Universal Credit and Working Tax Credits

Baroness Winterton of Doncaster Excerpts

Wednesday 15th September 2021 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. I am going to make every effort, and I am determined to get everybody in. That may mean that at some point in the very near future I have to reduce the time limit to two minutes, but if we help each other and take less time we might be in with a better chance.

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[Helen Hayes (Dulwich and West Norwood) (Lab)]

I rise to speak against the cut to universal credit, which is cruel, illogical and unnecessary. It is cruel because £20 a week makes all the difference to those on the lowest incomes, many of whom are already working all the hours they can but simply cannot make ends meet. Norwood and Brixton food bank, which serves many of my constituents every week with love and care, has been warning for many months that if local people on universal credit are subjected to this cut, the need for emergency food support will increase, placing even more pressure on its staff and volunteers. Our welfare state was established to provide a security safety net for people who cannot make ends meet, yet this Government are taking us back to Victorian Britain, where people forced into appalling hardship by the Government’s failures are reliant on the good will of our communities in ever-increasing numbers.

This cut will cause unspeakable hardship. Parents will go without food so that their children can eat. People will suffer in cold, damp homes because they will not be able to afford the heating. Debt will increase and physical and mental health will deteriorate. This cut is illogical, because at a time of fragile economic recovery, when high streets up and down the country are struggling and shops are closing, it makes no sense to be taking millions of pounds of expenditure out of every single constituency in the country. And this cut is unnecessary, because it is a political choice.

There are many ways in which the Government could lift people out of poverty. They could raise the minimum wage to the real living wage, make housing more affordable, make childcare more affordable and ban zero-hours contracts, but they have failed those on the lowest pay for more than a decade and now they are punishing the same low-paid workers. These are the same people who have been at the frontline of the coronavirus pandemic: social care workers, shop workers, childcare workers, delivery drivers, hospital porters, bus drivers and others. This is no way to treat those who have seen us through the greatest crisis since the second world war.

It does not take a degree in engineering to know that if the screws are too tight, the pressure will buckle and break even the strongest of materials. Make no mistake, this cut will break people who have already faced so much pressure from the cruel policies of this Tory Government bearing down on them. Government Members have a choice: they can live with this cruellest of cuts or they can join us in the Lobby and vote against it, because it is wrong and unacceptable.

[Madam Deputy Speaker (Dame Rosie Winterton)]

After the next speaker, I will reduce the time limit to two minutes, but that is because I want to get everybody in. I call Zarah Sultana.

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[Kim Johnson (Liverpool, Riverside) (Lab)]

This cut to universal credit is perhaps one of the most callous and cruel policies this Government have proposed, and we have a long list to choose from. After more than a decade of brutal austerity measures and chronic Tory mismanagement, absolute poverty and child poverty were soaring even before the devastating impact of the pandemic. In my Liverpool, Riverside constituency, where child poverty, relative poverty and absolute poverty already soar above the national average, it amounts to more than 3,200 families and nearly 6,000 children.

This draconian Tory Government are dangerously out of touch with the reality of millions. They have no comprehension of the reality of poverty, of missing meals and going cold. They claim that the need for fiscal responsibility overrides the need for just and fair policies, as if the two are mutually exclusive and as if economic prosperity cannot exist without inequality and poverty. The cut of £1,000 from the pockets of those most in need is the ugly face of that ideology of class warfare—let us call it what it is.

As a black, working-class woman born and raised in Liverpool, I know full well the impact of this class warfare. Thatcher’s policies of managed decline in the 1980s threaten to pale by comparison with the cruelty of this Tory Government. The bare, honest truth is that this cut is not fiscally competent. Hitting workers’ spending power with cuts to universal credit, a rise in national insurance contributions, a public sector pay freeze and a personal income tax freeze is not the economic competence that the Tories claim. It is the opposite.

Instead of taking money out of the pockets of those most in need, the Government must wake up to the reality facing millions of families who will be pushed into Dickensian levels of poverty and misery. I call on Members on both sides of the House to cancel this cut.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I call the Front Benchers, I should say that they have agreed to cut down their contributions to allow everybody to get in.

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[Jim Shannon (Strangford) (DUP)]

Further to that point of order, Madam Deputy Speaker. The House has expressed itself very clearly in saying that there are concerns about the £20 of universal credit being taken away from the people who need it most. That being the case, how can we ensure, legislatively, that we turn that into a victory for the people we represent in this House and for those who want that universal credit money to continue for at least a period of time?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the hon. Lady and the hon. Gentleman for their points of order. How the Government choose to vote is not a point of order for the Chair, but it might be helpful if I remind the House that on 26 October 2017 the former Leader of the House, the right hon. Member for South Northamptonshire (Dame Andrea Leadsom), set out the following:

“Where a motion tabled by an Opposition party has been approved by the House, the relevant Minister will respond to the resolution of the House by making a statement no more than 12 weeks after the debate.”

I am sure that those on the Treasury Bench will have heard that. To address the hon. Gentleman’s point directly, the resolution on an Opposition motion is not a binding resolution, hence my drawing attention to the fact that we assume that a Minister will come to the House within 12 weeks to respond.

[David Linden (Glasgow East) (SNP)]

On a point of order, Madam Deputy Speaker. You will be aware that if the Government do not take action on the universal credit cut, in 12 weeks that £20 a week will be gone from the constituents who we all represent. On a broader point of consistency, the Government have clearly abstained on the vote on the first motion of this Opposition day. The subsequent motion is essentially a motion about House business and would instruct Mr Speaker to set up a Committee. How can the Government claim to have consistency when they abstain in the vote on the first motion and will almost certainly vote against the second motion this evening?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am afraid I am not really answerable for whether there is consistency in the choices that are made. Every Member has the right to decide whether they want to vote or not vote. I assume that these issues could well be addressed later in the debate, to which we now come.

Pensions Update

Baroness Winterton of Doncaster Excerpts

Tuesday 7th September 2021 Commons Chamber

[Dr Coffey]

It would probably not be wise for me to go down that route, because we are still trying to estimate the likely uplifts in the different metrics. We will not actually use the figures until later in the year, but because of how the machinery of benefit upratings works, we need to be in a position to trigger it in November. Given my hon. Friend’s position on the Work and Pensions Committee, he may wish to ask that question a little later once we have some more detailed analysis in that regard, if that is okay.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the Chair of the Select Committee.

[Stephen Timms (East Ham) (Lab)]

Is it still the Secretary of State’s view that it is important that the level of the basic state pension keeps track with earnings over time, as the coalition pension reforms assumed? If so, will it not require some further adjustment after these two exceptional years? Given that pensioner poverty was starting to increase before the pandemic, after a long period in which, as she said, that did not happen, what will her Department do to increase the currently very low take-up of pension credit?

Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill

Baroness Winterton of Doncaster Excerpts

2nd reading
Tuesday 8th June 2021 Commons Chamber

Second Reading

[Madam Deputy Speaker (Dame Rosie Winterton)]

Before I ask the Minister to move Second Reading, I will introduce a three-minute time limit on Back-Bench speeches. As colleagues will know, this is a very short debate, but I will try to get in as many Members as I can.

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[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

Talking about the cost to the taxpayer, I wonder if my right hon. Friend continues to be shocked by the fact that a Member of this House, the hon. Member for Plymouth, Moor View (Johnny Mercer), received over £85,000 from subsidiaries that were mis-selling, like a company in my constituency that defrauded my constituents. That money has never been paid back, but that Member received money from the taxpayer, and actually we should be looking at ourselves—

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order.

[Mr McFadden]

I am grateful to my hon. Friend, and I do think it ill behoves any Member, given the scale of the losses and given the necessity of the Government to bring in this Bill to compensate people for their losses, to profit from this either directly or indirectly. I think that should be clear to all of us.

The Government are legislating on this because of the litany of regulatory failures set out in the report on this issue carried out by Dame Elizabeth Gloster. These failures included failures to respond to repeated warnings from investors and potential investors, LCF repeatedly running promotions implying its products were regulated by the FCA, and failures of communication between different parts of the FCA, all in the end leading to this collapse and financial loss. Had the FCA acted earlier, far fewer people would have invested through this firm, losses would have been lower and the taxpayer would not be faced with the £120 million we are talking about today.

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[Mr McFadden]

Many investors did invest because they thought that these mini-bonds were authorised by the FCA, and they were not. A big part of the problem here is having a regulated firm marketing unregulated products. If I am right, the hon. Member’s constituents may be eligible for the compensation authorised by the Bill.

Dame Elizabeth’s report makes it clear how badly the investors were let down by the regulator, and both the Government and the FCA have said that they accept the findings. I have a number of questions that I want to put to the Minister for his wind-up at the end of the debate. First, why is the level of compensation he has chosen 80% of the FSCS level? On what basis was that decision made? Secondly, how will this work practically? I understand that the Government want to avoid the involvement of claims management companies, and that is something I think we would all endorse. How will the Government do that and avoid repeated rounds of claims?

The Bill also gives rise to some important broader questions about policy. The failings identified were serious and substantial, and have to be addressed. The first of those broader questions is: when should compensation paid for by the taxpayer be paid and when not? The Minister quite rightly said that the taxpayer cannot stand behind every investment policy. It would be unfair on taxpayers to expect them to do so, and it would produce perverse incentives. After all, we all know that the value of investments can go down as well as up.

In the case of LCF, it was bonds that were being sold, and the advertising implied a guaranteed pay-out when such pay-outs could not, in practice, be guaranteed. Regulation is not aimed at enabling people to make reasonably informed choices and to understand the risks they are taking. Having made the decision to offer taxpayer-funded compensation in this case, when does the Minister believe it justifiable that the taxpayer should be asked to do that, and when does he not? What was the discussion in the Treasury about how to ring-fence this failure and this company from broader claims for financial compensation? There are calls for compensation quite regularly when investment failures happen. How confident is the Minister that the Treasury will not be subject to legal action from victims of other investment failings?

