion had already been cut in support for working-age people, with single parents and disabled people particularly affected.
Universal credit claimants have been driven into debt and rent arrears, and the increase in food bank demand is attributed to UC’s introduction. The associated poverty is driving negative impacts on health. For example, a peer-reviewed report published in The Lancet last March showed that people who moved on to universal credit experienced clinically significant psychological distress as a result. Another report from The BMJ showed that the hostile and demeaning universal credit system worsened physical and mental health.
As the covid crisis hit, not everyone could work from home and the low-paid and vulnerable sectors, such as hospitality and leisure, have been most affected, driving the increase in UC claimants. We know that not only is this health crisis far from over, but neither are the impacts on the economy and jobs. People need reassurance that in their time of need an adequate safety net is there. In my constituency, more than half of the 14,633 claimants now claiming UC are doing so as a result of the pandemic. Many have contacted me about the debate, but not just those relying on UC have written to me, which reflects the recent poll showing that 74% of the public support the increase in UC and want to see it extended.
I chair the APPG on universal credit, and we held an inquiry into the impact of covid on claimants last spring and made a number of recommendations to the Chancellor in November, including retaining the £20 per week uplift, as well as extending it to legacy benefits and replacing the five-week wait with an initial non-repayable starter payment.
We know from Save the Children that potentially 200,000 more children will be living in poverty if the uplift is not extended. The Resolution Foundation has estimated that by 2024 an additional 730,000 children will be living in poverty, but even if the uplift continues, people are still struggling. We know that one in five on UC always run out of money, compared with 8% of those not reliant on UC. We know that half a million people have accrued rent arrears since the start of the pandemic, with an average of £730 debt. The ban on evictions also runs out at the end of March. Covid saw those already struggling to stay afloat bear the brunt of the economic and health burden. We cannot—we must not—let them down. We must extend the UC uplift.
It is a pleasure to speak in this debate, and I thank my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) for the way he set out the case from the Front Bench. The facts speak for themselves. In my constituency, 9,147 of the lowest paid people across Audenshaw, Denton, Dukinfield, Reddish and the Heatons will be affected—people who are struggling and many who are relying on this money to get them through the current crisis.
The Trussell Trust has said that cutting universal credit could increase already high food bank use by another 10%. I will let that figure sink in. Universal credit is an in-work benefit, too, replacing the previous working and child tax credits. In that context, it is unthinkable to take £20 a week or £1,000 a year away from families. The Resolution Foundation states that the cut would see the poorest households lose 7% of disposable income. The Child Poverty Action Group states that the £20 uplift is essential
“to ensure low-income families with children receive the support they need”.
Last September, the Joseph Rowntree Foundation said that the cut risked bringing 700,000 more people, including 300,000 more children, into poverty. These are staggering and, frankly, frightening figures that should shame us all. We are better than this. We must urge the Chancellor to stop the cut and support those in need.
I know this motion has been brought to the House by the Labour Opposition, and politics dictates that we should take partisan lines—I get that those are the rules of the game, having been an MP for almost 16 years; I have seen it time and again—but this is not a game; it is millions of people’s lives. It is our children’s future, and sometimes we need to unite across the political divide to make a stand and do the right thing.
This political spin that abstaining deprives Labour of the opportunity to incite “hatred and bullying” towards Conservative MPs is just ratcheting up that game-playing. The only anger will be because this is not a game for 6 million families; it is real life, and the best way to remove that anger is to do the right thing and vote for the motion to stop the cut. All Members know the cut is wrong. Six million families are depending on us. I know I have represented the 9,147 who will be affected by this cut in Denton and Reddish. I oppose this cut, and I will vote against it if there is a vote tonight.
The last 12 months have been hugely difficult for many of our constituents as covid-19 has ravaged our communities. For those who have struggled to make ends meet, the £20 uplift has relieved pressures on household expenditure. Certainly on the Government Benches, there is not a single Member who does not want to support their constituents throughout this difficult period. That is why I consider this motion by the Labour party nothing more than a cynical attempt to score political points. Frankly, we should be above that; this issue is too important. Our constituents deserve better.
Throughout the course of the pandemic, we have seen the Government proactively provide support to those who have needed it, when they have needed it most—support measures worth £280 billion, including the coronavirus job retention scheme, £170 million to support food poverty over the winter period, a £500 million hardship fund, £6 billion in increases to welfare and £670 million to help people pay their council tax bills; along with an increase of almost £1 billion last year to increase the local housing allowance programme. This has all helped to ensure that there has been a degree of security for my constituents in their most anxious moments.
The Chancellor’s packages have been recognised across the world—including by organisations such as the IMF, the Bank of England and the OBR—as world-leading and crucial to shoring up the economy and the livelihoods of those who have been worst hit by this pandemic. It is incumbent on all of us to consider the best path to economic recovery out of the pandemic for those who need it most. There is no doubt in the mind of a Conservative that a healthy economy will lessen the need for universal credit in our society. A strong economy will deliver the jobs required to give people the stability and security that they need to thrive and succeed. Nobody should consider the impact of good employment on welfare to be insignificant.
The introduction of the uplift to universal credit was the right thing to do at the time. Given the economic and social situation, I absolutely supported it. I commend the Chancellor and my right hon. Friend the Secretary of State for Work and Pensions for ensuring that universal credit has worked smoothly and for supporting those who have needed it most.
Let me tell those watching who are not familiar with parliamentary procedure that today’s motions are not binding. They do not change anything; they do not protect lives and they do not protect the poorest in our society. If the last Opposition day debate is anything to go by, this debate will be used by many as an excuse to abuse some of my colleagues and friends, including with physical threats—as happened last time—to themselves and their families. Such threats should be condemned across the House. I therefore believe that it is not right to engage in the Opposition’s political games, not least because they want to abolish universal credit, which would leave the future for so many uncertain and reduce their support. “Gotcha” politics will not solve the scourge of poverty in our society, and the Chancellor should be given space to make the decisions that he needs to when he presents the Budget.
I thank our colleagues in the Labour party for bringing forward this debate to try to provide security and reassurance to those across all our constituencies who have relied on this uplift at a time of increased costs and fewer economic opportunities.
