Welfare Reform and Work Bill

Baroness Lister of Burtersett Excerpts

Tuesday 17th November 2015 Lords Chamber

[Baroness Lister of Burtersett (Lab)]

My Lords, the title of this Bill is a misnomer. It will not enhance welfare in the true sense of, to fare well. Instead, it will undermine the welfare of families with children in particular—already hit hard by a succession of social security cuts—because, unlike the last welfare reform Bill, which included some genuine reform alongside cuts, this Bill does not. In so far as it promotes work, it does so through the punitive Poor Law “less eligibility” principle and the devaluation of unpaid care work. A truer title would be the “denial and aggravation of child poverty Bill”. It effectively erases child poverty from the legislative lexicon, while together with other measures it could mean a further 600,000 children in poverty by 2020, according to the Resolution Foundation. The Joint Committee on Human Rights, of which I was a member, recommended that the Government should assess the impact on child poverty of any new law, as well as its compatibility with the UN Convention on the Rights of the Child. There is no such assessment, and that with regard to the rights of the child is written in a rose-tinted font.

Instead, as we have heard, the Bill removes all the statutory measures, duties and targets that underpinned this country’s child poverty strategy, which, under the last Labour Government, led to a significant reduction in child poverty. How will the Government now be held accountable for meeting their manifesto pledge to,

“work to eliminate child poverty”?

As for measures, the 2012 consultation balanced a preference for a multidimensional measure, with the statement:

“The Government is not playing a zero-sum game with child poverty measurement”.

This is from the coalition Government, but led by a Conservative in the DWP:

“There can be no doubt that income is a key part of our understanding of child poverty”.

The Government are playing a zero-sum game now. The 2012 consultation demonstrated overwhelming support for the retention of an income measure, as analysis of the responses by Kitty Stewart and Nick Roberts, of the LSE’s Centre for Analysis of Social Exclusion, demonstrates. They found general agreement that low income/material deprivation are the only factors that are reliably able to distinguish those in poverty from those who are not. In evidence to the Public Bill Committee, respected academics branded the proposal as “silly” and warned that we are in danger of becoming “an international laughing stock”. A systematic academic review by CASE demonstrated unequivocally that family income is a key driver of children’s development and opportunities. As a CASE blog observed, not measuring income poverty while professing concern about life chances is little short of bizarre.

The Social Mobility and Child Poverty Commission called for,

“a clear commitment to maintain the centrality of income in measuring poverty”.

Perhaps that is why it is now going to lose child poverty from its remit. Will the Minister explain why that is the case? Given the replacement of the Child Poverty Act with a life chances Act, would it not make sense to call it the “life chances commission”, which would signal a broader remit than the narrow, meritocratic concept of “social mobility”?

Why, when the majority of children now live in households with a parent in work, is there to be no measure that can capture this alongside worklessness? Perhaps one reason is that some of the Bill’s measures, together with other tax credit cuts, are likely to aggravate in-work child poverty. In particular, families “supporting themselves through work”, to quote the Minister, could be hardest hit by the removal of means-tested financial support for third and subsequent children because of the interaction with the benefit cap for out-of-work families. The Children’s Commissioner is one of many who have voiced concerns, pointing out that this does not take account of the way family circumstances can so easily change. Yet, when introducing universal credit, Ministers placed such emphasis on the need for a dynamic understanding of family behaviour. Overall, children in black and minority ethnic families are likely to be disproportionately hurt. Their already high risk of poverty will increase, as will that of disabled children.

Another measure that will bear down particularly hard on larger and minority ethnic families is the reduction in the benefit cap. Now that it is being decoupled from average earnings, the rationale for its level is unclear. The original arguments against the cap have even greater force. As I argued when we last discussed the cap, it is unfair deliberately to reduce the amount of money some families will receive to well below the amount Parliament has determined is the minimum required to meet their needs.

It is even more unfair when, as my noble friend Lady Sherlock pointed out, the Government do not compare like with like when contrasting out-of-work and in-work incomes. No account is taken of the in-work benefits received on top of the comparator earnings, in particular child benefit and child tax credit, yet these benefits are included in the cap. This was pointed out in a recent Supreme Court judgment. Three out of five of the judges believed that the cap is not compliant with the UNCRC’s requirement to treat the best interests of the child as a primary consideration. Although the appeal was not allowed, the hope was expressed that the Government would address the implications of this finding when they review the cap—some hope.

One of the justifications for the cap is to increase work incentives, yet the House of Commons Library observes that,

“there is no general consensus”,

that it is,

“proving an effective means of moving claimants into work”.

Instead, a Community Links study found that when you force people into what they call “survival mode”, it can make finding and keeping a job harder and less of a priority because all you can think about is trying to get by. Also, 6% of those already capped are claiming carer’s allowance. Carers UK warns that many,

“are not in a position to pick up work or further work without reducing or withdrawing the care they provide”.

It asks, as the Government have said that it is not their intention to encourage people to stop caring and go into work, why this policy applies to carers. I hope the Minister has an answer. Also, is it reasonable to expect the 15% of capped lone parents who have a child aged under one to work when they are not required to do so even under the Bill’s further extension of conditionality?

Finally, the benefits freeze comes on top of existing cuts in their real value, which is particularly marked for child benefit and has been described by the IFS as “highly regressive”. The impact assessment notes that women are more likely to be affected than men, which is true of many of the measures. Moreover, as the main managers of poverty, women will bear much of the burden, at the expense of their mental and physical health.

I end with two questions. Will the Minister explain how the family test—which the noble Baroness, Lady Altmann, assured your Lordships’ House would be “strictly applied” to “all new policies”—is applied to a Bill that will spell disproportionate hardship for families with children? Will he explain how this damaging and punitive Bill, which will increase child poverty, is compatible with the Prime Minister’s pledge of,

“an all-out assault on poverty”?