How confident is the Minister that the FCA can actually make the changes necessary to avoid a repeat of the findings set out in Dame Elizabeth’s report? Callers were phoning the FCA for three years before the company’s collapse. Appendix 6 of Dame Elizabeth’s report states that the FCA received 611 queries from consumers regarding LCF. That is not a random phone call at five o’clock on a Friday that can be missed; it is a pattern of people trying repeatedly to raise red flags and getting nowhere

Individual A said on 15 July 2016:

“This company is doing exactly what the pyramid scams are doing. What they’re doing is they’re paying the money out, the interest out from money which people are paying on the bond… In other words, it’s just a pyramid scam… they’re saying they’ve got charges on their property, security on them, assets on their property, of course they don’t have any assets. It’s all horrendous really, the whole thing”.

There was call after call like that, and they were not acted on. They were not passed up the line, partly because the mini bonds were not regulated. In fact, one caller was told by the FCA call handler that it was not a scam.

There was also the letter from individual financial adviser Neil Liversidge in 2015, three full years before the collapse of the company. He warned that LCF had one customer who was worth—bear with me on the language, Madam Deputy Speaker; I am quoting—

“the square root of bugger all”

and he tried to raise warnings about the practices and health of the company. It appears that that letter was lost.

One of the more damning findings in Dame Elizabeth’s report is that, even if the letter had not been lost,

“It is unlikely that it would have resulted in any, or any substantive, action or re-action by the FCA.”

So little faith did she have in the processes that she appears to have argued that it did not matter that that warning letter had been lost because it would not have been acted on. Imagine if the FCA had acted, in 2015 or 2016, when those reports were received, rather than only at the end of 2018. Another question for the Minister is this: what will the FCA do to improve its handling of reports like this?

Then, there is the so-called halo effect of regulated companies selling unregulated products. Being regulated by the FCA featured heavily in LCF promotions. The financial promotions team at the FCA did warn LCF to dial back on the advertising, but the pattern went on and on, and no one drew the conclusion that this was not just an advertising problem, but a problem with the content of what it was actually selling. Dame Elizabeth states in her report:

“A substantial proportion of the Bondholders said that they would not have invested in LCF had it not been for the fact that it was regulated by the FCA.”

How will the FCA avoid the difference between unregulated activity and regulated companies from being exploited in the future?

The Gloster report was also the subject of a well-publicised disagreement between Andrew Bailey, the Governor of the Bank of England, and Dame Elizabeth, about the nature of responsibility and accountability. Where do the Government stand on this issue? It was all played out before the Treasury Committee in several hearings. Is it the Treasury’s view that senior officials in leading regulatory bodies are responsible for the failing that happen on their watch, or should responsibility apply only to the organisation collectively?

Does the Minister agree with the statement in the report that

“It is difficult to see why an individuals’ willingness to take on challenging tasks in public bodies should absolve them from accountability”?

Or does the Treasury accept the statement from the Parliamentary Commission on Banking Standards quoted in the report that

“A buck that does not stop with an individual...stops nowhere”?

These broader questions matter, because with ever more complex financial markets, the regulators have to be equipped to do the job—equipped through their leadership and their systems, but also through the resources at their disposal. Part of the backdrop to this is the FCA taking on responsibility for tens of thousands more firms after it took on the responsibilities of the Office of Fair Trading back in 2014. Is the Minister confident that it has the resources after the LCF collapse?

Let me turn to clause 2 and the fraud compensation fund. The Bill authorises a loan to be made as a consequence of greater than expected claims on that fund arising from the Dalriada case. It is estimated that the judgment in that case could result in claims of over £300 million. The loan will be funded by a levy on the pensions industry, to be paid back over the next 10 to 15 years. That comes on top of the levy to pay for the Financial Services Compensation Scheme rising sharply since the introduction of the Government’s pension freedom legislation in 2015. Back then, the levy was £300 million; this year, it will be over £1 billion pounds. That is a 48% increase on the previous year and more than triple the level of five years ago. Why does the Minister think the FSCS levy has had to increase so much since the pension freedoms legislation was introduced in 2015? Now we have a new fraud levy to boot.

Surely the right way to tackle this issue is to ask why more and more pensioners are being exposed to fraud and scams in the first place. Why does the Minister think that is happening? Why are more pensioners losing their money? When the previous Chancellor introduced the pension freedoms changes, he said that

“there will be free impartial guidance available to all.”

Six years on, the take-up of that advice is just 3%. Even when the Department for Work and Pensions made a targeted push to increase it, it only got up to 11%, so the vast majority of people using these freedoms are not using that service. Of the small number who take up the option, 72% say they do something different from their first inclination after receiving advice, so it is clear that such advice can help people to make a better decision, yet take-up is nowhere near the promise made at the time.

The promise of pension freedoms being matched with good, trustworthy financial advice has not been kept, and these levies, which will have to be paid by the pension schemes that have been nowhere near fraud and are trying to offer a good service to their members, are being put in place at least in part as a result of the Government’s own pension reforms, which have left more pensioners exposed to fraud and scams. That conclusion was endorsed by the Work and Pensions Committee in its recent report.

What unites both these clauses is people being subject to fraud, often through online advertising. There is a clear need for greater action on this. People are being bombarded on a daily basis with adverts for investments, some of which are scams and attempts at fraud. Financial innovation can be a great thing, but consumers need help in navigating this world, and they are currently being failed by a regulatory system that is lagging behind what is actually happening in the financial markets. There is an online harms Bill coming that, as things stand, does not include plans to crack down on financial crime. I urge the Government to think again on that. To proceed with that Bill without tackling online financial harm would be an enormous lost opportunity to protect consumers against this type of crime.

The answer is not just compensation when people lose money; it is to protect people against financial scams happening before they lose their money, to crack down on the fraudsters while they are peddling their scams and to stop these adverts reaching people in the first place. Not all thieves wear masks. It is possible to rob people of their money through misleading websites and illusory promises of financial gain. It is critical that the laws that we pass in this place keep pace with the innovations in fraud and financial crime that are taking place. For that to happen, it will take a lot more than the two clauses on compensation in this Bill.

[Madam Deputy Speaker (Dame Rosie Winterton)]

We now go to the Chair of the Treasury Committee, who has four minutes.

[Mel Stride (Central Devon) (Con) [V]]

This is a very important Bill. It seeks to compensate for some significant wrongs. As part of our ongoing inquiry into London Capital & Finance and the FCA’s response to it, the Treasury Committee has heard many harrowing stories of those who, in many cases, lost life-changing amounts of money as a consequence of what happened.

The Treasury Committee has been involved in the LCF situation for some time. My predecessor, Baroness Morgan, initiated the inquiry by Dame Elizabeth Gloster through approaches by the Committee to the Treasury and the FCA. I take this opportunity to offer my thanks, on behalf of the Committee and of the LCF bond holders, for the very thorough report that she and her team produced, for the witness session she attended as part of our inquiry and for the courtesy and information that she provided to me outside that witness session by way of correspondence and discussions over the telephone.

Dame Elizabeth Gloster carried out some excellent work. As a consequence of her report, the level of the failings on the part of the FCA is very clear. Indeed, the answers to the key questions put by the Government to Dame Elizabeth as part of the directions for her inquiry were clear: the permissions granted to LCF were not appropriate to the business it carried on; the FCA did not adequately supervise LCF’s compliance with the FCA rules and policies; and the FCA’s handling of information from third parties regarding LCF was wholly deficient. The FCA had appropriate rules to regulate the communication of financial promotions by LCF. However, the FCA did not have in place appropriate policies. Numerous red flags were examined by the Committee, but they had been missed over a long period.

There were wider failings within the regulatory system, and we have heard some of those from the shadow Minister, the right hon. Member for Wolverhampton South East (Mr McFadden). The FCA’s approach to the perimeter was limited. It did not take a holistic view of the perimeter and therefore there was inadequate supervision of unregulated activities. The halo effect, which the shadow Minister also raised, was without doubt a wider systemic problem within the FCA.

Our inquiry is ongoing. We have taken evidence from Dame Elizabeth, from senior personnel at the FCA, including Andrew Bailey, who was the chief executive officer of the FCA during the appropriate period, and my hon. Friend the Economic Secretary to the Treasury. We will have much to say in our report, which will be published no later than the end of this month.

Looking ahead, the speakers so far have rightly asked how we make sure that this does not happen again. That lies within the transformation programme that the FCA is now undertaking. The Committee will be showing a close and careful interest in the progress of that transformation programme.

By way of intervention, I note the observation of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) about the importance of those responsible for shortcomings being held accountable. We will no doubt have something to say about that in the report.

The whole issue of compensation leads on to the issue of the general view that there should be personal responsibility for investments, as well as Government backing, and we will need to look at that. I am terribly short of time, so I will leave it there. I welcome the Bill.

[Madam Deputy Speaker (Dame Rosie Winterton)]

We now go to the SNP spokesperson, Peter Grant, who I am sure will be acutely aware of the very limited amount of time that we have left for the debate.

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[John Glen]

I thank the hon. Gentleman, as ever, for his representations. He has been a determined campaigner for that sector during my tenure. I have regular conversations, at least every six weeks, with the chief executive of the FCA, and we discuss a whole range of matters. I would be very happy to discuss that matter with him when I next speak to him in the next few weeks.

