Children’s Wellbeing and Schools Bill

Baroness Lister of Burtersett Excerpts

Monday 19th January 2026 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, I am pleased to support Amendment 77, to which I have added my name. I take this opportunity to thank my noble friend the Minister for the helpful meeting that I and stakeholders had with her to discuss the other issue I raised alongside this in Committee.

As my noble friend has said, I and other noble Lords have been pressing for many years the case of children who have not claimed the citizenship status to which they are entitled, including the high fees that can act as a barrier. Indeed, we have earned the label of “terriers” on the subject. I am delighted to welcome my noble friend Lord Moraes to the noble band of terriers. Like him, I speak as a patron of the Project for the Registration of Children as British Citizens.

This amendment, so ably introduced by my noble friend, would help to ensure that these children’s citizenship rights are not overlooked by local authorities in their role as corporate parents. As he emphasised, this concerns a statutory entitlement to citizenship and is not a matter of immigration or discretion: all too often, the Government have conflated the two in the past. The consequence of this right not being given effect has been spelled out by the High Court, which noted that children who identify as British but who have effectively been deprived of citizenship can

“feel alienated, excluded, isolated, second-best, insecure and not fully assimilated into the culture and social fabric of the UK”.

I also echo my noble friend’s welcome for the consideration the Government are giving to how better to support these children in establishing their right to citizenship. The White Paper, Restoring Control Over the Immigration System, stated that in the “near term” the Government will ensure that

“children who have been fully in the UK for some time, turn 18 and discover that they do not have status, are fully supported and able to regularise their status and settle. This will also include a clear pathway for those children in care and care leavers”.

This amendment, which also relates to some children born in this country, will make it less likely that children in this situation will turn 18 without having claimed their right to citizenship. So there is a good case for the Government accepting it. Given that the White Paper commitment was made last May, and related to the “near term”, what have the Government done to realise it?

These are important issues for children’s citizenship rights and well-being, so acceptance of this amendment would strengthen the Bill as it relates to some of the most marginalised children in our country.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a great pleasure to follow the noble Baroness, Lady Lister, as I have many times before on this subject, joining the terrier pack yet again. It is a great pity that that pack still needs to form; all the other occasions were under the previous Government and we were hoping that we might be able to disband and head on to other things.

I join the noble Baroness, Lady Lister, in welcoming the noble Lord, Lord Moraes, and thank him for tabling this amendment, to which I attached my name very late in the day. I just caught up with this Bill along the tracks.

The noble Baroness and the noble Lord have both made the case overwhelmingly for Amendment 77, so I will not go over the same ground as they did. I will just highlight again the campaigning work of Citizens UK in particular, which has focused on the incredible difficulty of the cost of more than £1,200 for a citizenship application and the fact that so many people are unaware that it is necessary.

I will make one additional point. We have seen in the Windrush scandal that the British state failed to meet its responsibilities and failed to do the right thing by British citizens. With the reality of Brexit, many children with European links and European families but with the right to British citizenship risk being trapped in the coming years unless their situation is sorted out before they turn 18. Let us not create another Windrush scandal for those Brexit and indeed other children.

Children’s Wellbeing and Schools Bill

Baroness Lister of Burtersett Excerpts

Wednesday 14th January 2026 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, I support Amendment 97, to which I have added my name. In Committee, I likened the waiting for Wales argument to a legislative Waiting for Godot. Well, Godot has arrived in the form of a very thorough evaluation of the first three years of the Welsh legislation. The overall message, as we have heard, is very positive.

I was particularly struck by what the report says about positive parenting, as this was a key argument used by my noble friend the Minister in rejecting the original amendment in Committee. The report makes it clear that this is not an either/or situation. The abolition of the reasonable punishment defence in Wales has been implemented in such a way as to promote and support positive parenting practices. Thus, the report makes it clear that, thanks in part to the introduction of a parenting support scheme which we have heard about, the response to physical punishment is proportionate and focused on behaviour change rather than criminalisation.

Elsewhere, the report notes that the aim of the Act was to protect children’s rights while adopting an educating and preventive approach which avoids criminalising parents. It suggests that this aim is being realised in practice, in that implementation is acting not to criminalise parents but to help educate and support them in managing behaviours differently. This addresses one of the fears sometimes expressed about abolition of the defence.

I argued in Committee that this is a very much a children’s rights issue, and the report points to research that indicated that professionals view the Act as having enhanced their ability to safeguard children’s rights, with nearly 60% reporting that it had either supported or greatly supported them in protecting children’s right to be free from violence.

This is, of course, an interim report, but in Committee my noble friend referred to it as helping to build the evidence base needed for the Government to make a decision, and I think it is fair in its claim to provide a robust initial evidence base. I am not sure what further evidence the Government need to be added to the pile that already exists. This amendment is very much a compromise, and I can see no good reason for them not to accept it. I hope they will, because otherwise it could be a very long time before English children are free from the harmful effects of what the four Children’s Commissioners described as an outdated and morally repugnant law.

[Baroness Benjamin (LD)]

My Lords, I support Amendment 28 in the name of my noble friend Lady Tyler, which I hope the Government will support. I should like to speak on Amendment 97 in the name of the noble Baroness, Lady Finlay, on the legal defence of reasonable punishment. I declare an interest as vice-president of Barnardo’s, which has been campaigning for the end of the reasonable punishment defence, along with its partners in the children’s sector.

We already know that physical punishment can cause significant harm to a child, including poorer mental health and increased behavioural problems, as the noble Baroness, Lady Finlay, has said. Any child who is physically punished is also at greater risk of even more serious abuse, which can be devastating.

