Benefit Changes: Vulnerable People

Baroness Buscombe Excerpts

Thursday 27th June 2019 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, I thank the noble Baroness, Baroness Janke, for securing this debate, and I thank all those who have contributed on this important issue. I am particularly pleased that the noble Lord, Lord Kirkwood, is back in his place.

I shall go through this at a bit of a canter because there are a lot of questions and points to cover, so I ask your Lordships to forgive me for talking rather fast.

This Government’s ambitious welfare reforms are driven by our firm conviction that the benefits system must work with the tax system and the labour market to support people into employment and higher pay. This is the only way to deliver a sustainable, long-term solution to poverty, and it is also the best way of giving everyone the chance to succeed and to share in the benefits of a strong economy.

Our record on employment is therefore vital to our success in helping people out of poverty, and we are rightly proud of it. There are now over 3.6 million more people in work compared with 2010. Unemployment is at its lowest rate since the 1970s, having fallen by more than half since 2010, and this has not just happened in London and the south-east: more than 60% of the employment growth since 2010 has occurred in other parts of the UK.

Importantly, around three-quarters of the growth in employment since 2010 has been in full-time work, which, as the evidence shows, substantially reduces the risk of poverty. Wages have consistently outpaced inflation for 15 months—in fact, they are growing at their fastest rate for a decade—and the growth in employment rates has overwhelmingly benefited the poorest 20% of households. Household income inequality is also lower than it was in 2010.

Of course, behind these statistics are people whose mental health and well-being are improved by moving into work and having the dignity and security that that brings. Indeed, 930,000 more disabled people are in work today compared with five years ago, and there are 667,000 more children in working households compared with 2010. Not only are these children less likely to grow up in poverty but their life chances are significantly better. The evidence on this is very clear.

A working-age adult living in a household where every adult is working is about six times less likely to be in relative poverty than one living in a household where nobody works, and a child living in a household where every adult is working is about five times less likely to be in relative poverty than a child in a household where nobody works. Children in workless households are twice as likely to fail at all stages of their education as children in working families. Full-time work in particular dramatically reduces the risk of being in poverty. There is only a 7% chance of a child being in relative poverty if both parents work full-time, compared with 66% for two-parent families with only part-time work.

Universal credit is of course at the heart of our reforms. It is a benefit fit for the 21st century that will remove the structural disincentives to work that were part of the legacy benefits that it replaces. It supports those who need it while providing a springboard into work—every extra hour worked is rewarded and each claimant receives tailored support from a work coach to help them find the right job for their circumstances. I would like to issue a challenge to the noble Lord, Lord Greaves. I invite him to come with me to a Jobcentre Plus, where I will show him a very different world. The “plus” is about the fantastic wraparound support that our staff give.

As the noble Lord, Lord Kirkwood, quite rightly said, mistakes will always be made; we are dealing with 7 million people. Some 1,500 iterative changes in just the last few months show that we are constantly listening and learning. As the noble Lord, Lord Shipley, said, we need a lot of changes—but we are making them and responding. Once fully rolled out, universal credit will cost £2.1 billion more per year than the legacy system it replaces. The Joseph Rowntree Foundation has reported that universal credit is likely to help an extra 300,000 members of working families out of poverty, the majority of which include someone who works part-time.

We have responded to concerns about the early rollout of universal credit by making a number of changes, as I have said. These include changes to remove waiting days, make bigger advance payments available and give extra support to disabled people. In the last Budget we announced a £4.5 billion cash boost that will make a huge difference to the lives of working families. Some of this has not yet filtered through, but it will provide extra support for people moving onto UC. In particular, we have put an extra £1.7 billion a year into work allowances, increasing the amount that hard-working families can earn before the taper is applied. So I cannot agree with the noble Lord, Lord Livermore. There is an incentive to work more; we are making work pay. This means an extra £630 a year for 2.4 million families.

We fully recognise that some claimants lack the digital skills they need to fully engage with a modern system. This is why we offer tailored, UK-wide, practical support to help ensure people receive their first payment on time when they make a new UC claim. Since April, we have partnered with Citizens Advice and Citizens Advice Scotland to introduce Help to Claim, a voluntary service which can be accessed any time until the first full, correct payment of UC is made. The service is available face to face, over the phone, online and through web chat to allow claimants to access support in the way that is right for them.

At the heart of the support that we offer to working-age claimants is an agreement that they commit to certain activities to improve or maintain their employment prospects, such as looking for work or doing work experience. We believe that it is right in principle that there is a system in place to reinforce conditionality, and to support and encourage claimants to do everything they can to move into or towards work, or to improve their earnings.

However, we have listened and taken action to ensure that the penalties for not meeting these conditions are proportionate, particularly for the most vulnerable. Last month, we announced that financial sanctions—which noble Lords have referenced today—for welfare claimants that last for three years would come to an end, and that in future the maximum duration of a sanction would be six months. In addition, there will be an evaluation of the effectiveness of UC sanctions to consider whether further improvements can be made.

Evidence about the effects of poverty is of course vital to tackling it effectively. We have committed to finding new and better ways to analyse poverty in this country. The Social Metrics Commission’s report, A New Measure of Poverty for the UK, made a compelling case for why we should look at poverty more broadly, to give a more detailed picture of who is poor, their experience of poverty, and their future chances of remaining in or falling into it. So we are working with the Commission and other experts in the field to develop new experimental statistics to measure poverty. These will be published in 2020 and, it is hoped, will help us target support more effectively.

But getting people into work at all costs is not the limit of our ambition. We are absolutely not treating that as a panacea for poverty, as has been suggested. Our reforms are about supporting people in work so that they can progress. The Government recognise that childcare costs can affect parents’ decisions to take up work, increase their working hours or remain in paid work. We are doubling free childcare to 30 hours a week for nearly 400,000 working parents of three and four year-olds and introducing tax-free childcare worth up to £2,000 a year per child.

When people move into work, this Government want to ensure that we do everything we can to support them to progress so that they can increase their earnings and build careers. As the noble Lord, Lord Kirkwood, said, in-work progression is really important. We are working and in discussions with the Trades Union Congress and the CBI on how we can take this forward. We are going further, with two national pilots on in-work progression. One will train work coaches to help those in work to decide when and how to switch jobs and focus on achieving that ambitious step up. The other will boost our capability to work with local businesses by creating jobcentre specialists who can encourage local employers to support progression and good-quality, flexible working.

We know that there is more to do to support working people but this Government have already gone much further than previous Governments, while the Chancellor’s Spring Statement set out the ambition of ending low pay across the UK. Low pay is a key area of this subject. I listened to what the right reverend Prelate said about the two-child policy, and a lot of this is about taking responsibility in the same way as those who make really tough decisions about whether or not they can afford to have more children. We have to think about low pay. I think about the Church and other religious institutions that rely on thousands of people who work as volunteers. What are they actually living on? Are they actually being paid, and are they being paid the living wage? This is something where we must all look to our own institutions and places of work and work out what we are doing to ensure that those people for whom we are responsible are properly supported.

Universal credit works alongside other policies introduced by this Government to promote full-time employment as the way out of poverty and towards financial independence. Our national living wage, which is among the highest in the world, is expected to benefit over 1.7 million people. The increase to £8.21 from April this year will increase a full-time worker’s annual pay by over £2,750 since 2016. Our tax changes will make basic-rate taxpayers over £1,200 better off from April compared to April 2010. Taken together, the most recent changes mean that from April a single person on the national living wage will take home over £13,700 a year, which is £4,500 more than in 2009-10. I encourage all those who employ others to look to the national living wage.

The welfare system is not just about providing a financial safety net for those who need it. That is why this Government have taken wider action to support and make a lasting difference to the lives of the most vulnerable, who often face complex barriers to employment. Our department seeks to support and help into work the most vulnerable people in society, people whose ability to work is frustrated by issues such as disrupted education, a history of offending, domestic abuse or insecure housing. We are addressing the barriers specific to different groups and ensuring that universal credit works for all those with complex needs.

Again I reference the noble Lord, Lord Kirkwood. He talked about how we can do more to recognise. That is something that we are working on: we are adding more to the software so that we can recognise people with different needs. In response to the noble Baroness, Lady Armstrong, on the whole question of those sex survivors and so on, they absolutely need bespoke support.

In jobcentres, work coaches are upskilled to recognise and help claimants with a wide range of complex needs. It is easy to underestimate the great work that our work coaches do to support our more vulnerable claimants. There are so many positive stories to tell; in contrast to the noble Lord, Lord Greaves, I do not have time to tell those tales today, but we have worked hard to build trust with these claimants to help them to turn their lives around.