As Members from across the House have recognised today, the measure concerning a loan to the board of the Pension Protection Fund, set out in clause 2, is vital to ensure that those defrauded of their pensions by scam pension liberation schemes are able to access the compensation that they deserve. The Bill will ensure that those whose pensions have been unjustly targeted by fraudsters receive their pensions. We must continue to provide a safety net for people across the UK, who deserve to have confidence that they will have a pension pot for their retirement. I note that a number of observations were made about the ongoing challenge of dealing with the evolving nature of financial services firms and the sophistication of scams. The Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham, and I are working across Whitehall to bring an effective resolution to this matter.

I acknowledge that Members from across the House have supported the principles of the Bill, and I welcome the support that it has received. It will offer some relief to the enormous distress and hardship suffered by LCF bondholders and victims of fraudulent pension liberation schemes. It is an important Bill, and I want to move as quickly as possible from Royal Assent to enact it and deliver that compensation. I hope that right hon. and hon. Members will support it this evening.

Question put and agreed to.

Bill accordingly read a Second time.

Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill:

Committal

The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 17 June.

(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Proceedings on Consideration and Third Reading

(4) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings on Consideration are commenced.

(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and Third Reading.

Other proceedings

(7) Any other proceedings on the Bill may be programmed.—(Alan Mak.)

Question agreed to.

Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (money)

Queen’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill, it is expedient to authorise the payment out of money provided by Parliament of:

(a) expenditure incurred by the Treasury for, or in connection with, the payment of compensation to customers of London Capital & Finance plc; and

(b) loans by the Secretary of State to the Board of the Pension Protection Fund.—(Alan Mak.)

Question agreed to.

Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill (ways and means)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Compensation (London Capital & Finance plc and Fraud Compensation Fund) Bill, it is expedient to authorise such levying of charges under section 189 of the Pensions Act 2004 and Article 171 of the Pensions (Northern Ireland) Order 2005 as may arise by virtue of that Act.—(Alan Mak.)

Question agreed to.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I will now suspend the House for two minutes to make the necessary arrangements for the next business.

Income Tax (Charge)

Baroness Winterton of Doncaster Excerpts

Thursday 4th March 2021 Commons Chamber

[Clive Lewis (Norwich South) (Lab) [V]]

As we know, the context of the Budget yesterday was a debilitating global pandemic. It was also the last Budget before the UK hosts the COP26 climate conference. It was therefore arguably the most critical Budget since the second world war. I say “critical” because my friends, my family and my community matter to me, and having a viable future for them and myself matters to me. I saw so many of them struggling before the pandemic because of this Government, and now even more are struggling because of this Government.

What the people of this country needed from the Chancellor’s Budget yesterday was so much more than simply a reaction to the crisis at hand. What the people of this country needed was a strategy that would support all people and businesses struggling amid the pandemic, tackle the rising epidemic of inequality and debt, initiate a massive programme of decarbonisation, invest in local authorities and public services—the backbone of the successful part of the pandemic response—and rebuild our town and city centres as the vibrant hubs of sustainable communities and community activity. By those measures, the Chancellor’s Budget has failed on every single metric.

What I have seen in the pandemic is the best of the British people and the worst of this Conservative Government. In my constituency of Norwich South, I have seen care and compassion in the face of adversity, and I have seen the power of collective action in public services such as our NHS and schools, which stepped up to carry this country through extreme circumstances. In this Conservative Government, I have seen corruption and cronyism as well as indifference to growing inequality and climate change. That is ingrained in the detail of this Budget, which is going to punish the public and our public services, instead of taking the transformative action needed to support the livelihoods of all people and businesses, not just today but for generations to come.

What we needed from the Budget was a massive green economic stimulus on the scale of that in the United States, if not larger. We did not get it. Instead, we got the decision to freeze fossil fuel duty. What we needed was investment in the very public services that have seen us through this pandemic, such as our NHS, which is delivering a world-leading vaccine roll-out, and our schools, which have set up virtual learning under extreme pressure and with their resources cut to the bone. We did not get it. Instead, the Chancellor buried a £30 billion cut to the health and social care budget while local authorities such as Norwich face a collective £10 billion black hole that will mean yet more cuts to vital jobs and services. What we needed was a remedy to the crisis in our privatised and failing social care system. We did not get it. Instead, we got platitudes about needing a cross-party consensus.

The Conservatives have had 10 years to sort this out. We got nothing on our broken social security system, and nothing on statutory sick pay so low that it has helped to fuel this pandemic. A nothing Budget from a nothing Government with nothing of worth to say about the future of this country. As my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer) said in his Budget response:

“That is not levelling up; it is giving up.”—[Official Report, 3 March 2021; Vol. 690, c. 265.]

The Chancellor said he would do “whatever it takes”, so why did he do nothing for those in rent arrears and nothing to deal with the inequality and the 4 million children living in poverty? He paid only lip service to tackling mass youth unemployment. He told the people of this country he was being honest with them, so why did he choose to hide billions of pounds of cuts to our frontline NHS services?

We came into this pandemic with an economy akin to a dilapidated house built on collapsing foundations. Ten years of Conservative austerity have delivered the UK’s worst decade for improvements in living standards in 200 years, and now our house has been hit by an earthquake and turned to rubble with 130,000 dead because the Government failed to invest in resilient foundations. So why on earth does the Chancellor now want to rebuild the same rubbish house on the same shaky foundations? If he wanted to protect the livelihoods of people and businesses in this country and in my city of Norwich, he could and should have made different choices yesterday. It is far better to invest in new design with stronger foundations.

The Chancellor must listen to the public consensus forming on the back of the pandemic, provide support for a universal basic income and universal services and prioritise our health and wellbeing over GDP, with direct intervention to make society fairer. He could have taken the public’s lead yesterday. He could have forgiven the debts of people in rent arrears and students burdened by high interest rates. We got none of that yesterday. Now 130,000 people are dead and the UK has the highest per capita death rate from covid-19 in the world.

This Budget will entrench inequality and it failed to tackle the climate crisis. It will be the job of those of us on this side of the House to remind the public in the years to come that these were the choices of this Government and this Chancellor.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am very keen to ensure that we get everybody in, so after the next speaker I will reduce the time limit to four minutes.

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[Peter Dowd (Bootle) (Lab) [V]]

Yesterday I was fortunate enough to have my first dose of the Oxford vaccine. I had it in a pharmacy that is just yards away from the house where I lived as a child. Davey’s Chemist, one of a number in Merseyside owned by Mary Davey, is at the heart of the community. In fact, I managed to have a quick chat with her after my jab because she happened to be in the pharmacy. The vaccination centre is being run efficiently, effectively, professionally and personably. How she and her staff managed to set it up so quickly and smoothly, I really do not know, but they did. It took hard work, effort, commitment and dedication, and I was impressed but not surprised, because pharmacies get on with it. They were asked to do a job. They said yes and delivered, and despite the stresses and strains on the pharmacy sector, they deliver time after time. So I was disappointed to find that there was not, as far as I can tell, anything in the Budget statement that in any way sent a message of support to the pharmacy sector, let alone any practical or financial support for it. A key sector in the fight against covid through the vaccination programme has been cut adrift, yet the Government still ask a sector that is under strain to pull out all the stops.

As a member of the all-party parliamentary pharmacy group, chaired by the hon. Member for Thurrock (Jackie Doyle-Price), I want to highlight some of the concerns and recommendations identified in the APPG’s report of December 2020 and the themes brought out in it that are affecting the sector. First, the Government should review the response from pharmacies during the pandemic and re-evaluate a clear vision of what we need from these undervalued frontline healthcare workers.

Secondly, the NHS and Government should enable pharmacists to do more by giving this vital sector additional resources for training and support. Thirdly, a reassessment by finance teams in the Department of Health and Social Care and the NHS of the value of pharmacies would be welcome. Fourthly, the Government should write off the advance payments as an immediate way of providing relief. In addition, they should re-evaluate the financial implications of asking pharmacies to pay back the—

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am sorry, but we seem to have lost Peter Dowd, so we will go to Gagan Mohindra.

--- Later in debate ---

[Richard Burgon (Leeds East) (Lab)]

The Budget should be judged on one key issue: whether it improves the living standards of the vast majority of people in this country. On that, I am afraid, it has failed, with a pay freeze for key workers, the poorest families facing universal credit cuts, 1 million lower-paid workers having to now pay income tax, and council tax rises. Living standards have faced an assault over the past decade, and that is set to continue. Average wages will be no higher in 2026 than in 2008: almost two lost decades.

The Government’s disastrous handling of the virus has caused one of the world’s deepest economic collapses, yet they expect the vast majority to pay for it—including through further cuts to public services of £15 billion per year compared with last year’s plans. Despite the need to treat a huge backlog and to fund ongoing vaccine and test and trace schemes, the Government would also cut the national health service budget back to pre-pandemic levels. That will also mean an axe to unprotected areas, such as local government, which is already cut to the bone.

The Government may counter that they are fixing the economy and that a higher tide will lift all boats. That is simply a lie. The Budget will see Britain continuing as a low-growth—just 1.7%—economy once the end-of-lockdown boost wears off. We have low growth, falling living standards and hollowed-out public services. For most people, I am afraid that it will feel very similar to the last decade, but it does not have to be. This should have been the Budget to invest massively in growth, in tackling inequality, in jobs, in tackling the climate crisis, in rebuilding our public services, in social housing and in moving us to a high-skill, high-wage economy.

Instead, public investment will remain pathetically low, and the main stimulus is a £25 billion corporate handout that may bring business investment forward but, as the Government’s figures show, will not increase overall investment levels. Those funds should instead have gone into a huge state investment programme also funded by record low borrowing costs and taxes on the super-rich, starting with a 50% rate on those on over £125,000. That could spur a shift to net-zero with a green new deal, build modern transport and infrastructure fit for the 21st century, lead to a mass house building programme, and renew our public services, all boosting growth, which is the best way to pay off the debt, but also creating decent jobs and helping to rebuild communities left behind for far, far too long.