The number of universal credit claimants in my constituency has increased by 145% in the year to November. That includes many people who have not been reached by furlough and self-employment support. The Prime Minister stated last week:
“What we want to see is jobs…and…growth”.
We all do, but between covid and Brexit that is simply not a realistic solution at present. Wanting a better economic climate is not going to meet the basic needs of those on universal credit, and it ignores the fact that 40% of claimants are already in work.
The compound economic crises that we are facing are driving more people into needing the safety net of social security. For public health reasons we need more people to stay at home, but the social security net is already being found to be unfit for purpose. Existing cuts are already biting. Lone parents—just one group—have lost around 10% of their income. One participant told the Women’s Regional Consortium Northern Ireland:
“The amount allocated to us just isn’t sufficient for basic living costs. We can’t have the heating on because we can’t afford the gas. Thank God for food banks, otherwise eating would have been much worse.”
I would like to take this opportunity to recognise the work of the South Belfast food bank, as well as the churches and the sporting organisations—including Bredagh GAC, Rosario football club and Ormeau Road boxing club—who have come together to meet the need in my constituency.
Unfortunately, in 2015 Northern Ireland returned welfare powers to Westminster. I regret that, despite pledges, hundreds of people are subject to benefit cuts without mitigation. I am urging the Department for Communities to bring forward legislation to stop tens of thousands more people falling into that gap, and to provide top-up payments for the two-child tax credit rule.
Medical experts make it clear that the crisis will not end neatly at the end of March. The economy will likely experience disruption throughout 2021. The uplift was the right thing for the Government to do, and I commend them for doing it, but by their own logic, there is no case for removing it now. That this change would save a lot of money is not in doubt, and I know that there are consequences to borrowing, but there are consequences here for the economy, too. The evidence shows that universal credit is spent almost immediately, so this cut would be a loss to local shops precisely when they need it most.
To finish, I will borrow a phrase from Marcus Rashford: people in poverty matter. The Chancellor seriously misjudges those people if he thinks that he can mislead them into thinking that an up-front payment is better simply than nothing. The one-off payment is an attempt to solve a political problem, but it does absolutely nothing to solve the problems of those families relying on this uplift.
I am grateful to the Opposition for bringing forward this debate, because it gives Conservative Members an opportunity to talk about the wide-ranging and comprehensive support that we provided to the lowest-income and most vulnerable families in this country. We did so not just through the £20 universal credit uplift, but through the furlough scheme, which we know is critical to keeping that vital link to work—the sustainable route out of poverty—through the hardship fund, through the winter support grant and through the catch-up schemes. This support has been provided to the families who most need it—and in a timely fashion.
It is worth dwelling on a point that the Minister and others have made: at points during this crisis, we had 100,000 people a day applying for universal credit, yet nine out of 10 applicants were paid on time—a fact that I hope to see recognised by more Opposition Members. In that context, it is inexplicable that we would now seek to scrap universal credit, and it is worth dwelling for a second on what we inherited from the Labour Government. It can be summed up in two simple words: welfare trap. We had a welfare system that was inexplicable, with six interacting benefits. If a person went into work, they actually lost money. There was an effective tax rate of 90%.
I am grateful to the hon. Lady for raising that matter. The politics of the taper rate is one of the fundamental points in any welfare system. Under universal credit, the taper rate is 63%, but that does not account for income tax or national insurance, so the withdrawal rate is effectively 75p in the pound. She did not give the full picture. Universal credit, according to the Joseph Rowntree Foundation, reduces the deduction rate from over 80% for some families, but it increases the deduction rate for other families. There are more families facing a deduction rate of between 60% and 80% than before, so the situation is more complicated. It depends on a person’s circumstances, including the hours they work and whether they rent. Putting this in binary terms is not, I am afraid, correct. We should look at the detail, because that is what the debate deserves.
The hon. Gentleman is quite right that there is a debate to be had about the right level of the taper rate, but I think we can all agree that it is better that people should want to earn more by working, and that the previous situation was worse. We have moved forward, but there is always more progress to be made, and it is important that we make progress. I think the new system is better than the last. We have a welfare system in which it pays, for the most part, to go to work. We are trying to provide a safety net, not a trap; that is the difference between now and what we had.
Today, we are discussing a complex question. The hon. Gentleman and other Labour Members will know that getting people out of poverty is more complicated than just giving them money. That is necessary, but not sufficient in and of itself. We need to provide re-training, help to get into work, and support for the whole family in the numerous challenges that they may face. It is absolutely right that this decision be taken in the round at a fiscal event, when we can think about how to look at all these things, and, crucially, how we pay for them.
The Opposition said this was not the time to think about fiscal events. We have shown that we will throw the kitchen sink at protecting the most vulnerable during this crisis, but that does not mean that we can make uncosted spending pledges. We need to think very carefully about how we deploy our money. That is not to say that a debate should not take place, but we should think about this in the context of our wider spending pledges, and in the context of making sure that we target support at the most vulnerable in society. I am very glad that, at the outset, all of us, wherever we sit in this House, recognised that we are all here to do that.
For many families across my constituency who have lost their jobs and have seen their incomes fall and their costs rise, the increase to universal credit has been a lifeline throughout this crisis. It has kept them from being dragged into poverty and prevented them from joining the thousands across Bradford who, because of low pay, insecure work, high costs and under-employment, sadly struggle to get from one day to the next. Despite the benefit from this small increase, which meant families did not have to worry as much about putting food on the table, heating their home or keeping a roof over their head, the Government are still intent on cutting universal credit from April.
I represent a constituency where half of children are growing up in deprivation, so I know just how destructive poverty can be for families, and to children’s chances. It hurts their education and development, and actively harms both their mental and their physical health. I cannot be clearer about just how damaging it would be for the 13,000 households on universal credit in my constituency if the Government were to pull this small but steady foothold, which has granted much-needed financial breathing space. It would cripple household finances that have already been stretched to breaking point, and plunge hundreds of families in Bradford into a state of poverty, in which they simply would not know how to make their incomes last the week.
