Work-related Activity Group

Debate between Anne Begg and Sheila Gilmore

Tuesday 3rd February 2015 Westminster Hall

[Dame Anne Begg (Aberdeen South) (Lab)]

One of the conclusions that my hon. Friend and I reached as part of the Select Committee on Work and Pensions inquiry was that the work-related activity group was too wide and trying to do two contradictory things: to give support to people who are not fit for work without being in the support group; and at the same time to move those who might be fit for work closer to work. Those two different aspects of the WRAG meant that it became the default for everyone who either was now not fit for work, or definitely could not work in future. The group is too wide and too unwieldy.

[Sheila Gilmore]

I thank my hon. Friend, the Chair of the Select Committee, for that contribution. I will come on to this in more detail later, time permitting, because the situation we are in now is important. If we end up with a default group and people in it for a long time, one of the questions that has to be asked is, how much further have we progressed from where we started?

One of the problems seems to be that different rules or practices from those for people previously on incapacity benefit are being applied to new claimants. The new claimants who go into the support group may be placed there without a face-to-face assessment. In some situations people are having a paper-based assessment and, if people go into the support group, that might seem acceptable. The WRAG, however, has a detrimental effect on income and circumstances, which I will come on to, so if people go into that group because of a paper-based assessment, they will not have had the opportunity to explain more fully their particular circumstances. That might seem a rather strange thing to say, given the debate about there being too many assessments—I have been part of that myself in my Adjournment debates—but it is important that we get things right.

The Select Committee called for the rules to be aligned, so that no claimants could be placed into the WRAG without having an opportunity to explain their particular conditions and their impact to an assessor, but the Government in their response of November last year refused to accept that recommendation. I hope that the Minister has had further thought and might want to reconsider.

Between 2008 and 2014 about 30% of new claimants with Parkinson’s or multiple sclerosis were placed in the WRAG. Of those, some 5,000 were given the prognosis that they were unlikely to return to work in the longer term. The Select Committee recommended that all claimants with such a prognosis be allocated to the support group, not the WRAG, but the Government’s response was disappointing, stating that “with the right support”—which I will go on to say is not there—

“that person might be able to return to…work”.

The Government also consider that individuals might be able to adapt to their condition or that advances in treatment might become available. If someone goes into the support group, however, regular reassessments are carried out, so even if claimants were able to adapt successfully or treatments became available, that would be picked up. On its own, therefore, that is not a good enough reason for placing people in the WRAG.

That leads me on to the quality of support. When ESA was first introduced, the intention was that Jobcentre Plus would provide the support, but since 2010 the number of disability employment advisers has declined, meaning many ESA claimants receive no more than two face-to-face interviews per year or, in the experience of some of my constituents, sometimes fewer. Many are now referred to the Work programme, with numbers increasing significantly following the October 2012 decision to expand the range of people referred from those thought able to return to work within three months to those thought able to return within 12 months. Concerns about the Work programme are well documented, but it is particularly inappropriate for those incorrectly placed in the WRAG.

A constituent of mine was placed in the WRAG and referred to Work programme contractor A4E, but her only activity was to search for jobs on the internet, despite the fact that she has complex regional pain syndrome and would have been unable to take up any job offered. She was given little help with how her particular condition might be alleviated or supported, or about what contact she would require with employers to make that happen. Rather, the result was that her treatment was disrupted and her condition exacerbated. Indeed, recent analysis, quoted in the Select Committee report, found that only 5% of claimants from the WRAG who were placed in the Work programme have moved into sustained work since 2011, against a target of 16.5%.

A few months ago, an evidence-based review of the work capability assessment, the test for deciding whether people are eligible for benefit and which group they go into, examined whether different descriptors would work. Part of the process was to ask expert panels to look at the WCA outcomes. Interestingly, they identified that, of the claimants who were found fit for work, 83% would require, on average, two or three adjustments to be able to undertake employment, 50% would require flexible working hours, and 24% would require a support worker. That was a review of fit-for-work assessments; those requirements are likely to be even more necessary for those in the work-related activity group. Such support just is not happening through the Work programme.

I do not have a particular view on whether support should be provided through Jobcentre Plus or a contractor or other provider, but in addressing these concerns it is important that provision is not forced upon people who cannot benefit from it, and that those who can receive it get it in a form that is applicable to their needs and local circumstances. In that respect, I strongly support the devolution of responsibility and finance for the Work programme to local authorities, as many specialist local providers offer a much more effective and personalised service to those with health problems or disabilities.