Over 12,000 young people leave care each year and their education, health and employment prospects are poorer than their peers’. By supporting care leavers through their difficult transition into adulthood with a series of safeguards and easements, work coaches can have a real impact on a young person’s life chances. We are also doing more to support ex-offenders in re-establishing themselves back in the community and moving into work, with around 135 prison work coaches based in resettlement prisons across Great Britain who help prisoners to gain employment on release and support benefit claims pre-release. Those work coaches are going in to talk to those in prison five weeks before their release but we are now looking to extend that, possibly to 12 or 13 weeks, so that we can really build a relationship with these people who are particularly vulnerable and help them through the process of ensuring that they have housing and support, and we can help them to think about a future with a job before they leave prison.

We have a proud record when it comes to supporting victims of domestic abuse. Those affected can have their work-search requirements suspended for up to six months under universal credit to enable them to stabilise their lives. By the end of the summer we will have a domestic abuse and homelessness advocate in every jobcentre in England. They will be able to build work coach capability in these areas and make important links with organisations in the community. We recently published two guides outlining the wide-ranging support offer for those experiencing homelessness. For example, you do not need a permanent address or ID to make a claim for universal credit.

With particular reference to survivors of domestic abuse, we are committed to providing the best possible support for all our claimants, including the most vulnerable in society. This includes those who are or have been victims of domestic abuse. As it can be difficult for individuals facing abuse to come forward, all work coaches now undergo mandatory training in how to support vulnerable claimants, including the recognition of signs of such abuse. By the summer of 2019 we will have implemented such a domestic abuse specialist in every jobcentre to further raise awareness of domestic abuse and support work coaches.

I commend the work of the noble Baroness, Lady Armstrong, on Changing Lives. We are listening and learning all the time. We absolutely accept that we have more to learn and focus on. We are looking at the issue of separate payments, for example. We must be aware—and we are doing work on this at the moment—that eight out of 10 claimants are very happy to receive just the one payment from universal credit and that 97% of couples pool their resources. To make a blanket change across the system, which looks as though it would not suit the vast majority of claimants, would be a big and possibly retrograde step. We are therefore looking at other ways in which we can support these women.

Furthermore, we are considering what more we could do to ensure that the main carer more often receives the UC payment direct, although they can actually ask for it. The initial work on this area will be completed this year and will improve the claimant messaging on the service to encourage claimants and joint claimants to utilise the bank account of the main carer to receive their UC payments. I repeat, however, that there is work in progress in this area.

Noble Lords made reference to various reports, including the IFS report, which touched on housing. We delivered over 220,000 additional homes last year. That is over 1.3 million extra homes in England since 2010. We are looking at what we can do cross-government —we have a cross-departmental project on this—to tackle the huge cost of housing benefit. Yes, it is £23 billion a year, much of it going to private landlords. We are ambitious about doing more on this huge issue.

We welcome, however, what came out last week in the IFS report, which stated that while poverty is complex and does not have an easy answer, there are two positive reasons which account for two-thirds of the increase in in-work poverty rates. One reason that a higher fraction of those on the lowest incomes are in work is simply that there are more people in work overall and far fewer workless households. This is something that Paul Johnson of the IFS, writing in the Times, described as,

“a triumph that we celebrate all too infrequently”.

The other reason is that far fewer pensioners are poor than ever before.

I will move on as quickly as I can, because my time is running out. We are continuing to listen and learn. The noble Lord, Lord Livermore, talked about tax credits as being a good idea, but they propelled many claimants into higher tax rates such that they have spiralling debts as a result. Also, in 2010, 20% of all UK working-age households were entirely workless, which was not a great record.

On the two-child policy, as I said, this policy ensures fairness between those supporting themselves solely through work and those receiving benefits. Let us not forget they also continue to receive child benefit, no matter how many children.

On the questions raised by the noble Lord, Lord Low, and the noble Baroness, Lady Thomas of Winchester, we are looking at the workplace assessments quite carefully and at PIP to see how we can make it simpler, easier, more straightforward and fairer. I also say to the noble Lord, Lord Low, that we are doing a lot on accessibility. In fact, two weeks ago I was lucky enough to be in New York with a wonderful man called Victor, who is in charge of accessibility for New York City. What they are doing there is incredible. We were sharing intelligence on more things that we can do to assist people with disabilities, including those without sight.

I now have to wind up. There is so much more that I would like to say, but I conclude by saying that we are not complacent about the challenges we face for those people on the lowest incomes and those who are particularly vulnerable. We constantly make progress, but we also constantly want to listen and to learn. We are spending a record £220 billion this year on welfare. I am proud of the work our department is doing, and I am grateful to all noble Lords who have taken part in the debate.

Poverty and Human Rights: UN Report

Baroness Buscombe Excerpts

Tuesday 25th June 2019 Lords Chamber

[Baroness Lister of Burtersett]

To ask Her Majesty’s Government what steps they are taking to address the concerns raised by the report of the United Nation’s special rapporteur on extreme poverty and human rights on his visit to the United Kingdom, published on 22 May.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, nothing has changed since I answered exactly the same Question on this issue last week, when it was asked by the noble Baroness, Lady Janke. We have responded fully to the special rapporteur’s recommendations and will continue to reform the welfare system so that it encourages work while supporting those who need help—an approach based on clear evidence that work offers families the best opportunity to get out of poverty.

[Baroness Lister of Burtersett (Lab)]

My Lords, the Government have previously dismissed the report as “nonsense”, “barely believable” and “inaccurate”, and have effectively rejected virtually all its recommendations. Yet, as was pointed out in this House last week, the DWP’s lead poverty official has acknowledged that it “made … good points” and was “factually correct”. One of those facts was the highly regressive impact of tax and benefit changes since 2010, which,

“have taken the highest toll on those least able to bear it”.

Will the Government therefore look again at the recommendation that requests that the NAO assess the cumulative social impact of those policies, especially on those in vulnerable circumstances, which independent experts have shown can be done?

[Baroness Buscombe]

My Lords, it is right that any Government are held to account for the effectiveness of their approach to tackling poverty, which was always one of our key priorities. While we take every report of this nature incredibly seriously, and recognise that there is more to do—as we always do—we remain disappointed by the overtly political tone of the report and strongly refute the suggestion that we have taken a deliberately punitive approach to welfare reforms. This year we will be spending £220 billion on welfare.

[Lord Robathan (Con)]

My Lords, not every assertion that comes from the United Nations should be taken at face value, any more than an assertion that comes from the Government or indeed from government agencies. But Philip Alston describes himself as left wing and then describes life for the poor as akin to a Dickensian workhouse. Can my noble friend tell me why, if this is the case, so many people are queueing up to come and live the awful life in this country?

--- Later in debate ---

[Baroness Buscombe]

My noble friend makes a very good point. We are in very good shape in this country and we deliver the fourth most generous level of welfare support in the OECD. We spend more on family benefits than any other country in the G7, and as a share of our GDP, our public spending on family benefits is the second highest in the OECD. We continue to listen and learn, but we are also very proud of what this Government are delivering.

[Baroness Corston (Lab)]

My Lords—

[Baroness Thornhill (LD)]

My Lords, I draw the Minister’s attention to recommendation (e) in the report, which I hope is less contentious. It mentions the importance of the Government getting the new fairer funding review correct, as it affects every council’s ability to plan and provide for services for the most vulnerable and poorest in society. Can she update the House on progress with that important review, because at the moment, councils do not know how much funding they will get from 2020, how it will be distributed and the means of delivery?

[Baroness Buscombe]

I have to tell the noble Baroness that that is not exactly my area, but I will take away what she asked. It is important to say that we are doing all we can to ensure that we are delivering more from our services and continue to increase spending—certainly from the Department for Work and Pensions—to support those in need.

[Baroness Corston]

My Lords—

--- Later in debate ---

[Baroness Meacher]

Thank you, Chief Whip. One of the causes of abject poverty of the most vulnerable is of course the work capability assessment. One of the creators of that assessment has declared it unfit for purpose. It denies severely disabled people benefits when they have no—but no—prospect of work. What plans do the Government have to review the model of the work capability assessment?

[Baroness Buscombe]

I am pleased to report that we are looking at that very point at the moment and are about to carry out a pilot for a much easier work capability assessment, which will mean that people do not have to have repeats or assessments for different things. That is something we are taking on board very seriously.

[Baroness Corston]

My Lords, given the Minister’s dismissive reaction to the UN report, can she explain why, for the first time in the history of the welfare state, teachers are bringing food into schools because so many children are too hungry to learn?