Professionals who work with children can find it difficult to assess and respond to potential risks, since distinguishing between physical punishment and abuse is challenging. As a result, Wales and Scotland have acted to remove the reasonable punishment defence from the law, but England has not done so. Children in this nation remain uniquely vulnerable, with less protection from assault than adults and other children elsewhere in the UK.

I turn my attention to the Welsh review, as mentioned by the noble Baroness, Lady Finlay. Some 95% of parents in Wales now know that physical punishment is illegal and 86% believe it is ineffective. We feared widespread criminalisation of parents, but that has not occurred. Fewer than five cases have been referred to the CPS, with no convictions to note. Instead, families have been diverted to supportive parenting programmes, which have led to positive outcomes for many of them, including in children’s behaviour and parental well-being. Professionals have also reported greater clarity and confidence when dealing with such cases. That shows that the law is working but, most importantly, that children are being protected.

There is widespread support for change. Polling from the NSPCC has shown that the majority of safe- guarding professionals, including teachers, healthcare professionals and the police, would like to see the end of physical punishment of children. More than 300 public figures also supported a change in the law. The Government wished to wait until evidence from Wales on the law change was available, but that evidence is now available.

The amendment before us does not seek to legislate the defence away at once. We ask only that the Government meaningfully consider the evidence from Wales and consider abolishing the so-called reasonable punishment defence in England through future legislation, within six months of this Bill becoming law.

When the proof of harm is so extensive and the evidence of change is so promising, I strongly feel that asking for a transparent response to that evidence is a reasonable and proportionate request. Children should not have to wait indefinitely for clarity on what their rights are, or for protection and fairness when evidence that could potentially change their lives already exists. I ask other noble Lords across the House to stand with children and give their support to this amendment, and, more importantly, for the Government to accept the amendment, as that would show that they too put children at the heart of the matter when it comes to equal protection for children. As I always say, childhood lasts a lifetime, so let us do it.

Universal Credit: Two-child Limit

Baroness Lister of Burtersett Excerpts

Wednesday 10th December 2025 Lords Chamber

[Baroness Sherlock (Lab)]

My Lords, the Government have seen no evidence that the two-child limit had an impact on family size. For example, 47% of households affected by the two-child limit were not claiming universal credit when any of their children were born. In other words, things happen; people set out, they have children and something happens. Maybe someone loses their job, they are bereaved, their spouse leaves them, or they get sick and cannot work. The welfare state should be there to support people, both into work and in work, but it is also there to support them when they cannot work. We already know that some 60% of households affected by this are in work. Our strategy is to make sure we do all we can to get people into work, get them to develop in work and support them, but we are there as a safety net when they cannot do so.

[Baroness Lister of Burtersett (Lab)]

My Lords, academic research has found that the two-child limit had no positive employment effect and that parents living in poverty are pushed further from the labour market because of stress, insecurity and the sheer hard work of struggling to get by. Does my noble friend therefore agree that a decent social security system can support effective job-seeking and plays an important role in tackling child poverty, as the child poverty strategy recognised?

[Baroness Sherlock (Lab)]

My Lords, my noble friend makes a really important point about the scarring effects of poverty. Our aim is to make sure that everyone who can work, does, with all the help they need to do that. That is what this Government have been doing. We are investing heavily in childcare to make it possible to work, making sure wages pay enough so that work is a good thing, and supporting children.

We know that when children grow up in poverty, things get worse for them. They are less likely to work as adults, and they earn 25% less at the age of 30. Even if some parts of the House are not persuaded on the grounds of the importance of the individual child, this is an investment in the future of our country. No other G7 country has a policy like this and there is a reason for it. We cannot compete on the world stage, grow our economy or create prosperous futures for our kids if we do not enable them to grow up thriving and healthy.

Carer’s Allowance: Overpayments Review

Baroness Lister of Burtersett Excerpts

Tuesday 18th November 2025 Lords Chamber

[Baroness Sherlock (Lab)]

The noble Viscount raises a very important point. Certainly, I have met with organisations over the years that work with young carers. Schools are becoming increasingly aware of these pressures. Good schools with good pastoral care systems are identifying them and making sure both that these young carers get the support they need and that they themselves are aware of broader issues in the home of which other authorities might need to know. The noble Viscount will know that this does not stop at 18, and there are issues for young adult carers who want to carry on and complete their studies. Fortunately, if somebody is doing less than 21 hours a week of supervised study, they can still claim carer’s allowance, but we are looking at how we can best identify and support young carers to enable them to combine their study with their caring. We want to make sure that their childhood is not ruined and that young adults have a chance to make a life for themselves as well as caring for those whom they love.

[Baroness Lister of Burtersett (Lab)]

My Lords, the level of carer’s allowance, understandably, was not part of the terms of reference of the review, but its very low level, relative to other similar benefits, contributes to the disproportionate risk of poverty faced by carers. Is this something that the Government might look at in the future?

[Baroness Sherlock (Lab)]

I will say to my noble friend that one of the differences, as I began to explain to the noble Lord, Lord Young of Cookham, is that carer’s allowance is not a means-tested benefit. If someone is on a low income and is doing some caring, they can also apply for a means-tested benefit, such as universal credit or, if they are older, pension credit. Although they cannot usually get both of those benefits, if they do get one of those benefits, they can get an extra £2,400 a year in universal credit or pension credit to acknowledge that caring. Having said that, the Government are determined to make sure that this maintains its value and is increased by CPI every year, and new rates for 2026 will be announced in the next few weeks. The Government are spending a record £4.5 billion this year on supporting a million carers through carer’s allowance.