As my hon. Friend the Chair of the Select Committee pointed out, there is a major flaw at the heart of the system, which explains some of the problems. The work capability assessment is trying to be a test of both eligibility for financial support and how close people are to being able to work. At the outset, there was in fact a further assessment called the work-focused health-related assessment, which was intended to explore the difficulties and obstacles that people would face in returning to work—that is, after eligibility for benefit had been determined, issues such as the obstacles to and distance from employment would be looked at.

In July 2010, the work-focused health-related assessment was suspended for two years on the grounds that it had not delivered the intended outcomes, although it seemed somewhat early to make that judgment as it was barely 18 months since the introduction of the benefit as a whole. In 2013, it was suspended for a further three years to await evaluation of the Work programme and universal credit.

[Dame Anne Begg]

The WFHRA, as it came to be known, was actually suspended before any existing incapacity benefit claimants had even been migrated on to ESA. It was that group in particular that would have benefited from some kind of assessment of their current and future barriers to work.

[Sheila Gilmore]

My hon. Friend is correct. There is no sign whatever that any evaluation was made that showed that it was not working. Do we need something better than the WCA to measure the obstacles and propose support measures? The answer must be yes. Does that necessarily mean two tests? I do not know—perhaps, or perhaps not—but it should be looked into properly so that we can decide how to deal with the issue. Scope, a leading charity in this field, has suggested replacing the WCA as a whole with a distance-from-work assessment to assess support needs rather than medical capacity.

The third issue that I want to address is the fact that the Government have both reduced the value of ESA payments to those in the WRAG and placed restrictions on its receipt that have significantly changed the character of the benefit. Although the value of payments to people in the support group has been uprated by inflation in both 2014-15 and 2015-16, payments to those in the WRAG have been subject to uprating by only 1%. Those in the WRAG are subject to the overall household benefit cap, whereas those in the support group are not. The Government justifies those differences on the basis that people in the WRAG are better placed to move towards the labour market, but I do not think that that is how the original architects of ESA would have envisioned the WRAG working. Under incapacity benefit, most of these people would have been given unconditional support, so it is wrong that the fact that they now receive some level of support with a view to an eventual return to work is being used as a stick to push them to get a job sooner than they are able.

The sorts of changes I have described have fed into the media perception that people in the WRAG are in reality fit for work. For example, on 1 April 2013, the Daily Mail ran a story under the headline “Just one in eight on sickness benefit is truly too ill to work”. It reported that of nearly 1.5 million new claims assessed for ESA since 2008, 837,000 were found fit for work and 232,000 were

“deemed by doctors to be too unwell to do any sort of work”—

that is, they were in the support group. It then said that

“a further 367,300 were judged able to do some level of work”,

which was clearly a reference to the WRAG and implied that such claimants were not truly too ill to work. Actually, the whole point of the test is to say that at this point in time they are deemed unfit for work.

A related change was the decision to time-limit the receipt of contributory ESA to one year for those in the WRAG, on the basis that they are likely to get better anyway and so will be in less need of the benefit than people in the support group. However, in contrast to incapacity benefit, ESA was designed with regular reassessments in mind, so were there to be any improvement and therefore lost of entitlement, that should be determined through the process of reassessment, rather than an arbitrary one-year time limit. Such a limit particularly affects people who have been in work for much of their life and therefore made their contributions, but who may, for example, have a working partner—possibly earning only part-time wages—and so reach a position in which they receive no payments whatever.

Another issue is that the letters that people receive to tell them about changes in their circumstances are very unclear. One former incapacity benefit claimant came to my surgery last year after he had received a cryptic letter from the DWP. He understood it as saying that he would continue to receive benefit, but became concerned several months later when he learned that his benefits were due to stop in a few months’ time. It turned out that he had been placed in the WRAG but was time-barred from appealing the decision. I hope that the Government’s proposed review of all ESA-related communications will address such issues. My experience is that people are still receiving letters that are hard to interpret. They tell them that there has been a change in circumstances and perhaps that there will be a slight change in the amount of money that they will receive, but they do not make it clear why, which of the ESA groups they are in, and the overall implications. It is important that people are given the information that they need in order to take the appropriate action.

In conclusion, it is worth quoting the Select Committee again, which concluded:

“The WRAG is by far the most problematic of the three ESA outcome groups.”

I know that it is likely that many of the policy changes that I have mentioned have been driven by financial considerations, and I do not necessarily expect the Government to change all their positions in the remaining few months of the Parliament. Nevertheless, I would like to think that these matters are under consideration and that there is a real attempt to overcome some of the problems and issues that I have mentioned. For example, good communication should not be beyond the bounds of possibility, even in the dying days of this Parliament. That could save money in the end, because if people understood what they were being told they would be much more likely to take the appropriate steps.