During what is the worst recession in 300 years, which has seen many more families who never expected to find themselves relying on universal credit dependent on the Government to get by, families need security in their incomes. I have seen an extension of the uplift described as a “splurge”, a “stunt” and a “waste”, but let me be clear: ensuring that people can afford to eat, keep a roof over their head and heat their home is never a splurge, never a stunt and never, ever a waste. It is a basic duty of any good Government to look after the poorest and most vulnerable in society. The decision to cut universal credit shows just how far removed from that duty this Government have become, and how they still have not grasped that it is the lowest paid and the poorest who are being hit hardest by the coronavirus pandemic.
We cannot escape the fact that there are many flaws with universal credit, but the choice for the Government today is clear: either they vote for the Labour motion and provide low-income families with certainty and security, or they choose to write off another generation and consign yet more families and children to a life of poverty and deprivation.
I thank the staff at the Department for Work and Pensions for the way in which universal credit has stood up to the pressure of the coronavirus pandemic. In the past year, UC has supported more than 5 million households—a level of demand that would have crippled the previous legacy benefits system. An agile, targeted welfare system is of immense value to society, and particularly to the 3,000 families in Brecon and Radnorshire who depend on universal credit. I therefore firmly reject the comments of the Leader of the Opposition, who seeks to scrap universal credit altogether. Now more than ever, it is needed to support those who have been hardest hit by the pandemic.
The International Monetary Fund has commended the UK Government for their “aggressive” economic response to the pandemic, which they have called
“one of the best examples of coordinated action globally”.
More than £280 billion has been provided to safeguard jobs and incomes, through measures such as the furlough scheme, the self-employed income support scheme and bounce back loans. As the number of vaccinations increases, the fight against coronavirus will move to the economic front.
There is no question but that we have a moral responsibility to ensure that the safety net is as strong as possible, but we cannot be ignorant of the cost to the taxpayer. Maintaining the £20 uplift will require a significant tax hike, which will cost anyone earning £30,000 around £175 a year, and every driver an extra 5p per litre of fuel. Universal credit is just one tool for lifting families out of poverty for good. I am proud that, rather than just giving people money, this Government are putting their shoulder to schemes such as kickstart and restart, and are doubling the number of work coaches, who give people intensive support to get back to the workplace. This is how we tackle poverty and eradicate it for good.
It is a sorry situation that in the middle of a pandemic, the Labour party uses its time sowing uncertainty and confusion. Constituents have already been in touch with me to ask whether tonight’s vote will reduce the money they can expect to receive this week. I want to be very clear: it does not. The Opposition should be thoroughly ashamed of playing on the fears of those whom they seek to represent.
I will take no lessons from the Labour party on poverty. According to the Joseph Rowntree Foundation, even before the pandemic, one in four people in Wales lived in poverty, including 140,000 children. Welsh Labour has run Wales for 21 years, and still, in the words of the First Minister himself, we are “older, poorer and sicker”, so I will take no lectures from it on poverty.
The best reason to shut down food banks that I ever heard was given to me by a woman who ended up starting her own food co-operative—a mum of four. Following the Osborne benefit cuts, money was just too tight. She was advised to go to the local food bank, but when she got there, she sat outside and cried. She could not go in; she just could not do it. That is why no one in our country should have to beg for food, and why there has been public outrage about child hunger during this crisis. It is wrong.
However, today’s debate is not about Marcus Rashford’s child food poverty campaign; it is not about scrappy food parcels, or whether a child ought to be able to survive for two weeks on dry pasta and a loaf of white bread. Today’s debate is a result of what happens if we ask ourselves why that campaign exists at all. It is a result of daring to ask the bigger question: “Why do we have food banks in our country?” If we ask ourselves what the cause of poverty is, we reach the following conclusion: too many people have jobs that pay too little, or for family reasons cannot work enough to pay for the necessities of life. This trend has been exacerbated greatly by the covid-19 pandemic, but it was set from 2010 onwards. Rising self-employment and uncertain, often low, income have undermined our battle against low pay; covid has made this 100 times worse, and many of those facing poverty are families with only one wage coming in, or where disability affects work prospects. That is why the social security system needs to support them, and make sure the indignity of food banks is no more.
What is the truth about social security today, and why does it fail to protect? Child benefit—the most dependable, easy-to-process family support—was cut in real terms by 22% from 2010 to the end of the decade. Proportionally, that was the largest welfare cut of all, and it fell on our children, meaning that all families with children have been squeezed for a decade. For those in low-paid work, the consequences have been severe, as we have heard from other Members. That is why we should welcome the extra money for families in this crisis, which went some way towards addressing the problems created over the past 10 years. I want the Government to go much further now, with no third or fourth child being sent the message by our country that the state does not care about them. Every child should be invested in through child benefit, and should never have to see their parents in distress because of an enforced visit to a food bank.
The contribution principle that Beveridge set up in our social security system is being undermined. We pay in when we are able and we take out when we need, but a generation is now being robbed of that promise. If the Minister does not know this, let me tell him that the anxieties we face in childhood echo on through our lives; they never leave us. That is why protecting our children is always the right thing to do.
Opposition day debates are allocated to the Opposition by the Government, and in the Opposition’s social media noise, they do not mention that on such days, while matters are debated and discussed, they are not decided on in the same way as they are through the ordinary legislative process. They are not backed up by White Papers or detailed policy, yet the Opposition rely on the public quite understandably not knowing the difference.
After the last Opposition day debate, my Labour predecessor dutifully posted the centrally supplied Labour attack graphics, and had to wade into the vitriolic comments under his Facebook post to ask posters to take care with their language, to which the first reply was:
“can we say Scum? Asking for a friend”.
This is just a mild example of what happened as a result of the last debate—a direct consequence of the efforts of the Labour party to stoke up an emotionally charged atmosphere at a difficult time. I can cope with that bad language, but I know that colleagues faced worse, including threats that required police intervention. So I hope the Opposition will consider carefully—I heard their spokesman’s comments earlier—the impact of their choice of language when they present the reality of this non-binding vote. It would also be helpful if the Opposition could present a motion that is consistent with their Front-Bench policy. Their stated aim is to abolish universal credit. What would that achieve? Chaos. Imagine if Department for Work and Pensions staff, plunged into an unexpected epidemic, had been forced to try to operate a number of different benefit schemes. The welfare system would have struggled to cope. The resilience of the system is a tribute to the sterling work of DWP staff, who have faced a challenge, stepped up and met it. I thank all the staff at the jobcentres that serve Gedling. I have been inspired by their enthusiasm over the last months.