--- Later in debate ---

[Baroness Buscombe]

My Lords, I am not dismissive of the report overall but I am dismissive of the UN rapporteur’s approach, which was very unhelpful. We are doing an awful lot to support children in schools, with breakfast clubs and so on. We are also spending a lot more on family benefits to make sure that children are properly fed. However, we can always do more and we take poverty seriously.

[Lord Kirkhope of Harrogate (Con)]

My Lords, does my noble friend agree that it is important for us to recognise that many good reports come from the United Nations on all manner of areas for which it is responsible, and that it is therefore rather unfortunate that this report was not objective in the normal way that we would expect of the United Nations? Does she agree that this should be drawn to the attention of the UN through our usual channels there?

[Baroness Buscombe]

My Lords, I am extremely grateful to my noble friend for what he says. I have just been at the United Nations in New York, representing Her Majesty’s Government at a disability conference. Time and again, Ministers and commissioners—everyone involved with the UN—said that they do not recognise this report. Much that the United Nations does is brilliant but I am grateful to my noble friend for suggesting that sometimes, as in this case, its reports are not as objective as they should be.

Extreme Poverty and Human Rights: United Nations Report

Baroness Buscombe Excerpts

Wednesday 19th June 2019 Lords Chamber

[Baroness Janke]

To ask Her Majesty’s Government what steps they are taking to address the findings of the report of the United Nations Special Rapporteur on extreme poverty and human rights, published on 22 May.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, we have responded fully to the special rapporteur’s recommendations. A sustainable solution to poverty needs a strong economy and a benefits system that works with the tax system and the labour market to support employment and higher pay. Under this Government, employment is at its highest level since the 1970s. Wages are rising at their fastest in a decade. Income inequality has fallen. The number of children in workless households is at a record low.

[Baroness Janke (LD)]

The evidence in the report is from widely respected sources: one-third of children are in poverty—the Social Metrics Commission; 50% of children in one-parent families are in poverty—the Joseph Rowntree Foundation; the bottom 20% of earners will have lost 10% of their income by 2021—the Equality and Human Rights Commission. Is it not time that the Government listened to the poor and their charities and restored a social safety net worthy of the UK in the 21st century?

[Baroness Buscombe]

My Lords, nobody wants to see poverty rising and we treat the issues raised by the special rapporteur seriously. However, we seriously regret the inflammatory and overtly political tone of his report and strongly refute the suggestion that we have failed to listen to stakeholders. As set out in our published response, we have taken action in a number of areas, including the recently announced reduction in the maximum duration for a single sanction from three years to six months.

[Baroness Bryan of Partick (Lab)]

My Lords, the rapporteur drew specific attention to the plight of women born in the 1950s, who have been particularly impacted by the “abrupt and poorly” phased in change to the pension age. Does the Minister accept that these women should be compensated for the loss they have experienced?

[Baroness Buscombe]

My Lords, I believe in equality. Some of the rapporteur’s recommendations show a rather myopic understanding of universal credit. When I broached the subject of this report while representing Her Majesty’s Government at the UN last week, it was clear that everyone who knew about it was keen to distance themselves from it, preferring to compliment this Government on, “Groundbreaking, exemplary and world-leading policies in the area of work and pensions.”

[The Lord Bishop of Leeds]

My Lords, if the success is so great, why are so many schools in my diocese having to feed children, and why does almost every parish contribute to food banks?

[Baroness Buscombe]

My Lords, we have done an enormous amount to tackle poverty since we came into government. We have invested huge sums of additional money into developing a welfare system that encourages people into work and supports them in work and with progression in their jobs, so that they can better provide, because we know that the best way to get out of poverty and save children from it is to work. As the IFS said today:

“Absolute poverty remains at its lowest ever level”.

[Lord Harries of Pentregarth (CB)]

Will the Minister comment specifically on Wales? The report says:

“Wales faces the highest relative poverty rate in the United Kingdom, with almost one in four people living in relative income poverty. Twenty-five per cent of jobs pay below minimum wage”.

[Baroness Buscombe]

My Lords, we are tackling poverty across the country. I refer noble Lords to the leader article in the Times of 25 May:

“The failings of Mr Alston’s report are legion … it is padded out with such accusations as that the government evinces a ‘punitive, mean-spirited and often callous approach’”.


This is the Times. It said, “This is nonsense”. It goes on:

“yet poverty in this sense does not exist in Britain in the 21st century”.

We are responding to reports with care but, in all seriousness, we must say that many things in this report are exaggerated and inflammatory.

[Baroness Sherlock (Lab)]

My Lords, perhaps I may offer the Minister a quote about the report:

“we did a fact check of that report. He made a lot of good points. It was factually correct … in terms of the facts, of austerity, cuts to local government funding, of the reliance that we have on the labour market and the risk that we face if there was a recession, all of those things were really good points that we have taken on board”.

That is a quote from the policy director for children, families and disadvantage at the DWP, giving evidence to the Work and Pensions Select Committee last week.

Given that we have received not just this report but one after another showing that families on low incomes are really struggling, and given the crucial point made by the right reverend Prelate the Bishop of Leeds that families are turning up at food banks all over the country, working parents are going to food banks and schools are feeding hungry children, something is going wrong. Please will the Minister look again at this?

[Baroness Buscombe]

My Lords, we continue to listen and to learn. The Government continue to spend more than £95 billion a year on benefits for people of working age. I say again, as I have said so many times before, that when the party opposite were in government, 20% of all working-age households in the United Kingdom—including Wales—were entirely workless. We have brought that figure down to 13.9% and we want to bring it down much further, but there are many different ways in which we are making a difference, listening and investing more money in real terms into the system to support and encourage people into the world of work and support those who cannot work.

[Baroness Boothroyd (CB)]

The right reverend Prelate asked a direct and interesting question. Will the Minister answer it?

[Baroness Buscombe]

I have answered it. We have listened; we have taken the questions and statements of the rapporteur very seriously. We do not accept, in the words of people at the United Nations last week, the political scaremongering, the hyperbole, the inflammatory and scaremongering approach to the whole subject. It is not helpful from someone who was not keen to engage with our officials.

Children Living in Poverty

Baroness Buscombe Excerpts

Monday 17th June 2019 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

On behalf of my noble friend Lady Primarolo, and with her permission, I beg leave to ask the Question standing in her name on the Order Paper.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, there are 1.7 million children in families where at least one adult is in work in absolute poverty, before housing costs. However, the evidence shows that nearly half of these families are in part-time work or are self-employed. A child living in a household where every adult is working is about five times less likely to be in relative poverty than a child in a household where nobody works. This shows that work is the best route out of poverty.

[Baroness Lister of Burtersett]

My Lords, I beg to differ that these figures show that work is the best route out of poverty, which is a message that the Government repeatedly tell us. How do they account for the fact that seven in 10 children in poverty have a working parent, up from just over half at the point they first took power? In particular, what assessment have they made of the impact on current and future levels of child poverty of their cuts to in-work benefits and tax credits?

[Baroness Buscombe]

My Lords, the statistics expressed by the noble Baroness do not reflect the £1.7 billion a year cash boost to our welfare system announced in the Budget, which will enable 2.4 million households to keep more of what they earn. We have taken strong action to support working families. The latest rise in the national living wage will increase a full-time worker’s annual pay by over £2,750 since 2016. No one wants to see poverty increase. That is why we are doing more to help parents into work and to stay in work through multiple avenues of support from across government.

[Baroness Janke (LD)]

My Lords, the Social Metrics Commission found that in 2018 almost a third of children were in poverty. The Joseph Rowntree Foundation found that child poverty has been rising almost entirely in working families. What action will the Government take to ensure that children are not disadvantaged? Will they consider in the comprehensive spending review ending the benefits freeze and the two-child limit?

[Baroness Buscombe]

My Lords, I have already made it clear at this Dispatch Box that we intend to end the benefit freeze next year. Again, the stats produced by the Social Metrics Commission last year predate much of the additional support that we have invested in the system since the last Autumn Budget.

We have done a huge amount to help families through transforming the welfare system so that people are not just helped into work. We are working hard on in-work progression, so that people preferably do not just have a full-time job—three-quarters of all jobs since 2010 are full time—because we want people to have good jobs, and are piloting new ways of supporting that. We are also boosting our capability to work with local businesses and working with jobcentre specialists to encourage local employers to support progression and good-quality flexible working which will support the children of those families in work.

[Baroness Sherlock (Lab)]

My Lords, the Minister has talked a lot about what the Government are doing to help people in jobs, but if the aim is to get families out of poverty, it is not working. The facts are clear: people are simply moving from one kind of poverty into another—that is, from out-of-work poverty into in-work poverty. The impact on children is very serious. Did the Minister see the recent research in the Archives of Disease in Childhood showing that child poverty has not only risen but will rise further? It looked at the impact on children of being in poverty in childhood and found that those in “persistent poverty” were three times as likely to have mental health problems and twice as likely to have a long-standing illness. The president of the Institute of Child Health said that we need,

“national targets to reduce child poverty backed by a national child poverty strategy, the reversal of cuts to universal credit and the reversal of public health cuts”.