It is profoundly unfair that people in the WRAG seem to be shouldering a disproportionate burden in reducing the deficit, and I hope that whichever party or parties are in government after the election take a different approach. No claimants should be placed in the WRAG without a face-to-face assessment, and only those able to benefit should be referred to the Work programme, if it continues—I hope that it can be improved considerably, or devolved so that we can use the specialist providers with which we have all had contact and that do such a good job. Ministers must acknowledge that those in the WRAG are currently too ill or disabled to work.

Jobcentre Plus

Debate between Anne Begg and Sheila Gilmore

Thursday 10th July 2014 Westminster Hall

[Sheila Gilmore (Edinburgh East) (Lab)]

The other side of the question of what is being measured is the lack of any measurement and follow-up on people who are not moving into work—it appears that no record is kept. A large number of people flow off benefit, but not only do they not flow into sustainable employment, they appear not to flow into employment at all.

[Dame Anne Begg]

I think people would be surprised to learn that Jobcentre Plus does not routinely record the reason why someone leaves benefit. As far as JCP is concerned, because the primary focus is on benefit off-flows, the important thing is that the person is no longer on a job-seeking benefit. However, as my hon. Friend says, why are they no longer on a benefit? It could be because they have a new job—that is what we hope—and it is possible that they have transferred to a different benefit because they have become ill, but they might be in prison or have gone into the black economy. We do not know, and nor does JCP because it does not gather that information or track claimants’ destinations. We think it is important that JCP does that in order to judge how efficient and effective its work is.

At some point, hopefully in the not-too-distant future, off-benefit is likely to cease to make much sense as a performance measure, particularly with the introduction of universal credit. I think Members agree that a system that merges out-of-work benefits and in-work tax credits, and in which benefits taper off gradually as earnings increase, would be a huge step forward. That is what universal credit is intended to do, but it will require creative thinking from the Government about new performance measures for JCP.

The Department says that it will think about how to formulate such measures once universal credit is implemented—whenever that is going to be. We think that it should be thinking about and testing them now, not leaving it until much later. Even if universal credit continues to slow down, the Committee certainly thinks that the development of a new measure is worth while anyway, whether in conjunction with universal credit or not. The Department must pilot more meaningful performance measures that track JCP’s effectiveness at getting people into work and helping them to stay there for the long term. I hope that the Minister can reassure us that the Government understand the importance of achieving longer-term positive employment outcomes.

Another part of our report that has received quite a lot of attention—perhaps because many Members have experience of it in their constituencies—is Jobcentre Plus’s use of sanctions. There is an inherent tension in what JCP does, between helping and supporting people to find work on the one hand, and, on the other, enforcing strict rules, including financial penalties for claimants deemed not to be trying hard enough to find work. Such is the everyday experience of the Jobcentre Plus adviser and the job-seeking benefit claimant, and it can make for an uneasy relationship.

Universal Credit

Debate between Anne Begg and Sheila Gilmore

Monday 7th July 2014 Commons Chamber

[Sheila Gilmore (Edinburgh East) (Lab)]

Some social security commentators have described a universal credit-type proposal as the holy grail of social security thinking. It is certainly true that the idea is nothing new. It was not invented by the current Government; it has been debated and investigated by previous Governments. In an earlier debate on the subject—I think it was an urgent question —my right hon. Friend the Member for Edinburgh South West (Mr Darling) made it quite clear that when he was Secretary of State for Social Security, he looked at the project and concluded that without very significant time and money being invested, it would be too difficult to deliver.

There has obviously been a learning curve to which, for whatever reason, the current Government seem to have decided to pay no attention. If we sometimes seem quite cynical and sceptical about the whole process, it is because of a lot of what we have heard over the past four years. There was total confidence that UC would be the answer to all sorts of questions, and would be relatively easy. I do not think that many people present, except my right hon. Friend the Member for East Ham (Stephen Timms), were on the Welfare Reform Bill Committee in 2011. The then Minister of State for Employment, the right hon. Member for Epsom and Ewell (Chris Grayling), who responded to most of the debates in Committee, was prone to describing his proposals as an empty bookcase. The Bill was the architecture; a lot of other things would come along later. I think he spoke more truly than he thought he did, because clearly it was a rather empty bookcase; a lot of the issues had not been fully bottomed-out and talked about in the way that they should have been.

One example of that—I will come on to others—is free school meals. We discussed the issue in the Bill Committee in 2011. Various people made written submissions and proposals, and there were discussions, about how that might or might not work as part of the project. We learn now that the Department still does not know how it will deal with free school meals in the further roll-out of universal credit. Three years later, we have not made much progress on something quite important and basic.