That should have been the legacy coming out of this crisis, and that is what we on this side of the House will need to fight for.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call Jerome Mayhew by video link.

I am afraid I am going to have to stop Jerome Mayhew and come back to him.

Social Security

Baroness Winterton of Doncaster Excerpts

Tuesday 2nd March 2021 Commons Chamber

[Madam Deputy Speaker (Dame Rosie Winterton)]

With the leave of the House, we will debate motions 5 and 6 on social security together.

[The Minister for Disabled People, Health and Work (Justin Tomlinson)]

I beg to move,

That the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2021, which were laid before this House on 14 January, be approved.

[Madam Deputy Speaker]

With this we shall consider the following motion:

That the draft Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2021, which were laid before this House on 14 January, be approved.

[Justin Tomlinson]

These statutory instruments will increase the value of lump sum awards payable under the Pneumoconiosis etc. (Workers’ Compensation) Act 1979 and the diffuse mesothelioma scheme established by the Child Maintenance and Other Payments Act 2008. As many hon. Members will know, these two schemes stand apart from the main social security benefits uprating procedure. While there is no statutory requirement to increase rates, I am happy to maintain the position and increase the amounts payable by the September 2020 consumer price index of 0.5%. This is the same rate that is being applied to industrial injuries, disablement benefits and other disability benefits under the main social security uprating provisions. These new amounts will be paid to those who satisfy all the conditions of entitlement for the first time on or after 1 April 2021.

The Government recognise the great suffering of individuals and their families caused by the serious and often fatal diseases resulting from exposure to asbestos or other listed agents. The individuals affected and their families may be unable to bring a successful claim for civil damages in relation to their disease. This is mainly due to the long latency period of their condition, but they can still claim compensation through these schemes. These schemes also aim, where possible, to ensure that sufferers receive compensation in their lifetime, without first having to await the outcome of civil litigation. While improvements in health and safety procedures have restricted the use of asbestos and provided a safe environment for its handling, the legacy of its use is still with us. That is why we are ensuring that financial compensation from these schemes is available to those affected.

I will briefly summarise the specific purpose of the two compensation schemes. The Pneumoconiosis etc. (Workers’ Compensation) Act 1979, which for simplicity I will refer to as the 1979 Act scheme, provides a lump sum compensation payment to individuals who have one of five dust-related respiratory diseases covered by the scheme who are unable to claim damages from employers and who have not brought any action against another party for damages. The five diseases covered by the 1979 Act scheme are: diffuse mesothelioma; bilateral diffuse pleural thickening; pneumoconiosis; byssinosis; and primary carcinoma of the lung if accompanied by asbestosis or bilateral diffuse pleural thickening.

The 2008 mesothelioma lump sum payment scheme, which I will refer to as the 2008 scheme, was introduced to provide compensation to people who contracted diffuse mesothelioma but were unable to claim compensation under the 1979 Act because, for example, they were self-employed or their exposure to asbestos was not due to their work. The 2008 scheme allows payments to be made quickly to people with diffuse mesothelioma at their time of greatest need. Under each scheme, a claim can be made by a dependant if the person with the disease has died before being able to make a claim.

The rates payable under the 1979 Act scheme are based on the level of disablement assessment and the age of the sufferer at the time the disease is diagnosed. The highest amounts are made to those diagnosed at an early age and with the highest level of disablement. All payments for diffuse mesothelioma under the 1979 Act scheme are automatically made at the 100% disablement rate, the highest rate of payment, reflecting the serious nature of the disease. Similarly, all payments for this condition under the 2008 scheme are made at the 100% disablement rate and based on age, with the highest payments going to the youngest people with the disease. In the last full year for which data is available, April 2019 to March 2020, 3,220 awards were paid under the 1979 Act, totalling £42.7 million, and 450 people received payments under the 2008 scheme, totalling £9.7 million. Overall, 3,670 awards were made across both schemes in 2019-20 and expenditure was £52.4 million.

I am keen to address the impacts of the covid-19 pandemic on sufferers of pneumoconiosis and mesothelioma. While this uprating debate is an annual event, this has been far from a normal year. We took the difficult decision at the outset of the pandemic to temporarily suspend all face-to-face health and disability assessments, including for the industrial injuries disablement benefit to protect the health of claimants and staff. We have continued, where possible, to process and qualify under SRTI rules—special rules for terminal illness—where a claim can be processed through paper-based review, and have recently explored telephone and video options in line with wider disability benefits to start to clear the backlog.

We are committed to working with our agencies and arms-length bodies to improve the lives of those people with respiratory diseases. People suffering from occupational lung diseases are likely to face a higher risk of complications resulting from covid-19 and it continues to be a distressing time for sufferers of the diseases we discuss today. As of Sunday 14 February, all those identified as clinically extremely vulnerable have been offered a vaccine.

Returning to these important regulations, I am sure we all agree that while no amount of money can ever compensate individuals and families for the suffering and loss caused by diffuse mesothelioma and other dust-related diseases covered by the 1979 Act scheme, those who have them rightly deserve the financial compensation that these schemes can offer. I am required to confirm that the provisions are compatible with the European convention on human rights and I am happy to do so. I commend the increase of the payment scales for those schemes and ask approval to implement them.

--- Later in debate ---

[Justin Tomlinson]

I thank hon. Members for their helpful contributions to this debate, which is a rare case of cross-party support. The debate was hugely enriched by the very personal stories and experiences that were shared, which highlight the importance of these annual uprating regulations. The Government recognise that these two schemes form an important part of the support available to people with dust-related diseases, and these draft regulations will ensure that the value of that support is maintained. I wish to echo the comments about the charities and organisations that both support claimants and families to secure a diagnose and provide ongoing support. This House recognises what an invaluable role they play for people in such challenging times.

Hon. Members raised a number of points, and I will try to cover the key ones. First, on the delays, due to covid we understandably had to suspend traditional face-to-face assessments. We have now been able to start with paper-based reviews and, as we have seen with wider disability benefits, we have looked to use telephone and video technology where possible. As quickly as we are allowed safely to return to face-to-face assessments, those for whom we have not been able to do a paper-based review or a telephone or video assessment will be a priority in this area.

The Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Stephen Timms), asked for an update on stats. They are published quarterly, and those he quoted are the last published ones. We will share the stats as soon as they come forward. However, we absolutely understand the importance of getting the backdates cleared. He also mentioned the issue whereby, for some claims made under the 1979 Act, due to the suspension of face-to-face assessments the amount of compensation a claimant can receive is based on their age on the date the IIDB was awarded, not the date of the claim. The Department is actively considering what we can do for those claimants who, through no fault of their own, have received a reduced amount as a result of the delays. We acknowledge that, we are looking to address it, and I very much welcome the right hon. Gentleman highlighting the issue in a proactive, constructive spirit. We do get that.

I turn to the quirk of why this debate is held annually. It was set in place in 2004, and Ministers—including me—have done it each year. A change to make this measure part of the wider statutory uprating would require primary legislation. However, aside from requiring legislation to make the change, this is an opportunity for us to focus on the scheme and the wider support, and the quality and merit of the speeches today shows why we have the debate annually. As ever, these things are kept under review, but it is one of those situations where there are gains, and it is about whether a change is needed.

A number of hon. Members raised the principle of equalising the levels of payments made to dependents. I listened carefully to the concerns raised, but the Government remain of the view that available funding should be prioritised to those people who are currently living with the disease.

A number of hon. Members spoke about the importance of research, which is crucial, particularly in our fight against cancer. I very much welcome the fact that the Department of Health and Social Care invests £1 billion a year in health research through the National Institute for Health Research. We have been working actively for several years to stimulate an increase in the level of mesothelioma research, and I thank organisations such as Cancer Research UK, the British Lung Foundation and the Medical Research Council that are proactively trying to stimulate additional crucial research in that area. We will welcome any more work that is done.

A number of hon. Members addressed the HSE, which is a wonderful organisation. I welcome the fact that it secured an additional £14 million for the financial year 2021-22 to continue to support the Government in the national response to the global covid-19 pandemic. That will fund spot checks and inspections, including those enforced by local authorities, to ensure that workplaces are covid-secure for workers and the public. That is in addition to the HSE’s regular Government funding to deliver its wide-ranging regulatory functions.

To be clear, the HSE does not only rely on direct Government funding; it also generates income. Rightly, a key part of its work is raising awareness, and its health and work strategy delivers a strategy for occupational lung disease that includes raising the profile of occupational lung diseases through activities such as facilitating the Healthy Lung Partnership to provide direction of co-ordinating stakeholder activity on occupational lung disease, in addition to targeted intervention activity. When I was responsible for the HSE as a DWP Minister—it is no longer part of my responsibilities—I was incredibly impressed with how well it engaged with businesses of all sizes to give them the best knowledge, support and guidance in all areas of health and safety, and that part of its work is crucial.

Moving on to the very important issue of cancer patients, it is imperative that people can get tested for cancer and that cancer patients continue to receive the treatment they need. While the covid-19 pandemic has presented major challenges for all healthcare systems, overall cancer treatment services have been maintained throughout the pandemic. The NHS has published a cancer service recovery plan that aims to prioritise long-term plan commitments, including respiratory disease, as a clinical priority, and that will support recovery. This includes the delivery of targeted lung health checks and the roll-out of rapid diagnostic centres. As of the end of 2020, there were 53 live rapid diagnostic centre pathways across hospitals in England, compared with just 12 in March 2020, with a further 63 pathways in development. In October 2020, NHS England, NHS Improvement and Public Health England launched the latest “Help Us, Help You” campaign to urge people with potential symptoms of cancer to see their GP. The lung cancer campaign will focus on the key symptom of a cough for three weeks or more and encourage anyone who has had this symptom to speak to their GP. I am sure we would all echo the importance of that message.