In the last Opposition day debate on free school meals, I said that, although Labour might claim a moral victory, it did not address the fundamental issues, which the Government had to now address. Very much the same applies today. This Government are taking action: the hardship fund; the covid winter grant scheme; the kickstart scheme; the restart scheme; millions of pounds of support for councils to help the poorest; the holiday activities and food programme; the flexible childcare fund; the furlough scheme; bounce back loans; rates relief; VAT deferrals; protection for renters; mortgage holidays; and much, much more. This is all supporting Gedling residents during these difficult times. While Labour plays on people’s emotions, it offers no solutions, and this Government are offering to support the most vulnerable in society. I know they will continue to do so at the next Budget, when spending matters will, quite properly, be announced. So in this debate, the division is clear, and I know which side I am on.
I wish to speak, albeit briefly due to the time available, in favour of the motion tabled by my right hon. and learned Friend the Leader of the Opposition, the shadow Work and Pensions Secretary and other hon. Friends.
Let me start by saying that at the very least the Government should rule out the cutting of this uplift in April and give certainty to families across the country. We know that the UK is in the midst of one of the most deadly global pandemics in a century and we are currently at the peak of the second wave. £20 a week is making a huge difference to the 8,306 people in receipt of UC in my constituency and to 6.2 million families across the UK. In many cases, it is making the difference between being able to put food on the table and not.
We know that times are incredibly tough. Our food banks are busier than ever, trying to support as many people as they can. In my constituency, we have a range of other voluntary organisations and community groups offering support with meals, and it is abundantly clear that families need more support, not less, although it seems that that is not clear to the Government. For them to consider this cut in the best of times would be callous, but to do it at this time, arguably the worst of times, is an absolute disgrace and plain cruel. Let us make no mistake: this cut will hit Britain’s poorest households and the Government must think again.
It appears that the Government are looking to make low-income families pay as a result of the Government’s incompetence and chronic mismanagement of the pandemic, which has caused Britain to suffer the worst recession of any major economy. This will make matters worse. In Merthyr Tydfil and Rhymney alone, this cut will mean a £7.8 million per annum loss to the local economy. We all remember when the Chancellor said at the start of the pandemic that the Government would do “whatever it takes” to support people through this crisis. How hollow those words sound now. Not only have the Government created the worst recession in any major economy, but they are now failing to take action to stop children and families going hungry. I hope that the Minister will tell us today what it will take for the Government to get real, see sense and stop this callous cut to the most vulnerable families in the country.
We also know that since the beginning of the pandemic the Government have chosen to exclude people on so-called “legacy benefits”, including the disabled, the sick and carers, from the extra support given to those on universal credit—the Government said it would take too much time to update the systems needed. They have had 10 months to put this right but, instead of trying to solve one problem, they are set to go headlong into creating another, affecting millions of families. We heard examples of this from our local citizen’s advice bureau just this morning. I urge all Members across the House, on all Benches, to put the needs of the most vulnerable families in the country first and to support the motion.
Welfare dependency is an invidious culture that I am proud this Government do not champion, or aspire to. The universal credit uplift was always temporary. It was part of the generous package from this Government to ensure that all parts of society were supported during the pandemic.
The better conversation and debate we should have been having today is about job creation and the Government’s £30 billion plan for jobs—helping people who have lost their job due to coronavirus to find new jobs, helping the over-50s bounce back quickly, helping young people into work, helping people to retrain and find new, well-paid jobs, and giving people the security of a regular income. After all, is that not the whole purpose of universal credit—giving people the means and support they need to get back into work? Never more is that important than now.
The Government are devoting more resources to this than any Government in recent history, and I challenge anyone to say otherwise. They have delivered £28 billion of support already, the furlough scheme, £1 billion in catch-up funding for schools and vulnerable children, a £500 million hardship fund, £117 million in support to tackle food poverty this winter and over £6 million in increases to welfare. At the beginning of the pandemic, the UK economy was in a good place. That is why the Chancellor is right to wait for more clarity on the national, economic and social picture before assessing the best way to support low-income families moving forward.
Those are the conversations that my constituents want to hear, not ones of political expediency or ambiguity. On the one hand, the Opposition call for this debate, as they think the universal credit uplift should be permanent, at a cost of approximately £6 billion a year, which would mean a 1% increase in income tax for 30 million taxpayers and a 5p increase in fuel duty. Where is the financial prudence in any of that? Bizarrely, the Leader of the Opposition calls to scrap universal credit, leaving people with no means of financial or practical support to get themselves back into work. Today’s debate smacks of political opportunism, with straplines that only serve to make headlines and do not help those most in need.
Where there is no ambiguity is in the simple fact that since 2010 this country has voted in all three successive elections for a Conservative leadership to lead this country, and there is a reason for that. It is in this Government that people can trust. This is a time to allow the Government to continue with that trust—a Government who will continue to stand behind families who need our support at the time of this country’s greatest need. Getting people back into work is what will see us lift this country out of this crisis, not political opportunism and not welfare dependency.
The Liberal Democrats fully support the £20 uplift to universal credit and making it permanent, and we will vote in favour of the motion accordingly. It is the right thing to do to ensure that our most vulnerable have a safety net that works for them and their dependants. It is the right thing to do to invest in our social security system and the best way to help people to escape from poverty and help stimulate our recovery. And it is the right thing to do to act now and give families certainty, rather than the approach favoured by the Government, which is to leave families in the dark, in the middle of the greatest economic crisis this country has ever seen.
The coronavirus pandemic has transformed how so many people see our welfare system. People who never thought they would interact with the system are now doing so and will need to continue doing so beyond April. We should therefore not be debating whether we should take away the vital £20; we should be debating whether we can go further. Hundreds of thousands of people receive legacy benefits and many of them are unable to transfer to universal credit. They were excluded last year from the Chancellor’s uplift on an entirely arbitrary basis. This group includes many disabled people and their carers. How can we leave them out of the uplift at a time that is difficult for so many? What happened to “no one left behind”? What happened to “whatever it takes”?