[Dame Anne Begg]

Does my hon. Friend agree that anyone building a bookcase has to know the size of the books that will be displayed on it before they can get the architecture right? Perhaps that was a lesson that the Minister forgot.

[Sheila Gilmore]

That is a very good analogy for how we have arrived in this position. The trouble is that it is not some sort of blunder: my hon. Friends have referred to some of the other big changes going through the DWP, and the same pattern has been seen with disability living allowance and the personal independence payment. First, a straw man was erected: there was a statement about certain things in the previous system, some of which were not entirely accurate, being really bad and having to be changed. There was then a brief initial consultation period before the Department went ahead with the change, which was not properly piloted. As a result, every new PIP applicant since June 2013 is part of the testing process. That is not a pilot, unless it is a pilot on a gigantic scale. Many people who are anxious and worried while they wait for their PIP payments to come through, are being treated as guinea pigs, after a failure to analyse the problem, implement the scheme or test the proposals. The pattern is not unique to universal credit.

Had we been told from the outset that there would be a slow roll-out because of the need for testing, we might not be standing here now debating whether the glass is half full, but we have been told so often that the glass is full and everything is going well. When the Select Committee prepared a report in November 2012, we concentrated on vulnerable claimants. At that time we were told that all the implementation plans were on track for 2013, which was not the case. By February 2013, the Major Projects Authority told the DWP to reset the entire project—that was an internal, private report of which Members had no knowledge at the time. That information did not come out clearly until July 2013, when the Secretary of State told the Select Committee that there were major changes to the roll-out. The NAO reported in September 2013, and the Secretary of State’s response was, “Oh, I knew about all those problems all along.” Perhaps he did know about the problems all along, but he did not tell many people about them. There were further changes in December 2013.

Some speakers, in trying to support universal credit, suggested that at least we have some people on it. There are 6,000 people on universal credit, and it will be rolled out to more jobcentres, but those are the very simplest cases. In essence, for those claimants universal credit is little different from jobseeker’s allowance. There is little to say that universal credit is a big breakthrough to a different form of benefit, because until now claimants have been single people. Apparently, we are now able to roll out universal credit to some couples, but the claimants so far have been single people. Some 70% of claimants are relatively young. They are new benefit claimants who do not have complications, basically. If universal credit is to bring together various benefits successfully, the difficult cases will be the real test, not the straightforward ones.

One bit of universal credit thinking that has been rolled out is the claimant commitment, which has been rolled out to JSA claimants, not merely those who are technically in receipt of JSA-style universal credit. The Government have rolled out the stick without rolling out the carrot. One of the problems with the claimant commitment is not necessarily getting people to agree what they will do to find work but that minor breaches of that agreement can lead to loss of benefits. The carrot—the bit that is meant to help people not only to find work but to make work pay—has not yet been introduced because the vast majority of people are nowhere near being on universal credit.

Since our original debates on the Welfare Reform Act 2012, we have experienced obfuscation through the use of computerese. MPs, like many lay people, are not IT experts. Initially, concerns were raised about the size of the IT project—various Governments have run into trouble with IT in the past—and people asked, “How do we know this will be different?” Any concerns were simply brushed aside because the Government had a new “agile” way of doing things that meant everything was going to be fine. About 18 months later we learned that that way of doing things had been abandoned, so clearly everything was not fine, but that is what we were told.

Other things that were “fine” included security, establishing people’s identity and the difficulties with online transactions. Those concerns were raised from the outset. I recall an informal briefing at which the Minister, Lord Freud, was asked questions by people who were expert, such as people who had served on housing associations. They asked, “What about the verification of people’s housing claims? How is that actually going to be done?” At the moment, those claims are done fairly intensively with people having to produce information, although housing associations have been allowed to verify that information because they have seen the lease, and so on. Lord Freud simply ignored all that and said, “No, universal credit will have far less fraud and error, and it will all be fine.” But of course it has not been fine, and it is now recognised that the notion that everything could be done online has not only been delayed but will never happen. One reason why that will not happen is that security has been recognised as a major issue. The same Ministers who told us that security was not a problem have now told us that it is a problem. When a Department is paying out substantial sums of money to millions of individuals, doing it fully online is not practical. After Ministers initially enthused about how everything would be straightforward, and after having been told different things at different times—even when the reality was that something else was going on—we are somewhat sceptical.

As other speakers have said, we were told that a certain type of IT is being used for the very small number of current claimants but that, at the same time, the Department was working on what in February 2014 was called the end-state, open-source, web-based solution. [Laughter.] Exactly. I know the meaning of each individual word, but I have never been clear about what the phrase means. We were told that it was a digital solution—it therefore seems to be an important aspect of the whole programme—and that it would be ready to be tested on 100 claimants by November 2014. As the Select Committee report found, the system is still a long way from being viable. There is a huge difference between operating something like that for a small group of 100 claimants and operating it for far more people.