On dependents and gender imbalance, we have not conducted an impact assessment, but a valid point has been raised and I will take it away to look at it.

I commend the uprating of the payment scales for these schemes and ask for approval to implement them.

Question put and agreed to.

Resolved,

That the draft Pneumoconiosis etc. (Workers’ Compensation) (Payment of Claims) (Amendment) Regulations 2021, which were laid before this House on 14 January, be approved.

Resolved,

That the draft Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2021, which were laid before this House on 14 January, be approved.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I will now suspend the House for three minutes to make the necessary arrangements for the next business.

Universal Credit and Working Tax Credit

Baroness Winterton of Doncaster Excerpts

Monday 18th January 2021 Commons Chamber

[Sam Tarry (Ilford South) (Lab)]

I find it astonishing that the hon. Member for Heywood and Middleton (Chris Clarkson) and other Government Members do not understand the fury that has been unleashed across this country by the measures that the Government are failing to take and the callous way that they have treated so many millions of people. It is clear to me and the constituents of Ilford South that the Government should be hanging their heads in shame. They should not have even been forced to come to this Chamber or to have this debate.

This is a Government who have spent billions of pounds of taxpayers’ money on contracts with friends linked to donors, and hundreds of millions of pounds on a failed test and trace system and, in my constituency, unusable personal protective equipment. It is an absolute disgrace that the Government cannot stump up an extra 20 quid to put food on the table of some of the most vulnerable people in this country.

We are in the midst of the worst recession ever. Millions of families, many in work but reliant on Government support to supplement poverty wages, are on the brink. This is not a time to let them sink below the poverty line; it is time for the Government to stick their hand in their pocket and do what is right.

Instead, the Government’s cruel and callous decision will have an impact on more than 6 million families across the country, and risk plunging more than 300,000 children into poverty. In my constituency of Ilford South, more than 19,000 people rely on universal credit to make ends meet. That is more than double the national average.

Worse, that decision comes just days after we learn that the Government are only setting aside £5—five measly pounds—to feed our children. Let us be under no illusion: this is an attack on Britain’s workers by a Government who represent the 1% of this country, intent on cutting tax rates for their mates and handouts for the poorest.

We are struggling through a devastating pandemic and—I think that people on both sides of this House agree—perhaps the biggest challenge for our country since the second world war. Due to the unprecedented nature of this crisis, we have all had to adapt rapidly, so it is little surprise that living costs have risen in recent months. Indeed, research by Save the Children and the Joseph Rowntree Foundation found that 86% of families with children on universal credit and tax credits have been faced with additional costs since the crisis began.

The increase in Government support previously was rightly welcomed. It eased the burden on millions of families up and down the country. However, it will be many months, unfortunately, before we are out the other side of this awful pandemic, and millions more will lose their jobs and be at risk of unemployment when the furlough scheme comes to its end. It is completely the wrong time to end that vital piece of support.

The Government have tried to spin their one-off payment of £500 as a positive, something that so many people have seen through. As my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) pointed out, in real terms that means the lowest level of unemployment support for 30 years, at a time when redundancies are going through the roof.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am afraid we now have the last speaker, who is Jacob Young.

[Jacob Young (Redcar) (Con)]

This is an unprecedented crisis that demands an unprecedented level of Government support. Our Conservative Government have been there for the most vulnerable at every turn. Never have any Government in our history done so much to support those in need, with more than £280 billion spent on measures prioritising the people on the lowest incomes. While the Labour party squabbles over whether that should be £281 billion or £282 billion, our determination to help the lowest paid and most vulnerable in our society continues.

The Chancellor, in his autumn statement, accepted all the recommendations of the Low Pay Commission and increased the national living wage, worth £345 to those who work a 40-hour week. In the public sector, we have had to take the difficult decision to freeze pay for many public sector workers, but we have again shielded the lowest paid: those in the public sector with below the median income will see their wages rise this year by at least £250. Since 2010, we have raised the personal tax threshold to £12,500—something that benefits the least well-off the most. We have paid 80% of people’s wages and provided the self-employed income support scheme designed for those earning less than £50,000. We have protected renters, helped with mortgages, and are delivering the targeted support needed to help families with their council tax, food and energy bills. We have continued to prioritise the least well-off.

Meanwhile, the leader of the Labour party characteristically offers only division and indecision. Last week, he said that he wanted more restrictions on our economy, but he will not tell us what they could be. He has told us that he wants to scrap our Brexit deal and to do his own, but he will not tell us what that will include. Now he says he wants to scrap universal credit, but he will not tell us what would replace it.

Sadly, since the first lockdown in March, the number of people claiming universal credit has doubled. Yet the system has not fallen over under the weight of all that additional pressure, and I pay tribute to those outstanding DWP staff, especially those at my local jobcentres in Redcar, Eston and Middlesbrough, who have worked so hard to ensure that.

The Labour party can criticise universal credit and the DWP all it likes, but it knows that the legacy system it left behind would not have been able to cope with this increase in demand, and while we have invested in universal credit by doubling the number of job coaches to provide the necessary one-to-one jobseeker support that we know works so much better, it would throw it all away rather than admit it is delivering exactly on the priorities of those who need it most. Work is the best route out of poverty, which is why we have taken such extraordinary measures to protect as many jobs as we can. This Government are rising to the immense challenge presented by a crisis like no other in our history. We are all in this together, and together is how we will beat this virus.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I am sorry we have not been able to fit everybody in to this debate. It was heavily over-subscribed, and we had a statement earlier and we do have another heavily subscribed debate, so I am now going to the shadow Chancellor, Anneliese Dodds.

--- Later in debate ---

[Mr William Wragg (Hazel Grove) (Con)]

On a point of order, Madam Deputy Speaker. My apologies to the right hon. Member for Warley (John Spellar) and the hon. Member for Sheffield, Brightside and Hillsborough (Gill Furniss) for not being able to give them prior notice of my point of order because they were on telling duty. I was concerned, at the calling of that Division, that the advent of face masks in the Chamber may have disguised a member or two of the Opposition Whips Office shouting opposition to their own motion, thus rendering redundant the idea that the vote should follow the voice. Could you advise me further on that, Madam Deputy Speaker?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the hon. Gentleman for that point of order. Nothing disorderly has happened. There was a shout of “Aye” and a shout of “No”, and Tellers were put in when I put the question again. I am sure that he is not questioning my judgment. Nothing disorderly has happened, and the vote took place in the proper manner.

I will now suspend the House for three minutes in order to enable the arrangements necessary for the next business to be made.

Pension Schemes Bill [Lords]

Baroness Winterton of Doncaster Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Monday 16th November 2020 Commons Chamber

[Stephen Timms (East Ham) (Lab)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Dame Rosie Winterton)]

With this it will be convenient to discuss the following:

New clause 2—Pensions Advisory Commission—

“(1) The Pensions Regulator shall establish a committee to be known as the Pensions Advisory Commission.

(2) The Commission shall consist of—

(a) members of the Regulator as provided under section 2(1) of the Pensions Act 2004, and

(b) five other persons appointed by Her Majesty on the recommendation of the Secretary of State.

(3) A person appointed under subsection (2)(b) shall exercise only functions in pursuance of the duties in subsections (5) and (6).

(4) The Commission shall be chaired by a person appointed under subsection (2)(b).

(5) It shall be the duty of the Pensions Advisory Commission to submit to the Secretary of State each calendar year, beginning with the year 2022, a report setting out the Commission’s views on—

(a) the impact of provisions in Parts 1, 2 and 4 of this Act on—

(i) persons in different parts and regions of the United Kingdom,

(ii) equal treatment of men and women in access to pension provision, and

(iii) persons with a protected characteristic under section 4 of the Equality Act 2010; and

(b) the effectiveness of the powers in Parts 1 to 3 of this Act in enabling the Pensions Regulator to achieve its objectives under section 5 of the Pensions Act 2004.

(6) It shall also be the duty of the Commission to report to the Secretary of State by 31 October 2021 its views on when commercial operators should be able to enter the market for provision of a pensions dashboard service.

(7) The Secretary of State must lay before Parliament a copy of every report received from the Commission under this section.”

New clause 3—Pension accounts—

“(1) A jobholder to whom section 3 of the Pensions Act 2008 applies may by notice require an employer to arrange for the jobholder to receive into a pension account any contribution which would otherwise be made by the employer into an automatic enrolment scheme.

(2) A contribution by a jobholder or by their employer into the jobholder’s pension account shall be invested in a pension scheme offered by an approved pension provider.

(3) The Secretary of State may by regulations make provision—

(a) about the form and content of a notice given under subsection (1), or

(b) about the arrangements that the employer is required to make.

(4) The Secretary of State may make regulations to set criteria by which a pension provider may be approved for the purposes of subsection (2).

(5) Regulations under this section shall be made by statutory instrument and may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

New clause 4—Employer debt: trustees’ discretion—

“(1) The following changes are made to the Occupational Pension Schemes (Employer Debt) Regulations 2005 (SI 2005/678).