The Government have failed to act on this issue, and my North East Fife constituents who claim legacy benefits feel forgotten. That is why we support uplifting legacy benefits and backdating the uplift to April 2020.
It is the same story for carers. Unpaid carers are doing a remarkable and important job in very difficult circumstances. They deserve our support, but there is an historic deficit in the support available to unpaid carers. Carer’s allowance is just £67.25 a week, the lowest benefit of its kind. That is why it is vital that the Government immediately uplift carer’s allowance, too, in line with the uplift to universal credit. Too often, carers have been an afterthought for many politicians. It is time to stand up for them.
As more and more people access universal credit, it is also high time that we looked at the areas where it is failing to deliver. Last year, the Joseph Rowntree Foundation published a report looking at universal credit in Glasgow. The report highlighted that many people who access universal credit suffer from mental ill-health, but even more damningly, it said that even among people who did not have a mental health condition, many still suffered anxiety caused by their engagement with universal credit. The reasons include challenges in navigating the online system and a lack of face-to-face support with this, poverty and financial insecurity due to the waiting period for the first payment, the stress of managing budgets between payments, housing, conditionality and the fear of sanctions. The whole point of conditionality is to get people back to work, but right now there is simply little prospect of that. The Government have failed to suspend conditionality during the current lockdown even though they suspended it between March and July last year. On the “digital by default” approach, the majority of claimants access the system on mobile technology, and this has issues for my rural constituency.
In short, there is much work to be done.
As the Prime Minister has said countless times since last March, when the difficult but necessary decision was taken to fundamentally change the way we have all had to live our lives, we as a Government would put our arms around the people of this country. The support has been phenomenal—not just financial but genuine engagement across every Department to support our most vulnerable. It is a proud record that we as Conservatives will stand on. The International Monetary Fund has said that the UK response is
“one of the best examples of coordinated action globally”.
The key aim has always been to protect as many lives and livelihoods as possible, to give certainty in uncertain times and, even now, continued hope beyond this moment of incredible national achievement in rapidly rolling out the vaccination programme. When we emerge from this pandemic, it is important that we have not simply survived but have the building blocks in place to thrive again. The Chancellor of the Exchequer will be looking at the right measures at the right time, but we are not there today.
In the meantime, the extensive support has included the temporary and emergency £1,000 per year uplift to universal credit. That is just one pillar of support, but there is much, much more. We have funded local authorities to help families of all ages in difficult circumstances with the covid winter grant scheme—not just food vouchers but help with bills too. It is right that we care deeply for those who struggle most, but it is also right that we are mindful of those who sit just outside the support that universal credit offers. We are asking them to support all these measures through taxation. I look forward to hearing from the Chancellor how he will strike this important balance in the coming weeks and months. As so many have done, I wish to recognise the excellent and professional delivery of the universal credit system overseen by my right hon. Friend the Secretary of State for Work and Pensions, her team, and the amazing people working in jobcentres.
Let me add a gentle note on Opposition day motions, if I may. Members on both sides of this House want what is best for every member of our communities. Making political capital and amplifying social media storms sadly comes with risk. Once, in October last year, could be deemed, if being generous, as unforeseen; twice has the dishevelled appearance of carelessness. While the Opposition seek to cause division and worry and prey on the fearful, this Government will calmly continue to deliver.
We have before us today a simple motion, and I am a simple kind of guy, so I am going to be quite straightforward in indicating that I will be supporting it. It is supported by a majority of people in this country: my union, Unite, carried out a survey indicating just that. There is, however, a wider debate to be had, though not today, about values and principles. Are we a society that is accepting of homeless people freezing to death on our streets? Are we a society that is accepting of millions of people being reliant on food banks for their next meal? Are we, as a society, prepared to accept that one in three children are receiving holiday hunger hampers in the form of food parcels?
Almost 6 million families are dependent on universal credit, and 40% of them are in work; they are in receipt of in-work benefits. Government Members are accusing Opposition MPs of being partisan, but sadly, the lives of the poorest and most vulnerable people in society only seem to concern the Conservative leadership when they risk bad headlines. Government Members—and that includes the Prime Minister, the Chancellor and the Secretary of State for Work and Pensions—must know the poverty and hardship that will be caused by failing to uprate universal credit.
At the outset of coronavirus, anticipating millions of new universal credit claimants, the Government announced a 12-month £20-a-week uplift. This was not an altruistic gift; it was a political calculation. The Minister said that he welcomed today’s debate. Frankly, I do not expect the Government to change their position today, because the Government will welcome three months of uncertainty and arguing against retaining the uplift. If they were to concede today, the Opposition would have more time to focus on the national scandal of the Government’s covid response. The Government are too busy making political calculations affecting the lives of more than 10,000 people in my constituency of Easington who are in receipt of universal credit.
I expect the Government will U-turn on universal credit, but it will not be today or next week. The Prime Minister should stop playing politics with people’s lives and start governing in the national interest for the good of the country. He should U-turn today, consolidate the uplift and give some security to the millions of people who have been let down by this Government.
Yesterday I took the unusual step of posting to my Facebook an account of what an Opposition day actually is. Usually I like to focus on local issues in Heywood and Middleton rather than process. However, after the abuse, threats and vitriol generated by the last series of Opposition day debates, I felt it necessary to get ahead of the misinformation that will doubtless follow on social media after today’s debate, despite the fine words from the hon. Member for Stalybridge and Hyde (Jonathan Reynolds). He should consider carefully the intemperate language used by some of his colleagues in the debate so far.
People deserve so much better than political opportunism. That is why I am genuinely saddened by the tenor of today’s debate, which is not just disingenuous but painfully ironic. It remains the position that the official Opposition want to scrap universal credit altogether. Whether it is furlough, covid winter grants or the stay on evictions, the schemes that the Government have put in place to support people through this pandemic have been refined and adapted to meet the changing circumstances we face, and so too with universal credit. The truth is that we simply do not know what the next few weeks hold or what the best solution will be. The responsible thing to do is to assess the situation as we approach the Budget, which is why the Secretary of State is actively reviewing next steps.