The Select Committee thought that what we were being told about was a different and digital way of doing things, and we specifically asked for more detail. The Government’s response to the Select Committee report evaded the question, and it is all there. First, the response talked about the claimant commitment, which I have already mentioned and did not have anything to do with the digital solution. Secondly, the response talked about a

“more challenging and supportive relationship between claimants and coaches.”

“Coaches” is the new name for jobcentre advisers. Again, that does not really tell us anything about the digital solution. There are concerns about how scalable those intensive relationships will be. Thirdly, we were told that there will be more online services, but many JSA claims are already made online, so again it is unclear whether that has anything to do with the end-state or digital solution.

Therefore, having gone around the houses about the claimant commitment, the things that are already happening online and the more supportive relationship, all that we have been told is that the digital solution is

“a multi-channel service that makes greater use of modern technology”—

I am glad that it makes use of modern technology, rather than ancient technology—

“to ensure the system is as effective, simple and transparent as possible.”

Those are all worthy aims, but they tell us nothing about what the end-state solution actually is, what it does, how much progress has been made towards it, how many people are working on it, what it will cost or what the interface will be between claimants and the system. It is nothing more than an aspiration.

Fairness and Inequality

Debate between Anne Begg and Sheila Gilmore

Tuesday 11th February 2014 Commons Chamber

[Sheila Gilmore]

The big increase in income inequality was clearly between 1979 and 1997. Any graph will make that quite clear.

There is a danger in perpetuating the myth mentioned by the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards). I apologise to the House for missing some speeches, including the one by the Member who represents the Western Isles—I am sorry, but as a lowland Scot I genuinely find it difficult to pronounce the name of his constituency in Gaelic so I shall just call it the Western Isles. I missed his virtuoso performance because I was sitting on a Public Bill Committee, not because I did not want to hear what he had to say.

The hon. Member for Carmarthen East and Dinefwr said that there was no difference between a Labour Government and the current Government. As I have said in some of my interventions, that is not correct. It is dangerous to say so, too, because it makes a lot of people think that there is no point in voting or trying to change things because Governments do not make any difference and because there is no difference between the parties.

For example, the reduction in pensioner poverty during the years of Labour government should not be forgotten. Many pensioners will not forget that. A lot of what that Government did created the base on which this Government propose to build with the single-tier pension. As I have said before, it was not the triple lock that produced the highest cash payment to pensioners but inflation—an inflationary rise made necessary by the Government’s own—[Interruption.] I apologise to the Chair of the Select Committee on Work and Pensions, of which I am a member, for not seeing her try to intervene.

[Dame Anne Begg (Aberdeen South) (Lab)]

Does my hon. Friend agree that one of the great achievements of the previous Labour Government on pensioner income, in particular, was the introduction of pension credit, which took every single pensioner out of absolute poverty? Not one was left in absolute poverty at the end of that Labour Government.

[Sheila Gilmore]

I entirely agree. That was a hugely important step forward, but we also addressed the issue of getting people back to work. One myth is that we are not at all interested in getting people back to work, but the tax credit system did a lot to help people to get into work, particularly single parents—350,000 of them were helped into work as a result of that policy—and that is important.

I accept that employment for those who are fit and able to work is an important prerequisite of increasing their income—remaining on benefits is not the way to increase one’s income and has not been under any Government—but that is not always sufficient as a marker that people can become better off. It is a necessary beginning, but it has not been sufficient and we must consider the hours of work that people are doing and the low wages that many receive. If we do not tackle that, people in work will still be very poor, as they are now. That is why the child poverty measures show that 60% of those in child poverty have members of their families in work.

We should look at what is happening in places such as Scotland, instead of assuming that these problems have been magically addressed, because there are still problems, some of which, in relation to social care, I alluded to earlier. I am not saying that free social care should not be looked at—it was introduced not by the current Scottish Government, but by the previous Administration—but it does present severe challenges, and if we do not discuss those honestly, we will confuse people about what we can achieve, and then no wonder they become cynical. Those in Scotland struggling with poor quality care know that. In addition, there are issues in Scotland in the education field. Universities give free tuition, but as a result the colleges, which are hugely important for social mobility—they give people a second chance in education—have been starved of finance. That is important.

To sum up, we have to be somewhere in the middle and make real changes in people’s lives, not pontificate about what might be possible in some wonderful place where the sun always shines and no one is ever poor.