Public Authorities (Fraud, Error and Recovery) Bill

Baroness Lister of Burtersett Excerpts

Report stage
Tuesday 21st October 2025 Lords Chamber

[Lord Verdirame (Non-Afl)]

My Lords, this amendment follows on from a previous amendment tabled by the noble Baroness, Lady Lister, in Committee. It also has support from the right reverend Prelate the Bishop of Leicester and the noble Baroness, Lady Finn. I am very grateful to both of them. Since Committee, the noble Baroness, Lady Lister, and I have engaged with the Minister, who has been very helpful and constructive. I also thank the Public Law Project for its assistance, not least in navigating a complex area of law and public policy.

The amendment seeks to ensure that the recovery of overpayments by deductions from universal credit payments, which is the DWP’s preferred method for recovering overpayments from people still in receipt of universal credit, is fair and affordable. It seeks to achieve this objective by adding a new subsection to Section 71ZB of the Social Security Administration Act 1992. The new subsection would have two effects.

First, it would require DWP to consult claimants before deductions are applied and to ensure that the rate of recovery is affordable to that individual. The version of this amendment that we debated in Committee would essentially have written off official error overpayments. The version that we have brought on Report is wider in scope, in that it applies to all overpayments, not just those due to official error, but it is also less ambitious in that it does not require any write-off of overpayments.

The second effect of the amendment is that it would limit the powers of recovery to overpayments that are less than six years old, in line with the limitation period that applies to the recovery of debts through the courts. In Committee, the Minister stated that the department’s preference was,

“always to agree an affordable and sustainable repayment plan”.—[Official Report, 25/6/25; col. GC 16.]

This is not currently the approach applied to the recovery of overpayments from individuals still in receipt of benefits. Instead, in these circumstances, DWP has the power to deduct 15% of an individual’s monthly universal credit payments directly, with limited notice and without the individual’s consent. For a single adult aged 25 and over, this amounts to a sudden, unanticipated loss of £60 a month.

The current approach to the recovery of overpayments stands in stark contrast to the requirements that apply to commercial lenders, such as banks and utilities companies, which are required by regulation to engage with customers extensively if they owe them money. That approach also contrasts with the provision of new powers to recover deductions from the bank accounts of individuals no longer in receipt of benefits and who are not engaging with the system. In these cases, the legislation would provide for an opportunity to make representations on affordability and hardship, before the deductions begin.

By requiring the Secretary of State to give notice and invite affected persons to make representations on affordability, the amendment seeks to ensure that equivalent protections are put in place for the recovery mechanism that applies to those who continue to be in receipt of benefits. As far as the limitation period is concerned, the new subsection would require that a recovery must commence before the expiration of a six-year period from the date on which the recoverable amount was paid. Currently, no such restriction applies, which means that individuals can face recovery action for overpayments that are many years old—and of course, in those cases, people will often not be able to locate records.

I understand that the Government are sympathetic towards the objectives of our amendment but still have concerns. We have addressed at least one of those concerns in the version of the amendment that has been tabled; that concern related to the way in which we had formulated the subsection on limitation. But I understand that the Government have a wider concern: the Minister explained in particular that, in a complex system such as welfare, there is a risk of unintended consequences once any new statutory provision is put into operational effect. I know that she speaks from depths of experience and from a sincere commitment to make the system fair and efficient.

Given that we have agreement on first principles, if in her reply the Minister is not inclined to support this amendment in its current terms, I hope that she might consider a Third Reading amendment that reflects the Government’s concerns—although I echo the concern of the noble Lord, Lord Vaux, about the very limited time we have before Third Reading. If the Government are not inclined to bring back a Third Reading amendment, can the Minister reassure us in two critical respects: first, that the Government agree with the objective of giving people in receipt of benefits a fair chance to discuss an affordable repayment plan rather than applying the automatic deduction of 15%? Secondly, can the Minister outline concrete alternatives to the statutory provision that we have proposed whereby this objective might be achieved? One solution might be the setting up of a task and finish group within the governance structure of the current review of universal credit to work through the technicalities.

Again, I am very thankful to the Minister for her exemplary engagement with us on this amendment. With that, I beg to move.

[Baroness Lister of Burtersett (Lab)]

My Lords, I start by thanking the noble Lord, Lord Verdirame, for tabling this amendment, which, as he said, follows up on the one I tabled in Committee, to which he spoke so eloquently. I too thank my noble friend the Minister and her officials for the very useful meeting we had recently and the Public Law Project for all its help.

Through the universal credit system, the Government determine the minimum amount that people and families need to live on. As has been evidenced by the Joseph Rowntree Foundation, for many that amount is not sufficient to meet their essential needs. As acknowledged by the DWP’s own policies, any deduction that takes people below that amount will result in hardship.

A Public Law Project survey of 500 people who had deductions applied found that a third of respondents became destitute as a result. Some 97% of Citizens Advice advisers reported that overpayment or advance loan deductions negatively affect people’s ability to afford essentials, while analysis by Policy in Practice found that, in addition to lowering income, deductions increased income volatility,

“making it harder for low income households to budget and plan ahead”,

with

“far reaching consequences, particularly for housing affordability and the risk of homelessness”.

The need to address the impact of deductions on poverty and financial instability was recognised by the Government at last year’s Autumn Budget, when they introduced the fair repayment rate. This move, which reduced the maximum amount that can be taken from someone’s universal credit payment to repay debt from 25% to 15%, was very welcome, but it is not enough to address the issues associated with overpayment recovery. The 15% rate is the rate that already applied for recovery of overpayments where individuals do not have earned income. Further, while it is helpful to have a maximum cap, it is not a substitute for assessing what constitutes an affordable rate of repayment for individuals.