Does the Minister agree?

[Baroness Buscombe]

My Lords, again, we are doing a huge amount, quite a lot of which is not reported or reflected in the additional support we have injected. I have just returned from the G7 in Paris, where we focused on labour. There is no question that, across the world, the changing world of work presents challenges. We are at the forefront on this issue; other countries look to us. Our living wage is way in excess of what other countries afford their citizens. We are setting an example and achieving a huge amount in having a transformational system that helps people into work, pays them to work and gives them in-work progression. Let me give an example: a couple with three children need to work for a total of only 24 hours per week to be exempted from the benefit cap; they can then receive from the state the equivalent of a £35,000 gross salary a year, plus housing support. That is not ungenerous.

[Baroness Jenkin of Kennington (Con)]

My Lords, does the Minister welcome the recent weekly earnings increase?

[Baroness Buscombe]

Absolutely. The increase in weekly earnings makes a huge difference. Tackling poverty will always be a priority for this Government; they have lifted 400,000 people out of absolute poverty since the party opposite was in government. Inequality has fallen. Our reforms have made sure—this is important—that our welfare system encourages people into work, but is also fairer for the taxpayer and sustainable for the future.

Housing: Pensions and Deposits

Baroness Buscombe Excerpts

Wednesday 5th June 2019 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty's Government what plans they have to allow individuals to use accrued pension savings to fund first time home deposits.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, the Government have no plans to change access to accrued pension savings. Automatic enrolment has transformed pension participation, with over 10 million people enrolled in workplace schemes. We will build on these reforms. We are also committed to helping people realise their aspiration to own their own home. Since 2010, over half a million people have been helped to purchase a home through government-backed schemes including Help to Buy.

[Lord Kennedy of Southwark (Lab Co-op)]

When I read about this proposal, I thought it was ill-thought-out and damaging. Does the noble Baroness agree that people need to plan carefully for their retirement, to ensure they have an adequate income? If this idea ever came to fruition, it is likely that it would push up house prices and leave people worse off regarding their expected retirement income.

[Baroness Buscombe]

I entirely agree with the noble Lord that we must think carefully about how we encourage and support people to save for the long term and their retirement. That is why we are so pleased about the success of auto-enrolment. Our priority remains establishing long-term savings behaviour, so that people are enabled to save for greater security. Automatic enrolment has already reversed the decline in workplace pension savings seen in the decade prior to its introduction, and the number of first-time home buyers is at its highest level for 11 years.

[Baroness Thomas of Winchester (LD)]

My Lords, could the Minister clarify whether the average 35 year-old has put £35,000 into a pension pot, or whether the figure is much lower, as statistics showed a few years ago? It is very good news that we are not going to risk young people completely emptying their pension pots in a desperate attempt to get on to the housing ladder. Of course, this is another reason why more affordable housing is desperately needed.

--- Later in debate ---

[Baroness Buscombe]

I entirely agree with the noble Baroness that one of our key concerns is to ensure that we encourage this culture of young people saving for their retirement. Of course, we do not want to do anything which would expedite them getting into financial difficulty by accessing their pension pots early. We are very excited by young people’s level of uptake of the auto-enrolment pension scheme. Our ambition and aim is to do anything we can to support them and to build more affordable homes.

[Lord Tebbit (Con)]

My Lords, would my noble friend not agree that the problem in the housing market is a shortage not of money, but of houses? If we do anything at all to put more money into the market before we have dealt with the problems of planning consents and got the houses built, we will only inflate the prices of houses even more.

[Baroness Buscombe]

I do agree. I am sorry that I am not the Housing Minister answering this Question, but it is important that we are committed to ensuring the housing market works for everyone. Of course, there is more to do. That is why we have announced an extra £17 billion in funding for Help to Buy since 2017 and reformed stamp duty so that 80% of first-time buyers will not pay tax. We are absolutely on a track that does not mean an increase in house prices. The important thing is that we focus on supporting first-time buyers. The number of first-time buyers is at an 11-year annual high.

[Baroness Sherlock (Lab)]

My Lords, I agree with the noble Lord, Lord Tebbit.

[Baroness Sherlock]

There is a first time for everything. When I read about this, like my noble friend Lord Kennedy I initially wondered whether it was April Fools’ Day. The Minister in charge of housing has a wheeze whereby young people should raid their pension pots to fund the deposit on a new house. I can immediately see three things wrong with this. First, frankly, most young people do not have enough money to put a deposit on a flat to rent—there is certainly not enough for fish and chips afterwards. Secondly, if they have enough money in their pension pots it should stay there, otherwise they will not have anything to retire on. Thirdly, as my new friend, the noble Lord, Lord Tebbit, points out, this will drive up the cost of housing. Given all that, and given that the DWP has had a multi-million-pound advertising campaign to encourage younger people to save, what will happen to James Brokenshire?

[Baroness Buscombe]

My Lords, I am very grateful that the noble Baroness has formed a new friendship over this topical Question. In short, our focus in the Department for Work and Pensions is on ensuring we support young people in every way we can to save for the long-term, for their retirement and security. I have to say to noble Lords opposite that, if they feel as I do, perhaps it is not right that we should be giving so much oxygen to this idea in the House of Lords.

[Lord Lea of Crondall (Lab)]

On the question of the role of land in house prices going up, is not one of the requirements of a sensible policy that the land value increase does not all stay in the pockets of the people who are sitting on this land, which could be given planning permission? That would help the Exchequer in other aspects of public finance.

[Baroness Buscombe]

My Lords, as I said, I am not the Housing Minister, but I will say this. Clearly, we must be very careful about how we develop our policies in this area. The reality is that our schemes are working. We are building a record number of homes. The latest evaluation has found that there is no evidence of a significant impact on house prices overall. The Help to Buy scheme is a hugely important part of that. There is no question of us supporting any scheme that would mean excess profits in the wrong hands.

Child Poverty

Baroness Buscombe Excerpts

Tuesday 21st May 2019 Lords Chamber

[Baroness Janke]

To ask Her Majesty’s Government what steps they are taking to address the concerns raised by teachers in, and the findings of, the survey on child poverty published by the National Education Union on 14 April.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, the Government are committed to a sustainable solution to poverty so that we can improve children’s long-term outcomes. This means a strong economy and a benefits system that supports employment and higher pay. Children in households where all the adults are working are around five times less likely to be in poverty than those in workless households. However, 13.9% of all UK working-age households are still entirely workless and we are working hard to reduce that figure.

[Baroness Janke (LD)]

Perhaps I may ask the Minister to give her response to the experiences of teachers reported in the survey: “Children are attending school not only hungry but with no coats and holes in their shoes”, and “Children are just not ready to learn. They are embarrassed and ashamed”. There are many more quotes along these lines. Does she endorse the recent findings of the Social Mobility Commission that inequality will remain entrenched in the UK “from birth to work” unless the Government take urgent action?

[Baroness Buscombe]

My Lords, of course we take the issue of poverty very seriously, although inequality has fallen. Tackling disadvantage will always be a priority for this Government. We have already taken steps to tackle food inequality by providing free school meals and our Healthy Start vouchers. We are also investing up to £26 million in school breakfast clubs along with £9 million to provide meals and activities for thousands of disadvantaged children during the summer holidays, which is something that has not been done before. We continue to spend more than £95 billion a year on working-age welfare benefits.

[Lord Bird (CB)]

My Lords, if we were to tackle the low-wage economy and the low social security economy that goes with it, we would lift people out of poverty. There is no way that young people can go to school and lead a full life if their parents are on, at best, between £5 and £9 an hour.

[Baroness Buscombe]

My Lords, we have taken strong action to support working families. We now have the national living wage and so on, but I agree entirely with the noble Lord that it is incredibly important to look closely at low pay and issues around debt. The Government are doing this, and indeed it is something that is close to my heart. Sometimes debt goes to the heart of why people are in poverty. We need to get much closer to this issue and in the coming months we will be introducing a breathing space to help people out of debt. We are also keen to ensure that children learn how to cope with money because that, as well as a low-wage economy, is often at the core of where things go wrong.

[Baroness Lister of Burtersett (Lab)]

My Lords, evidence from teachers, civil society organisations—including, just yesterday, Human Rights Watch—and children themselves on the impact of poverty, aggravated by social security cuts, on children’s learning, health and well-being is shameful and heartbreaking. This impact is not captured by the official poverty statistics, so what steps will the Government take to measure the impact of their policies on the depth of child poverty in and out of work? This and other evidence suggests that their policies are pushing children further and further below the poverty line.