Under-Occupancy Penalty

Debate between Anne Begg and Sheila Gilmore

Tuesday 5th November 2013 Westminster Hall

[Sheila Gilmore (Edinburgh East) (Lab)]

It is a great pleasure to follow my hon. Friend the Member for South Shields (Mrs Lewell-Buck), who secured this important debate. The bedroom tax was primarily a savings measure. It was then dressed up, in some debates, as a way of tackling affordable housing shortages by making better use of property. However, as my hon. Friend clearly demonstrated in her opening speech, we warned from the outset—those of us who served on the Welfare Reform Bill Committee back in 2011 pointed this out at the time—that the savings would be less than estimated.

If the policy were genuinely about supply, it would have been sensible to start by understanding local housing markets and developing policies appropriate to local areas. As colleagues, including my hon. Friend the Member for South Shields, have described, in some cases, the bedroom tax is making larger houses unlettable. I must say that that is not a problem in my city, where more than 900 households have been given the second-highest priority banding because they need two extra bedrooms, and about 350 households have the same priority level because they are homeless and need three-bedroom housing. More than 1,200 families in the area need large homes, and there simply are not many. They do not exist. It is not that single people or couples in my constituency are rattling around in big homes that they do not need; the properties just do not exist.

As for those who might want to downsize, this week, 22 one-bedroom properties are available to let across all the housing associations and councils in the whole city of Edinburgh. That is not just in my constituency; it is across the whole city, which comprises five constituencies. Of those properties, three are sheltered—they are for older people, who are by definition not affected by the bedroom tax—so they would not be available to those affected by the bedroom tax. This is not an unusually dry week for housing supply; it is typical of all weeks. I check the availability regularly.

[Dame Anne Begg (Aberdeen South) (Lab)]

Has my hon. Friend analysed what types of houses the available one-bedroom properties are? If Edinburgh is anything like my constituency, I suspect that they will not be in areas to which people looking to downsize would move in any case. Very often they are for the young homeless, or those prepared to live at the top of a tower block.

[Sheila Gilmore]

Indeed, because of the nature of building at the time, a lot of smaller properties in the city, when we have them, are to be found in high-rises.

Universal Credit

Debate between Anne Begg and Sheila Gilmore

Wednesday 6th March 2013 Commons Chamber

[Dame Anne Begg]

The Government’s whole point in doing this is to make the system easier, so hopefully it will be. If it is not easier at the end of the process, we really will have got everything wrong. In the process of introducing this fully, the Government will obviously have to address some of the concerns that hon. Members have raised.

The Government’s response indicates that they expect only 50% to claim online and about 5% to get face-to-face interviews, which means 45% will claim through the telephony system. Perhaps the Minister can explain the wording in the Government’s response. It states:

“Our target is that 50% of claims which can be made online will be made online in October 2013 when Universal Credit is launched nationally.”

I am not sure that I understand that sentence. Does it mean 50% of the total number of people who will make a claim, or 50% of those who can make it online, which will not be everybody. I am not exactly sure what proportion the Government are talking about.

The Government’s response mentions face-to-face interviews, which is good, but they are still for only 5% of cases, and they give not a hint about where the interviews might take place and what proportion of them are likely to be home visits. After all, a large number of people in the universal credit cohort will have severe disabilities. They might receive other benefits that they have claimed previously, but they will also be in the universal credit cohort.

I am also glad to see that jobcentres are to have IADs—internet access devices—which sounds great. The Government response trumpets the fact that there will be computers in Jobcentre Plus offices. However, if we divide the number of computers by the number of Jobcentre Plus offices, we find that it works out at about three terminals per office, and I am not sure whether that will answer some of the questions about access to computers. Also, it appears that wi-fi is not yet available in Jobcentre Plus offices, although that is planned, as it should be available. Many people do not have a computer at home and will need to access their claim form through a public-access computer, whether in Jobcentre Plus or not. They will need help, and the Government’s response is not very clear about that. It does say that staff will be available, but it is very vague: it does not say how many or how much time they will have. Jobcentre Plus staff are already overworked. Will they have the time to sit down alongside someone until they have filled in their whole claim, or will they just get the screen up and leave them to it? For many people, that would not be enough help.

The Government say in their response that they are liaising with local authorities to supply help. However, we all know that local authority budgets are already being squeezed year on year, and that a lot of welfare rights officers, where councils have them, are disappearing, if they have not already done so. There is also a squeeze on organisations such as Citizens Advice. This is such a big undertaking that it is incumbent on the Government to make sure that this help, of the necessary quantity and quality, is there and that people know how to access it. It has occurred to me that as some local authority staff will no longer be employed in administering housing benefit, they might be an experienced resource that the Government could call on to act as advisers in providing the help that many people will need to make an online claim.

