Universal Credit
Debate between Mark Hoban and Richard Drax(11 years, 2 months ago)
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Richard Drax
I agree with the shadow Minister. When I was a soldier, the great cry was, “Hope for the best and prepare for the worst.” I am a little concerned that, on this policy, the worst has perhaps not been prepared for. Will the Minister, when he sums up, reassure us that there is a system in place that will cope?
In dealing with the inevitable snags, community care grants and crisis loans could be administered by the local departments if this computer system were rolled out to them. The local housing benefit departments in my constituency are already running down their offices, yet their local knowledge could be invaluable in administering universal credit. In the world of IT and computers, how often have our constituents rung a telephone number and got a disembodied voice saying, “If you want flowers, press 1. If you want somebody else, press 2. If you want to go to heaven, press 3. And if you don’t want to bother us at all, press 4.”? At that stage the person wishes they had slammed the phone down and they give up the will to live. Although I welcome IT—I am not a luddite in that sense—I am a great believer in the human touch. Nothing beats eye-to-eye contact with constituents, including, as in this case, the many who need help. If people lose that contact with human beings—leaving aside the distress that will be caused if the computer system goes down—there will be an awful lot of concern, particularly among the elderly, many of whom do not understand the system in any case.
Richard Drax
I take my hon. Friend’s point, but many people who are not of pension age are, like me, middle aged—shall we put it that way?
As we know, universal credit is also intended to go online. As we have heard from many Members on both sides of the House, that will be unfeasible for many and could result in many incomplete applications. Again, local offices equipped with universal credit software might be a great help at least until the system is up, running and proven.
Another of Mr Hodder’s concerns is about the receipt of a single lump sum payment once a month. Although most of the population—75%, I believe—receive their salary once a month, and although we want to treat everyone in this country in an adult fashion, it is pragmatic to realise that many of the people who will receive quite a lot of money in one blow are not necessarily in a position to handle it and have not been accustomed to it. Welfare recipients are currently paid out of many pots and money comes in at different times of the month, possibly to different accounts and different partners. For example, child benefit is often paid to the mother.
Management of a single lump sum payment is likely to prove challenging for many, at least at first. Mr Hodder suggests, and I concur, that payments should be split into two a month to lessen the stress of managing day to day. He also points out that that would make recipients less of a target for payday loan sharks, as the monthly benefit salary would not be so large. I believe that there will be a rise in the number of those sharks, who will prey on those who get their money one month, spend it and then want more money to pay off their bills. The problem will therefore be increased. The money will also often go to one member of the family. If the husband is abusive, for example, there will be a problem if the wife does not have access to the money and it all comes in one lump.
Mr Hodder’s main concern is the proposal to include housing benefit, which was once paid to landlords, in that monthly lump sum. Mr Hodder’s view, with which I agree, is that there is a “huge risk” of non-payment to landlords—I think that that is a pragmatic and realistic fear—because of wilful non-payment or the inability of the tenant to manage funds over a month. He says that the impact on his association and others will be a rise in arrears and collection costs. They will need more staff, the cash flow will be reduced and there will be less investment in social housing. Private landlords are already saying that they will not take on tenants who get their money first, for obvious reasons, so that could also shut the door on the private rented sector. Further down the line, arrears could lead to more evictions, more clogged-up courts and more families being thrown on the mercy of local authorities, which are charged with accommodating them in emergencies.
In my view, those are all unintended consequences, but the human cost means that they matter even more. This ambitious shake-up is bound to cause some problems and I think we all accept that there will be some. Mr Hodder, I and many people to whom I have spoken believe that they could be mitigated by careful forward thinking.
The intention of universal credit is to make the benefits system more streamlined and efficient. I think that we would all agree with the principle that incorporating some of Mr Hodder’s suggestions would give it the best possible start. I hope to hear from the Minister that some of those concerns, expressed by Members on both sides of the House, will receive some answers. I also hope that the Government will consider very carefully all that has been suggested.
Section 5 of the European Communities (Amendment) Act 1993
Debate between Mark Hoban and Richard Drax(12 years ago)
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Mr Hoban
It is not appropriate for any of us to provide a running commentary on the French presidential elections, but it is important that Governments, whether inside or outside the euro, make their argument as to why they believe that the measures required to bring about fiscal stability and economic growth are necessary. Those arguments need to continue to be made, because that is vital to Europe’s long-term interests. We will wait and see what the outcome of the French presidential election is and what the view of the new President is on the fiscal compact.
Richard Drax (South Dorset) (Con)
What will the Minister tell the millions of people in the eurozone when it goes horribly wrong—as it will—and their lives are ruined, given that we have had the chance, as has been suggested, to rebalance the euro from a position of control? It will collapse.