[Baroness Buscombe]

My Lords, I cannot agree with the noble Baroness that our policies are doing that; in fact, they are doing precisely the opposite. We have increased in an enormous number of ways the support—not just financial but practical—we give to children in low-income families. Indeed, the previous Question illustrates that. On how we measure poverty, the noble Baroness is right: we should debate, and have debated, looking at how we measure poverty. That is why on 17 May the Minister for Family Support, Housing and Child Maintenance announced that new experimental statistics to measure poverty will be developed, working with the Social Metrics Commission and published by DWP in 2020. We are looking to rethink the measures of poverty.

[Lord Farmer (Con)]

My Lords, while the survey findings are challenging, there are clearly additional factors at play—not simply a lack of money. A comment highlighted in the report and likely representative of many others is that:

“Their social and emotional needs are not being met and this is having detrimental effects on their learning and behaviour”.


We cannot assume that this is wholly due to long working hours. What are HM Government doing to ensure that parents struggling to nurture their children are given early help?

[Baroness Buscombe]

My Lords, I pay tribute to my noble friend Lord Farmer for the enormous amount of work he has done and continues to do so selflessly in this area. He is absolutely right: this is not just about money. The truth is that support for the family structure is critical. Parents play a critical role in giving children the experiences and skills they need to succeed. Children exposed to parental conflict can suffer long-term harm. That is why we have introduced a new Reducing Parental Conflict programme, backed by up to £30 million. This programme will encourage councils across England to integrate services and approaches that address parental conflict into their local services for families.

[The Lord Bishop of Winchester]

My Lords, in a recent poll of teachers in England, 46% reported that holiday hunger had increased over the last three years. In my diocese, in Southampton alone 37% of children—many of whom are in working families—are living in relative poverty; that is, below the 60% median income line. Despite what she has already said, can the Minister give assurances that the Government will commit to reviewing their policies to reverse the rise in child poverty?

[Baroness Buscombe]

My Lords, the right reverend Prelate referenced holidays, which is a really important issue because children are outside school protection. In 2018 the Government announced a programme of work to explore how best to ensure that disadvantaged young people can access healthy food and enriching activities over the school holidays. This included awarding contracts to seven organisations to deliver free healthy food and activities to children and families in some of the most disadvantaged areas during the 2018 holidays. This year the funding will be more than quadrupled, and we want to strengthen the programme to encourage co-ordination in local communities so that even more disadvantaged children can benefit from high-quality provision during the summer holidays.

Severe Disability Premium: Transfer to Universal Credit

Baroness Buscombe Excerpts

Tuesday 7th May 2019 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer given by my honourable friend the Minister for Disabled People, Health and Work to an Urgent Question in another place on the transfer of the severe disability premium to universal credit. The Statement is as follows:

“Universal credit is the biggest change of the welfare system since it was created. It is a modern, flexible, personalised benefit reflecting the rapidly changing world of work. When designing universal credit, a choice was made not to replicate every aspect of the disability provision in the legacy system. However, I want to make it very clear that our intention was that no money from this area would be taken out of the system. Universal credit was therefore designed with all the money from the old disability premiums recycled to target support for the most severely disabled.

Disabled people are some of the biggest beneficiaries of universal credit, with around 1 million disabled households having on average around £100 a month more on universal credit than they would have had on the legacy benefits. On Friday, the High Court handed down a judgment in relation to universal credit and the severe disability premium. The severe disability premium—SDP—is an additional premium payable with mean-tested benefits such as ESA. Universal credit is more targeted and support is focused on those who need it most. Transitional protection will be available for people who are moved on to universal credit from other benefits, provided their circumstances stay the same.

We are pleased that the court recognises that it is for Ministers to frame the appropriate transitional arrangements for moving claimants on to universal credit, and we will consider all our options. This Government are committed to delivering a welfare system that supports disabled people”.

[Lord McKenzie of Luton (Lab)]

My Lords, I thank the Minister for repeating the Answer to the Urgent Question. On their flagship social security policy, the Government have yet again found themselves before the courts, subject to a judgment of illegality, and mired in complexity.

As we have heard, on 7 June last year the Government pledged that severe disability premium claimants would no longer have to transfer to universal credit until managed migration started. Yet for months afterwards, they were still required to do this until the Government finally introduced the statutory instrument that came into force on 16 January. In the interim, because the severe disability premium does not exist in universal credit, in transferring they have lost about £180 per month. The Government plan to pay them only £80 a month in compensation, but if they were to move under managed migration, transitional protection would cover the full amount. Little wonder the High Court said in its damning judgment on Friday that this had no logical foundation. Payments to former SDP claimants are part of the regulations for the managed migration pilot but the Government have still not scheduled those for debate, so no payments at all have been made.

Will the Government ensure that the payments to former SDP claimants who have transferred to universal credit fully reflect the loss that they have suffered? From what the Minister said in her introduction, I am not sure that that is the commitment that the Government are making. Also, what assessment have they made of the hardship that claimants might have suffered as a result of this loss of income and, in particular, of the impact on their children, who have had to take on additional care responsibilities as a result of their family’s loss of income?

[Baroness Buscombe]

My Lords, as I have already said, Ministers are considering the judgment in detail and will make a decision about their response in due course. When designing universal credit, it was important to provide a simpler system, and a conscious choice was made not to replicate every aspect of disability provision in the legacy system, which contains seven different disability payments. These are difficult to deliver and prone to error, and they can be confusing for claimants. Therefore, we are replacing those seven complex and overlapping disability benefits.

Under the legacy benefit system, 500,000 disabled people did not claim what they were entitled to. Therefore, in terms of families losing out, about £2.4 billion of benefits went unclaimed in the legacy system as a whole. We have now moved to a much fairer system. For example, the rate per month under UC for claimants determined as having limited capability for work and work-related activity is more than twice the amount payable through the equivalent support group component of ESA. Under universal credit, it is now £336.20 per month per household, compared with £167.05 per month through the equivalent ESA support group. This means that around 1 million disabled households will gain an average of £100 more per month on universal credit than on legacy benefits.

[Baroness Thomas of Winchester (LD)]

My Lords, I thank the Minister for repeating the Answer. She said that the Government are considering their options and whether the regulations will have to be rewritten. What about the 10,000 people who are still waiting for the lump-sum payments that they were promised? They will have to wait much longer unless the Government separate the payment regulations from the rest of the managed migration pilot regulations so that the lump-sum payment can be made as soon as possible. Being disabled is very expensive and I expect that people have racked up quite a lot of debt because of this problem. Will the Government undertake a thorough process of evaluation of the effect of universal credit on disabled people?

[Baroness Buscombe]

My Lords, I make it clear that current severe disability premium claimants will receive transitional protection as part of the managed migration process. We now have transitional payments in place for severe disability premium claimants who have moved on to universal credit. As the noble Baroness well knows, we are now spending over £50 billion a year on benefits to support disabled people and those with health conditions, which is over £4 billion more than in 2010. We continue to evaluate the impact of our policies on this system. As the lead Minister for research at the Department for Work and Pensions, I am very clear that we make it our business to evaluate all the policies that we put in place.

[Baroness Lister of Burtersett (Lab)]

My Lords, the Minister said that transitional protection will be available for people moved on to universal credit from other benefits, provided their circumstances stay the same. However, surely natural migration occurs only where circumstances change—sometimes very trivially. As a result, many people are a lot worse off, because they have been transferred on to universal credit, despite the Government’s original claim that nobody would be worse off under universal credit. Will the Government look again at natural migration and pause it to see what can be done to provide transitional protection for this group, who are just being forgotten about?

[Baroness Buscombe]

As the noble Baroness knows, the focus of this Urgent Question is the court case and severe disability payments. We put that block—if I can call it that—in place on 16 January to stop those with a severe disability migrating, and to prevent any more people who are on severe disability premium naturally migrating to universal credit, because we recognise that there is an issue here.

However, to deal with the stock of SDP claimants who have already moved to UC following a change of circumstances, it has been agreed that claimants will be eligible for a transitional SDP payment if they meet the following criteria: that they were eligible for SDP before they claimed UC; that their UC award has not subsequently terminated; that they have not ceased to be entitled to one of the qualifying benefits for the SDP—the middle or higher-rate care component of DLA, the PIP daily living component, the armed forces independence payment or AA; and that no one has become a carer for them. This is focused on that bespoke cohort of individuals the judgment relates to: those who live alone, without a carer.

