Social Security (Amendment) (EU Exit) Regulations 2018
Baroness Buscombe Excerpts(5 years, 5 months ago)
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Baroness Buscombe
That the draft Regulations laid before the House on 31 October be approved.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, these regulations were laid before both Houses on 17 October 2018. They enable the Government to make minor and technical changes to domestic legislation to reflect the fact that the UK will no longer be an EU member state after exit day.
Let me provide some context and background to the regulations. British domestic legislation contains various references to EU law and to the UK as a member state of the European Union, which will no longer be the case once the UK withdraws from the EU. It also includes a provision that allows the Secretary of State to implement reciprocal agreements. The social security legislation applying in Northern Ireland broadly mirrors that in Great Britain; we are making regulations that make analogous amendments to the corresponding Northern Ireland legislation. The Department for Communities in Northern Ireland has agreed to the text of the regulations. This follows the recommended approach in the EU exit SIs policy handbook: to make separate NI statutory instruments that create a separate “transferable” body of NI legislation made at Westminster in the absence of a functioning Northern Ireland Assembly. This helps to keep a separate body of Northern Ireland law intact for when a functioning Executive and Assembly return.
These regulations are made using powers in the European Union (Withdrawal) Act 2018 to fix legal inoperability and other deficiencies that will arise on exit in retained EU law—so that the converted law continues to operate effectively post exit—and make consequential provision. The approach to these amendments is completely in line with both the policy and legal intent of the withdrawal Act. The use of secondary legislation to amend primary legislation—the so-called Henry VIII powers—was debated at length during the passage of the withdrawal Act.
The list of specific legislation that the regulations amend is lengthy. Broadly speaking, we are using the regulations to make two types of changes, the first being where the UK is referred to as a member state of the EU. In these instances, an amendment will be made to reflect the UK’s new status as a state independent of the EU. Secondly, we are extending the scope of Section 179 of the Social Security Administration Act 1992 to allow us to implement a social security agreement with a supranational organisation such as the EU. Of course, the ability to implement an international agreement with such organisations was not necessary as an EU member state. It is only logical that we make this consequential change to our legislation to reflect the UK’s position as independent of the EU and allow us to fully implement any agreement in domestic law.
The Northern Ireland regulations mirror the same amendments to Northern Ireland legislation. No formal consultation was carried out by the Department for Work and Pensions on the regulations as these changes make only minor and technical changes to existing DWP domestic legislation. Similarly, we expect the regulations to have no impact on business, charities, voluntary bodies or the public sector.
Noble Lords will know that the withdrawal Act is a crucial piece of legislation that will ensure, whatever the outcome of negotiations, that we have a functioning statute book on exit day, providing certainty to people and businesses across the UK. The Act enables this by providing a power for Ministers in the UK Government and devolved Administrations to deal with deficiencies in the law arising as a result of our exit from the EU. We are continuing to work closely with the devolved Administrations to ensure that all parties are involved in the process where their interests are concerned. I beg to move.
Lord Kirkwood of Kirkhope (LD)
My Lords, I thank the Minister for that helpful introduction. I understand that these are minor and technical amendments. I have looked at them very carefully as a member of the statutory instruments scrutiny committee of your Lordships’ House. I am pretty familiar with their scope.
Could the Minister clear up two questions from my mind? First, is there any prejudice, potential or otherwise, to transfer payments and entitlements made from United Kingdom sources and systems to United Kingdom citizens and families living in the European Union? I think the answer is no, but an assurance would help, particularly relating to pension payments.
Secondly, I know that the Minister cannot do anything about this but I am getting more and more nervous about the Northern Ireland arrangements being handled indirectly by the department with no meaningful legislature in Northern Ireland to deal with some of their consequences, particularly since it has a free-standing social security system of its own. Colleagues know that it is a mirrored system, so changes are almost automatic. We have been living with that for some time. But in situations such as this, where changes are being made at one or two stages removed from the good people of Northern Ireland who are entitled to these benefits, there are particular concerns that those entitlements should be especially carefully considered in these amendment regulations. If the Minister can help me with these two items I would be very happy to see the regulations pass.
Lord McKenzie of Luton (Lab)
My Lords, I thank the Minister for introducing these regulations. It is fair to say that this is not the most exacting task she will have to undertake on matters Brexit. As we have heard, there are two sets of regulations, the territorial application of one set relating to Great Britain and of the other to Northern Ireland. The two sets cover parallel issues.
The Explanatory Memorandum reminds us that the Northern Ireland Executive are not in being, although the policy areas that are the subject of these regs are transferred matters and should be the responsibility of the Executive. That point was touched on by the noble Lord, Lord Kirkwood, with some expression of concern that we share. The memorandum states that the Government,
“will take through the necessary secondary legislation … in close consultation with the Northern Ireland departments”.
Perhaps the Minister will say what this involves. I think she might have answered that by saying that the Department for Communities was consulted.
The regs will operate with effect from exit day, but it goes without saying that many of us wish that that day will never arrive. Given that the powers of the European Union (Withdrawal) Act 2018 are engaged by these regulations, it is incumbent on Ministers to make certain statements. These encompass a requirement to state that the regs do no more than is appropriate to deal with deficiencies in retained EU law, but that there are good reasons for the provisions and that they leave intact equalities provisions. The Minister states that, given that the Equality Act does not extend to Northern Ireland, she has given due regard to the need to eliminate discrimination, harassment and victimisation. We do not seek to disagree with those conclusions.
As we have heard, these instruments fall into two groups. They amend various provisions in UK domestic legislation that contain references to the UK as a member state of the EU, or of the EEA. Further, they amend Section 179 of the Social Security Administration Act 1992 and its Northern Ireland equivalent to enable social security-related reciprocal agreements to be entered into with international organisations. The Explanatory Memorandum instances the EU, but can the Minister state what others might be in contemplation? What is the position with any existing agreements that the UK has entered into with the EU? Could the Minister please list these? Do they have to be reinstated on some basis or do they run on?
The insertions made to Section 179(4) list a range of EC or EEC regulations. Can the Minister differentiate between the two? Taking new subsection (4)(am) as an example, I presume that its inclusion is not intended to change the domestic law. Can the Minister outline for us the impact of Regulation (EEC) 1408/71 on the application of social security systems to employed persons, to self-employed persons and to members of their families moving within the Community?
The regulations extend to other amendments to existing secondary legislation to ensure accuracy of references when the UK is no longer part of the EU. These cover persons abroad, invalid care allowance regulations, SSP, SMP, overpayments and recoveries, AA, DLA, housing benefit, PIP and universal credit. Can the Minister confirm that in each case there is just a change of wording to reflect the changed situation of the UK and that it has no wider implications for the position of the continuing EU members?
We hope to see these regulations gather dust in some corner of Westminster and not be called into use. In so far as they are, we agree that they do the job.
Baroness Buscombe
I thank noble Lords who have taken part in this debate. Perhaps we have now gleaned rather more from the Benches opposite as to which way the noble Lord’s party may vote in the coming days; hitherto, we have been entirely unclear, as have all honourable friends in another place.
These are minor and technical amendments. I want to make it clear that there is no impact on policy. There is of course frustration—if I may put it that way—that the people of Northern Ireland are not fully represented. The noble Lord, Lord Kirkwood, is quite right that there is sadly nothing that I can do about that. The UK Government remain committed to restoring devolution in Northern Ireland—that also concerned the noble Lord, Lord McKenzie. This is particularly important in the context of EU exit, where we want devolved Ministers to take the necessary actions to prepare Northern Ireland for exit. That includes making the necessary legislative corrections to ensure that the Northern Ireland statute book is ready for exit day, consistent with the action taken at Westminster and in the other devolved legislatures. However, with exit day only a few months away and in the continued absence of a Northern Ireland Executive, the window to prepare the Northern Ireland statute book for exit is narrowing. UK Ministers therefore decided that it would be in the interest of legal certainty in Northern Ireland for the UK Government to take through the necessary secondary legislation at Westminster. That decision was made in close consultation with the Northern Ireland Civil Service. We are in constant touch with the Department for Communities in Northern Ireland. I can reassure noble Lords that we are doing all we can to make sure that we work well with it. We hope that the current situation will change for the better in the near future.
I make it absolutely clear that the regulations make consequential amendments to domestic legislation; they do not make any changes to entitlement to benefit or payment—it is crucial to say that in response to both noble Lords’ questions and concerns. A multitude of references to the EU are made as we are currently members of it, but for only a few months longer. I do not have a list today of all the legislation that this references, but I am very happy to write to noble Lords to make very clear exactly which pieces of legislation this impacts upon.
The Government are committed to ensuring that the social security system works for everyone post exit day and these regulations will help to do this by fixing minor and technical changes to existing DWP and corresponding Northern Ireland domestic legislation. They are part of a package of legislation. We have already dealt with some legislation in reference to the payment of pensions. On that basis and with the proviso that I will write to the noble Lord, Lord McKenzie, with specific reference to those aspects of the legislation, I hope that noble Lords will support these statutory instruments.
Universal Credit
Baroness Buscombe Excerpts(5 years, 5 months ago)
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Baroness Sherlock
To ask Her Majesty’s Government what plans they have to split payments in Universal Credit.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
Split payments are already available on request for universal credit claimants. We have processes in place to record complex needs for individual claimants and have introduced a new IT function so that these claimants are instantly visible to the staff helping them. We are also examining how claimants tell us about their complex needs, how we record those needs and how we can extract data which can help us monitor and improve support.
Baroness Sherlock (Lab)
I thank the Minister. To mark White Ribbon Day yesterday, I want to ask specifically about the impact of universal credit split payments on people suffering domestic abuse. At present money for children is paid in tax credits to the main carer once a fortnight, and that supporting low-paid work to the main earner once a fortnight. Universal credit rolls up all those payments with housing, childcare and disability payments, and is paid once a month into the bank account of one member of a couple. There is widespread concern that this may exacerbate economic abuse. Domestic abuse survivors can request a split payment, but charities such as Women’s Aid are concerned that simply asking for it can put them at risk because of course it triggers the evidence that they have done so concerning the abusive partner. My noble friend Lady Lister raised this in a Question in July and presumably the Minister has been thinking about it. But the latest statistics show that only 20 households have split the payments, even though 40% of awards are to couples. Can the Minister please tell the House what action the Government are going to take?