(2) In regulation 2, in the definition of “scheme apportionment arrangement”—

(a) in sub-paragraph (f)(ii), after “apply”, insert “but not if the circumstances in paragraph (h) apply”;

(b) at end insert—

“(h) the consent of the remaining employer or employers shall not be required under (f)(ii) above where all of the following conditions apply—

(i) the departing employer’s debt was treated as becoming due prior to the coming into force of this provision; and

(ii) the departing employer’s debt was less than 0.5% of the scheme’s overall liabilities, as estimated by the trustees or managers on advice of the scheme actuary, as if the whole scheme had been winding-up at the time the debt was treated as becoming due; and

(iii) the employer in question was operating as an unincorporated business during his participation in the scheme; and

(iv) the trustees or managers consider that, in the context of the scheme overall, taking into account factors such as the scheme’s assets, liabilities and the trustees’ or managers’ most recent assessment of the overall employer covenant, there would be no material benefit to the scheme and its members in seeking recovery of the employer’s liability share from the departing employer.”

(3) In regulation 9, after paragraph (14B), insert the following new paragraph—

“(14C) Condition L is that a debt was treated as becoming due from him under section 75 of the 1995 Act but is excluded under this Condition because—

(a) the employer’s debt was treated as becoming due prior to this Condition coming into force; and

(b) the employer’s debt was less than 0.5% of the scheme’s overall liabilities, as estimated by the trustees or managers on advice of the scheme actuary, as if the whole scheme had been winding-up at the time the debt was treated as becoming due; and

(c) the employer in question was operating as an unincorporated business during his participation in the scheme; and

(d) at or before the applicable time, the trustees or managers have made a determination not to pursue the debt on the grounds that, in the context of the scheme overall, taking into account factors such as the scheme’s assets, liabilities and the trustees’ or managers’ most recent assessment of the overall employer covenant, seeking recovery represented a disproportionate cost to the scheme and would be of no material benefit to the scheme overall.””

This new clause would enable pension scheme trustees to exercise discretion not to pursue employer debt following an employer’s exit from a pension scheme where such debt is below a de minimis threshold. This aims to support unincorporated employers who are now retired for business and for whom the current regulation allows no easements.

New clause 5—Employer debt: deferred debt arrangement—

“(1) The following changes are made to the Occupational Pension Schemes (Employer Debt) Regulations 2005 (SI 2005/678).

(2) In regulation 6F—

(a) in paragraph (1), leave out “A” and insert “Subject to the provisions of paragraph (8) below, a”;

(b) at end insert—

“(8) In relation to a frozen scheme, the trustees or managers of the scheme may agree to a deferred debt arrangement where the employment-cessation event occurred at a time prior to the scheme becoming a frozen scheme, providing the conditions of paragraph (3) are met at the time the deferred debt arrangement is entered into.””

This new clause would permit employers in a pension scheme closed to future accrual to apply for a deferred debt arrangement, providing they meet the other statutory tests. This aims to support employers who are still trading but were not able to use the existing deferred debt easement.

New clause 6—Regulation of pension superfunds—

“(1) The Secretary of State shall publish a statement on proposals for primary legislation in relation to a duty on the Pensions Regulator to regulate pension superfunds.

(2) For the purposes of this section, a pension superfund is a defined benefit pension scheme that allows for the severance of an employer’s liability towards a defined benefit scheme and one of the following conditions applies—

(a) the scheme employer is replaced by a special purpose vehicle (SPV) employer, or

(b) the liability of the employer to fund the scheme’s liabilities is replaced by an employer backed with a capital injection to a capital buffer.

(3) The statement under subsection (1) shall be laid before Parliament before the end of a period of six months from the day on which this Act receives Royal Assent.”

This new clause would require the Secretary of State to publish within six months of Royal Assent proposals for primary legislation to place a duty on the Pensions Regulator to regulate pension superfunds.

Amendment 15, in clause 118, page 104, line 19, at end insert—

“(3) Requirements prescribed under subsection (2) must include a requirement that a pensions dashboard service may not include a facility for engaging in financial transaction activities.”

This amendment ensures that a pensions dashboard does not include a provision for financial transaction activities.

Amendment 9, page 105, line 20, at end insert—

“(6A) A requirement under subsection (6)(d) may require the provider of a pensions dashboard service to ensure that the needs of people in vulnerable circumstances, including but not exclusively—

(a) persons who suffer long-term sickness or disability,

(b) carers,

(c) persons on low incomes, and

(d) recipients of benefits,

are met and that resources are allocated in such a way as to allow specially trained advisers and guidance to be made available to them.”

This amendment would require that specially trained advisers and guidance are made available to people in vulnerable circumstances and would provide an indicative list of what vulnerable circumstances should include.

Amendment 10, page 105, line 20, at end insert—

“(6A) A requirement under subsection (6)(d) may require the provider of a pensions dashboard service to communicate to an individual using the dashboard the difference between—

(a) provision of information,

(b) provision of guidance, and

(c) provision of advice.”

This amendment would require the provider of a pensions dashboard service to ensure that users are made aware of the differences between “information”, “guidance” and “advice”.

Amendment 11, in clause 119, page 108, line 18, after “scheme,” insert—

“(iva) the total cost of charges incurred for the administration of the scheme”.

This amendment would add information about the total cost of charges incurred for the administration and management of occupational pension schemes to the list of information displayed on the dashboard.

Amendment 13, in clause 121, page 112, line 42, after “scheme,” insert—

“(iva) the total cost of charges incurred for the administration of the scheme”.

This amendment would add information about the total cost of charges incurred for the administration and management of personal and stakeholder pension schemes to the list of information displayed on the dashboard.

Amendment 8, in clause 122, page 116, line 37, at end insert—

“(2A) Before any other pension dashboard services can qualify under section 238A of the Pensions Act 2004 (qualifying pensions dashboard service)—

(a) the pensions dashboard service under subsection (1) must have been established for at least one year, and

(b) the Secretary of State must lay before Parliament a report on the operation and effectiveness of the pensions dashboard service under subsection (1) in its first year.”

Amendment 14, page 116, line 37, at end insert—

“(3) Before any other pension dashboard services can qualify under section238A of the Pensions Act 2004 (qualifying pensions dashboard service) the Secretary of State must lay before Parliament a report on the operation and effectiveness of the pensions dashboard service, including the adequacy of consumer protections.”

This amendment would require the Secretary of State to report on the operation and effectiveness of the public dashboard service (including consumer protections) before allowing commercial dashboards to operate.

Amendment 7, in clause 123, page 117, line 34, at end insert—

“(2) In exercising any powers to make regulations, or otherwise to prescribe any matter or principle, under Part 3 of the Pensions Act 2004 (scheme funding) as amended by Schedule 10, the objectives of the Secretary of State must include ensuring that schemes that are expected to remain open to new members, either indefinitely or for a significant period of time, can adopt funding and investment strategies which are suited to the characteristics of such schemes.”

Amendment 1, page 117, line 34, at end insert—

“(2) In exercising any powers to make regulations, or otherwise to prescribe any matter or principle, under Part 3 of the Pensions Act 2004 (scheme funding) as amended by Schedule 10, the Secretary of State must ensure that—

(a) schemes that are expected to remain open to new members, either indefinitely or for a significant period of time, are treated differently from schemes that are not;

(b) scheme liquidity is balanced with scheme maturity;

(c) there is a correlation between appropriate investment risk and scheme maturity;

(d) affordability of contributions to employers is maintained;

(e) affordability of contributions to members is maintained;

(f) the closure of schemes that are expected to remain open to new members, either indefinitely or for a significant period of time, is not accelerated; and

(g) trustees retain sufficient discretion to be able to comply with their duty to act in the best interests of their beneficiaries.”

This amendment seeks to ensure that open and active schemes which are receiving regular, significant cash contributions and closed schemes are treated differently, in accordance with their differing liquidity profile.

Amendment 6, page 117, line 34, at end insert—

“(2) The Secretary of State must, on or before 30 June 2021, lay before Parliament a comprehensive impact assessment of the effect on the charitable sector of changes to defined benefit schemes made under Schedule 10.”

This amendment would require the Government to produce an economic impact assessment of the changes to defined benefit schemes upon the charitable sector.

Amendment 16, in clause 124, page 118, line 45, leave out subsection (8) and insert—

“(8) In this section and in sections 41AA, 41B and 41C—

(a) “the Paris Agreement goal” means the objectives set out in Articles 2 and 4.1 of the agreement done at Paris on 12 December 2015; and

(b) “other climate change goal” means any climate change goal approved by the Secretary of State, but does not apply to a climate change goal which fails to meet the objectives of the Paris Agreement goal.

41AA Alignment with the Paris Agreement goal

(1) Trustees or managers of occupational pension schemes of a prescribed description must develop, set and implement, and from time to time review and if necessary revise, a strategy for ensuring that their investment policy, objectives and practices (including stewardship activities) are aligned with the Paris Agreement goal or other climate change goal.

(2) Such a strategy is to be known as a “Paris-alignment strategy”.

(3) The objective of a Paris-alignment strategy must be to achieve net-zero greenhouse gas emissions by 2050 or sooner, consistent with the Paris Agreement goal or other climate change goal.

(4) Provision may be made by regulations—

(a) requiring the trustees or managers of a scheme, in determining or revising a Paris-alignment strategy, to take into account prescribed matters and follow prescribed principles—

(i) as to the level of detail required in a Paris-alignment strategy; and

(ii) as to the period within which a Paris-alignment strategy must be developed, set and effected;

(b) requiring annual reporting on the implementation of the Paris-alignment strategy and progress against the objective set out in subsection (3); and

(c) requiring a Paris-alignment strategy to be reviewed, and if necessary revised, at such intervals and on such occasions as may be prescribed.”

This amendment enables regulations that would mandate occupational pension schemes to develop a strategy for ensuring that their investments and stewardship activities are aligning with the Paris agreement goals, and include an objective of achieving net-zero greenhouse gas emissions by 2050 or sooner.

Amendment 17, page 119, line 7, after “scheme” insert

“and alignment with achieving the objectives of the Paris Agreement goal or other climate change goal”.

This amendment is consequent on Amendment 16.

