Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 30th November 2020 Commons Chamber

[Dr Coffey]

The cap has been in an important part of policy in trying to stimulate entrance into work. I am conscious that there are still only about half a million vacancies, compared with a significant number of people unemployed. However, I am sure the hon. Lady will welcome, with me, some of the actions that are possible for some of the most disadvantaged families, particularly those supported by the £170 million covid winter grant, from which I understand her local council will benefit to the tune of about £823,000.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

What recent assessment she has made of the effectiveness of the more than minimal test for determining housing benefit payments for supported exempt accommodation.

[The Parliamentary Under-Secretary of State for Work and Pensions (Will Quince)]

Local authorities apply the minimal test for determining housing benefit for supported housing accommodation. No assessment has been made of the effectiveness of the more than minimal test for housing benefit. However, we are reviewing the guidance to help improve consistency in decision making.

[Shabana Mahmood]

The annual housing benefit bill in Birmingham for supported exempt accommodation is now a massive £200 million. Too many housing providers are exploiting the extremely weak regulations that govern the payment of enhanced housing benefit; all they have to do is show that the support they provide is more than minimal, and this is causing misery for vulnerable tenants and the communities they live in. So will the Minister meet me to discuss the situation in Birmingham, and will he bring forward urgent proposals to change the situation and get a grip of this growing national scandal?

[Will Quince]

Although we recognise there are problem areas, it is worth noting that the majority of supported housing is provided by well-run registered social landlords with a strong social mission. These are regulated by the Regulator of Social Housing, for registered charities, or by the Charity Commission. But I do recognise that there is a problem, and I would be happy to meet the hon. Lady.

Kickstart Scheme

Shabana Mahmood Excerpts

Thursday 3rd September 2020 Commons Chamber

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

Some 72% of the population in my constituency are from black, Asian and minority ethnic backgrounds. What reassurances can the Secretary of State give me that measures will be taken to ensure that young people from minority backgrounds have equality of access and opportunity under the scheme, and that the systemic inequality we all know exists in our employment market will not be allowed to be a feature of the scheme?

[Dr Coffey]

The hon. Lady is right to focus on the young people in her constituency and their challenges to employment. There is already a youth hub in Birmingham. We are learning from the employability coaches who are already in place. The West Midlands Combined Authority is very keen. The Mayor and the chief executive, Deborah Cadman, are very engaged in wanting to make this happen. My officials will be meeting the West Midlands Combined Authority again today.

Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 27th January 2020 Commons Chamber

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

The hon. Gentleman flagged up that issue with me earlier. We are investigating urgently, because that should not be the case.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

T4. There are now more than 84,000 people on universal credit in Birmingham, including more than 9,000 in my constituency. They include large numbers of disabled, unemployed and single-parent claimants, which is exactly the profile of claimants that the Resolution Foundation found will be worse off on average once the benefit is fully rolled out. If the Government are serious about levelling up economic outcomes across the country, why are they so determinedly ignoring the true impact of universal credit in areas such as mine?

[The Parliamentary Under-Secretary of State for Work and Pensions (Mims Davies)]

I recently visited a jobcentre in Birmingham, where I found an incredibly vibrant and positive labour market, particularly ahead of the Commonwealth games, working with women in construction and reaching out for youth employment opportunities. I am happy to speak to the hon. Lady if that is not her experience, but I implore her to pop into the jobcentre, where she will hear a very different, vibrant message.

Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 1st July 2019 Commons Chamber

[Justin Tomlinson]

I absolutely commend my hon. Friend’s constituent for the work that she does in her community. I also congratulate Ms Fennell on receiving the British Empire Medal in the Queen’s birthday honours, as well as a national citizenship award in recognition of her work: a true tribute.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

16. What recent discussions she has had with the Secretary of State for Justice on universal credit claims and access to legal aid.

[The Secretary of State for Work and Pensions (Amber Rudd)]

The Ministry of Justice is responsible for access to legal aid, and we will continue to work closely with it as it reviews the means test for entitlement. However, that is not the only initiative on which we have been working together. For instance, I recently announced an ex-offenders pilot scheme, which will provide enhanced employment support and help with access to universal credit in order to lift people out of the cycle of reoffending.

[Shabana Mahmood]

Solicitors in my constituency have told me that the DWP is refusing to supply written confirmation in the precise legal format that is required for legal aid applications made by people on universal credit. It is a case of one Government body refusing to comply with the rules of another. Is the Secretary of State aware of how deep these problems go, and will she ensure that no universal credit claimant misses out on legal aid because the DWP cannot follow the rules of the Ministry of Justice?

[Amber Rudd]

I am surprised to hear that question from the hon. Lady. According to my experience and the evidence that I have received during my conversations with the Ministry of Justice, there is no problem and it has been possible to passport in the same way. I hope that that will continue, but, as the hon. Lady knows, the Ministry of Justice is conducting a review. If she will write to me about that particular case, I will look at it myself.

Universal Credit

Shabana Mahmood Excerpts

Wednesday 17th October 2018 Commons Chamber

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

I should not really be shocked. I have been an MP for long enough and I have heard the rhetoric from the Government for long enough not to be shocked. I have to say, however, that listening to the Secretary of State today, and the tenor of the interventions and comments we have heard from some Government Members, beggars belief. Their approach is utterly divorced from reality. This programme was supposed to be about so-called compassionate conservatism. If the Government really believed the rhetoric behind the programme when they set it up—that it was about making work pay and all those high ideals—they, and the Secretary of State in particular, would show some humility in their approach to the debate.