A recent report from the Money and Mental Health Policy Institute, while welcoming the fair repayment rate, expressed concern that the 15% rate would continue to drive hardship. Its research found that the current system for overpayment recovery

“disproportionately affects people with severe mental health conditions … who are eight times more likely to have been overpaid benefits”.

The result, the charity says, is

“serious financial and psychological harm for many people already struggling with money and mental health problems”.

One research participant commented on the deduction, saying,

“some days I have been not eating because I can’t afford to, which is leaving my mental health in tatters”.

Universal Credit Bill

Baroness Lister of Burtersett Excerpts

2nd reading & Committee negatived & 3rd reading
Tuesday 22nd July 2025 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, I pay tribute to the many disabled people and disability and anti-poverty organisations, as well as colleagues in the Commons who listened to them, for winning concessions and shrinking this Bill to exclude PIP. Nevertheless, there remain serious concerns. Although, thankfully, for the most part existing claimants are protected, the shrunken Bill will still cause real damage. Yet the rushed process does not allow for proper scrutiny—a criticism voiced by the many disabled people who have emailed us. We should not underestimate the degree of anxiety, stress and mistrust that this episode has caused them.

The joint civil society briefing, for which I am grateful, warns that by 2030 the cuts to the health element of universal credit will mean a loss of £3,000 a year for 750,000 disabled people, with the impact increasing in future years. They will also have a damaging knock-on effect on carers, some of whom are themselves disabled. A major point of concern is the drafting of the severe conditions criteria, which will protect a small number of future health element claimants with a terminal illness or lifelong condition, and in particular the “constantly” requirement, which applies a more stringent standard than now, to the detriment of people with severe conditions that fluctuate day to day, including MS and Parkinson’s. The Minister in the Commons tried to address this at Third Reading, but the civil society briefing warns that

“there is a gap between the stated intention to exactly reflect the existing severe conditions, and the test which is written into … the legislation”.

Given the lack of time to look at this properly now, will my noble friend consider withdrawing paragraph 6 of Schedule 1, which simply amends existing regulations, so that this can be sorted out through secondary legislation? What the Minister said so helpfully in the Commons needs to be written clearly into legislation. Can my noble friend explain why it is not?

As noted, the Joseph Rowntree Foundation and the New Economics Foundation estimate that the net effect of the Bill’s measures will be an increase of around 50,000 in the numbers of those in poverty by 2029-30. Yet disabled people are already at disproportionate risk of poverty, as demonstrated by a recent report from the APPG on Poverty and Inequality, which I co-chair. Disabled women are particularly at risk—one of the human rights concerns raised by the UN—but the revised impact assessment offers only a superficial high-level equalities analysis rather than a proper equalities impact assessment.

The one mitigating provision in the Bill is the very welcome real increase in the UC standard allowance, which contributes to the aimed-for rebalancing of it and the health element. However, the rebalancing is not exactly balanced as, between the cuts to the health element and the improvements in the basic UC rate, even by the end of the decade we are talking about a real increase of only around £5 a week. Of course, even £5 matters to someone on a very low income, but it is hardly enough to provide the dignity and security that is promised in the impact assessment—which acknowledges that this only starts to improve basic adequacy. As the Resolution Foundation warns, it will still leave benefit income being far from adequate. Moreover, the impact assessment acknowledges that a “fairly small number” will not gain from the increase, because of the benefit cap. Can my noble friend indicate how many this “fairly small number” will be, considering that anyone who loses entitlement to the health element could then be subject to the cap?

I welcome the commitment to coproduction of the Timms review, and the assurances he has given. I hope these will allay the totally understandable fears of disabled people and carers, given the lack even of genuine consultation hitherto. But while, like him, I hope the review group will be able to achieve a consensus, if it does not, then what? Can my noble friend say whether, in such a scenario, those who disagreed with the outcome would be able to publish their views as part of the official report?

When recently I asked my noble friend whether the DWP would consider extending the principle of coproduction to the UC review, she tried to reassure me with reference to forthcoming focus groups with Changing Realities. I am a great supporter of Changing Realities, which brings the expertise of lived experience into the policy domain, but a few focus groups do not amount to coproduction. In an unanswered letter to Minister Timms, the APPG on Poverty and Inequality made the case for establishing a formal mechanism for coproduction and meaningful consultation with those who have experience of claiming UC, so as to avoid the shortcomings of the current scheme.

Finally, I hope the omnishambles of the past few weeks will stand as a lesson for how not to carry out social security reform. Yes, there is general agreement that we need reform. Indeed, I have been arguing for it for years, all the more urgently after a decade or so of cuts amounting to £50 billion a year—the very opposite of the scare stories about ballooning expenditure. Charities, think tanks and academics all make the case for investment in social security as a force for good rather than treating it as a dead weight. It is time we put the security back into social security.

Universal Credit: Two-child Limit

Baroness Lister of Burtersett Excerpts

Wednesday 9th July 2025 Lords Chamber

Asked by

[Baroness Lister of Burtersett]

To ask His Majesty’s Government what assessment they have made of the cost of abolishing the two-child limit for Universal Credit.

[The Minister of State, Department for Work and Pensions (Baroness Sherlock) (Lab)]

My Lords, the Government do not routinely publish costings of policy alternatives. However, estimates have been produced by independent think tanks, including the IFS, the Resolution Foundation and IPPR. Their costings range from £2.5 billion to £3.5 billion a year in steady state. This Government are committed to tackling child poverty and will publish an ambitious child poverty strategy in the autumn.