Baroness Buscombe
The Government support White Ribbon Day—the International Day for the Elimination of Violence against Women—and will be making a number of announcements over the 16 days of action, which I am sure all noble Lords will welcome. The Government are committed to doing everything we can to end domestic abuse. It is important to stress that it is the responsibility of government across Whitehall to support victims of domestic abuse. The single payment of universal credit usually allows both people in the household to make the money management choices that are best for them in considering how their decisions about work affect their household income. The reality is that I and my honourable friend in another place, the Minister for Family Support, Housing and Child Maintenance, Justin Tomlinson, are working hard with stakeholders to see what improvements could be made.
Baroness Lister of Burtersett (Lab)
My Lords, the Minister said that split payments are available on request but, as my noble friend said, if somebody asks for a split payment, her abusive partner will know. How many of us would be willing to take the risk of further abuse? Can the Minister tell me why the Government think that they know better than survivors of domestic abuse and the organisations working with them, and continue to put the onus on the survivor and put her at greater risk?
Baroness Buscombe
My Lords, it is important to stress that claimants can request a split payment during a face-to-face meeting and a phone call could be made away from the perpetrator of domestic abuse or online, via the journal. Research carried out for the department suggests that only 2% of married couples and 7% of cohabiting couples keep their finances completely separate. Indeed, a number of legacy payments have always been paid as one payment.
Baroness Couttie (Con)
My Lords, many people who have experienced domestic abuse would find it extremely traumatic to relate the details of what has happened to them. Does the DWP require details of the abuse before they can receive split payments?
Baroness Buscombe
Well, it is helpful because it is constructive. No, we do not expect people to disclose the details of domestic abuse. Any individual can be accompanied by a third-party organisation to provide expert support when discussing their situation with a work coach. Each case is unique and the work coach will therefore ensure that the process is claimant-centric, to best support the needs of the individual. We treat all personal information in confidence and do not disclose it to third parties without explicit consent, but we also ensure mandatory training for our work coaches to give the support that people who are in a vulnerable situation require.
Baroness Janke (LD)
My Lords, what assurance can the Minister give that split payments will be part of the test and learn DWP pilot scheme to be introduced early next year? Can she also give assurances that any results will be published before the managed migration takes place in 2019?
Baroness Buscombe
My Lords, the noble Baroness may know that during the test and learn phase, we will be working within a co-design phase for seven months on a number of projects with stakeholders from all parts of the welfare system to assist us in the kinds of questions that we need to ask. But we are also going to look at how Scotland implements this. Scotland has made its own decision, which it is entitled to make, to go ahead and implement split payments. We want to learn from Scotland, too, about how this can be done, what challenges there might be and how practical it will actually be when six benefits are being brought into one under UC.
Baroness Watkins of Tavistock (CB)
My Lords, if we are to learn from Scotland, is it not time that we decided how quickly we might learn from other countries? It seems to me that this will kick it into the long grass, rather than resolving the situation for split payments in England. Could the Minister please comment?
Baroness Buscombe
My Lords, we should not do this in haste. The reality is that Scotland has proposed split payments and is going to implement them. We would much rather watch what Scotland is doing—this is known there. Meanwhile my colleague in another place, whom I have already referenced, is working with various stakeholders on how we can improve support for those victims of domestic abuse through the welfare system.
Baroness Armstrong of Hill Top (Lab)
My Lords, I currently chair a commission which is looking at services and support for women who have experienced violence and abuse. Through that, I have met many of the women whom other Members here have been trying to alert the Minister to. I am sure that the Minister has every good intention, but I have to tell her that these women really do feel that they cannot disclose what is happening to the DWP and why they need separate payments. Even if they did, their partner would then be so angry that they would suffer. Will she therefore agree to meet people who are working on this to hear of direct cases, which I do not want to put in front of the whole House, so that she hears about the concern, fear and anxiety, and then the mental health problems that come as a result?
Baroness Buscombe
I thank the noble Baroness for her question. We take this extraordinarily seriously. I have already met representatives of Women’s Aid and Refuge, but it is important, as the noble Baroness will appreciate, that split payments in universal credit cannot be the solution to what is ultimately a criminal act. Domestic abuse is still a huge problem in our society. The solution to it is complex and should be delivered through the judicial system. If they feel it is appropriate, anyone in a joint claim, including individuals suffering from domestic abuse, can request a split payment, but I should add that we now have more and more work coaches in jobcentres who have not only been through the mandatory training but are specialists in understanding and detecting domestic abuse. We are learning as we are going on, and we are continually working hard to improve the system, bearing in mind that as at August this year only 20 people had requested this.
Universal Credit
Baroness Buscombe Excerpts(5 years, 6 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, with the leave of the House, I shall repeat a Statement made in another place by my right honourable friend the Secretary of State.
“Mr Speaker, I would like to make a Statement on the changes announced to universal credit in the Budget last week and on the managed migration regulations, which we are laying in the House today. The Chancellor announced a substantial package at the Budget to ensure that millions keep more of what they earn, and vulnerable claimants are supported when they move to universal credit. In total, this package will be worth an extra £4.5 billion across the next five years.
I want to say a special thank you to all the colleagues, charities, third sector organisations, Jobcentre Plus staff and claimants who fed back to me to build this package of support to ensure universal credit is a fair system, supporting thousands who cannot work, as well as thousands who can. I would also like to thank my right honourable friends the Prime Minister and the Chancellor for their support to deliver these measures.
Make no mistake: this is a department that listens and a department that will continue to listen, adapt, change and deliver. We will put an extra £1.7 billion a year into work allowances, increasing the amount that hard-working families can earn by £1,000 before universal credit is tapered away—providing extra support for 2.4 million working families. Of course, the Opposition do not like helping 2.4 million families, which is why they are laughing, because we help and support people into work. That is why it was welcomed not only in this House but among charities like the Child Poverty Action Group, which said:
‘The work allowance increase is unequivocally good news for families receiving universal credit’;
and the Joseph Rowntree Foundation, which said that this extra investment,
‘will help make Universal Credit a tool for tackling poverty’.
We have gone further, recognising the genuine concerns raised about the support we were offering people, especially the most vulnerable, when they move to universal credit. So we have made a further £1 billion package of changes, providing two additional weeks of DWP legacy benefits for those who move on to universal credit—a one-off, non-repayable sum that will provide claimants with extra money during the period before they receive their first universal credit payment. This is on top of the two additional weeks of housing benefit announced at Autumn Budget 2017, and put into place this year. We will also support the self-employed moving to universal credit. We will open up a 12-month grace period before the minimum income floor is applied, supporting 130,000 self-employed claimants, because we are the party of business—we are the party of aspiration.
We will support those in debt by reducing the normal maximum rate at which debts are deducted from universal credit awards, from 40% to 30% of standard allowances. This will help over 600,000 families to manage their debts at any one point when rollout is complete, providing them with, on average, £295 extra a year as their debts are repaid over a longer period. This is targeted support to help work pay and support the vulnerable.
That is why today I lay regulations to deliver the next phase of universal credit: managed migration, through which people will be moved on to universal credit. It is a move from a system that trapped people on benefits and created cliff edges at 16, 24 and 30 hours, with punitive effective tax rates of over 90% for some. Under Labour, between 1997 and 2010, benefit spend went up by 65%. In 1997, households were paying £5,500 in taxes to fund the benefits system, and by 2010 it had risen to £8,350. This party was voted into office to manage the country’s finances and get them under control, and to make sure that the benefits bill was affordable and sustainable for the future. So while the party opposite may hanker for the dark old days—trapping people on benefits, excluding them from the opportunity of work and getting on in life, while at the same time delivering a big bill to the taxpayer—we do not.
Under this Government 3.4 million more people are in work, the vast majority of which are full-time and permanent roles. That means that we have created more new jobs in the UK since 2010 than France, Spain, Ireland, the Netherlands, Austria and Norway combined, alongside creating a welfare system that supports those who need it.
Through universal credit, around 1 million disabled households will receive around an extra £100 on average per month through more generous support. The managed migration regulations will, in addition, protect 500,000 people’s severe disability premium at the point of migration, and will deliver transitional protection for those we move, to ensure that at the point of moving, those manage-migrated have their entitlements protected.
We will take a measured approach to delivering managed migration, taking our time to get it right and working with claimants to co-design it. We will continue to take on board the advice of experts and charities such as the Social Security Advisory Committee, whose report on the regulations we have published, along with our response, today. We have accepted in full or part all but one of its recommendations, and the one we did not accept is because we want to make it more generous.
I pay tribute to the hard work of the Social Security Advisory Committee in scrutinising our regulations. We have changed a key part of the regulations, which charities, MPs and the department have asked me about, which relates to the minimum statutory notice period for people moving from their legacy award to universal credit. We have extended this period from a minimum of one month to a minimum of three months, to allow claimants maximum time to prepare and make their claim before their legacy award expires. Alongside this, we have unlimited flexibility to extend claim periods for people who need it. We will also back-date any claimant who has missed the deadline date but who has made a claim within a month of the deadline day passing. We will also test a variety of communications methods, including advertising campaigns, face-to-face communication, letters, texts, telephone calls and home visits. This will provide support for claimants during managed migration. We will constantly review our approaches, engaging fully with charities, experts, claimants and all Members of this House. I commend this Statement to the House”.
My Lords, that concludes the Statement.
Baroness Buscombe
I begin by welcoming the comments of both noble Lords opposite, who have welcomed at least in part what we have achieved, both through the Budget announcements and the laying of the regulations today.
In response to the noble Lord, Lord Kirkwood, I say straightaway, up front, that unlike honourable Members in another place who did not seem to realise that we would be debating these regulations, we have—and want—to debate them. They are affirmative measures and we will debate them before the end of the year. Otherwise, if we do not get these regulations through, the transitional protection support for people will be lost; we have to make that very clear. I have pretty much put a date in the diary for my first session. I was going to alert noble Lords after our upcoming recess but, in fact, I will make sure that is sent out to all Peers tomorrow. I want to make sure that any Peer who would like a conversation has one with myself and the Minister of State for Employment—he wants to join me in engaging with all noble Lords. It is really important. We want the opportunity to spell out the detail of these regulations. We are excited about it, not least because we have listened and learned.
