Transitional State Pension Arrangements for Women

Debate between Owen Smith and Alison McGovern

Wednesday 24th February 2016 Commons Chamber

[Owen Smith]

I am going to make a little more progress, and then I will give way. The truth is that we have had quite enough talk. The sins of omission and commission are well known, and the Government should now act. The Bills in 1995 and 2011 were their Bills, and the mistakes were their mistakes, so it is for them to put things right. Women in Britain have suffered inequality in the workplace and on payday for far too long. No Government should compound that fact when the carers and the grafters in our society, on whom we rely for so much, reach their retirement day.

There is a Budget in three weeks, and the Chancellor has a golden opportunity to rise to the challenge and put in place one of the six variants of transitional arrangements that I have talked about. He would be well advised to do so.

[Alison McGovern (Wirral South) (Lab)]

My hon. Friend mentions the Budget. Does he agree that, given the corporation tax cuts and the cuts to inheritance tax in the Chancellor’s most recent Budget, the Chancellor clearly has the will to spend and should now pay attention to the WASPI campaign?

[Owen Smith]

At the last Budget, the Chancellor happened to find £27 billion extra in tax revenues, which was a very handy little windfall to find down the back of the sofa, but the WASPI women will have heard that he did not spend a red cent of it—not a penny—on them, as he could have done. If he continues to play the WASPI women for fools and continues to take our pensioners for granted, then, as Baroness Altmann has told him already, he will live to regret it.

That is a sentiment that we can share right across the House. It is why not a single Conservative Member chose to vote against either of the previous calls for transitional arrangements in any of the debates we have held. It is why so many Conservative Back Benchers have pledged their support to the WASPI campaign. It is why this issue will not go away without action from the Government.

Universal Credit Work Allowance

Debate between Owen Smith and Alison McGovern

Wednesday 6th January 2016 Commons Chamber

[Owen Smith]

I agree wholeheartedly. In fact I believe that in my hon. Friend’s constituency 12,000 people will by 2020 be subject to far lower incomes as a result of the cuts to UC. That is 12,000 people—less the northern powerhouse than a northern workhouse.

Let me be clear about what we are talking about, because this is complicated; UC is a bit of a black box and I think many people out in the country—and many on the Tory Benches—do not quite yet appreciate what is going on and have believed the smoke and mirrors from this Government. The changes that were snuck out—mentioned in passing in last summer’s Budget and then leaked out piecemeal in a statutory instrument subject to negative resolution that we had to pray against in order to get it even debated in this House—will halve the value of the work allowance under UC, which is the piece of UC that is essential to making work pay.

Let me illustrate exactly the nature of those changes to the work allowance by giving a few examples. For a single mother with one or more children, the work allowance will be halved from April of this year from £8,808 to £4,764, a reduction of £4,044. In cash terms, that working mother will lose £2,628 next year. That is the nature of the loss to a single mother. For a joint couple living and working together, one or both with limited capacity to work as they are disabled, their budget —the work allowance—will be cut from £7,700 to £4,700, a loss of £3,000 in their income. A single individual in receipt of UC will lose everything—a £1,332 reduction; a net loss to their income of £865.

[Alison McGovern (Wirral South) (Lab)]

I am so glad my hon. Friend has mentioned single parents and how they are going to be hit. The last Labour Government did us all proud with the new deal for lone parents. Does my hon. Friend agree that the fate that now befalls single parents in this country is an absolute reversal of what past Governments did to help them work?

[Owen Smith]

Let me be very clear: under the Tory Governments in the 1980s I remember the right hon. Member for Wokingham (John Redwood) being dragged through the newspapers in this country for damaging the reputation of working mothers almost irreparably after comments he made about the St Mellons estate in Cardiff, and the Tories are back on the same track. In their sights are single mothers. They are the biggest single group of losers from all these changes to tax credits and UC, and it is an absolute disgrace that the Tories are undoing all the good work the last Labour Government did.