Uprating UC represents £4.6 billion of additional spending to support those impacted by coronavirus, and the rapid roll-out of funds must, by any measure, be considered a success. Despite an almost two-thirds increase in the number of claimants, 96% of new claimants got their full payment on time. Staff at the DWP deserve our thanks and praise, and I associate myself with reports from the Work and Pensions Committee and the House of Lords Economic Affairs Committee highlighting their successes and the fact that the digital structure of the benefit has enabled the system to withstand the sudden increase in demand, where the legacy system would have struggled severely. We know that the official Opposition want to do away with UC, despite its effectiveness during this national crisis, but we have yet to hear what they would do or, more importantly, where the money would come from. That has been the hallmark of their behaviour throughout—taking no firm positions and offering no constructive alternatives.
It is at times like this, when we are up against it, that we find out what people are really made of. I have been genuinely humbled by the selflessness of my constituents and proud of my colleagues, many of whom are learning the job as we deal with the pandemic. I am deeply saddened but not at all surprised by the naked self-interest of Opposition Members in trying to weaponise this emotive subject. Despite the veiled threat to red wall Conservative MPs from the hon. Member for Stalybridge and Hyde, I will not be voting for this motion, because to do so would be to give the oxygen of publicity to an Opposition who, frankly, have nothing constructive to say.
I find it astonishing that the hon. Member for Heywood and Middleton (Chris Clarkson) and other Government Members do not understand the fury that has been unleashed across this country by the measures that the Government are failing to take and the callous way that they have treated so many millions of people. It is clear to me and the constituents of Ilford South that the Government should be hanging their heads in shame. They should not have even been forced to come to this Chamber or to have this debate.
This is a Government who have spent billions of pounds of taxpayers’ money on contracts with friends linked to donors, and hundreds of millions of pounds on a failed test and trace system and, in my constituency, unusable personal protective equipment. It is an absolute disgrace that the Government cannot stump up an extra 20 quid to put food on the table of some of the most vulnerable people in this country.
We are in the midst of the worst recession ever. Millions of families, many in work but reliant on Government support to supplement poverty wages, are on the brink. This is not a time to let them sink below the poverty line; it is time for the Government to stick their hand in their pocket and do what is right.
Instead, the Government’s cruel and callous decision will have an impact on more than 6 million families across the country, and risk plunging more than 300,000 children into poverty. In my constituency of Ilford South, more than 19,000 people rely on universal credit to make ends meet. That is more than double the national average.
Worse, that decision comes just days after we learn that the Government are only setting aside £5—five measly pounds—to feed our children. Let us be under no illusion: this is an attack on Britain’s workers by a Government who represent the 1% of this country, intent on cutting tax rates for their mates and handouts for the poorest.
We are struggling through a devastating pandemic and—I think that people on both sides of this House agree—perhaps the biggest challenge for our country since the second world war. Due to the unprecedented nature of this crisis, we have all had to adapt rapidly, so it is little surprise that living costs have risen in recent months. Indeed, research by Save the Children and the Joseph Rowntree Foundation found that 86% of families with children on universal credit and tax credits have been faced with additional costs since the crisis began.
The increase in Government support previously was rightly welcomed. It eased the burden on millions of families up and down the country. However, it will be many months, unfortunately, before we are out the other side of this awful pandemic, and millions more will lose their jobs and be at risk of unemployment when the furlough scheme comes to its end. It is completely the wrong time to end that vital piece of support.
The Government have tried to spin their one-off payment of £500 as a positive, something that so many people have seen through. As my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) pointed out, in real terms that means the lowest level of unemployment support for 30 years, at a time when redundancies are going through the roof.
This is an unprecedented crisis that demands an unprecedented level of Government support. Our Conservative Government have been there for the most vulnerable at every turn. Never have any Government in our history done so much to support those in need, with more than £280 billion spent on measures prioritising the people on the lowest incomes. While the Labour party squabbles over whether that should be £281 billion or £282 billion, our determination to help the lowest paid and most vulnerable in our society continues.
The Chancellor, in his autumn statement, accepted all the recommendations of the Low Pay Commission and increased the national living wage, worth £345 to those who work a 40-hour week. In the public sector, we have had to take the difficult decision to freeze pay for many public sector workers, but we have again shielded the lowest paid: those in the public sector with below the median income will see their wages rise this year by at least £250. Since 2010, we have raised the personal tax threshold to £12,500—something that benefits the least well-off the most. We have paid 80% of people’s wages and provided the self-employed income support scheme designed for those earning less than £50,000. We have protected renters, helped with mortgages, and are delivering the targeted support needed to help families with their council tax, food and energy bills. We have continued to prioritise the least well-off.
Meanwhile, the leader of the Labour party characteristically offers only division and indecision. Last week, he said that he wanted more restrictions on our economy, but he will not tell us what they could be. He has told us that he wants to scrap our Brexit deal and to do his own, but he will not tell us what that will include. Now he says he wants to scrap universal credit, but he will not tell us what would replace it.
Sadly, since the first lockdown in March, the number of people claiming universal credit has doubled. Yet the system has not fallen over under the weight of all that additional pressure, and I pay tribute to those outstanding DWP staff, especially those at my local jobcentres in Redcar, Eston and Middlesbrough, who have worked so hard to ensure that.
The Labour party can criticise universal credit and the DWP all it likes, but it knows that the legacy system it left behind would not have been able to cope with this increase in demand, and while we have invested in universal credit by doubling the number of job coaches to provide the necessary one-to-one jobseeker support that we know works so much better, it would throw it all away rather than admit it is delivering exactly on the priorities of those who need it most. Work is the best route out of poverty, which is why we have taken such extraordinary measures to protect as many jobs as we can. This Government are rising to the immense challenge presented by a crisis like no other in our history. We are all in this together, and together is how we will beat this virus.
I am sorry we have not been able to fit everybody in to this debate. It was heavily over-subscribed, and we had a statement earlier and we do have another heavily subscribed debate, so I am now going to the shadow Chancellor, Anneliese Dodds.
Thank you very much, Madam Deputy Speaker.