[Baroness Lister of Burtersett]

Perhaps I might come back, because the Statement talks about people being moved on to universal credit generally. The terrible position of those on SDP is the worst tip of an iceberg, but there are a lot of people underneath it who are losing out because they are being naturally migrated to universal credit—often because of the most trivial changes in circumstances, such as moving house.

[Baroness Buscombe]

My Lords, I am sticking to the Urgent Question—which is about the severe disability premium. However, the reality is that we are looking at that judgment and considering with care the way in which we support those who are transferring naturally to universal credit. It is important that we have the legislation in place as soon as possible, so that in future everybody is manage-migrated, as it were, rather than naturally migrating, which, as the noble Baroness has said, some are at the moment.

Financial Guidance and Claims Act 2018 (Naming and Consequential Amendments) Regulations 2019

Baroness Buscombe Excerpts

Wednesday 1st May 2019 Lords Chamber

As might be apparent, we view this as an extremely important piece of legislation—I think we built on a consensus—and one on which we will at least have to have a watching brief.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, I very much welcome this debate. It has been very good, albeit short, and has covered a number of important issues. It is really timely to reflect on where we have come to since the passing of the Financial Guidance and Claims Act. My memory has constantly been nudged while listing to noble Lords about many of the things we debated, often at length, particularly regarding education. I will do my best to respond to the questions that have been raised.

I will address some of the specific points in due course, but I start by thanking the noble Lord, Lord Stevenson, for moving this Motion. I will take this opportunity to provide your Lordships’ House with an overview of the newly named Money and Pensions Service, what it has done and what it plans to do.

As noble Lords will know, the Financial Guidance and Claims Act 2018 (Naming and Consequential Amendments) Regulations 2019 were laid before this House on 4 March. These regulations came into force on 6 April and renamed the single financial guidance body, provided for in the Financial Guidance and Claims Act 2018, as the Money and Pensions Service. These regulations also made amendments to existing legislation, so that references to the Money Advice Service or the Pensions Advisory Service were either removed or replaced with the Money and Pensions Service.

The launch of the Money and Pensions Service’s new name and brand on 8 April is a very positive development that has been welcomed by experts in this field and by industry. The Department for Work and Pensions is especially pleased that the new name for the single financial guidance body has now been set in legislation. This will ensure that both the body itself and its customers are protected by the criminal power in the Act, which makes it an offence to impersonate the body. That was our key purpose in keeping the name back until after the Act was introduced. We now have safely in place this powerful deterrent to protect customers against fraudulent activity. The new name—the Money and Pensions Service—has been well received. It has been positively noted that references to “advice” and “advisory” no longer feature in the name, which was a particular concern raised by noble Lords during the passage of the Act.

I am pleased to say that work has continued apace since the body was established as a legal entity in early October 2018 on the appointment of the chair, Sir Hector Sants, the chief executive, John Govett, and their executive and non-executive teams. On 1 January, the body began delivery to the public of pensions guidance, money guidance and debt advice. It also took on its consumer protection function, and has since laid out its plans for the development of a national strategy to improve financial capability, an important issue that all noble Lords have touched on this evening.

We were clear during the passage of the Act that we wanted to deliver a seamless transition from the Money Advice Service, the Pensions Advisory Service and Pension Wise to a single organisation, the Money and Pensions Service—which we should call MAPS, as the noble Lord, Lord Stevenson, suggested. I am pleased to confirm that we successfully achieved this with no detriment to the customer. It is, however, important to remember that the new service is going through a period of transition. It is essential that we do not underestimate the scale of transformation it is undertaking. The service needs time to focus its energy and resources on a successful transition, while at the same time building towards its long-term strategy. This was well put by its chief executive, John Govett, who set out that his priority for the year ahead is to, “bring the three” previous,

“organisations into one, and re-focus their efforts to increase the number of people supported by the Money and Pensions Service each year”.

This is a laudable and important goal, but it will take time to get right. I noted particularly that the noble Lord, Lord McKenzie, like myself, is always impatient, and rightly so. However, we need to ensure that there are no unintended consequences of moving too quickly. Exceeding expectations and then finding that the body has forgotten to put things into play to support people and protect their finances would be a mistake.

The service will work closely with the Government throughout, particularly the Department for Work and Pensions and Her Majesty’s Treasury. I say to my noble friend Lady Neville-Rolfe that, yes, I am pleased to report that we are working closely and well with our colleagues at Her Majesty’s Treasury. Part of getting it right is ensuring that the new service is responding in the right way to customers’ needs. That is why, at the Money and Pensions Service’s launch last month, it declared that its mission is to put the customer at the heart of everything it does. Its vision, as spelled out in its first business plan, is to ensure that everyone is,

“making the most of their money and pensions",

and that it is improving financial well being throughout people’s lifetimes and equipping, empowering and enabling individuals to make informed financial decisions with confidence.

I am pleased to inform noble Lords that as part of its transition to full service, MAPS has also announced that it will be undertaking a UK-wide programme of listening events. This is really important. During these events, the service will engage with a wide variety of individuals and organisations, including customers, levy payers, providers, consumer organisations, funders and commissioners and other stakeholders, who will help to frame the future strategy of the service. The insight from the listening phase will help to shape MAPS and its three-year corporate plan, which is due to be published in the autumn.

As well as these listening events, MAPS is starting to deliver on the commitment, set out in the Financial Guidance and Claims Act 2018, to gather evidence and develop trials for how to most effectively and more strongly nudge people to take pensions guidance prior to accessing their pension pot—something we debated at length during the passage of the Bill. This builds on the success of the Pension Wise service, which was set up in 2015 to help people understand the pension options available to them. In its first year, 61,000 Pension Wise guidance sessions were delivered. Last year, this had increased to 167,000 and this year MAPS aims to increase that number to 205,000. Building on this tremendous track record, we expect the new service to nudge people towards guidance earlier and to reach them before they start the pension access decision-making journey. This will ensure that consumers have what they need to make a more informed decision, including about taxes and benefits, and to avoid scams—an important issue that was raised by the noble Baroness, Lady Janke. To this end, we are working with MAPS to test with care what is practically feasible. I thank my noble friend Lady Neville-Rolfe for her suggestion of taking a longer look at websites and so on to ensure that we are giving the right advice in a simple form, because a lot of this is about prevention as well as support.

The Government are also swiftly implementing their manifesto commitment to deliver a breathing space scheme. Her Majesty’s Treasury is drawing on the expertise of MAPS in the design of such a scheme—something crucially important and close to the hearts of myself and the noble Lord, Lord Stevenson—including seeking formal advice on specific areas, as required in the Act. The Government will continue to work closely alongside the body as the scheme is delivered. This close work between MAPS and the Treasury will both support the implementation of the scheme and, when it is introduced, enable MAPS to help people in problem debt in the most effective way possible.

Since the passage of the Financial Guidance and Claims Act 2018, the Government have published a policy proposal on all aspects of the breathing space scheme for consultation, proposing strong protections for debtors. The consultation closed in January and a government response to it, to be published shortly, will confirm the details of the scheme. As I have already mentioned, primary responsibility for this policy rests with the Treasury, which will be publishing the response shortly. As I have already said, we are working closely with it.

I am pleased to say that MAPS will be establishing an industry delivery group, bringing together the pensions industry, consumer organisations and others to implement pensions dashboards, including a non-commercial version. This has not been touched on this evening, but the Government will be introducing legislation in this area when parliamentary time allows.

I will now endeavour to address the outstanding points raised during the debate. Regarding the name, yes, as the noble Lord, Lord Stevenson, suggests, we are in a sense talking about two separate issues—how people operate and manage their money, and how they save. Time frames are different for managing debt and for saving for pensions, but we trust in MAPS to manage these realities.

Key to this debate has been the issue of problem debt. The Government have taken steps to support people who have fallen into problem debt, including providing access to high-quality, free-to-use debt advice. Public funding for debt advice in England has risen to £55.8 million in 2019-20, which will provide help with debts to over 560,000 people in 2019-20—an increase of 85,000 compared to 2018-19. MAPS is an important addition to this. I note the concern expressed by the noble Lord, Lord Stevenson, that those in problem debt include increasing numbers of young people and women. Yes, housing is an issue but that is a government priority across all departments, and we are very focused on all aspects of housing and its funding. It is very important to us.

--- Later in debate ---

[Baroness Buscombe]

I thank my noble friend for her point, which is so well made. One reason I am so pleased to have this debate is that it helps, in a sense, to put more pressure on those taking this forward to look a little harder and further at what more we can do to develop financial capability. Yes, as raised by the noble Baroness, Lady Janke, there is always an issue with regard to squeezing this into the curriculum but of course this makes absolute sense, as many noble Lords said during the passage of the Bill. Many thanks to my noble friend for pushing that point a little further. We need to ensure that we can start the process of education by informing people, when they are as young as possible, about planning for their future; that is, in terms of pensions but also in managing their money. Great work is done by charities, but I am sure it will also be done by MAPS.