Another big area of concern about UC is that it will be paid once a month into a single bank account for each household. The Government’s response says that the Secretary of State has powers to vary the frequency of payments, but this would be time limited. It also says that the Department for Work and Pensions will try to identify claimants with, for instance, mental health or addiction problems who might not manage monthly payments, but suggests that help will be provided for only a limited period. The Government seem to think that a drug addict will somehow be able to learn how to budget properly after a couple of months. The essential problem is that getting a whole month’s money in their hand at once might be too tempting. I do not think that what the Government describe as “transition to monthly payments” after

“getting help with monthly budgeting”

is going to work in practice. Will the Minister clarify that?

[Sheila Gilmore (Edinburgh East) (Lab)]

As the Chair of the Select Committee, my hon. Friend knows, but I suspect that other people do not, that we have been hearing evidence about the apparent lack of information held by Jobcentre Plus about people’s circumstances in relation to being placed in the Work programme. Jobcentre Plus may therefore be unaware that people are homeless or have other difficult circumstances. What confidence does she have that it will be any better for the purpose of working out which people need this additional help?

[Dame Anne Begg]

I am worried that the Government say bluntly in their response to our report that they are not going to provide a definition of a vulnerable claimant. Without that, it will be difficult for Jobcentre Plus to identify the individuals who need help. This is our biggest area of concern. We do not know whether someone will need to get into trouble before they can get help rather than already having been identified as needing it.

--- Later in debate ---

[Sheila Gilmore (Edinburgh East) (Lab)]

When the Welfare Reform Bill was in Committee, the Minister’s predecessor was fond of the bookcase analogy. We were constantly told that what we were dealing with at that time was an empty bookcase, which would shortly be filled. Ministers and some Government Members who have intervened in the debate today, rather than those who have spoken at length, tend to feel that because most commentators, interest groups and parties think a unified system that will take people from unemployment to employment is in itself a good thing, that somehow means we should not be critical of the policy or its contents.

We have reached a point where some of the books have appeared on the bookcase, but there are still large gaps, some of which may not be filled until the roll-out takes place. We should realise, and the Minister should appreciate that, as I understand it—he may correct us—the initial pathfinder will deal only with very simple cases and people who do not have any complicated family situations, so it will test only some elements of the system. After that, more books will doubtless appear. However, one can have the same bookcase as someone else yet disagree radically about what books to put in it. We need to have that debate.

We must be careful not to oversell the reform. Although we talk about universal credit as though it will be simple, in reality universal credit will have lots of arms and legs. It is an umbrella, so to speak, with lots of arms and legs, because there will be different categories of people who fall under this umbrella, who will have to meet different eligibility criteria, who will receive very different payments and elements of payments, and who will be subject to very different conditions in order to get their benefits.

There will be a series of different types of universal credit. I would not be at all surprised if, in a couple of years, for convenience, particularly those who work in the field will refer to employment support allowance universal credit applicants or unemployed universal credit applicants. Otherwise it will be difficult to explain the situation. Universal credit will not be and perhaps cannot be simple. We on the Opposition Benches have said repeatedly that simplification is not the be-all and end-all when one is dealing with people who have complicated lives.

We have to put the financial capacity to deal with monthly payments in place. The Minister may remember that during his previous incarnation in the Treasury we had a debate about basic bank accounts. One of the issues I raised with him in his previous role was the need to extend basic bank accounts and to make it compulsory for banks to provide them. He resisted that move at the time. He may come to regret that in his new role in the DWP because it might have been better if there were a better raft of basic bank accounts that people could access. The number of banks offering basic bank accounts has not grown in the past nearly three years; it has diminished. Where will people be able to have the moneys paid to? Will they be able to get such bank accounts? There are people who cannot access basic bank accounts, either because there is no bank in their vicinity that offers them, or because they are not allowed to have such an account for one reason or another.

[Dame Anne Begg]

There are indeed difficulties getting a basic bank account, but does my hon. Friend accept that there are also people who have had a bad experience with banks, particularly with direct debits, and found themselves overdrawn and incurring lots of charges, and who therefore do not want to use a bank account to manage the money they get through universal credit?

[Sheila Gilmore]

My hon. Friend raises another important aspect. People have run up large bank charges, often inadvertently, on a very limited income. They might decide not to use the bank account any longer because that is easier, or the account may even be suspended.

Many warm words have been spoken about credit unions, but if we are honest about it, in most parts of the UK—the situation might be slightly different in Northern Ireland—credit unions are pretty small and cover only a relatively small part of the population. If we seriously wanted to increase their use, we would have to fund that properly and give them some ability to expand to the extent required. I would be more than happy to direct constituents in that sort of difficulty to a credit union, but I know that the credit union serving the local area currently has very limited capacity to expand. We have to think about that extremely seriously.