With our country still locked down after record redundancies and with even more anticipated, it is astonishing that the Government are still threatening family finances. Ministers could have come to this House and promised that there would be no cut to universal credit in April. They could have recognised the incredible hardship that families have faced in the last 10 months and are likely to face as we continue in the throes of this crisis. We heard the voices of many of those families today in speeches from my hon. Friends the Members for Ealing North (James Murray), for Bermondsey and Old Southwark (Neil Coyle), for Birkenhead (Mick Whitley), for Bradford East (Imran Hussain) and for Belfast South (Claire Hanna).
The cut to universal credit is just one part of a triple hammer blow on families across the country, when coupled with the council tax rise of 5% and the pay freeze for many key workers. While today we have rightly been focused on the immediate threat to the incomes of 6 million families, we should not forget that those on legacy benefits, including the 1.9 million people claiming either form of employment and support allowance and the 300,000 people claiming either form of jobseeker’s allowance, of course have not received an uplift. Those payments must be uprated in line with those for universal credit.
Those on the Government Benches opposed support for families against support for jobseekers, but their choice to cut universal credit is a political one. The past year has seen the Government spend £22 billion on an outsourced test and trace system that still is not delivering. A quarter of that cost has been estimated as the cost for a continuation for a whole year of the support for families that we are debating today. This comes from a Government who have spent monumental amounts wastefully on goods and services that simply have not worked: £150 million on face masks that could not be used; £16 million on antibody tests that did not work; and £12 million on an app that had to be scrapped. The list goes on and on, as intimated by my hon. Friend the Member for Ilford South (Sam Tarry).
Instead of tackling waste and mismanagement, our Government are targeting families, with the worst-off fifth of households in our country facing what the Resolution Foundation has described as an “almost unimaginable” 7% hit to their disposable incomes if the Government continue on this path. Cutting £20 a week from universal credit is a political choice to make ordinary families carry the can for this Government’s mistakes, as my hon. Friend the Member for Merthyr Tydfil and Rhymney (Gerald Jones) rightly put it.
There are rumours that the Chancellor is considering a one-off payment of either £500 or £1,000 instead of maintaining the £20 per week uplift. If those payments take place at the beginning of April, people would miss out if they were affected by the end of the furlough scheme in April, so if someone loses their job on 30 March, they would get £1,000 more to see them through than if they lose their job just a month later. There can be no economic justification for this approach. Furthermore, at times during this pandemic we have had 200,000 new claimants coming on to this system in a single month. A one-off payment simply will not work.
I want to make it clear that I and the Opposition have no truck with those who abuse Government Members for their opinions or threaten them. We wholeheartedly condemn that behaviour and it has no place in our democracy, as my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) made crystal clear.
The Prime Minister’s spokesperson described our debate as a “political stunt”, and other Members on the Government Benches echoed him. However, when the Conservative party was in opposition, it did not consider debates such as these as stunts, and nor did the then Labour Government. My right hon. Friend the Member for East Ham (Stephen Timms), in one of many exceptional speeches today, put his finger on the problem: the Government have lost the capacity to listen. They need to ask themselves why a number of their own Members, from the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) to the hon. Member for Barrow and Furness (Simon Fell), called again today for the Government to look at the issue and to retain the uplift during this crisis.
The Resolution Foundation has shown how the cut, combined with rising unemployment, would lead to the biggest year-on-year rise in poverty rates since the 1980s, and to a rise in absolute, as well as relative, poverty. My hon. Friends the Members for Denton and Reddish (Andrew Gwynne) and for Oldham East and Saddleworth (Debbie Abrahams) rightly highlighted the impact of that on child poverty in particular. The cut is morally untenable, but it is also economically nonsensical. What the UK needs as we come out of this crisis is confidence—confidence that the Government have got a grip on public health, but also confidence that people can afford to spend, to go out on to our high streets and into our small businesses. This cut shatters the confidence of those who are far more likely to spend than those who are better off. The cut also ignores the high long-term costs of poverty, as underlined by my hon. Friend the Member for Wirral South (Alison McGovern). As my right hon. Friend the Member for East Ham highlighted, this is a false economy.
Finally, I regret that I have to mention this, but yet again we saw Conservative Members pitting universal credit claimants against working people. Universal credit is an in-work benefit. It does not take money from everybody else who works, as the hon. Member for Bexhill and Battle (Huw Merriman) suggested, and it should not be pitted against getting Britain back to work, as the Under-Secretary of State for Work and Pensions and the hon. Members for Derbyshire Dales (Miss Dines) and for Stourbridge (Suzanne Webb) maintained. My hon. Friends the Members for Edmonton (Kate Osamor) and for Easington (Grahame Morris) were absolutely right to point to the impact on claimants of such false comparisons.
The proposed cuts will disproportionately impact those in the north of England and in Wales. It is bad enough that one in five non-pensioner households in the south-east will be hit by these cuts, but in the north-east, Yorkshire and the Humber, Wales and the west midlands it will be more than one in three households. The Chancellor might want to learn the lessons of his predecessor. George Osborne also thought he could cut an average of £1,000 a year from families’ incomes. It took just over a month for him to see the error of his ways and back down. Mr Osborne’s cuts would have affected 3.3 million working families. The current Chancellor plans to take a hammer blow to nearly double that number—6 million families—across the country. Month after month, he has stubbornly ploughed ahead, ignoring the economic evidence, even ignoring two former Conservative Secretaries of State for Work and Pensions.
The Minister stated in opening that the Secretary of State was in active discussions with the Treasury. On the Labour side, our DWP and Treasury teams have already had those active discussions. We decided to prioritise families and our economic recovery, and we are doing something about it today. For all the talk of wanting to address inequality in this country, here is a policy choice from the Conservatives that would see one in four people—and one in three children—in relative poverty by the end of this Parliament. Instead, our Government should be focused on securing our economy, protecting our NHS and rebuilding Britain. Cutting a financial lifeline for 6 million people will not secure our economy. Enacting a policy that will plunge families into hardship, widen regional inequalities and make working people carry the can for the Government’s mistakes is no way to rebuild Britain. It is not too late for Government Members to do the right thing. I urge them to vote with us today and send a clear message to millions of families that their elected representatives hear them and are on their side.