The most reverend Primate the Archbishop of York made an important point about exploitative lenders. While this is a matter for the Treasury, I can say that MAPS has ambitious plans to help people make informed decisions about their money—an app has been suggested. We are looking for ways to include this in the issues to do with Breathing Space. As I said, the Government will take forward plans on this in due course.

I am very aware of the time but I will say quickly that MAPS is due to publish the national strategy in the autumn, alongside its corporate plan. I also want to say something quickly on pension scams, which have devastating consequences such as the loss of an entire pension fund. That can leave victims without the means to fund their retirement. The Government are committed to implementing a ban on pensions cold-calling and created the powers to do this through the FGC Act. I am delighted to say that the ban came into effect in January 2019, making it more difficult for scammers to initiate pension fraud. Although the ban will have a significant impact on tackling scams, the Government do not consider it as a job done and we will continue our efforts to understand, and take action to prevent, pension fraud.

I think I have covered almost everything. There may be one or two other points that I have not included but I thank noble Lords for their contributions to this debate. It has been important and I feel proud to stand here to talk about the progress being made. I thank again the noble Lord, Lord Stevenson, for giving me that opportunity. We are in a good place with setting up the right bodies and organisations to tackle some of these really important issues, which are close to all our hearts. I would like an opportunity in the not-too-distant future to tell noble Lords more.

[The Archbishop of York]

I know that the Minister will not want to go into areas covered by other departments, but will she at least commit to take seriously the question of the curriculum? Governments of all parties in the past have done many good things—a noble Lord formerly in education was here at one point. It is important that this should be part of the curriculum and not purely a vague idea of education, because that can go nowhere. Is the Minister giving a commitment that she will talk to those in education who would like to look afresh at the curriculum and that this, like many other important things, could be included in it?

--- Later in debate ---

[Lord McKenzie of Luton]

The issue seems not so much to be what is covered by the national curriculum as the extent to which schools have to comply with it. That is the challenge. As I understand it, free schools and others do not have to. That is the stumbling block that we hit last time. We need to unlock that.

[Baroness Buscombe]

I thank the most reverend Primate the Archbishop of York and the noble Lord, Lord McKenzie, for giving me a further springboard to have discussions on this with my ministerial colleagues in the Department for Education. It is something that we worked on during the passage of the Bill. We did not get as far as we would have liked. We will try again, but we will also keep talking to the Treasury about this and hope to make progress.

[Lord Stevenson of Balmacara]

My Lords, I thank all those who have contributed to this short debate. It has served its purpose and achieved what we wanted, which was a chance to reflect on the progress made since the passing of the Bill and an update on the heartening and encouraging work now going on—the listening posts, the three-year plan and the idea that out of this will come a national strategy. I cannot remember whether in the Bill we required that to be brought back to Parliament, but I am sure that an inventive Minister like the one who has just responded would be able to find a way of allowing us to have another discussion on that strategy when it is produced so that we might at least have some sense of engagement with it.

One question arises from that which does not need to be responded to today. On the programme of events that will accompany the emergence of MAPS as a fully fledged body, the breathing space can be achieved by regulation, but the statutory debt management plans require legislation, as might some of the work on pensions. I do not see many notifications of that in the forward programme, but that itself is also quite difficult to discern. When the Minister has some information, perhaps she might share it with us when we are developing that set of legislative processes, because it would give us opportunities to come back to some of the issues we have not touched on. There is an outstanding Goods Mortgages Bill which would be fantastically important in eliminating one more of the high-cost credit problems that we have; namely, that car book loans, established under Victorian legislation of 1858 and 1862, still exist and fall completely outside the current system under which the Financial Ombudsman and others can operate. They predate that and are about a thing called a bill of sale, which should be outlawed. If we cannot get that on to the statute book as part of this process, we are really failing.

I think the question of bailiffs will come up through the report of the Ministry of Justice on bailiff operation. There is a clear need for a statutory basis for bailiffs’ operations. A good code of practice and some form of redress system would contribute considerably to assisting those in trouble. Those are details to be followed up. I include in that the pensions dashboard, which the Minister did not touch on but which is also an important step forward.

The most reverend Primate the Archbishop of York was right to say that there is still too much high-cost credit around. The corollary of that is that there is still a problem about low-cost credit being available at the appropriate time and in the appropriate amount to those who, curiously, borrow the most in our society. The poorest in society borrow more than those further up the income scale because they have to. As they are paid on a short-term basis or are living on limited amounts of money, they have to borrow when big expenditure arises. The system does not provide for that—not even for basic bank accounts. We need to go back to that and think more about savings. Auto-enrolment is a huge success. A lot of thinking by the Treasury has contributed to it—under previous Governments as well as under the current one—and it is to be given great credit. When it was first proposed when I was in a think tank, I thought it was the daftest thing I had ever heard of—making people contribute to savings when there were so many other pressures on them—but it has been a huge success and I am very glad that it is there.

However, it is only part of the story. It is far easier to borrow money in this society than it is to save. Why is that? Why do we have perverse incentives about people being able to accumulate cash that would see them through? I did not cite the statistics in the StepChange yearbook, but it is still incredible that a huge number of people do not have enough money from their current income to see them through one month’s problems. We must do something to help them.

The most important strand is education. We delude ourselves if we think that by simply asserting that this is an important area that should be in the national curriculum we will achieve it. Both my noble friend Lord McKenzie and the noble Baroness, Lady Neville-Rolfe, have experience of trying to get this to work in previous Administrations and I wish the Minister well with it. Is there anything we can do to ensure not only that this is seen as a good idea but that it is taken up by those with the ability to deliver, particularly given my noble friend’s points about the new environment? The Government’s only statutory ability is in relation to the limited number of schools that are still a local authority concern, but they have no lien in terms of forcing through the curriculum for academies or those schools in private hands. There are situations where kids will not learn what we all know they need to learn. Exactly like the noble Baroness, I wish I had known at the time, when I could have done something about it, what I know now when I am in such straitened circumstances.

Food Banks

Baroness Buscombe Excerpts

Wednesday 1st May 2019 Lords Chamber

[Lord Bassam of Brighton]

To ask Her Majesty’s Government what assessment they have made of the reported increase in food bank usage in 2018/19 and the 73 per cent increase since 2013/14.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, we are reforming the welfare system to better support the most vulnerable while encouraging more people into work, which is the most effective route out of poverty. We provide a strong safety net for those who need it and continue to spend over £95 billion a year on working-age benefits. We are introducing big changes and a further £4.5 billion boost following the Autumn Budget, which will shortly filter down to those in need.

[Lord Bassam of Brighton (Lab)]

I remind the noble Baroness that 70% of people in poverty are actually in work. The Secretary of State, Amber Rudd, acknowledged in February that the difficulty in accessing universal credit was forcing families to use food banks. The CEO of the Trussell Trust, Emma Revie, said recently that it is,

“unacceptable that anyone should have to use a food bank”,

and added:

“No charity can replace the dignity of having financial security”.


Does the Minister agree with that statement? What steps will the Government now take to speed up universal credit payments and end the shameful need for half a million children to depend on emergency food parcels?

[Baroness Buscombe]

My Lords, while we have always said that there are many reasons why people use food banks and that their growth cannot be linked to a single cause, we have long acknowledged that there were issues with the early rollout of UC. We have responded quickly to the feedback we have received and made numerous improvements to universal credit. We have removed waiting days and created advances of up to 100% of first payments, which people can receive within hours of attending a jobcentre. We have given extra support for disabled people and a two-week housing benefit run-on for new UC claimants. We are working hard to ensure that we are tackling the root causes of poverty, but also making sure to the best of our ability that we can improve our research into why people are using food banks.

[Baroness Boycott (CB)]

My Lords, food poverty is particularly hard on children. In last week’s Children’s Future Food Inquiry we found many things. Rickets is now at its highest rate in 50 years and is stunting height—children are 1 centimetre shorter at the age of 10 if they have grown up on bad diets. Can the Minister give me any idea what the Government are doing to ensure everyone in this country, regardless of income or geography, can access decent, affordable and healthy food?