I have listened to the noble Baroness opposite; I know, for example, that she had a particular concern—as did the noble Lord—when we met to talk very briefly in private two months ago about what we were trying to do with the one-month minimum term to migrate claimants to UC. We have now moved that to three months. We decided on three months, rather than longer, because in talking to experts and stakeholders we decided that any longer might in fact be a disincentive and unhelpful to claimants. It felt as though it was too long a burden in front of them.
We want to do all we can to work with claimants, working with stakeholders—hence having this period now, after the full rollout of universal credit at the end of this year. We will be spending until July next year going through a test and learn process. Our process will be co-designed with stakeholders to ensure that we have listened and understood claimants’ experiences. We want a process that works well for everyone. We are focusing on building safeguards for vulnerable claimants and ensuring that we have all the necessary information to enjoy a smooth transition, with uninterrupted support.
I would say to the noble Baroness, Lady Sherlock, that we have decided that we do not want to do anything in terms of migrating claimants without face-to-face or online support because, when we did that, we actually got wrong what we thought would be a smooth, automatic transition from incapacity benefits to ESA—I am going back now to 2011. We got it wrong because we did not always have up-to-date information on people’s circumstances. We did what we call “pre-populate”, and we have decided as a department that that is too dangerous, in case we get it wrong again. We are talking about a huge number of people and we want to get it right.
Therefore, the test and learn process that we are going to go through before beginning the transition will be actually working with claimants who come forward to work with us, testing and trialling how we can make the process better. We have not yet developed the system for managed migration, for the very reason that we want to spend time with everybody: lab sessions, where we use researchers who have recruited claimants; pop-up testing, where researchers have visited job centres, and all the support organisations, homeless shelters and parent and child organisations, to talk to claimants and staff to get this right.
When we do start the managed migration process, we are going to migrate a maximum of only 10,000 people in the first year, which sounds slow, but we think that is the right thing to do. We want to spend all that time checking and making sure that we are right. I will be very happy to come back to your Lordships’ House to keep noble Lords informed of how that process is going, because it is absolutely important that we get it right. We are never going to get 100% of the cases right, but we will do our best.
The important thing is to explain that the two-week support is an additional payment. There will be no gap. That will help people to adjust from being paid two-weekly to four-weekly, but it does not represent any form of gap in transition in terms of payments. It is an additional payment, in addition to the two-week additional housing benefit—which, again, is a one-off cash payment to support people through the process.
I was asked what was meant by my right honourable friend in another place talking about what happens if claimants cannot migrate. We are of the opinion that we should keep the system entirely flexible, so that where a claimant has complex needs or is vulnerable, the work coach can have the option to suggest an extension of the deadline of migration, arrange a home visit or, to be entirely flexible, remove the claimant from the managed migration process entirely. We have to be careful that we do not allow people to fall through the cracks. Let us be clear that this one to three month minimum period is the minimum period for people to manage migrate, but we will be flexible, particularly with those vulnerable claimants who are having difficulty in migrating to the new system.
Baroness Sherlock
Before the Minister sits down, I think she may have inadvertently omitted to answer a couple of my questions. Could I invite her to check the record and write to me?
Lord Trefgarne (Con)
My Lords, can my noble friend confirm that these regulations will be presented to the Secondary Legislation Scrutiny Committee, to which the House normally delegates these matters?
Baroness Buscombe
Absolutely. We will make sure that these regulations will be part of the proper process.
Baroness Lister of Burtersett (Lab)
My Lords, I welcome the concessions in response to SSAC, and I think we owe SSAC and all the organisations that gave evidence to it a big debt. SSAC recommended that before the department starts the migration process it should undertake what it called a “rigorous and transparent assessment” including,
“how effectively Universal Credit … is currently operating”.
Given the Public Accounts Committee’s observation of,
“a culture of denial … in the face of any adverse evidence”,
how can we be confident that the DWP’s acceptance in principle of this recommendation will mean that, before managed migration, it really will tackle the design flaws that all the organisations on the ground are saying are preventing UC operating effectively? Following on from my noble friend, why will those who do not claim within one month of the new target date not get transitional protection, when Ministers constantly say that everyone will get transitional protection?
Baroness Buscombe
My Lords, let me make it clear that we are now in a very different place from when that PAC report was drafted. We are injecting an additional £4.5 billion into the system to support the migration on to universal credit. We are in a place where we are already spending £100 billion on benefits for people of working age; we have to think about sustainability and affordability.
When it comes to testing the system, we will adjust and amend our processes according to how claimants respond, which we will identify through ongoing user research with claimants, where we look to establish why claimants did not interact with the service and what they found difficult. We will use that to improve the processes. At the end of the day, though, we cannot leave the process entirely open-ended, where people for whatever reason do not choose to migrate. The important thing is that that is why we are having the whole preparation and learning process—to understand why there could be anyone who fails to go through the process or there is more than one month after the closure of when they should have applied to go on to universal credit.
We will be spending time and a lot of input into advertising campaigns; communications by text, phone and letter; and home visits. Those people will not be falling through the cracks without an extraordinary amount of effort on the part of our 83,000 employees at the DWP, who are not a department in any denial whatsoever. They want this to work. They are excited about it and work hard for it; they will help us to succeed, to the best of our ability.
Lord Framlingham (Con)
My Lords, can the Minister confirm that, due to the investment in work allowances, an extra 2.4 million families will keep an extra £630 per year of what they earn, by removing the taper rate from an extra £1,000 of earnings?
Baroness Buscombe
My noble friend is absolutely right. The measures in relation to work allowance will make an enormous difference to families. The measure directs additional support in a package worth £1.7 billion across Britain, to some of the most vulnerable, low-paid working families. If a single claimant has responsibility for a child or qualifying young person, or has limited capability, they currently receive a work allowance of £198 per month and those with housing costs £409. With universal credit, raising the current work allowances will mean direct additional funding to working families with children, and working disabled people, by allowing them to keep more of their earnings before the taper rate is applied.
Baroness Donaghy (Lab)
My Lords, the Minister will not be surprised if I focus on the self-employed. The Social Security Advisory Committee has acknowledged that the main concern about the self-employed was not the grace period, though it acknowledged that a small extension is welcome, but the principle of the minimum income floor itself. Organisation after organisation submitted evidence to the committee to say that this would not work. The committee requested that,
“the Department should undertake a robust evaluation of the policy and its operation ... It is important to determine whether it operates equitably, what effect it has on the self-employed themselves, and what effect it is having on start-ups generally”,
and that,
“evaluation should extend to the related tests of ‘gainful self-employment’ which underpin the way in which the Minimum Income Floor operates”.
There is a fundamental flaw in the way that that has been structured. Can the Minister give some assurance that there will be such a robust evaluation of the policy?
Baroness Buscombe
My Lords, in all that we are doing with universal credit we constantly question and consider issues of substantive policy, because we want to make sure that the system works for the long term. The Government want to support people to be self-employed but it is right for them to be financially self-sufficient. Key to this is continuing to support people in, or considering, self-employment to progress to a level of sustained financial self-sufficiency. We recognise that it takes time for new businesses to grow and that even established businesses can experience difficulties. We will therefore provide all gainfully self-employed claimants with an equal chance and support from specially trained work coaches to grow their earnings, and to prepare and adjust for the application of the minimum income floor. We were going to move the minimum income floor to six months after migration, but have decided to introduce a grace period of 12 months.
Lord Shinkwin (Con)
My Lords, my noble friend mentioned the severe disability premium and the serious implications of not getting these regulations through. Will she confirm that these regulations support the most vulnerable claimants moving to universal credit and that, moreover, voting against them would deprive 500,000 claimants of that premium?
Baroness Buscombe
My noble friend is entirely right. I could not put it better myself. We have to make sure that we get these regulations through. If we do not, that support for half a million vulnerable people will be lost. The regulations provide transitional support for recipients of the severe disability premium while removing the complexity of dealing with different rules for seven different disability additions. We want to make sure that we take special care of those people when migrating them on to UC. As the CEO of Citizens Advice, Gillian Guy, said,
“improved protection for people who receive the Severe Disability Premium is a welcome move that will mean better financial security for many disabled people who move onto Universal Credit”.
We must have these regulations.
Baroness Primarolo (Lab)
My Lords, I thank the Minister for the information she has given about the changes made in the Budget last week. However, she will know that the Government had already pre-announced billions of pounds to be cut from the budget that will facilitate universal credit by 2020. Last week’s announcements have given some money back, but not all of it. The Government’s original estimate was that universal credit would lift 350,000 children out of poverty, but the Joseph Rowntree Foundation says that, as a result of these changes, an extra 1.2 million children will grow up in poverty by 2020. What is the Minister’s latest estimate for raising families and children out of poverty as a result of universal credit?
Baroness Buscombe
I am proud to say that this country provides more benefits for families than any other advanced nation. I do not recognise the estimates; it is not right to make estimates without any underlying evidence. We have come a long way since the cuts some years ago to which the noble Baroness referred. There were cuts right across the board, in all departments. For example, the cost of social security went up by 65% under Labour and was becoming totally unsustainable. We could not continue with that rise. We have therefore had to adjust and make some very difficult choices.
We are doing all we can, with the working tax allowance and increased support for childcare costs, to support children and families. An additional 80,000 working parents who are in receipt of transitional protection and who access support for childcare costs provided by UC are expected to benefit from these regulations. The support for childcare costs provided by universal credit, worth up to £1,108 per month for two or more children, is more generous than the system it replaces. However, the most important support that anyone in a family can give their children is being in work; setting a course for that family out of poverty—a hand up, not a handout—and being role models for the children. There are over 800,000 job vacancies at the moment. We want to do everything we can to support people into work, because that is the best way to lift children out of poverty.