[Baroness Lister of Burtersett (Lab)]

My Lords, it is generally accepted that the abolition of the two-child limit and, many would argue, the benefit cap must be, in the words of the Children’s Commissioner, “the foundation” of the much-anticipated child poverty strategy. Does my noble friend therefore agree with charities in the field and former Prime Minister and Chancellor Gordon Brown that the immediate cost to the Exchequer must be weighed against the economic, financial and social costs of this key driver of child poverty, including the cost to the NHS, education, children’s care services, homelessness provisions, local economies and, indeed, to the Government’s own missions?

[Baroness Sherlock (Lab)]

My Lords, my noble friend mentioned the Children’s Commissioner. She will be aware that the Government commissioned the Children’s Commissioner to look at the experience of children in poverty. I am sure that, like me, she has read their comments, and they make for uncomfortable reading. But we cannot tackle child poverty in this country if we are not willing to look in the face the reality of the lives of our children. Importantly, having set up a Child Poverty Taskforce, the Government have pledged to look at the full range of the underlying causes of poverty and will continue to do that work.

I reassure my noble friend that the Child Poverty Taskforce is continuing to look at all available levers to lift our children out of poverty. We are looking at everything, including social security measures, housing, education and health, and the Government will bring forward an ambitious child poverty strategy in the autumn. But I want to reassure her that the last Labour Government lifted the best part of 1 million kids out of poverty, and we have a manifesto commitment to tackle child poverty. The Prime Minister set up this task force very early in his time in office. We are determined to tackle this scourge in our country.

Welfare Reform

Baroness Lister of Burtersett Excerpts

Wednesday 2nd July 2025 Lords Chamber

[Baroness Sherlock (Lab)]

I am sure that the noble Baroness knows, given her connection to the sector, that we specifically consulted on the future of Access to Work in the Green Paper. We are now working our way through the responses, and will make decisions on that basis. The demand for Access to Work has been growing at a very high rate—the previous Government will have been aware of this. It is very challenging. We want to consult on it and then look at how we can reform the system to make sure it helps as many people as possible.

[Baroness Lister of Burtersett (Lab)]

My Lords, I welcome the fact that common sense finally prevailed, so that the review of PIP will be undertaken before any decisions about eligibility. I hope that that will help to allay the anxieties expressed so powerfully by the noble Baroness, Lady Browning, and that we have all received in our inboxes. It is also welcome that the review will be co-produced with disabled people and organisations that represent them—something that was not done under Conservative Governments. Although, as the Secretary of State said, the precise methods of co-production will need to be worked out with disabled people and other stakeholders, can my noble friend assure us that co-production will mean that they have a full and genuine say throughout the policy process? Will the DWP consider extending the same approach to its ongoing review of universal credit?

[Baroness Sherlock (Lab)]

I thank my noble friend for appreciating the decisions that we have taken. In terms of co-production, the Secretary of State and my colleague, the Minister for Social Security and Disability, have been very clear that this review will be led by Minister Timms and co-produced with disabled people, their representative organisations and other experts. Work has already begun on scoping. We have published the terms of reference. We are already beginning to engage and we will make sure that that is a genuine process.

We understand, if we are to have this level of reform, that we need to try to build a consensus around what a good PIP assessment process will look like. We also need to try to have popular public confidence in the system. If we are to sustain the level of investment that we have in our social security system, we need to make sure that people feel that it is being done well, appropriately and given to the right people.

On the universal credit review, which is looking at the way that universal credit operates, I can reassure my noble friend that we are doing focus groups with Changing Realities to look at specific aspects of the way the system works at the moment. I hope that that will reassure her.

Public Authorities (Fraud, Error and Recovery) Bill

Baroness Lister of Burtersett Excerpts

Committee stage
Wednesday 25th June 2025 Grand Committee

Moved by

[Baroness Lister of Burtersett]

123: After Clause 96, insert the following new Clause—
“Overpayments made as a result of official error(1) Section 71ZB of the Social Security Administration Act 1992 (recovery of benefit payments) is amended as follows. (2) In subsection (1), for “The” substitute “Subject to subsection (1A), the”.(3) After subsection (1) insert—“(1A) The amount referred to in subsection (1) must not include any overpayment that arose in consequence of an official error where the claimant or a person acting on the claimant’s behalf or any other person to whom the payment is made could not, at the time of receipt of the payment or of any notice relating to that payment, reasonably have been expected to realise that it was an overpayment.””Member’s explanatory statement
This new Clause would bring the test for recovery of Universal Credit overpayments caused by official error into line with Regulation 100(2) of the Housing Benefit Regulations 2006 by providing that they can only be recovered where the claimant could reasonably have been expected to realise that there was an overpayment.

[Baroness Lister of Burtersett (Lab)]

My Lords, Amendment 123 is supported by the noble Baroness, Lady Bennett of Manor Castle, who is in the Chamber, and the right reverend Prelate the Bishop of Leicester, who regrets that he cannot be in his place. He was going to be replaced by the right reverend Prelate the Bishop of Manchester but he is also in the Chamber. I thank them anyway for their moral support, even if it cannot be practical. I also thank the Public Law Project for all its help with the amendment. I apologise that I was unable to attend Second Reading, but my noble friend Lord Davies of Brixton kindly gave notice of this amendment.

The amendment brings the test of recovery of universal credit overpayments caused by official error into line with the housing benefit provisions by ensuring that recovery can be made only where the claimant could reasonably have been expected to realise there was an overpayment. There is surely no better time to address official error overpayments in a Bill so appropriately named the “Fraud, Error and Recovery” Bill. However, it is currently one sided. Although it recognises the harms that both fraud and error cause in the social security system, it focuses only on the behaviour of claimants. It does not address the harms that result from the recovery of so-called official error overpayments. These are debts created because of mistakes made by the Department for Work and Pensions.