--- Later in debate ---

[Owen Smith]

The Minister says it is 250,000, but 350,000 is the latest estimate that I have seen from the Office for Budget Responsibility. Perhaps it is wrong—it could be wrong about other things in future, as well. However, there will not be transitional protection for the 5.8 million people who will eventually be on universal credit. Even for the 350,000 who are currently on it or will be on it by March, there will not really be transitional protection if they undergo anything that constitutes what the Government call a “serious change of circumstances”. In that case, the maintenance of their in-work support at tax credit levels will stop. It will interest the House, especially given the Secretary of State’s interest in marriage as an institution, that getting married will constitute a serious change of circumstances. If someone who is on tax credits and enjoying transitional protection gets married, the Secretary of State for Work and Pensions will take that money away from them.

There will be no protection whatever for any of the millions of new claimants by 2020. The Secretary of State has implied on several occasions that there will be transitional protections. Indeed, when he intervened on me in the debate before Christmas—he was not leading for the Government in that debate—he said explicitly:

“We are transitionally protecting those who are moving on to universal credit.”—[Official Report, 7 December 2015; Vol. 603, c. 696.]

Unfortunately, the Minister for Welfare Reform, Lord Freud, had to correct him in the House of Lords, saying:

“It is not the same as transitional protection…it might be some more work or it might be upskilling”.—[Official Report, House of Lords, 14 December 2015; Vol. 767, c. 1910.]

In truth, the £69 million fund that the Secretary of State has prayed in aid as transitional funding will in no way make up for the £3.2 billion loss over this Parliament.

The truth came out in the infamous data dump of documents snuck out in Christmas week. Responding to criticism by the Government’s own Social Security Advisory Committee, Ministers had to admit that the only way to recoup the losses would be to work an additional three to four hours a week. That is right—the House heard me correctly. The Government are now saying to a single mother who is working full time on the national minimum wage and looking after her children in the evening and who will lose £3,000 that she has to get another job working an extra three or four hours a week—approximately 200 hours a year—to make sure that she is no worse off. Tell me, Mr Speaker—I cannot see it—how that single mother who has a child at home and who is working full time will, even on the new national minimum wage, be able to work an extra three to four hours a week or 200 hours a year. Is she meant to get a job after work in a bar, in a garage or serving coffee? Is she meant to get a job in addition to the full-time job she is doing during the day and in addition to looking after her children—for example, cleaning in the mornings—to earn an extra few quid?

What on earth is the incentive for that mother to undertake that extra work? I ask that because the other massively damaging effect of the cuts is that they fundamentally undermine and destroy the very premise of universal credit—to make work pay.

[Alison McGovern]

I thank my hon. Friend for being so generous and giving way again. I remind him that when the Chancellor announced his so-called living wage, he assumed a rising personal allowance in his calculations in the Budget book that suggested that work would pay. Given the Government’s broken promises left, right and centre, why should any single parent believe what they say?

[Owen Smith]

My advice to single parents is absolutely clear: do not believe a single word that the Government say in response to today’s debate, or what they are telling the country about making work pay and about universal credit. Each and every promise is being broken.

Finance (No. 4) Bill

Debate between Owen Smith and Alison McGovern

Wednesday 18th April 2012 Commons Chamber

[Owen Smith]

I have absolutely no confidence whatever. My hon. Friend’s point goes to the heart of the dodgy economics in the dodgy dossier. The figure of £100 million is entirely predicated on the assumption that there will almost be a net offset of the £3 billion static loss as a result of the change to the 50p rate, through people deciding to work harder, save less, take their income in the current year, and hide their income less. Those are the behavioural changes that the Government are assuming will take place, but there is no real evidence base for the change. It is fundamentally dodgy.

[Alison McGovern (Wirral South) (Lab)]

Does my hon. Friend agree that we are debating the difference between those of us who do our economics using evidence and those on the Government Benches who do it using spurious theory? We should all be responsible; we should look at the evidence and report that evidence. That is why it is important that the Prime Minister should return to the House to correct the record.

The Economy

Debate between Owen Smith and Alison McGovern

Wednesday 22nd June 2011 Commons Chamber

[Owen Smith]

rose—

[Alison McGovern]

rose—

[Margot James]

I will take an intervention from the hon. Gentleman, who was a member of the Health and Social Care Public Bill Committee.