Lord McKenzie of Luton (Lab)
My Lords, a moment ago the Minister said that we had come a long way. I am not sure that is how millions of people who have endured this Government’s cuts would view matters, even though a portion is put back in today’s announcements. The Minister said that home visits would be available for help with a claim. On what basis would that be? Would they be available as of right to anybody who seeks one? I recall that with ESA there were meant to be automatic home visits for people with mental health issues. I do not believe that ever happened. What assurances do we have that it will be robust in this case?
Baroness Buscombe
It is important to explain a little more about the test and learn process, which is one of the reasons why we are taking longer than we might to introduce the first tranche of managed migration. We are not doing this by ourselves. It is very much a co-design with a number of charities, the third sector and researchers to help us work out our monitoring. We will closely monitor the quality of communications which we will issue, and whether they are understood by recipients, before we increase the pace of migration. We are also making sure to put out letters that are easier to understand, and constantly working out what we can do. However, if we hear nothing from a claimant, we will offer home visits. That has to be an opportunity for those who are genuinely afraid of change. That is one reason why we on this side feel passionately. The less scaremongering around this system, the better. I put some of the blame on the media, which has not fully understood it.
We are trying to lift people out of the system that trapped them in poverty—on legacy benefits with cliff edges, where they could not work more than 16 or 24 hours a week without losing benefits. The brilliant thing about this simplification—merging six benefits into one—is that you do not lose your benefits. Your benefits may now increase by £1,000 before they begin to taper, and the taper rate has just been reduced from 40% to 30% of your standard allowance. I also remind the party opposite that when it left government and this party came into power—the noble Baroness may shake her head—this Government had to fund debt amounting to 10% of our GDP. That was the issue facing us.
Lord McKenzie of Luton
Would the Minister care to reconsider what she has just said about the taper rates being reduced from 40% to 30%?
Baroness Buscombe
My Lords, I am sorry, it should be the debt repayment rate. I am grateful to the noble Lord. I am so eager to get this right, and noble Lords may understand that there are quite a lot of numbers and it is quite technical. I am quite emotional about the fact that we are the party of social mobility and we have introduced a system that we genuinely believe will be better for everyone. It is, however, a very hard system to get right for everyone, because everyone is different—we are dealing with different situations and circumstances and we do not want people to fall through the cracks.
Baroness Andrews (Lab)
I appreciate what the noble Baroness has just said, because it is an extraordinarily complex system, and this is the biggest—and riskiest—change in social security for decades. She has said that people’s lives are different. When she refers to working conditions and benefits, surely she should remember what we have been saying about the need to take great care—universal credit is great in principle but very difficult to get right. A redesign should not be beyond the Government’s confidence.
I will repeat one question that was raised by both my noble friend on our Front Bench and by the noble Lord, Lord Kirkwood. If the Government want, as they must, to simplify whatever they can, surely they should have a better answer than the one they have given about why they do not segment certain categories of people that cannot be treated universally. It would be relatively simple to do. Apparently the department has said that it cannot be done. That is not a good enough reason when the noble Baroness is struggling to explain what will happen. There is a risk of mistakes that will bear down on the very poorest with disastrous results. This is not scaremongering, and I resent it being described so: these are very serious challenges for the very poorest in our society.
Baroness Buscombe
I agree with some of what the noble Baroness said but not that I am struggling—I am just saying as much as possible in the time allowed. There is a lot to say—a lot that is positive. I repeat, however, that she is correct in saying that it is hard and that we have to get it right. That is why we are going to spend so much time on the design, which is not there yet—we have not yet designed the managed migration process. That is the point: we will have rolled out universal credit itself in all the jobcentres—634 of them, I think—by the end of this year, but we will take the actual managed migration process much more slowly, because it will lift people already on benefits from legacy benefits on to universal credit.
I wish that we could automatically transfer certain categories of people seamlessly, but we did that in 2011 when we were moving people from incapacity benefit to ESA, and the problem was that we missed some people’s change of circumstances and underpaid them. We do not want to take that risk again—we would be facing another judicial review. We know, however, that about 700,000 people are not receiving the legacy benefits—worth about £2.4 billion—that they are entitled to, and we want them to. That is one of the main reasons why we want face-to-face contact—work coaches and claimants working together to make sure that they get the right support.
Child Support (Miscellaneous Amendments) Regulations 2018
Baroness Buscombe Excerpts(5 years, 6 months ago)
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Baroness Buscombe
That the draft Regulations laid before the House on 12 September be approved.
Relevant document: 41st Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 30 October.
Benefits: Reductions
Baroness Buscombe Excerpts(5 years, 6 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, I join all other noble Lords in congratulating the noble Lord, Lord Bassam, on securing this debate. It gives me great pleasure to respond. Once again, I pay tribute to the life of Lady Hollis. I have already said once before that she and I were opponents back at the beginning of this century. That said, I will never forget the hug that she gave me when I was appointed to this position. The noble Lord suggested an annual debate in her honour. No doubt he will take that matter up with the usual channels.
This is a Government who support families. Our welfare system supports those who are vulnerable and helps people into work. Let me dispel the idea that we are not providing financial support for families: this country spends more than any other developed nation on family benefits. Through our employment success—with 1,000 more people in work on average each and every day since 2010—we are creating a great working nation. Let us not forget that, under the last Labour Government, the number of households in which no one had ever worked almost doubled. Every time Labour is in government, it leaves office with unemployment higher than when it entered office, so ripping the heart out of families across the country, denying people the dignity of work, and removing aspiration from a generation. This was a consequence of the Labour Party’s mismanagement of the economy and its perverse welfare system. It was a system that, through a complicated mix of benefits and tax credits, created effective tax rates of more than 90% for some and cliff edges at 16, 24 and 30 hours, thereby discouraging further work and punishing families for doing the right thing. This was a broken system that did not support families: rather it trapped people out of work.
As noble Lords will know, under the last Labour Government, 1.4 million people spent the best part of Labour’s last decade on unemployment benefits. This resulted in the benefits bill soaring by £84 billion in today’s prices, a rise of more than 60% in real terms. As my noble friend Lady Jenkin said, vast sums of money were being spent, while people were being locked into a life on welfare. This was why we had to introduce a benefits freeze. The system was simply not sustainable. We even had people claiming more than £100,000 a year in housing benefit. This meant that households were contributing £8,350 a year—up by nearly £3,000 from 1997-98—to fund the welfare system. How does that help families and how is it fair?
In stark contrast, this Government have helped more than 3.3 million more people into work since 2010. On average, that is 1,000 more jobs each and every day, and the vast majority of these are full-time, permanent roles. I want to stress that: they are not zero-hours contracts and they are not part-time. We have created more new jobs in the UK since 2010 than France, Spain, Ireland, Netherlands, Austria, and Norway combined. Youth unemployment has more than halved under this Government. There are now 964,000 fewer workless households in the UK since 2010, close to a record low. This means there are 637,000 fewer children growing up in workless households since 2010. This is the best support that we can provide for families, because—I say this to the noble Lord, Lord Bassam—work is the best route out of poverty, including getting people out of in-work poverty. Children in households where all adults are working are around five times less likely to be in poverty than those in workless households. Compared with 2010, there are now 1 million fewer people in absolute poverty, including 500,000 fewer working-age adults and 300,000 fewer children.
Work sets children up for the future. Children who grow up in workless families are more likely to be workless themselves as adults, compared to children with working parents. I say to the right reverend Prelate the Bishop of Portsmouth and the noble Baroness, Lady Lister of Burtersett, that it is a tough choice, but the same considerations and choices faced by people not in receipt of benefits should also be faced by those claiming benefits—those able to work.
We are not complacent and I do not accept any reference to us being a department in denial. I find that a shocking statement, referencing the 83,000 people who work tirelessly in the Department for Work and Pensions. I thank the noble Lord, Lord Young of Norwood Green, for his reference to those brilliant people. We do all we can to support them, and we must do more, because they do an amazing job throughout the United Kingdom. While there are almost a million fewer workless households than in 2010, there are still 3 million where no member of the household is in employment. We want to help those people.
The two-child policy has been referenced as a reason why many people are in poverty. That policy was brought in only in April 2017. It is important to stress that it is not retrospective and that we have child benefit, which continues for each and every child. While there are almost 1 million fewer workless households, the department has great ambitions to return many more people to work, such as our target to increase the number of disabled people in work by 1 million. It can be done. We currently have more than 800,000 job vacancies across the country. These great ambitions are the reason why we created universal credit, in recognition that the punitive legacy system took opportunities from families, creating—I repeat that extraordinary quote from my noble friend Lord Farmer’s brilliant speech—
“a shadowland of complete welfare dependency, with some saying, ‘I cannot afford to work’”.
Instead, we want to give people the dignity of work and we have changed the welfare system to give people a hand up rather than a handout.
As we have heard, universal credit is an up-to-date system that replaces six benefits with one monthly payment and ensures that work pays. The taper system means that people can take on more hours and part-time seasonal work, as the benefit adjusts to their earnings. There are no cliff edges. I am proud that work transforms lives, because it helps to improve the well-being of families—their health, and their children’s prospects and preparation for later life. Of course, it improves their chances of building a pension through, for example, automatic enrolment. We will help an extra 200,000 people in work and empower people to work an extra 113 million hours a week. Those in work under universal credit earn on average £600 extra a year. That is how we will deliver a sustainable welfare system.
Make no mistake, we are supporting families that need support. This country spends more than any other developed nation on family benefits. Through universal credit, around 1 million disabled households will receive an extra £110 on average per month through more generous support. Universal credit pays up to 85% of childcare costs, compared with 70% under legacy, regardless of the number of hours worked, unlike tax credits. This provides the extra cash boost to pay for childcare and allows people to work extra hours.
Working families in England can also claim up to 30 hours’ free childcare for three and four year-olds from support from other government departments. This has helped drive profound cultural change in this country, with 1.6 million more women in work since 2010. As a working mother, I know so well that most women really want to work and stay connected. I agree with my noble friend Lady Pidding that universal credit unlocks work opportunities for everyone, unlike the legacy system—and, yes, we will not stop the rollout of UC.
We know that work does not just pay financially—it does much more than that, it provides people with a sense of purpose, identity and personal achievement—all those things that we in your Lordships’ House experience and perhaps sometimes take for granted in our own lives. It also helps with physical and mental health as it tackles loneliness head-on. It allows people to develop their skills and transform their lives. That is what this Conservative Government are doing, and we are doing it through universal credit.