[Baroness Buscombe]

I agree with the noble Baroness: everyone should have access to decent, healthy food. Tackling disadvantage will always be a priority for this Government. We welcome the new report from the Children’s Future Food Inquiry. Employment is at a record high and wages are outstripping inflation, but we know that there is more to do to ensure that everyone has access to nutritious, healthy food. We have already taken steps to tackle food inequality by providing free school meals and our Healthy Start vouchers. We are also investing up to £26 million in school breakfast clubs and £9 million to provide meals and activities for thousands of disadvantaged children during the summer holidays.

[Baroness Janke (LD)]

My Lords, is the Minister aware of recent reports of schools and teachers buying food, clothes and basic essentials to enable children to come to school, and that children feel ashamed because they cannot afford them? Many people, including charities, attribute this to the benefits cap. What plans do the Government have to address this and to ensure that children’s education is not put at risk through poverty?

[Baroness Buscombe]

I think it is fair to say that I answered that question to some degree in a previous answer. We are working hard with schools and injecting significant funds to ensure that children are properly fed, if not at home then by breakfast clubs, and through the school holidays. There is much more that we have been doing to ensure that families are not worse off; indeed, we have the most generous benefits for families of all the G7 countries. We recognise that there is more we can do but I have to keep saying: remember, we have made significant changes and increases in people’s income through increasing work allowances and so on. However, some of this will not yet have come through to be felt on the ground. We are still rolling out some of the big changes to universal credit.

[Baroness Neville-Rolfe (Con)]

Has my noble friend visited the Trussell Trust? Its HQ is in my home town of Salisbury, which is now recovering from its difficulties. The Trust first alerted me to the phasing problem that families have with the introduction of universal credit. Are the measures she described actually beginning to solve the problem it identified? I found it extremely interesting and poignant.

[Baroness Buscombe]

I can reassure my noble friend that one of the reasons we have been making so many iterative changes to universal credit is that we have been concerned about the delay in people receiving income quickly and fairly. I re-emphasise that we are still waiting for some of the benefits of that to filter through to the work on the ground and benefit people who need the support. Our department is working very closely with the Trussell Trust—some of my officials are having a meeting with it today—because we believe it is very important that we work together.

[Baroness Lister of Burtersett (Lab)]

My Lords, according to the Trussell Trust, the main reason for people needing emergency food help is that benefits are consistently not covering the cost of living. A key reason for this is the four-year freeze. The Chief Secretary to the Treasury says, “Don’t worry, the Government are moving on from the freeze as it ends next year”. However, hungry claimants, in or out of work, cannot move on from the permanent effect of a significant real cut in their benefit. Will the Government therefore now reverse and make good the freeze, as a matter of urgency?

[Baroness Buscombe]

My Lords, the Welfare Reform and Work Act 2016 provided for a four-year freeze, and this was supported by Members in both Houses. This freeze will lapse after 2019-20. The freeze was implemented at a time of great public debate about the fairness of benefits outstripping earnings growth. However, we are doing much more than that. Switching people on to universal credit is taking time because it is a huge change, but it is empowering people to take responsibility for their own lives. It is changing from the dreadful legacy system, which left people in the shadowlands of dependency without any responsibility or a prospective future that could actually make a difference to their lives.

Universal Credit and Child Tax Credit: Two-child Limit

Baroness Buscombe Excerpts

Wednesday 24th April 2019 Lords Chamber

[The Lord Bishop of Durham]

To ask Her Majesty’s Government what analysis they have made of the impact of the two-child limit on the per-child element of Universal Credit and Child Tax Credit payments on (1) child poverty, and (2) child development, for children under five years old affected by the policy.

[The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)]

My Lords, the Government are committed to supporting child well-being, and keep the impact of all their policies under review. This policy ensures fairness between those supporting themselves solely through work and those receiving benefits. Isolating the effect of the many individual policies on the income and well-being of children and families is, of course, challenging. Child benefit continues to be paid for all children, as well as an additional amount for any disabled children.

[The Lord Bishop of Durham]

I thank the Minister for her reply. May I push her further on the impact, specifically on child development? We all know that the first years of life are the most crucial for development and, therefore, the impact on life chances. Will the Minister commit to hearing the emerging stories of families with a third child who are being adversely affected by this policy?

[Baroness Buscombe]

My Lords, to be clear, on 28 June last year we published the first annual statistics related to the policy and have committed to do so annually. The Government have a broad range of policies which affect children and families across the tax and benefits system and public services. What makes a difference to child poverty is a strong economy, and I am pleased to inform the House that employment is at a record high, at 76.1%, while unemployment, at 3.9%, has not been lower since the 1970s.

[Baroness Lister of Burtersett (Lab)]

My Lords, the Government’s own statistics show that families with three or more children are at much greater risk of persistent poverty. Given that it is clear from Written Answers to the right reverend Prelate that the Government have done nothing to monitor the impact of this policy on children’s well-being, how can the Government be sure that it is in the best interests of children, in line with the UN Convention on the Rights of the Child, which the Government claim guides their policies?

[Baroness Buscombe]

My Lords, as I have made clear, the Government will be publishing statistics on this policy annually. Children growing up in workless families are almost twice as likely as children in working families to fail at all stages of their education, so our welfare reforms are designed to help people get into work, such that there are now 665,000 fewer children in workless households compared with 2010. Of course we want child poverty to fall, and that is part of our in-depth policy development, which is ongoing.

[Baroness Boycott (CB)]

My Lords, I thank the right reverend Prelate for raising the important issue of child poverty and development in relation to universal credit. We are the fifth-richest economy, but 4.1 million of our children live in poverty and 2.5 million of them come from families who cannot afford to feed them properly. This cripples their ability to grow and develop. Tomorrow the Children’s Future Food Inquiry, which is the first comprehensive investigation of children’s food insecurity, will be published. It details the devastating impact that has on children’s emotional well-being, their attainment at school and their mental and physical health. What plans do the Government have to strengthen and expand policies which make healthy, nutritious food available to all families on any income, regardless of where they live?

[Baroness Buscombe]

My Lords, the noble Baroness’s question is across government, but it is important from our standpoint at the Department for Work and Pensions that we concentrate on lifting people out of poverty so that they can support their children and develop as role models. A child living in a household where every adult is working is about five times less likely to be in relative poverty than one in a household where nobody works, so we support parents into work. For example, the Government spend £6 billion on childcare each year, which is not reflected in our poverty statistics, to help parents go out to work, support their families and develop a responsible living situation where they can properly feed their children.

[Lord Farmer (Con)]

My Lords, financial stability is important for healthy child development, but so too is relationship stability. The Government have replaced the family stability indicator with parental conflict measures, yet many divorces and separations take place in low-conflict relationships. Research shows that these are more damaging to children than when high-conflict relationships end. What are the Government doing to prevent family breakdown, not just reduce parental conflict?

[Baroness Buscombe]

My noble friend makes a good point. Although our welfare reforms—and, in particular, universal credit—are already transforming lives to lift children out of poverty and support parents into work, child development and family stability depend on so much more than financial stability and benefit payments alone. That is why the Government are, for example, helping local authorities across England train front-line practitioners to identify relationship distress, provide appropriate support and refer as appropriate.

[Baroness Massey of Darwen (Lab)]

My Lords, as the Minister said, co-ordination across government is important. The Royal College of Paediatrics and Child Health suggested that having a strategy for children and young people’s health across the board would help improve effectiveness and co-ordination. Do the Government agree and what will they do about it?

[Baroness Buscombe]

There is no doubt that a cross-governmental strategy is incredibly important, and that is why we are working across government with our colleagues in the Department of Health and the Department for Education. We of course want to see child poverty fall and child development improve, and we remain determined to tackle this. We will look at what more can be done to help the most vulnerable and improve their life chances by tackling the root causes of poverty, ensuring that children have the best possible start in life.

[Baroness Janke (LD)]

My Lords, nearly half of children from lone-parent families are in poverty, due not to worklessness but to disproportionately high housing costs and low wages. What are the Government doing to ensure that these children, already suffering disadvantage, are not doubly disadvantaged by the continuation of the benefits freeze?

[Baroness Buscombe]

My Lords, a very important point in relation to universal credit is that when somebody is homeless, the first thing our work coaches do—through support, understanding and signposting as necessary—is ensure that that person and their children are properly housed. We then go to the next stage, to see how we can support them to ensure they can manage both in work and in looking after their children.

[Baroness Meacher (CB)]

My Lords, the Minister will be aware that disabled children and their families are particularly penalised under universal credit. Does she accept that the lifelong prospects of those disabled children will be severely damaged by the loss to their families of something like £1,000 a year?

[Baroness Buscombe]

My Lords, I do not accept that disabled children in such families are penalised by universal credit. We spend more than £50 billion a year on benefits to support those with disabilities, including children. Let me be clear: we are making sure we do all that we can to support people, particularly children, through the introduction of the severe disability premium.