Unlike many other benefits, DWP can recover official error UC overpayments from claimants. This power was introduced in the Welfare Reform Act 2012 and represented a significant change to the position previously applied to most legacy benefits—that is, those that preceded UC. According to DWP data, in 2023-2024, 686,756 new UC official error overpayment debts were entered on DWP’s debt manager system. Is my noble friend the Minister able to give us any data on the circumstances in which official error overpayments occur and the average length of time before they are identified?

We are not just talking about numbers on a debt manager system. These DWP mistakes are having a serious impact on the lives of individuals such as D, who got in touch with me after hearing my noble friend Lord Davies raise the issue at Second Reading. D emailed me and we had a phone conversation. She told me that after her son was born, she was incorrectly told by DWP that she would be able to claim UC while her partner was studying for a master’s degree. Two years later, the DWP then told her that she was not eligible and that she now owed them £12,000—a “life-changing amount”, in her words. She has tried to dispute this through the tribunal system and the DWP complaints process. But even though the judge in the tribunal was sympathetic, the response has been that the DWP has the power to recover all overpayments, regardless of how they are caused. D now has £20 deducted from each UC payment she receives but no record from the DWP of how much she still owes.

It simply should not be the case that claimants such as D are paying the price for DWP mistakes. Public Law Project research demonstrates that the financial and psychological impact of overpayment debt recovery on individual claimants can be severe and is often associated with a particular sense of injustice. Understandably so, with individuals finding themselves unexpectedly in debt through no fault of their own.

The DWP’s default approach is to recover all overpayments regardless of how they are caused. The onus is on claimants to request discretionary measures, such as a waiver, but the DWP does not automatically tell them this. In 2023-24, only 75 waiver requests were granted; this equates to only 0.01% of overpayment debts registered that year. Could my noble friend tell the Committee what steps, if any, the DWP is taking to make waivers more accessible? In particular, would it consider following the example of the Department for Communities in Northern Ireland and automatically including reference to waivers in communications with claimants? Will it consider lowering the thresholds and evidential requirements to grant waivers?

In the Commons, the Minister referred to measures that were in place to mitigate the risk of harm associated with overpayment recovery. I welcome the introduction of the fair repayment rate, which I am sure my noble friend will mention. However, access to some of these safeguards is not an easy process for claimants to navigate. Moreover, as evidenced by research from the Public Law Project, Citizens Advice, the Trussell Trust and StepChange, and acknowledged by the DWP’s own guidance, those safeguards are not sufficient to prevent harm and hardship.

This was illustrated by a recent report from Policy in Practice about deductions from UC in general. It observed that many low-income households are already in crisis and at risk of deep poverty, prior to the application of deductions. I know that I do not have to explain to my noble friend the difficulties of trying to survive on universal credit and how low it is. That will still be the case despite the welcome, real-terms increase being proposed in the legislation currently before the Commons. Policy in Practice found that deductions risk placing households further from being able to afford the essential items of daily life. This is particularly the case for lone parents and carers.

Citizens Advice reports that fewer than 40% of its clients who contacted the DWP were successful in getting an affordability measure put in place, yet the DWP’s own guidance recognises that any recovery of an overpayment from any person in receipt of benefit is almost certain to cause some hardship and upset for them and their family. What criteria does the DWP use to decide what is an affordable deduction? Would the DWP consider agreeing an affordable and sustainable repayment plan with claimants before initiating recovery by way of deductions?

As I said, overpayment recovery is taking the individual below the amount that the DWP has assessed them to need, in a context where UC rates have already been shown to be insufficient to meet essential needs—a point emphasised by Policy in Practice. This is why I have tabled an amendment to bring the test for recovery of UC overpayments into line with the current test for housing benefit. It would ensure that UC overpayments caused by official error could be recovered only when individuals could reasonably have been expected to have realised that they had been overpaid. It places the onus on DWP officials to consider the fairness of recovery before initiating it. When UC was introduced, the then Labour shadow Minister for Employment considered this a just and fair test, which has been tested in case law.

This amendment would also create a clear incentive for the DWP to prevent these mistakes in the first place, which is a step towards a better-functioning social security system that gets things right first time. We ought to pay attention to the more than 30 charities that have written to the Secretary of State urging the Government to grasp this opportunity.

In introducing the Bill’s Second Reading, my noble friend stated:

“Our approach is tough but fair … fair on claimants, by spotting and stopping errors earlier and helping people to avoid getting into debt. It is fair on those who play by the rules”.—[Official Report, 15/5/25; col. 2346.]


But the current system is patently unfair to those who have been affected by an official error that they could not be expected to spot, and who have played by the rules as they understood them.

This is a fundamental question of fairness and of rights and responsibilities. If a government system makes mistakes, who should bear the consequences? Is it the system that caused the error and has the power to avoid it, or the service user who has no control over, or responsibility for, that mistake and, worse, is detrimentally affected by it? If we are serious about addressing fraud, error and the recovery of debt in the Bill, it would—for want of a better word—be an error on our part not to take action to end this unfair practice and source of economic instability for hundreds of thousands of families and individuals whom our social security system is there to serve. I beg to move.

[Lord Verdirame (Non-Afl)]

My Lords, I will speak in support of the amendment because it raises, as the noble Baroness, Lady Lister, pointed out, a question of principle. Should a person who received payments in error always be required to make restitution in full?

We are dealing with the application of this principle in the context of welfare payments, but it may be useful to keep in mind how this principle would apply in other contexts under our law. The default position is, as one would expect, that a party that has received money in error is obliged to return that money. However, it is also the case that our law has developed an important exception to this general position. This is known as the change of position defence, which was first recognised by Lord Goff in the case Lipkin Gorman v Karpnale Ltd 1991, where he said that

“the defence is available to a person whose position is so changed that it would be inequitable in all the circumstances to require him to make restitution, or alternatively, to make restitution in full”.