We will make a success of universal credit by being an open department that listens. In response to my noble friend Lord Sherbourne, who is so right, it is important that we listen. We are travelling the country to speak to experts, workers and those on UC to understand where the system can be improved. That is quite right. As the noble Lord, Lord Young, said, we need to keep listening and travelling the country. This year, my ministerial colleagues and I have met with over 500 colleagues, charities and stakeholders; visited over 50 jobcentres, service centres and pension centres; tabled 35 Written Ministerial Statements and appeared 15 times in front of Select Committees.
As a Government we have listened to concerns and responded. This week, the Chancellor announced significant changes in the Budget that will make a huge difference to working families and those moving to universal credit. For those in work, we have put an extra £1.7 billion a year into work allowances, increasing the amount that hard-working families can earn before universal credit is tapered away. This provides 2.4 million families with an extra £630 a year. This is a pay rise of 7% or more for these workers, showing that hard work pays off. This measure will increase the incentive to enter work and focuses support on some of the most vulnerable—parents, disabled people and carers, as referenced by the noble Baroness, Lady Pitkeathley—who may face greater barriers to entering employment.
We will also support those moving to universal credit, especially the vulnerable. My noble friend Lord Farmer asked about the £1 billion package announced by the Chancellor in his Budget. This will provide two additional weeks of legacy out-of-work benefits for people moving on to universal credit, providing claimants with extra money during the five-week period before receiving their universal credit payment. I think that is possibly where the noble Lord, Lord Young of Norwood Green, suggested three weeks. People will receive an extra two weeks of benefits to help them with a more seamless transition from legacy on to universal credit. This is extra money that does not have to be paid back. It will provide 1.1 million people with an average one-off additional payment of £200, on top of the two additional weeks of housing benefit announced in autumn 2017 and put into place this year.
We think that about 700,000 people have been missing out on their benefits under legacy. We have worked that out to be to the value of about £2.4 billion. There will be a significant change in how people find out about what they can receive, because they will have constant contact with, and will work together with, their work coach.
We have gone further in the Budget to support families. We will support those in debt by reducing the normal maximum deduction rates from 40% to 30% of a person’s standard allowance. This will have a huge impact, helping over 600,000 families at any one point when rollout is complete. It will provide them with on average £295 extra a year as their debts are repaid over a longer period.
With particular respect to the self-employed, I say to the noble Baroness, Lady Donaghy, that we will support new businesses by opening up a 12-month grace period before the minimum income floor comes into effect. In 2023-24, around 130,000 self-employed households will benefit from exemptions from the minimum income floor, giving them the opportunity to grow a successful business. This is alongside extending new enterprise allowance contracts, which provide support for those out of work to set up a business and become self-employed. This will add to the 45 new businesses a day that have been created since the introduction of the scheme in 2011. We have listened, we have acted and we continue to listen.
Next month, universal credit will be in place in every jobcentre in the country, and this autumn we will bring forward regulations to deliver the managed migration phase of universal credit, to move people without a change of circumstances. These are positive regulations which allow us to protect 500,000 people’s severe disability premium at the point of migration; and deliver transitional protection for those we move, to ensure that at the point of moving those who are manage-migrated do not lose a penny. We will take a measured approach to delivering managed migration. It will start later: this is not a pause but we will be taking longer to introduce the managed migration, because we need to do test and learn to make sure that we get the system right. The process will start later in 2019.
Lord Young of Norwood Green
The Minister says, “It is not a pause, we will take a little longer”. Will she just clarify that? What does she mean exactly?
Baroness Buscombe
Let me clarify: we are not stopping the rollout. The rollout for all people coming on to universal credit will be completed by the end of December 2018, and they will continue on universal credit. The system will carry on and all those new people will come on, but we are not going to start moving people from legacy benefit over to the universal credit system until July 2019. We want to spend the first six months of next year building a system that works, through a process of test and learn, to make sure we get it right for those people. I promise that we will work with all our stakeholders to make sure that people do not fall through the cracks. I think the noble Lord has a family interest in this, in terms of jobcentres. The reality is that everybody is working hard to make this enormous change we have undertaken work to the best of our ability. I hope that that explains it.
In response to my noble friend Lady Wyld, I say that our migration processes will be co-designed with stakeholders, as I just said, to ensure that we have listened and understood claimants’ experiences. That obviously relates very particularly to people with disabilities—we want a process that works well for everyone. We are focusing on building safeguards for vulnerable claimants and ensuring we have all the necessary information to ensure a smooth transition with uninterrupted support. We will target support to the most vulnerable, as referenced by my noble friend Lord Shinkwin, and will focus on working to support those with mental difficulties. To ensure that the most vulnerable claimants are supported, we have improved the learning journey for our work coaches, which includes training to work with people who suffer from mental health issues. We have also increased the number of disability employment advisers who can provide additional support.
It is important to add that we are working holistically across government, including the Department of Health, the Department for Education and the ministry of housing. It is very important that all our systems work together for the benefit of all, so no more than 10,000 people will be moved in the first six months of the preparation phase for the managed migration. Let me say that this side of the House will not play politics with these regulations, as I am sorry to say we all know the Labour Party did earlier this year when they voted against the £1.5 billion of support we announced at the 2017 Budget. I confirm for the noble Lord, Lord Kirkwood, that we will lay the managed migration regulations very shortly. Pausing or scrapping universal credit—whichever is the Labour Party’s policy; we are not quite sure at the moment—will not support the families that Labour purports to stand for.
I hear what the noble Lord, Lord Kirkwood, said about universal support. We are working hard on universal support—our new partnership arrangement with Citizens Advice is an example of that—and we continue to work with local authorities. In terms of affordable credit, we will work with stakeholders on a feasibility study on a no-interest loan scheme—something that was announced in the Budget.
I will try in the last moments to answer one or two more questions. Her Majesty’s Treasury published a cumulative distributional analysis alongside the Budget in October 2018, which shows that government policy continues to be highly redistributive. In 2019-20, the 10% of households with the lowest incomes will receive over four times as much support in public spending as they contribute in tax on average, while the 10% of households with the highest incomes contribute over five times as much in tax as they receive in public spending. I listened to the noble Lord, Lord Livermore, and the noble Baroness, Lady Drake, and their analysis was wrong. There has been no sudden increase in in-work poverty. The chances of a working family being in poverty are broadly the same as they were in 1997.
In terms of housing support, we are working hard. A number of noble Lords referenced housing. We are working closely with the department of housing to improve what we can do to support new builds, as well as supporting those in social housing.
We spend £50 billion on benefits to support disabled people and those with health conditions—a record high—and £9 billion in real terms since 2010, so I do not recognise all the references to cuts. We are doing an extraordinarily difficult job. My noble friend Lord Sherbourne referenced the word “hard”. It is very hard to get this right, because we are working with millions of people on a daily basis across the United Kingdom to support them.
We stand to provide opportunities for families across the country, through the opportunity to work, and through a sustainable, fair welfare system—fair to those claiming through it and those paying for it, fair because we support vulnerable families as compassionate Conservatives, and fair to those who can work by rewarding hard work.
Child Support (Miscellaneous Amendments) Regulations 2018
Baroness Buscombe Excerpts(5 years, 6 months ago)
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Baroness Buscombe
That the Grand Committee do consider the Child Support (Miscellaneous Amendments) Regulations 2018.
Relevant document: 41st Report from the Secondary Legislation Scrutiny Committee
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, I begin by thanking noble Lords for bearing with me as I take these regulations through from a seated position. I want to say a particular thanks to the noble Baroness, Lady Sherlock, for giving me early notice of her response to the regulations, for which I am extremely grateful. The regulations were laid before both Houses on 12 September 2018. They enable the Government to make amendments to child maintenance legislation to deliver the new child maintenance compliance and arrears strategy. Let me give the Committee some context and background to the regulations.
The Government introduced a reformed child maintenance scheme in 2012. The reformed scheme provides stronger incentives for parents to work together following separation and, where possible, to make a family-based arrangement for maintenance, avoiding state intervention altogether. The Child Maintenance Service is there for families unable to make a private arrangement. It delivers a simpler scheme, avoiding the problems which beset the previous statutory child maintenance schemes. These draft regulations will strengthen the statutory scheme and introduce measures to prevent parents artificially minimising their child maintenance liability. They will also introduce new collection measures, close loopholes and broaden the sanctions that we can bring against the small number of parents who persistently fail to meet their obligations to their children.
Now that the majority of cases with ongoing maintenance have been closed on the CSA schemes, the Government want to draw a line under the regrettable legacy of the CSA and end the years of uncertainty that families who have historic CSA cases have experienced. For many years, these cases have been held in limbo. The debts outstanding are often small, and in some cases, when asked, parents have moved on with their lives and are not interested in pursuing the debt. These regulations will give parents in certain circumstances a final chance to tell the Government that they still want to consider taking action to collect their debt where it is likely to be possible at reasonable cost to the taxpayer. This will enable these cases to be closed finally in the next few years.
A small number of parents are currently able to lower their child maintenance liabilities artificially, or avoid them altogether, by drawing an undeclared income from assets. Whether this is via loans against the value of bullion or through the acquisition of virtual currency, the cultivation of a cash-poor but asset-rich lifestyle is a rare but growing method of evading child maintenance responsibilities. These regulations introduce new powers to address this problem. Where a client believes their ex-partner possesses the relevant assets, the Child Maintenance Service will investigate, escalating to its financial investigations unit if appropriate. If possession of a relevant asset is confirmed, and the value exceeds £31,250, a notional income will be calculated at 8% of the asset’s total value. This will be added to the total income used to calculate the maintenance due. It is recognised that assets can be acquired for legitimate reasons, which is why this power will be used in only a very small number of cases. The draft regulations protect assets in certain circumstances, including where the asset is used for business purposes or is the primary home of the parent or a child.
It has become evident that some parents are able to place all their funds in joint or unlimited partnership accounts, rendering them inaccessible to our current powers. These regulations extend the Government’s powers to enable the Child Maintenance Service to use regular and lump sum deduction orders in relation to joint and unlimited partnership bank accounts and to use lump sum deduction orders in relation to sole trader accounts. The introduction of this new power will mean that an additional £350,000 of maintenance per year may be collected for children.