Another question considered today was that of the direct payment of rent. There are six demonstration projects, and indeed a report was published some time ago, but it was what the researchers called a baseline project report. In other words, it effectively looked only at people’s attitudes and capacities before the project got going; it proves nothing about whether it is working. Further data published by the DWP in December 2012 showed that in four months 8% of rent had not been collected. At that stage, 316 tenants had already been switched back to direct payment to the landlord, and the range of collections was actually greater than the 92% would suggest. In one project in an Edinburgh housing association, 63 of the 1,832 tenants were switched back to direct payments in the first four months, which I think is a substantial portion in a relatively short period.

It also appears—this will have to come out in the research very clearly—that some of the pilots have excluded some of the people most likely to fail. The pilot in Oxford apparently excluded those considered to be vulnerable, and the one in Wakefield excluded those who did not already have a bank account, so some of the difficult cases have not been included. That is fair enough in a pilot, but those cases must be taken into account before it can be claimed that all will be fine when this is rolled out more fully.

Members have spoken at length about the “digital by default” approach. I am not a luddite. I think that moving towards online claiming, wherever possible, is a good idea. In fact, when I was the convenor of housing on City of Edinburgh council we started a choice-based lettings system. It was possible to apply through a newspaper, people could fill in a form in the more traditional way, or they could apply online. Some people, including tenants’ groups, told us that we could not do it online because people would not be able to access it. We replied that we were giving people the choice. The online take-up was actually higher than many people had feared. Some of them will be getting help to do that, and that is the distinction we have to see.

There is a problem with the top-line figure, which is constantly quoted, of 78% for the proportion of claimants who already use the internet. It is drawn from research done for the DWP. It revealed that 78% have used the internet, but only 48% said they used it everyday, and that includes people in work, on tax credits and right across the whole spectrum. When we break the figures down, we see, for example, that 60% of people who are in receipt of incapacity benefit said that they had used the internet, but only 31% used it every day. There are some important distinctions within these groups.

If the new system frees up more adviser time, that can only be a good thing, but we need to know that that is really going to happen and where it is going to happen. The current situation appears to be quite stressed already. I have been told, and claimants’ experiences tend to back this up, that in Jobcentre Plus in my city people barely get four minutes with an employment adviser. Time is very stretched as it is.

Universal Credit

Debate between Anne Begg and Sheila Gilmore

Thursday 22nd November 2012 Commons Chamber

[Dame Anne Begg (Aberdeen South) (Lab)]

I beg to move,

That this House has considered the matter of the publication of the Third Report from the Work and Pensions Committee, on Universal Credit implementation: meeting the needs of vulnerable claimants, HC 576.

Today the Work and Pensions Committee published a report, “Universal credit implementation: meeting the needs of vulnerable claimants”. Universal credit is a new working-age benefit that, if the various IT systems work—fingers crossed—should be easy to operate for the majority of claimants. Almost all our witnesses supported the principles of universal credit, but as we took evidence it became clear that there were concerns about how those who will find the new system difficult are to be helped. That explains the title of our report. The Government’s approach is to design a system that works for the majority before they then assess what additional support more vulnerable claimants might need. However, we have significant concerns that insufficient progress has been made in deciding what the additional support will offer, how it will be delivered, and who will qualify for it. There is therefore a risk that this help will not be in place for the implementation of universal credit in the first pathfinder areas from April next year.

The report highlights several areas of concern. First, “digital by default”, as the Government call it, means, in effect, that all claims and all changes in circumstances will have to be submitted online, which might cause problems for a sizeable minority of people. On the single monthly payment per household, we are concerned about who within the household will be the recipient. We are worried about potential delays in the system that could mean not only that one benefit is delayed but that all moneys that are due to go into the household are stopped for one reason or another. Another concern is that under universal credit the housing costs of someone in social housing will no longer be paid directly to the landlord but will be part of the single monthly payment.

The Government’s emphasis on planning for the majority means that that is where all the work has been done. There has not been enough detail on the so-called exceptions policy and on how people who are not managing—those who are not in the majority—will be picked up.

[Sheila Gilmore (Edinburgh East) (Lab)]

I thank my hon. Friend for presenting this very important report. I think she will agree that one of the Committee’s major concerns was that the concept of exceptions—people who might get additional help or assistance, or who might not be subject to the monthly payment rule—was very unworked-out. It would be helpful to get some of the detail so that these things are anticipated rather than dealt with once people have got into trouble.