In essence, where the person has changed their position, in good faith, in reliance on that payment—for example, by spending it—restitution in a non-welfare context may be denied in whole or in part.

As I said, it is an equitable exception that our law has developed over a number of decades and on the basis of various decisions. It is a complex area of law known as unjust enrichment, on which many doctoral theses have been written. The reason it has attracted so much attention is that there is a conflict of fairness. On the one hand, it seems right that the payer who paid in error should, in principle, receive the money back and that people should not derive benefit from someone else’s innocent error. On the other, it also seems wrong that someone who made no error and relied, in good faith, on that payment should be unduly penalised. The common law and equity seek to strike a balance between these two concerns with the change of position exception that I have outlined.

For welfare payments, we are dealing with a context where statute rather than common law applies; however, it seems that the concerns that the common law has sought to address in other contexts arise even more acutely. The people who received the payments are socioeconomically disadvantaged and very likely to have spent that money, as the case mentioned by the noble Baroness illustrates. Thus, they are very likely to have changed, in good faith, their position by relying on those payments. To ask them to return that money is particularly burdensome on individuals who are on benefits and without a safety net.

Section 71ZB of the Social Security Administration Act, which the amendment proposes to change, seems a very blunt instrument. It responds to that first concern—to ensure that the payer, in this case the taxpayer, should have their money back—but it does nothing to protect the bona fide recipient of that payment from being penalised unduly. For that reason, it seems a fundamentally unfair provision. It seems wrong that the protection that a bona fide recipient of a payment in error would enjoy in other contexts, including a commercial context, should not apply to the bona fide recipient of a welfare payment made in error. This amendment seeks to remedy that unfairness, and it has my support for that reason.

It is true that Section 71ZB gives the Government a discretion and I suppose it will be said that there is guidance that tells the Government to exercise that discretion, taking into account certain circumstances. But the good will of the payer is not sufficient and that certainly is not the position under the general common law on restitution. It is not just a matter of the payer having the good will not to pursue the recovery of the payment; there has to be more to recognise that the innocent beneficiary, too, has an entitlement to protection. It seems to me that this amendment seeks to provide that correction to Section 71ZB of the Social Security Administration Act 1992.

I will, of course, be interested to hear what the Minister has to say about the various mitigations that might exist, but at the moment I agree that, unless the mitigation is in statute, whatever guidance might be in place will not be sufficient. I would also like to take this opportunity to thank the Minister and her officials for the very informative briefing last week.

--- Later in debate ---

I hope that has answered noble Lords’ questions and explained how the policy came about, what the safeguards are and the reasons why the department is operating in the way it does at the moment. We are very focused on improving payment accuracy while trying, where it is appropriate, to recover public money in a way that supports anyone struggling with their repayment terms. In the light of that, I ask my noble friend to withdraw her amendment.

[Baroness Lister of Burtersett (Lab)]

I am afraid it was remiss of me not to congratulate the Chair on the recent addition to his family and to send best wishes to his daughter—fingers crossed, and I hope it all goes well.

I thank all noble Lords who spoke, including the noble Lord, Lord Verdirame—he sounded so learned that I want to call him noble and learned—for his helpful contribution. There is something very comforting about having someone who knows the law coming in behind you and saying that this is a point of principle. I very much appreciated that, as well as the support of the noble Lord, Lord Palmer of Childs Hill.

I appreciated the sympathy expressed by the noble Viscount, Lord Younger of Leckie, but it felt a bit like doing contortions so as not to have to criticise what his Government introduced. I do not accept the argument about public money. It is not like there is little pot and that if some of that pot goes to someone who has been overpaid because of the department’s error, that money will not be there for other claimants. The talk about public money felt a bit like some of the arguments around taxation being theft and so forth because it is public, the “It’s our money, not their money” sort of thing. Anyway, I appreciate the sympathy with which he approached the question, and I appreciate my noble friend, as always, engaging fully with what was said. I am disappointed that the department is not willing at all to budge on this.

We have to remember that universal credit is complicated. It may have been sold to us by the previous Government as a simplification but, in fact, it is complicated and, therefore, not surprising if people do not understand the payment that goes into their bank account. Who understands how universal credit is worked out? The answer is not many people. That has to be borne in mind when we are talking about what it is reasonable to expect people to know and respond to. The noble Lord opposite talked about fessing up and realising they have got it wrong, but people may not realise they have got it wrong until it is brought to their attention by the department because, tardily—we will hear more about that when it comes to carer’s allowance—it is brought to their attention that the payment is wrong. It is a question not of hiding but of simply not knowing.

I understand that universal credit is a dynamic benefit and that the payments are different from what went before—it is different from housing benefit—but surely there could be a provision that allowed for repayment not to be made in certain circumstances. My noble friend talked about a right of appeal, but that is pointless in this situation. The person who contacted me, D, went to appeal. She had a lovely judge at the appeal who looked at what the DWP said and said, “I’d really like to be able to give you this, but I can’t because the law does not allow me to.” Everybody’s time was wasted. She was given undue expectations. My noble friend said that people are encouraged to contact the recovery team and work out a decent repayment rate. I am not involved in the day-to-day business of universal credit, but the organisations that have helped with this and asked me to put this forward know the situation, and that is not how they see it. What should happen in theory does not always happen in practice on the ground.

If nothing else, perhaps this amendment will encourage the DWP to look again at its procedures and the guidance to make sure that things are happening as they are supposed to happen so that the picture that my noble friend painted is an accurate picture of what happens on the ground. I will obviously want to read in more detail to see whether we want to bring this back. I very much appreciate my noble friend answering my rather nerdy questions. It is not the first time that we have exchanged nerdiness in this Room. With that, I will withdraw the amendment but will want to consider what we do on Report.