It is a privilege to close this debate on behalf of the Government. Let me begin by thanking right hon. and hon. Members across the House for their contributions. Many spoke with great passion. Having listened to the debate, it is clear to me that there is a heartfelt desire, shared on both sides of the House, to support those constituents impacted by the economic consequences of covid. That was reflected in the well measured opening remarks of the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), speaking from the Opposition Front Bench, and in the comments from my hon. Friends the Members for Sevenoaks (Laura Trott), for Barrow and Furness (Simon Fell) and for Guildford (Angela Richardson), among many others.
The Government are acutely aware of the harm that the crisis has done to people’s finances, including the most vulnerable in our society. At every stage of the pandemic, we have striven to support those who have found themselves at the sharp end. As the Minister for welfare delivery, my hon. Friend the Member for Colchester (Will Quince), outlined earlier, that is why we introduced a wide-ranging package of welfare measures worth over £7 billion this year. That included temporarily increasing the universal credit standard allowance and the working tax credit basic element by £20 a week—an increase that has boosted welfare spending by £6.1 billion. As my hon. Friend also pointed out, given the evolving nature of the pandemic, it is right that we wait until the Budget before making future tax and welfare decisions.
I think what that ignores is that a quarter of the scheme is still to run, because there is still almost three months until the end of the financial year.
One should look at the package of measures as a whole. As a number of right hon. and hon. colleagues have pointed out, my right hon. Friend the Chancellor has allocated £280 billion in fiscal stimulus to help weather this crisis—I think the Chair of the Work and Pensions Committee has welcomed a number of these measures. As was further pointed out during the debate, and as Treasury analysis supports, the measures have overwhelmingly supported the poorest families most and reduced losses for working households by up to two thirds. That point was elegantly expressed by my hon. Friends the Members for Bexhill and Battle (Huw Merriman), for Meriden (Saqib Bhatti) and for Redcar (Jacob Young)—he correctly identified that the scale of Government support has been praised by many international observers, including the IMF, which has singled out the UK’s performance.
Let me briefly remind the House of some of the key elements of that support that relate most closely to this debate. The furlough scheme has protected the jobs of almost 10 million people, many of whom are on low incomes. Over 3 million people have benefited from self-employment grants. In addition to the temporary uplift in welfare payments, we have also suspended the universal credit minimum income floor and increased the local housing allowance rates for housing benefit and universal credit.
We have also supported those on low incomes through other measures, including council tax relief through the £500 million hardship fund, and the £500 payments for people on low incomes who have to self-isolate. Our covid winter support package includes the £170 million covid winter grants scheme and a £220 million expansion of the holiday activity and food programme for disadvantaged children. Those points were made during the debate, including by my hon. Friend the Member for Rushcliffe (Ruth Edwards). These measures have provided financial support to millions of families and individuals.
Beyond the state help that those measures have enabled, there can be no doubt that the best way to raise living standards is to keep as many people in work as possible and to support their wages. That is why my right hon. Friend the Chancellor has focused on our pledge to end low pay by increasing the national living wage by 2.2% to £8.91 an hour. Indeed, he has gone further, protecting, creating and supporting employment through our £30 billion plan for jobs—a point that my hon. Friend the Member for Stourbridge (Suzanne Webb) brought to the House’s attention very effectively. Measures including the furlough scheme, along with a raft of other initiatives designed to get people into work, have boosted jobcentre capacity, doubling the number of work coaches, and sit alongside measures such as the new £2.9 billion restart programme to help over 1 million unemployed people back into work.
As well as helping people to find jobs, we are creating new ones through a range of policies. They include our £8.6 billion investment in infrastructure, decarbonisation and maintenance programmes, and our £2 billion kickstart scheme for young people. Over the long term, we plan to unlock 250,000 highly skilled sustainable jobs that will boost our recovery under the Prime Minister’s 10-point plan for a green industrial revolution.
I have set out to the House the scale of support we are providing to people in this crisis, as well as our commitment to helping the most vulnerable and those on low incomes. Let me add that it would not have been possible to provide that support without the dedication of thousands of workers in the Department for Work and Pensions and on the frontline in jobcentres around the country. Let me echo the remarks of the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Colchester, the Minister for welfare delivery, by pointing out how well the universal credit system has coped with the enormous increase in claimants over the past months, a point recognised quite rightly by my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb), my hon. Friend the Member for Brecon and Radnorshire (Fay Jones)—I am sure colleagues will join me in wishing her a happy birthday—and my hon. Friend the Member for Gedling (Tom Randall).
Despite immense pressures, payments have still been issued swiftly and efficiently to millions of people through the universal credit system. It is clear that every Member of this House is concerned for the financial wellbeing of families and individuals in their constituencies and across the country. That has been reflected in the remarks from all sides of the House during the course of the debate. The Government, too, are acutely aware of the challenges people face. That is why we have spent £280 billion in response to covid, reflecting the Government’s and the Chancellor’s commitment to support individuals, businesses and our public services. As such, we will not move an amendment to this debate.
The list of Members currently certified as eligible for a proxy vote, and of the Members nominated as their proxy, is published at the end of today’s debates.
That this House believes that the Government should stop the planned cut in Universal Credit and Working Tax Credit in April and give certainty today to the six million families for whom it is worth an extra £1,000 a year.
On a point of order, Madam Deputy Speaker. My apologies to the right hon. Member for Warley (John Spellar) and the hon. Member for Sheffield, Brightside and Hillsborough (Gill Furniss) for not being able to give them prior notice of my point of order because they were on telling duty. I was concerned, at the calling of that Division, that the advent of face masks in the Chamber may have disguised a member or two of the Opposition Whips Office shouting opposition to their own motion, thus rendering redundant the idea that the vote should follow the voice. Could you advise me further on that, Madam Deputy Speaker?
I thank the hon. Gentleman for that point of order. Nothing disorderly has happened. There was a shout of “Aye” and a shout of “No”, and Tellers were put in when I put the question again. I am sure that he is not questioning my judgment. Nothing disorderly has happened, and the vote took place in the proper manner.
I will now suspend the House for three minutes in order to enable the arrangements necessary for the next business to be made.