To protect the rights of other joint account holders, a number of safeguards have been put in place to prevent deductions being taken from the other joint account holder’s funds. Joint or unlimited partnership accounts will be targeted only where there are insufficient funds in the parent’s solely held accounts. Before action is taken, the last six months’ account statements will be checked to establish the ownership of the funds. In a small number of cases where, despite investigation, it is not possible to establish how much of the funds within the account belong to the parent—for example, because no evidence is furnished as to ownership—a pro-rata approach will be adopted. This will assume that the parent’s share of the funds is equal to that of the other account holders. All account holders will be notified before a deduction order is made in respect of a joint account and given the opportunity to make representations in relation to the funds targeted. The standard representation periods will be 14 days for regular deduction orders and 28 days for lump sum deduction orders. All account holders will also have appeal rights. Further safeguards are in place to ensure businesses have sufficient cash flow to continue to trade. A deduction will not be taken if it would reduce the account balance below a reasonable amount; we suggest, for example, £2,000. There is also a requirement for the Government to review these provisions every five years.
Baroness Buscombe
I thank noble Lords for their contributions to this debate and for the constructive approach that they have taken towards today’s proceedings. I will now respond to some of the key issues raised. I will attempt to do this in order but I doubt whether I will succeed. I will do my best and if I fail to answer any questions, please be assured that we will write to the Committee following the debate.
I wish to put into context the justification for what we are doing. This has not been a quick or easy decision; it has involved exhausting other approaches to deal with the debt. We have also had numerous long debates and discussions within the department in trying to decide the best thing to do. We are talking about huge sums of money here. I say immediately that when considering resources and budgets, the truth is that we have to be proportionate—what is reasonable in the circumstances; what is more pressing; and what is more important. In our department we are already spending 25% of the entire government budget across Whitehall, so we have to think about resources and the degree to which we want to protect and support children going forward versus the difficulty of writing off such a considerable debt. We have to balance that against the fact that if we do not write it off and keep it on our books it would cost us approximately £30 million a year, which would not be money well spent. It has been a difficult balancing act.
Moving all the debt to the CMS IT systems would incur a one-off cost of at least £250 million, without the resources to action it. We have taken various actions to collect this debt, including using debt collection agencies to chase what is owed. More than 63,000 cases were passed to debt collection agencies for them to arrange collection, but after three years we took back 55,000 cases because the DCAs had not been able to make any debt collection arrangements.
This is our approach following exhaustive discussions, debates and thinking through what is fair to the taxpayer. As the noble Baroness, Lady Sherlock, said, the most important thing is to put the children at the forefront of our minds while seeking ways to send out the critical message that no one should cease to be responsible for their children. Enforcement matters.
I say to the noble Lord, Lord Kirkwood, that I absolutely respect his considerable and lengthy involvement on this really important subject. Of course, there have all along been compelling arguments on both sides. It is interesting what he said about the economic environment being different. Maybe there is also a sense that people are becoming more artful in how they seek to avoid their responsibilities, which is depressing. I am not sure what that says but the truth is that we must have the well-being of children at the forefront of our minds. In a sense, yes, these regulations are overdue, so it is important that we look forward. It is also important to say here that they form the first of two packages. We plan to lay a further set of regulations in 2019 to secure the remaining powers to deliver the 2018 compliance and arrears strategy. These will allow us to take a consistent approach to deduction from benefits.
I should explain that the regulations are being laid in two packages because the Social Security Advisory Committee needs to consider the regulations that make changes to deductions from benefits. But we would not wish to delay the rest of the regulations so that we may lay them all together. Those regulations are not yet drafted, so there is still time—I stress this—to take into account any thoughts on these provisions from noble Lords and honourable friends in another place. We welcome any input on that.
Lord Kirkwood of Kirkhope
That is an opportunity perhaps, under an SSAC consideration of the second package of regulations, for affected parents with care and non-resident parents to make submissions to the SSAC scheme later this year. If I understood what the Minister was saying, the Social Security Advisory Committee will undertake a normal consultation and will be looking for people to make submissions for consideration as the committee makes its recommendations. Am I right in thinking that?
Baroness Buscombe
I ask the noble Lord to bear with me, because I do not want to get this wrong. The answer is: only if the committee decides to report the regulations.
I will focus on some of the questions put to me, which are welcome. I start with the question from the noble Lord, Lord Kirkwood, on case closure timescales and the fact that there has been slippage. We are still on course to have ended all existing liabilities on CSA cases by the end of this year, 2018. The noble Lord referenced the NAO report. In that context, it is really important to say that we are continuing to consider the recommendations in the report. The department, in a broader context, has really taken on board that we need to be much better at listening. We thought that we were doing enough perhaps, but there is always more that we can do—within time and resource constraints, of course—but it is very important that we listen.
The noble Baroness, Lady Sherlock, asked how the representations will be sought. Will each parent to whom money is owed be written to individually? Depending on which category a case falls into, a client will receive a different letter or series of letters explaining what is happening and why, and, where appropriate, giving them the opportunity to ask us to try to collect their debt. These letters will be sensitively worded and will acknowledge that this may not be the outcome a client is hoping for. I was asked whether, if there has been a payment in the last three months, we will continue to collect. The answer is yes. If the case is in payment, we will continue to collect any arrears still outstanding for as long as the case remains in payment.
I was also asked whether our power to confiscate passports will be used only in a few cases. We will use this power in a targeted, proportionate way. I noted what the noble Baroness, Lady Sherlock, said about our having tried driving licences and asking whether that worked. The keyword here is “deterrent”. The vast majority of parents, we must stress, willingly pay towards their liabilities; we will seek to apply sanctions only in cases where parents wilfully refuse to pay. This happens only in limited circumstances. As with other enforcement powers, such as removing driving licences, the threat of exercising it can be very persuasive. The threat of denying people a passport is certainly something that stood out, when I first read the draft regulations, as something quite exceptional. I hope noble Lords will agree that it should send out a strong message to those who, frankly, are consistently refusing to take responsibility for their children.
The noble Baroness, Lady Sherlock, and the noble Lord, Lord Kirkwood, enquired about compliance rates for cases of collect and pay, asking what we are doing to improve the figure of 57%. The latest data, published in September, for collect and pay compliance shows it is going up; it is now 62%. Of the £1.85 billion due to be paid since the Child Maintenance Service began, £1.6 billion has been arranged through direct pay or collected through collect and pay while £290 million is currently unpaid—around 12% of the total. This percentage share continues to decline from 12.4% last year and 13.1% two years ago.
The CMS is not the only option available for separated parents to arrange child maintenance; it is there for people who cannot work together to make their own arrangements. The collect and pay service is in place for those parents unable to work together, who are less likely to be compliant. This means that the caseload is smaller but naturally more challenging than the CSA caseload.
The noble Baroness, Lady Sherlock, asked how many cases will be affected by the notional income power each year. We have not made projections on this point, but we anticipate the number to be small as, historically, only a small number of parents attempt to avoid their liabilities in this way. On the question of how many passports we expect to be disqualified every year, the figure referred to indicates that we project 20 applications for all types of sanctions will be made in the year. These include commitment to prison and disqualification from driving. Sanctions must only ever be a last resort; this is not just about how many we pursue but about targeting the right people. The threat often results in payments restarting.
The noble Lord, Lord Kirkwood, asked why the passport power is not being introduced for people in Northern Ireland. I can assure the noble Lord that this is not a particular sop to those resident in Northern Ireland who do not respect their responsibilities for their children. This is not being introduced in Northern Ireland simply because Northern Ireland citizens are entitled to an Irish passport; they have options for dual nationality, which would reduce the effectiveness of the power—they would simply find an easy way around it.
The noble Baroness, Lady Sherlock, asked whether giving periods of representation to account holders would mean that NRPs can move money to other accounts. This change is intended to close down a known loophole. If we intend to deduct a lump sum from a joint or business account, the funds will be frozen during the representation period. If parents move their funds to another type of account—for example, a sole account—we will target that account. If the funds are moved to an account we are unable deduct from, we will use our other strong enforcement measures to collect the debt.
Employment and Support Allowance
Baroness Buscombe Excerpts(5 years, 7 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, with the leave of the House, I shall repeat in the form of a Statement an Answer given to an Urgent Question in another place by my right honourable friend the Minister for Disabled People, Health and Work. The Statement is as follows:
“The department is correcting some historic underpayments of ESA, which arose while migrating people from incapacity benefit to employment and support allowance. We realise how important it is to get this matter fixed. Clearly the mistakes should not have happened, and we know it is vital that it is sorted as quickly as possible.
For the initial stage of the exercise, we expect to review around 320,000 cases, of which around 105,000 cases are likely to be due arrears. We now have a team of over 400 staff working through these cases and have paid around £120 million of arrears. We expect to complete the vast majority of this part of the exercise by April 2019, and we have to date completed all cases where an individual is terminally ill and has responded to the review, thereby ensuring they receive due priority. The additional cases will be undertaken throughout the course of 2019.
The announcement in July about paying cases back to the point of conversion requires us to review an additional 250,000 cases, of which we estimate around 75,000 could be due arrears. We will undertake this work throughout the course of 2019, and an additional 400 members of staff will be joining the team throughout this month and November. We will assign further staff throughout the review of the 250,000 cases. This will enable us to complete this very important activity at pace.
The department has prioritised checking claims from individuals whom we know, from our systems, to be terminally ill; to date we have completed all cases from the initial 320,000. Where an individual is terminally ill and has responded to the review, we want to make sure that they get that money as soon as possible, so we are now contacting cases identified as most likely to have been underpaid according to our system. Some of those cases will undoubtedly be the most complex.
Yesterday, the department published an ad hoc statistical publication, setting out further detail on the progress we have made in processing cases and revised estimates of the impacts of this exercise, including details of the number of claimants due arrears and the amounts likely to be paid. Also yesterday, I updated the frequently asked questions guide and deposited it in the Library, and I will continue to update this House”.