Amendment 18, page 119, line 8, leave out “section 41A” and insert “sections 41A and 41AA”.

This amendment is consequent on Amendment 16.

Amendment 19, page 119, line 19, after “41A”, insert “, 41AA”.

This amendment is consequent on Amendment 16.

Amendment 20, page 119, line 21, after “41A”, insert “, 41AA”.

This amendment is consequent on Amendment 16.

Amendment 21, page 119, line 22, at end insert—

“(za) provide for the Authority to undertake a review of, and report publicly on, the extent to which the activities under sections 41A and 41AA are achieving effective governance of climate change risk and alignment of pension schemes with the Paris Agreement goal;”.

This amendment enables the regulator to publicly assess the progress and development of schemes’ strategies to achieve alignment with Paris agreement goals.

Amendment 22, page 119, line 25, after “41A”, insert “, 41AA”.

This amendment is consequent on Amendment 16.

Amendment 23, page 119, line 30, after “41A”, insert “, 41AA”.

This amendment is consequent on Amendment 16.

Amendment 24, page 119, line 37, after “41A”, insert “, 41AA”.

This amendment is consequent on Amendment 16.

Amendment 2, in clause 125, page 120, line 32, at end insert—

“(e) the results of due diligence undertaken by the trustees or managers regarding the intended transfer or the receiving scheme.”

This amendment enables regulations under inserted subsection (6ZA) of section 95 of the Pension Schemes Act 1993 to prescribe conditions about the results of due diligence undertaken in relation to a transfer request such as to determine that the statutory right to a transfer is not established if specific “red flags” are identified in relation to the transfer or intended receiving pension scheme. Amendments 3, 4 and 5 are related.

Amendment 3, page 121, line 27, at end insert—

“(e) the results of due diligence undertaken by the trustees or managers regarding the intended transfer or the receiving scheme.”

This amendment enables regulations under inserted subsection (5A) of section 101F of the Pension Schemes Act 1993 to prescribe conditions about the results of due diligence undertaken in relation to a transfer request such as to determine that the statutory right to a transfer is not established if specific “red flags” are identified in relation to the transfer or intended receiving pension scheme. Amendments 2, 4 and 5 are related.

Amendment 12, in schedule 9, page 178, line 14, after “scheme,” insert—

(iva) the total cost of charges incurred for the administration of the scheme”.

This amendment would add information about the total cost of charges incurred for the administration and management of occupational pension schemes in Northern Ireland to the list of information displayed on the dashboard.

Amendment 4, in schedule 11, page 192, line 20, at end insert—

“(e) the results of due diligence undertaken by the trustees or managers regarding the intended transfer or the receiving scheme.”

This amendment enables regulations under inserted subsection (6ZA) of section 91 of the Pension Schemes (Northern Ireland) Act 1993 to prescribe conditions about the results of due diligence undertaken in relation to a transfer request such as to determine that the statutory right to a transfer is not established if specific “red flags” are identified in relation to the transfer or intended receiving pension scheme. Amendments 2, 3 and 5 are related.

Amendment 5, page 193, line 15, at end insert—

“(e) the results of due diligence undertaken by the trustees or managers regarding the intended transfer or the receiving scheme.”

This amendment enables regulations under inserted subsection (5A) of section 97F of the Pension Schemes (Northern Ireland) Act 1993 to prescribe conditions about the results of due diligence undertaken in relation to a transfer request such as to determine that the statutory right to a transfer is not established if specific “red flags” are identified in relation to the transfer or intended receiving pension scheme. Amendments 2, 3 and 4 are related.

[Stephen Timms]

I rise to speak to new clause 1, together with amendments 2 to 5, and I am grateful to those from my party, the Conservative party and the SNP who have added their names to them.

New clause 1 addresses a serious flaw in the implementation of the pension freedoms that George Osborne announced in his Budget speech in 2014 and that were implemented the following year. This is what George Osborne said in that Budget speech on 19 March 2014:

“Let me be clear: no one will have to buy an annuity. We are going to introduce a new guarantee, enforced by law, that everyone who retires on these defined contribution schemes will be offered free, impartial, face-to-face advice on how to get the most from the choices they will now have.”—[Official Report, 19 March 2014; Vol. 577, c. 793.]

That was a recognition that there could be pitfalls in allowing people to do whatever they wanted with their pension savings—for many people, the largest sum of money they would ever have access to—and that the Government would have to ensure that everybody had access to guidance to help them make the best decisions.

The outcome of George Osborne’s promise is the Pension Wise service operated by Citizens Advice, and it is an excellent service. It is free and it is impartial, as George Osborne promised, and it gets very high satisfaction ratings from those who use it. The problem is that hardly anyone does use it, and new clause 1 is intended to fix that. The latest figures show that about one in 33 of those eligible for Pension Wise actually use it. Last month, the Department for Work and Pensions published a document entitled “Stronger Nudge to Pensions Guidance: Statement of Policy Intent”. That proposed the adoption of new nudges, which, according to the trials, would increase the take-up from one in 33 to one in nine. Well, that is not enough.

--- Later in debate ---

[Gareth Davies]

I am very grateful to my hon. Friend for his intervention. I agree that the Bill is sufficient in its current form to be able to achieve what we all want to achieve, which is to get pension funds to invest in a climate-aware way.

The last point that I will make in concluding is around this point on focus. In my experience, it is not the fund managers or the trustees whom we need to persuade or to make do anything, but the middle men and women—the gatekeepers, the investment consultants —who typically require a five-year track record and £100 million in assets held by fund managers and managed by fund managers. In my experience, that was always the issue. We were running money in a way that was really pushing things forward in terms of our climate targets. We knew that the pension clients really wanted to invest with us, but, because we could not meet the requirements of the investment consultants, we could not marry the two together. If we use the combined intellect, passion and energy of this House, from all parties, to come up with a solution to that, we could make great progress.

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. I am going to suspend the House for a short time—probably five or 10 minutes—to allow some extra cleaning to take place. Could Members leave the Chamber, so that the cleaning can take place? The bell will ring a minute before we are due to resume.

--- Later in debate ---

[Pete Wishart (Perth and North Perthshire) (SNP)]

On a point of order, Madam Deputy Speaker. I wonder if you could tell the House why there was the necessity for the further cleaning of the Chamber. I understand that this is the first time that this has ever happened. Is there anything in particular that the House needs to be informed about because of that arrangement?

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the hon. Gentleman for that point of order. We were asked to suspend the House just to ensure that there was a little bit of extra cleaning. I do not have any further information other than that, but I am sure that it is precautionary, and if there is anything further that Members need to be informed of, I am sure that they will be.

[Jim Shannon (Strangford) (DUP)]

First, let me thank all those who have made contributions, which have been excellent. I thank the Minister for his response and the hon. Member for Grantham and Stamford (Gareth Davies) for the contribution he made just before me. It is a pleasure to speak on this issue. Although I know that this is not the purpose of this Bill, I cannot in all good conscience let the occasion go without raising the issue of the WASPI—Women Against State Pension Inequality Campaign—women, who still want their pension scheme. Once more, I look to the Minister for a response on that.

I want to speak to new clause 1 and some of the other amendments, ever mindful of the fact that the Bill provides for territorial extent, as set out in clause 117 and schedule 8, clause 120 and schedule 9, clauses 118, 119 and 129 and schedule 11. Pensions are a devolved matter in Northern Ireland, but this is an area where Northern Ireland has long maintained parity with Great Britain. There is, in effect, a single systems of pensions across the UK, with many pensions schemes, and indeed the regulator, the pensions ombudsman, the Pension Protection Fund and so on operating on a UK-wide basis.

Devolved government has now been restored in Northern Ireland, and we are pleased to have it in place. On 1 June, the Northern Ireland Assembly approved the legislative consent motion on the Bill, as introduced, and a further LCM will be necessary to cover amendments to the Bill, which the Northern Ireland Minister for Communities has agreed will be done and should extend this to Northern Ireland. So some things are positive on that.

I have been in contact with a number of pensions bodies that have expressed concern about the proposals in the Bill. We all know how essential a good pension is, and it is becoming more important with each month. I am sure that I am not the only one to have seen the losses in pensions in this year’s statement. I have a decent understanding of how my pension pays out, but I was listening to the girls in my office and it is clear that, although my staff members in their 40s and 50s have a grasp on their pension, the two staff members in their 20s and 30s do not and they do not seem to be able to understand just how it works. The older girls say, “I wouldn’t swap my pension but I like to see what is in it,” and they have already had a look at their pensions to know what they have. Many people are wise and astute enough to do that, but others are not and they have no understanding of what can be done. There is more to doing our best to secure our financial future than simply opening a letter—there has to be more than that.

The right hon. Member for East Ham (Stephen Timms) referred to new clause 1, which underlines the importance of an easily accessible, easy to navigate pensions dashboard that is easier to understand than an annual statement. The Association of British Insurers has said:

“Pensions Dashboards are a necessary addition to Automatic Enrolment. More than 10 million people have now been automatically enrolled into workplace pensions through inertia, and will need to find their pension pots and make decisions about them.”

We are all probably at that age, Minister, when we have to think about our pension pots, and if we are not doing so, there is something seriously wrong, because we should be. The ABI went on to say:

“Already 1 in 5 adults admit to having lost a pension pot and latest PPI research suggests that there is at least £19.4bn held in pots that consumers have lost track of.”

It is horrendous to hear that.

Supporting Disadvantaged Families

Baroness Winterton of Doncaster Excerpts

Monday 9th November 2020 Commons Chamber

[Dr Coffey]

It is nice to see my hon. Friend back in the House after her maternity leave. She speaks with appropriate compassion and she recognises some of the local organisations in her area. I encourage her to work with them and her council to help to ensure that the £170 million funding can be effectively distributed, so that the most disadvantaged children and families are truly helped. We want to make sure that that activity continues to support similar children through the holiday activity fund.