[Viscount Younger of Leckie (Con)]

I shall just pick up on what the noble Baroness said about universal credit and the fact that it is quite complicated. I hope she will agree that the old system, where there were six benefits, was particularly overcomplicated and that one of the successes of the past 14 years of government was that the six benefits became one. I hope she might accept that it is not quite so complicated and that, secondly, as I have been told and believe, if we had not done that then the system of paying out benefits would have been in severe trouble during the Covid period.

[Baroness Lister of Burtersett (Lab)]

I do not want to have a long debate with the noble Viscount about the pros and cons of universal credit because we would be here all night. I just point out that it may be simpler overall to have it all in one, but that does not make the one in itself any simpler. Some of the rules around universal credit are very complicated to understand because they do not always make sense. That was the point I meant to make. I am not saying that it was nirvana beforehand, but at least then an overpayment error made without the claimant knowing was not repaid, so in that sense it was better, but I will not go into any more detail about that.

Amendment 123 withdrawn.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise extremely briefly and apologise to the noble Baroness, Lady Lister, that I could not be in the previous group as I was in the Chamber. I will take seconds to intervene in the interesting debate between the noble Baroness and the noble Viscount to say that, of course, if you have a universal basic income, that is an extremely simple system to administer that would not create any of these kinds of problems.

Anyway, I rise with great pleasure to follow the noble Lord, Lord Palmer of Childs Hill, and to back in particular Amendment 124, although I will be interested to hear the Minister’s response to Amendment 127. I felt I had to speak because I raised at some length in earlier discussions the case of Nicola Green. That is one case, but overall the Government have been clawing back £357 million. Hundreds of people have acquired criminal records in what I think most people would agree are entirely unjust circumstances, whatever the detail of the law. Some people now face debts of up to £20,000 or more.

This amendment—waiting until we have the review and not doing more damage to individuals’ lives and to the reputations of the Government and the Department for Work and Pensions—is a really simple, practical measure, and I commend the noble Lord, Lord Palmer, for doing this and for powerfully presenting his case. I also align myself very much with his tributes to unpaid family carers, who are doing so much in our society for what are, on a week-to-week basis, derisory sums of money for an incredible amount of labour.

[Baroness Lister of Burtersett (Lab)]

My Lords, I rise very briefly. My noble friend said that the department tries to move as quickly as possible when there is an error in payment, but, patently, that did not happen with carer’s allowance. Therefore, I am very grateful to the noble Lord, Lord Palmer of Childs Hill, for raising the issue. Part of the problem was that the DWP allowed the overpayments to accumulate until they were really significant and, given the way the cliff edge works, you could be a tiny amount over and end up having to repay the whole of your carer’s allowance. So it is a really important issue.

I want to ask my noble friend a question. Do we know when the review will be published? How quickly does the department hope to be able to move once it has been published? In a sense, that affects the practical impact of the noble Lord’s amendment.

PIP Changes: Impact on Carer’s Allowance

Baroness Lister of Burtersett Excerpts

Monday 31st March 2025 Lords Chamber

[Baroness Sherlock (Lab)]

My Lords, there is confusion, but I do not think it is the Chancellor who created it. I have heard a suggestion that carers’ benefits are being cut. Let me be clear: carers’ benefits are not being cut. Carer’s allowance will rise to £83.30 from next week, or the end of this week, and the Government have boosted the earnings threshold in carer’s allowance by the highest ever amount.

Secondly, reforms are being made to disability and sickness benefits. One of the consequences of those is to change some of the people who currently are entitled to the personal independence payment. Because carer’s allowance is paid to people who care for someone on personal independence payment, there will be some people currently getting carer’s allowance for whom there may not be an entitlement in future.

We spelled out clearly in the Green Paper that we would look at how we could support those who are losing entitlement in general as well as, specifically, carers who are losing entitlement. I want people to be clear: we are not cutting the value of the benefit; we are not changing the fact that they can earn more—but there will be some people who are getting carer’s allowance now, and who might have got it in the future, who will not get it. However, given the rate at which the PIP case load is growing, with all the changes that we are making we are stemming the rate at which spending on sickness and disability benefits goes up, not cutting it.

[Baroness Lister of Burtersett (Lab)]

My Lords, at the very end of the Green Paper, in an annexe, is, I believe, the one and only reference to the impact of the personal independence payment cuts on unpaid carers. It says:

“The government will consider the impacts on benefits for unpaid carers as part of its wider consideration of responses to the consultation as it develops its detailed proposals for change”.


As the impact on carers is not included in the list of questions for consultation, can my noble friend the Minister explain exactly how the Government propose to consult on it? Are we talking about anything more than possible transitional protection?

[Baroness Sherlock (Lab)]

My Lords, I cannot tell my noble friend at this stage what it will be, both because we are listening to the wider views and because we are going to take our time to work this through. To be clear, we specifically said in the Green Paper that we would look at the impact on carers and look at ways in which we could support carers who might find themselves losing entitlement to carer’s allowance.

To give a sense of timescale, assuming that Parliament approves the primary legislation that will bring about these changes to disability and sickness benefits, the changes to PIP that will affect carer’s allowance will not come in until November 2026. Only after that will somebody who is getting PIP at the moment see their entitlement change. It will be only as and when they are called to a review and their own circumstances are reviewed that their entitlement changes, which could in turn affect carer’s allowance. So I am confident that we have plenty of time available to us to work through the way in which we can support those who will lose out as a result of these changes.