Baroness Sherlock (Lab)
My Lords, I thank the Minister for repeating that Answer. This week we learned that 180,000 sick and disabled people have been underpaid vital social security. The problem goes back to 2011 when the Government began migrating people on to ESA from incapacity benefit, but did it wrongly. In many cases, they migrated them across to contribution-based benefit when they would have been entitled to income-based benefit, which means that they could have got other payments, such as severe disability payment premiums and the like.
Initially Ministers said that they were allowed to pay claimants back money only until 2014, until CPAG went to court—at which point, they changed their minds. At the time of that migration an independent expert working for the DWP, Professor Malcolm Harrington, urged Ministers not to proceed until he was certain that the system was robust. But they did. Last July, the Public Accounts Committee published a scathing report about this error, in which it suggested that some people had lost out by as much as £20,000. It described the DWP as being defensive and unwilling to listen to warnings, which is very worrying. Claimants are now getting money, but in some cases it seems they have no idea how the sums were arrived at. The DWP now estimates that it is going to pay £1 billion as a result of this very serious error.
Will the Minister tell us, first, what steps are being taken to ensure that all claimants will be compensated for the lost value of passported benefits such as free school meals, NHS prescriptions or dentistry treatment? Secondly, what compensation will be paid to claimants on top of the arrears? Many of those will have found themselves forced into rent arrears, some into destitution. All of this costs money. How much compensation will they get for it? Thirdly, the DWP has identified those whom it knows to be terminally ill. How is it going to go about maintaining that, to include people who become terminally ill while the review carries on until the end of next year? What systems are in place to identify those people and prioritise their cases? Finally, and most importantly, what lessons has the DWP learned from this to ensure that it listens to the many warnings about universal credit migration and does not make the same mistakes?
Baroness Buscombe
My Lords, first, I will respond to the noble Baroness by referencing passported benefits, which are of course the responsibility of each government department. It would be impractical for the DWP to undertake an exercise to uncover who might have been entitled to those other passported benefits. However, we are talking to other departments to make them aware of the issue. In terms of compensation, it is important to make it very clear that no one saw a cash reduction when they were transferred to ESA. This is about extra money that they might have been entitled to. Also, it is really important to explain that we are learning lessons from this. The key lesson is that it is a mistake to try to prepopulate information without being in touch with claimants. It is very important for us to make sure, when we are changing benefits or introducing new benefits, that we do so in a way that involves working with claimants so that, rather than trying to be clever with a seamless process, we actually engage. That is what we are doing now, with what will be 800 people working with claimants to get this right.
Lord Stoneham of Droxford (LD)
My Lords, this announcement is a stark warning that a botched transition, which very sadly took place under the coalition, can leave vulnerable people thousands of pounds out of pocket for years to come. As the noble Baroness, Lady Sherlock, has just said, in the move to universal credit, we must take more care. What lessons are the Government learning from this mistake for the big changes to come and what new safeguards are they putting in place? In particular, will the Government amend the proposed Universal Credit (Transitional Provisions) (Managed Migration) Amendment Regulations 2018 so that claimants are transferred automatically from legacy benefits such as income-related employment and support allowance to universal credit?
Baroness Buscombe
First, I want to make it clear that we are constantly looking at how we can make our procedures more robust. In fact, our Permanent Secretary is in discussion with the Public Accounts Committee about how we can do this. The key lesson that we have very much taken on board in developing our processes and our thoughts on managed migration is—as I have just said, and I will repeat it—that it is important that we engage properly with the claimants and that we do not have a system that is entirely automatic without the opportunity to understand up-to-date data, information and circumstances with regard to each and every claimant. That is to ensure that claimants do not lose out on benefits to which they are entitled, unlike the legacy benefits, which about 700,000 people are not receiving. That is about £2.4 billion because there is not sufficient contact.
Lord McKenzie of Luton (Lab)
My Lords, will the Minister say a little more about the reasons for these underpayments? Is it fundamentally a systemic problem, or simply a collection of ad hoc errors?
Baroness Buscombe
It is right to explain—indeed I did explain this in July—that the reality is that a mistake was made that should never have been made. No mistakes are acceptable when it comes to people who genuinely need this important support. What we did back in 2013 was respond to individual cases. Clearly, the department was not aware that there was a much bigger problem. We worked to legal advice at the time, and we took the view that the law prevented us from paying arrears beyond the date of the LH judgment in October 2014. An Upper Tribunal in Scotland endorsed that approach. The department is, however, now in a position to extend the payments back to the date of the original conversion from incapacity benefit to ESA. The department expects to pay back around £970 million in arrears between now and 2020.
Lord Pickles (Con)
My Lords, the Minister has been quite contrite about what has happened, and I think the whole House will welcome that. Can we briefly return to the question of passported benefits? I understand how difficult this is, but the regulations on passporting have become better known since they originally came in. Will my noble friend look again at that and make it more of an automatic process rather than relying on the good offices of other government departments? But I have to say that I am extremely impressed by the way in which the Minister and her department have approached this.
Baroness Buscombe
I thank my noble friend for his question. I agree that it is not sufficient for the medium and long term just to say that we are talking to other departments. We are looking to see how, when we move to universal credit, we can ensure through managed migration that nobody loses out and that, where possible, all the benefits that can be passported are passported. However, we have to accept that we are dealing with a really complex system and with millions of people. It is right to put this in the context of ESA: we are dealing with 2.3 million working-age people and, up to now, we have spent £54 billion on benefits for these people with disability and health conditions. That is over 6% of all government spending. We have to do this in a way that is sensible and practical and as careful as possible. That is why we are also now employing 400 people in addition to the 400 we have already in order to sort out this particular mistake.
Baroness Thomas of Winchester (LD)
My Lords, perhaps I might ask about communications. Will all the JCP offices be able to tell people that they do not have to take any action themselves to get compensation for what has happened? Sometimes people have asked JCP officers whether they need to fill in the form and have been told that they do. Obviously, there is a bit of mis- information flying round. Will the department keep JCP office staff up to date with how they should carry on?
Baroness Buscombe
The noble Baroness is right to raise this point. The core communication hub is at Oldham and it is working hard to send out letters with phone numbers to absolutely everybody, so that people can be in touch by phone. We are constantly training our work coaches in all job centres to make it absolutely clear that this is something we are prioritising and have to sort out. It is up to us to do it; it is not for claimants or others to have to make that move. We are in touch with people who think they might be within this group and we urge them to be in touch with us on the numbers we are sending them by letter.
Universal Credit
Baroness Buscombe Excerpts(5 years, 7 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, I begin by paying tribute to Baroness Hollis of Heigham, who was a Minister in this House from, I understand, 1997 to 2005. Baroness Hollis was a formidable Minister—I know because I was a shadow Minister for Social Security during some of that time. I remember her as a fantastic champion of the welfare system, women’s rights and in particular women’s pension rights. I feel privileged to have known her.
By leave of the House, I shall repeat as a Statement an Answer given to an Urgent Question in another place by my right honourable friend the Minister for Employment.
“Mr Speaker, I note the precise wording of the Urgent Question from the right honourable gentleman, for whom I have a great deal of respect. I know he cares deeply about welfare matters and is an excellent chair of the Work and Pensions Select Committee. Of course he, his committee and the whole House have a right to hold the Government to account, and that includes the Department for Work and Pensions. I do not wish to be unhelpful in my response. However, some of the matters that he may be alluding to are the subject of speculation in the media. There has been a great deal of speculation around universal credit in the last few days. I cannot comment on speculation.
When it comes to rollout, we have long said that we will take a slow and measured approach to managed migration. That is why we will continue to take a ‘test and learn’ approach, acting on feedback and improving the system as it rolls out. By December 2018 universal credit will be in every jobcentre in the country. People who are making new claims to our benefits system now apply for universal credit rather than being put on the old system. Next year we will start the wider process of moving people from the old benefits system on to universal credit. The process will begin later next year in a measured way with no more than 10,000 people moved over, to ensure that the system is working well for claimants and to make any necessary adaptations as we go. We have said for a long time now that the managed migration process will take place from 2019 to 2023.”
Lord McKenzie of Luton (Lab)
My Lords, I start by thanking the Minister for her kind comments about my erstwhile colleague Baroness Hollis. It is with regret that we have the absence of her voice for our deliberations today. She had unparalleled experience on universal credit. She was determined, she was passionate, and her oratory rang out across this Chamber. I fear that we will not see her like again.
Universal credit is causing severe hardship for many people claiming it. Over the past two weeks, conflicting statements from the Government have caused real confusion about the impact it will have on people who are required to move across to claim it in the next phase. First, we were told that austerity was over, then that families on low incomes are in danger of losing up to £200 a month as a result of transferring to universal credit. Next, the Prime Minister said that nobody would be worse off, but the Secretary of State contradicted her the following day. This morning, we had the BBC report—I understand the Minister’s position on that—saying that the Government are planning changes to the universal credit system that will include the end date for the rollout being put back by a further nine months. This is the sixth time since 2013 that this benefit has been recalibrated.
Is the reported delay to the start of the next phase the result of the warnings that the Government have received from right across the voluntary sector and expert organisations that their draft regulations are simply not fit for purpose? Will they now publish their impact assessment of that next phase? How will the changes reported by the BBC affect the savings that universal credit is expected to make for the Treasury? How many households currently claiming legacy benefits will be worse off between now and 2023 as a result of making a new claim for universal credit? Together with dozens of disability and advice organisations, we call for a halt to the rollout of managed migration until it is fit for purpose.
Baroness Buscombe
My Lords, I am grateful for the noble Lord’s questions. Let me say straightaway that we have not been recalibrating anything. He will be aware that there have been a number of PQs in the past few months. There was a Written Ministerial Statement in June this year, wherein we set out very clearly that from the beginning of next year, we want to move to managed migration in a very slow and careful way. We want to be sure that we get it right, that the right systems are in place. As we also made clear to the Social Security Advisory Committee, we will not begin to introduce managed migration, which is those who are on existing benefits—the legacy system, as we call it—rather than those who are new to the benefit system who are going on to universal credit, until July next year. That has long been the case.