[Madam Deputy Speaker (Dame Rosie Winterton)]

In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next, I am suspending the House for a few minutes.

Social Security (Up-rating of Benefits) Bill

Baroness Winterton of Doncaster Excerpts

Committee stage & Committee: 1st sitting & Committee: 1st sitting: House of Commons & Report stage & Report stage: House of Commons
Thursday 1st October 2020 Commons Chamber

[DAME ROSIE WINTERTON in the Chair]

[The First Deputy Chairman of Ways and Means (Dame Rosie Winterton)]

Before I ask the Clerk to read the title of the Bill, I should explain that although the Chair of the Committee would normally sit in the Clerk’s chair, in these exceptional circumstances, in order to comply with social distancing requirements, I will remain in the Speaker’s chair, although I will be carrying out the role not of Deputy Speaker, but of Chairman of the Committee. We should be addressed as Chairs of the Committee, rather than Deputy Speakers. Excellent.

Clause 1

UP-RATING OF STATE PENSION AND CERTAIN OTHER BENEFITS FOLLOWING REVIEW IN TAX YEAR 2020-21

[Chris Stephens (Glasgow South West) (SNP)]

I beg to move amendment 1, page 1, line 10, leave out from “State” to the end of line 15 and insert—

“shall lay before Parliament the draft of an order which increases each of the amounts referred to in subsection (1) above by a percentage no less than—

(a) the difference between the general level of earnings at the beginning of the period under review and the general level of earnings at the end of that period, or

(b) the difference between the general level of prices at the beginning of the period under review and the general level of prices at the end of that period, or

(c) 2.5%,

(none) whichever is the greater.”

This amendment would require the Secretary of State to up-rate the benefits to which this Act applies in accordance with the “triple lock” of the higher of increases in prices, increases in earnings or 2.5%.

[The First Deputy Chairman of Ways and Means]

With this it will be convenient to discuss the following:

Amendment 2, page 1, line 23, at end insert—

“(2C) No draft order laid before Parliament under section (2A) above may be made in the form of the draft until the Secretary of State has laid before Parliament a report containing an assessment of the impact of its effect on levels of poverty.

(2D) The assessment required by paragraph 2C shall, in particular, consider the impact on levels of poverty in—

(a) Scotland, and

(b) Wales.”

 

This amendment would require the Secretary of State to lay before Parliament an assessment of the impact of the up-rating on levels of poverty, including in Scotland and Wales.

Amendment 3, page 1, line 23, at end insert—

“(2C) No draft order laid before Parliament under section (2A) above may be made in the form of the draft until the Secretary of State has laid before Parliament a report containing an assessment of its impact on persons not ordinarily resident in Great Britain, including the impact of exempting any such persons from entitlement to up-rating increases granted by the order.”

This amendment would require the Secretary of State to lay before Parliament an assessment of the impact on those overseas pensioners whose pensions are frozen in accordance with Government policy.

Amendment 4, in clause 1, page 1, line 23, at end insert—

“(2C) No power may be exercised under this or any other Act so as to exempt persons not ordinarily resident in Great Britain from entitlement to up-rating increases granted by an order made by virtue of section (2A) of this Act.”

This amendment would ensure that this up-rating applied to all overseas pensioners, including those whose pensions have previously been frozen in accordance with Government policy.

Amendment 5, page 1, line 23, at end insert—

“(2C) No draft order laid before Parliament under section (2A) above may be made in the form of the draft until the Secretary of State has laid before Parliament a report containing an assessment of its impact on those affected by the changes in the state pension age made by the Pensions Act 1995 and the Pensions Act 2011; and that assessment shall, in particular, consider the impact on women born between 6 April 1950 and 5 April 1960.”

This amendment would require the Secretary of State to lay before Parliament an assessment of the impact of the up-rating on those whose state pension age was changed by the Pensions Acts 1995 and 2011, including in particular the group known as the “WASPI women”.

Clause stand part.

Clause 2 stand part.

[Chris Stephens]

It is good to see that social distancing is being applied at all times. It was remiss of me not to welcome the Pensions Minister back to his place. I did send him a private message, and thoughts of him and his wife and family are very much with us all in this House. I do welcome him back.

These are five non-controversial amendments, which I hope— [Interruption.] We seem to have a laugh already from the Minister. I do not know why. He has obviously not read these non-controversial amendments. We have tabled some probing amendments and look forward to his response.

The first amendment is a theme that was picked up on Second Reading by the hon. Member for North East Fife (Wendy Chamberlain), which is to ensure that the triple lock is applied in legislation. The Government would have to give an explicit commitment to maintain the triple lock for the year ahead. The amendment seems to speak very much for itself.

Amendment 2 asks for an assessment on poverty, which again was picked up on Second Reading. It is certainly our view that the Government are overseeing some brutal benefit cuts, which have exacerbated poverty, and we require a proper impact assessment of the proposed uprating and the impact that has on poverty levels in each of the devolved nations.

Previous UK Budgets have introduced some fairly punitive cuts to social security—certainly the most punitive in recent memory—and we are starting to see an active reversal of reducing and fighting poverty. The Social Metrics Commission report, which was referred to at an earlier stage, notes that prior to the outbreak 14.4 million people in the UK were already living in poverty, including 33% of children, 22% of all working-age adults and 11% of pension-age adults. The largest employment impacts of covid have been felt by those in the deepest poverty, with many at risk of falling deeper into poverty as a result of job losses, reduced hours or reduced pay. We have tabled amendment 2 to provide for that impact assessment.

Amendments 3 and 4 deal with the issue of frozen pensions. UK pensioners deserve a full uprated state pension, wherever they choose to live. Due to the historical arbitrary bilateral agreements between the UK and other countries around the world, some UK pensioners who live overseas do not have their state pension payments uprated every year. That means that their pension is frozen at the level at which they first received it for the rest of their lives abroad. As of August 2019, that affected over 5,110 UK pensioners, who we believe are being adversely affected by the UK Government’s frozen pension policy. Pensioners who have paid the required national insurance contributions during their working lives in expectation of a decent basic pension and retirement find themselves on incomes that fall in real terms year on year. Pensioners will now face ending their days in poverty because they choose to live in the wrong country, in most cases without any knowledge of the implications of their choice for their pension.

In our view the state pension is a right, not a privilege. UK pensioners who have paid their fair share of national insurance contributions should not have to suffer simply because successive Governments have failed to establish bilateral agreements with certain countries. Therefore, we are asking that amendments 3 and 4 be agreed. I also refer hon. Members to the frozen pensions campaign, of which many hon. Members are members.

Amendment 5 relates to 1950s-born women, an issue that I am sure the Pensions Minister would be disappointed if I did not mention. As a previous Speaker of this House advised in 2015, persistence is not a vice. The amendment would require the Government to publish an assessment of the impact of uprating on those whose state pension age was changed by the Pensions Acts 1995 and 2011, including in particular 1950s-born women, or WASPI—Women Against State Pension Inequality Campaign—women, as they are known.

The numbers of ’50s-born women and men claiming working-age benefits has rocketed, and they should have been receiving their state pension. This is a double whammy, with those with occupational defined-contribution pensions to fill the gap being squeezed even further. Those claiming benefits find themselves having lost Government support in many cases, excluded either due to gaps in national insurance contributions, because of low-paid, precarious work, or because of other parts of household income. We are very aware of the history of 1950s-born women and the inequality they have faced throughout many parts of their lives. They now find themselves discriminated against on the basis of so-called equality, while those losing their jobs or seeking work are being further disadvantaged by an unequal playing field and a shrinking job market.

I look forward to hearing the Minister’s response to our amendments.

Social Security Benefits: Claimant Deaths

Baroness Winterton of Doncaster Excerpts

Monday 24th February 2020 Commons Chamber

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Thank you, Madam Deputy Speaker, for granting an Adjournment debate on such an important issue.

The first duty of any Government is to keep its citizens safe, particularly the most vulnerable among us. This evening, I want to discuss the deaths of vulnerable social security claimants since 2014. That those deaths have been linked to the actions of the Department for Work and Pensions is a matter of grave concern. It shows abject failure on the part of not only the Department, but the Government. Ministers set policy and the Department implements it, so both are culpable. However, this is not just about what policies are implemented but about how they are delivered, and that relates to the culture in the Department. [Interruption.]

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. May we have a little bit of quiet? We cannot hear what the hon. Lady is saying.

[Debbie Abrahams]

Thank you, Madam Deputy Speaker. I shall speak up.

As I was saying, the leadership determines the culture in an organisation. In a Department, that culture is determined by Ministers. It is a question not just of the policies and their implementation, but of the tone and culture that are related to their delivery.

We know that the Government’s health assessment process and sanctions regime leave sick and disabled people in fear and dread as they wait for the inevitable envelope to drop on their doormat inviting them to participate in a work capability assessment or a personal independence payment assessment, or possibly both. More than three quarters of claimants who appeal against assessment decisions telling them that they are fit for work have those decisions overturned, and that is because these are poorly people. We also know that in 2013 the death rates among people on incapacity benefit or employment and support allowance were 4.3 times higher than those in the general population, an increase from 3.6 times higher in 2003. That showed the level of sickness and ill health in that group of people.

Peer-reviewed research published in the Journal of Epidemiology and Community Health estimated that, between 2010 and 2013, work capability assessments were independently associated with an additional 590 suicides, 280,000 cases of self-reported mental health problems, and 725,000 antidepressant scripts. Not only are those assessments not fit for purpose; they are actually doing harm.