We are now waiting for the end of the rollout of the system into every jobcentre by the end of December this year. We are also now in receipt of some important recommendations made by the Social Security Advisory Committee as a result of our proposals to it with regard to managed migration regulations, which we hope to lay before the House in the near future. We are now considering those recommendations very seriously and I will report to this House in the very near future.
The most important answer that I must give straightaway is that a key point for the managed migration regulations, which we will bring forward, is to protect the most vulnerable. We are not halting any rollout. Our concern is to protect the most vulnerable— those who cannot work, those with severe disabilities—through the severe disability premium and careful full transitional protection through migration on to universal credit.
Lord Kirkwood of Kirkhope (LD)
My Lords, I am grateful to the Minister for repeating the Statement. I concur with her tribute to Patricia Hollis. She was an integral part in the creation of this legislation and delivered a complete masterclass in parliamentary scrutiny in the 2012 committee which I was privileged to share with her. She will be missed.
Can I confirm that there will be no delay in the publication of the managed migration regulations and that the Social Security Advisory Committee report will be published in due time? There should be no delay in either of those two things. Some of us are a little surprised that the recent controversy about the cuts has suddenly blown up, because it has been painfully obvious since 2012 that a moment would come when these things would bite and things would get really tough in terms of financial hardship for low income families.
I will make two points. First, I am now really worried about the requirement for managed migration people to have their benefits turned off and then to make their own application. We need to seriously look at these regulations to make sure that there is automaticity of transfer to universal credit, and then we can sort out the difficulties afterwards. Otherwise, hardship will be exacerbated.
The other thing I will say strongly to the Minister is that Church Action on Poverty has produced a very interesting report indicating that the safety net that was available in 2012, according to its research, has been slashed. Community care grants and crisis loans totalled more than £200 million a year, and we are now at the stage when the Government have just announced £37 million as the total amount of money for universal support across the country. Frankly that is not enough to prevent hardship occurring in ways that will hurt families in the future. The House will need to turn its attention to these things during consideration of the managed migration regulations.
Baroness Buscombe
I thank the noble Lord and say straightaway that there will be no delay to the publication. Indeed, because we have to see these regulations on the statute book by the end of this year, it is very important to ensure that they are laid shortly and that we can debate them in your Lordships’ House. We very much hope that, unlike the package of £1.5 billion in extra support for universal credit that was introduced in another place following the Budget last autumn, the managed migration regulations will not be rejected, as the package was last autumn.
It is important to remember that we introduced a package that made advance payments quicker and easier for people to access. They could have a 100% advance up front for their first month’s claim, with no interest to repay for 12 months. We scrapped the seven-day waiting period and introduced a two-week run-on for people receiving housing benefit, with a cash payment that was not repayable. We are helping more than 500,000 people by protecting severe disability premiums.
That package was rejected in another place. Let us hope that this managed migration package will be supported in another place and in your Lordships’ House, because we want to protect the severely disabled, those with health conditions and those who genuinely need our support. We, too, are surprised by the recent controversy, because we are trying to do the right thing to support the right people. Benefits will not be turned off. We will be very careful to ensure that there is a transfer. That is why we will introduce the system slowly and carefully. We are using six months of next year to try to get this right.
Baroness Lister of Burtersett (Lab)
My Lords, I echo what has been said about my noble friend Lady Hollis. She was an inspiration.
This morning, at a meeting of the APPG on universal credit, organisations working with claimants around the country were unanimous that so-called managed migration—as the noble Lord, Lord Kirkwood, made clear, it will not be managed on behalf of claimants—should not go ahead until UC’s design flaws are rectified, especially inflexible monthly assessment, which is creating huge problems. Will the Minister undertake to look at these problems as a matter of urgency? UC needs to be recalibrated.
Baroness Buscombe
My Lords, I do not recognise the word “inflexibility” when it comes to universal credit. The whole point of the system is to take six different benefits and put them into one simple one that tracks people’s circumstances on a monthly basis, rather than leaving people with no contact, sometimes for literally years, under the legacy system. We are spending £3.1 billion on transitional protections for 1.3 million claimants to ensure that no one loses out at the point of transition. This will ensure that no families receive less money than they do today. We are spending an additional £1.4 billion on protection for 500,000 disabled people receiving disability premium.
Personal Independence Payment
Baroness Buscombe Excerpts(5 years, 7 months ago)
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Baroness Thomas of Winchester
To ask Her Majesty’s Government what action they are taking to improve Personal Independence Payment assessments in the light of the number of successful appeals.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
Of the 3.5 million decisions made since the personal independence payment was introduced, 9% of all decisions have been appealed and 4% of all decisions have been successfully appealed. We are committed to making further improvements to the quality of decision-making and have now deployed 150 presenting officers across PIP and ESA to provide valuable insight into why decisions are overturned at tribunal.
Baroness Thomas of Winchester (LD)
I thank the Minister for that reply. Maybe that takes us slightly further on, but she will know that the chairman of Scope, who is appealing his own PIP decision, has drawn our attention to the 71% of successful, but expensive, PIP appeals in the first three months of this year. The figure goes up and up. This tallies with the experience of Muscular Dystrophy UK, which reports a huge increase in PIP cases, with many claimants left in real financial hardship, such are the delays in the system. What practical, concrete steps is the department taking to improve the quality of assessments right now?
Baroness Buscombe
I am pleased to say to the noble Baroness that appeals actually reduced by 9% in the last quarter, April to June of this year. We are doing a great deal to try to ensure that we get the decision right the first time. To that end, we have changed the guidance to ensure that those on the highest awards, with needs that will not change or will deteriorate, get an ongoing award; we have made changes to the PIP assessment guide; we have restructured our decision letters to make them easier to understand; we have introduced mental health champions to support assessors who undergo specific training to emphasise the functional effects of mental health conditions; we have launched a series of videos outlining the claim process in a simple and clear way; and, to help to improve trust in the assessment process, we are considering options to video record PIP assessments. We are designing a live-testing pilot, due to begin later this year. I assure all noble Lords that my honourable friend in another place, the Minister for Disability, is constantly looking at ways to improve.
Lord Clark of Windermere (Lab)
My Lords, will all those individuals who were assessed for PIP in the months leading up to the judicial interference be reassessed? Will they be informed that they are going to be reassessed, and will they be informed of the outcome?
Lord Low of Dalston (CB)
My Lords, what the Minister says is all very well but she will be aware of the publicity recently given by the chairman of Scope to inconsistencies that he experienced in his assessment for PIP, with different weightings being given to characteristics that had not changed from one assessment to another. What reassurance about the fairness of the system can the Minister give to people like the chairman of Scope, for whom this is an all too common experience?
Baroness Buscombe
I think it is important not to conflate the appeals figures with assessment or decision-making quality. Having said that, we are constantly looking at how we assess the quality of those decisions. On the appeals themselves, oral evidence, which is critical in determining appeal outcomes at tribunal, often greatly assists in drawing out the right evidence more effectively, as the Social Security Advisory Committee has said. New written evidence provided at the hearing that has not previously been seen by decision-makers can make the difference. Also, tribunals sometimes draw a different conclusion based on the same evidence. However, it is important to add that we are talking about nine different possible awards, and each and every one of those is capable of mandatory appeal. It is not so straightforward when people have such individual and complex needs.
Baroness Couttie (Con)
My Lords, the Government are clearly putting forward a number of amendments to try to improve the process and payment of PIP. What are they actually doing to make improvements for mental health patients, who might find the system quite complicated and difficult?
Baroness Buscombe
My Lords, there has been a very strong focus, particularly in recent months, on mental health conditions. PIP has a much better understanding of non-physical conditions such as mental health conditions than existed under DLA. Indeed, overall, 65% of PIP recipients whose main disabling condition is a mental health one are getting the enhanced rate of the daily living component, compared to only 22% of mental health recipients under DLA; and 33% of PIP recipients whose main disabling condition is a mental health one are getting the enhanced rate of the mobility component, compared to only 10% of mental health recipients receiving the higher rate of the DLA mobility component. PIP is showing a greater and more generous focus regarding delivery for those with mental health conditions.
Baroness Sherlock (Lab)
My Lords, the Minister seems to think that tribunal decision rates do not reflect quality. If 71% of cases are overturned at tribunal—for example, the figure for JSA is only 36%—something has gone badly wrong. The noble Lord, Lord Low, and the noble Baroness, Lady Thomas of Winchester, mentioned the case of the chairman of Scope, who has Parkinson’s and incurable prostate cancer. At two subsequent assessments he was awarded 11 points; you need eight to get PIP. At last March’s assessment, he got only two. His Parkinson’s is progressive and now very severe, and his prostate cancer is incurable. He has described the experience of navigating this as Kafkaesque, complex and unprofessional. I think any noble Lord who has ever spoken to a single person who has navigated this will recognise that. What are the Government going to do about this?
Baroness Buscombe
My Lords, I absolutely hear what the noble Baroness, Lady Sherlock, is saying. But I think it is really important to stress that we genuinely believe the PIP system is working, and it is a vast improvement on the DLA system. It is not perfect and we are constantly looking to improve it, but it is only right that support is targeted at those disabled people who require the most assistance to lead independent lives, and personal independence payment will achieve that. But key to the benefit is a more objective assessment which allows us accurately and consistently to assess individual needs. We are focusing more on training the assessors and working with champions to support them, to improve the outcomes right from the start.
Personal Statement
Baroness Buscombe Excerpts(5 years, 8 months ago)
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The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Buscombe) (Con)
My Lords, with the leave of the House I will make a short personal statement concerning comments I made on 24 July when, in response to an Oral Question, I spoke about the position of Refuge on split payments in universal credit. I said:
“Refuge has made it clear that it is not convinced that split payments help”.—[Official Report, 24/7/18; col. 1597.]
Refuge has clarified its position to me, saying that split payments should happen by default for all couples. I apologise for my inadvertent error. I recognise that I did not accurately represent Refuge’s views, and I am grateful to Refuge and the noble Baroness, Lady Lister, for drawing this error to my attention. Further, I am grateful to the House for allowing me to correct the record at the earliest opportunity. Lastly, I thank Refuge for its continued service to victims of domestic abuse, which, as noble Lords know, the Government take incredibly seriously.