Clearly, the Secretary of State has made the political decision to front this out while our constituents are being forced to live in misery and face destitution. That is not compassionate, that is not humane and that is not moral. I urge the Secretary of State to reflect on the attitude she is displaying to the House, our constituents and the country in the way that she is approaching this debate, because it is not acceptable. It flies in the face of the rhetoric the Government themselves use. What they are doing today is unbelievable.

[Chris Philp]

Will the hon. Lady give way?

[Shabana Mahmood]

I will not.

It is not unusual for Government programmes to run into trouble. I am a member of the Public Accounts Committee and it is our bread-and-butter work every week to look at Government programmes that run into difficulties. A Government who cared about a programme —one that is not a vehicle for cuts and is not designed to force people to have less money than the system it is replacing—would actually engage properly and genuinely to learn lessons and make the programme better. Instead, the Government said that talk of cuts was somehow fake news. The Secretary of State then had to admit that people are going to be worse off. We have heard the figures of £200 a month and £2,400 a year being mooted. That is a staggering sum of money to lose every year for the working poor and the vulnerable in our community. We know that the self-employed will potentially be up to £2,500 a year worse off compared with those who are not self-employed under the new system. These are the realities that the Government cannot deny. That is not fake news; that is just the truth.

The Government and the DWP said to the National Audit Office—this was recorded in its most recent report—that the organisations at the coalface of helping our constituents to deal with the troubles they face because of universal credit, whether the Trussell Trust, other people who run food banks or local government, which is now facing much higher levels of rent arrears than previously, are motivated by a desire to lobby for changes rather than accurately reflect what is happening on the ground. That is a disgraceful attitude for the Department to take towards organisations that, yes, may well have a different vision for how they think the social security system should work, but are absolutely telling the truth about the destitution and difficulties our constituents are facing.

I invite the Secretary of State and any of her Ministers to come and spend a day in my constituency office and to see the explosion in our case load that has been created by the roll-out of universal credit. My staff spend most of their time every single day on the phone trying to sort out difficulties arising from universal credit. I shall highlight just two cases we have had recently, the first regarding delayed payments. The Government say they are taking action on that, but I have a constituent who has not received any money since 12 July. He has no money for food, fuel or anything. I invite the Secretary of State to intervene and tell me what I should tell him about where he should get some money to try to survive while his universal credit is being sorted out.

[The Minister for Employment (Alok Sharma)]

I thank the hon. Lady for taking an intervention. What I say to her, and I have said this before in the House, is that if there are individual cases Members should bring them directly to Ministers. [Interruption.] I am sorry, but that is not what happens. What we hear are general comments. After this debate, if she is willing, I will talk to her directly about the cases that are affecting her constituents.

[Shabana Mahmood]

I wish it was just one case. I would happily bring them all to the Minister and he can tell me how I should respond to my constituents, but my experience of engaging with the Department on this matter is not a happy one. If he wants to become the constituency caseworker for the whole of the House for universal credit cases, he will be a very busy man. In fact, it would be easier for him to improve the system and fund it properly so that people are not forced into destitution in the first place.

There is a particular difficulty in my constituency relating to constituents with autism and other mental health conditions moving on to universal credit, often because they have failed the assessment—they had previously been in receipt of employment and support allowance—having not been supported as they tried to navigate a very complicated online system. The support that is available is simply not enough. I invite the Government and the Minister, in that spirit, to revisit some of those issues, because they are not ones that he will be hearing from me for the first time.

In this context, it beggars belief that the Government wish to continue with managed migration. There is only one fair, humane and compassionate thing that they could do for all the people facing difficulty under the system: stop the roll-out and try to genuinely engage and fix the problems of universal credit right now, before they move on. Most importantly, however, they need to fund it properly, because this is a vehicle for cuts—they know it, we all know it, and our constituents are paying the price for it.

Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 17th October 2016 Commons Chamber

[The Parliamentary Under-Secretary of State for Pensions (Richard Harrington)]

The Government have already made a concession to the WASPI women. The state pension is very much part of public expenditure and always will be, and it is absolutely not the case that defence expenditure and that on the state pension can be compared.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

The most recent Her Majesty’s Revenue and Customs figures show that my constituency now has the highest level of child poverty in the country, and we know that two thirds of children living in poverty live in working households. For my constituents this is not a country that works for everyone. Will the Secretary of State now agree that he must come to this House and reverse the cuts to universal credit so that my constituents and others are supported, rather than penalised for this Government’s choices?

[Damian Green]

I hope the hon. Lady will recognise that the figures I have quoted on a number of occasions show that child poverty and the number of children living in workless households has fallen. Clearly, there will be different percentages in different constituencies around the country, but we will continue on a path that gets more people into work and means that fewer children are in workless households, so that the prosperity can be spread across all parts of this country.

Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 11th July 2016 Commons Chamber

[Stephen Crabb]

The important point to make to my hon. Friend is that the Work and Health programme is just one part of a wider package of initiatives that we are taking forward to close the disability employment gap and to provide better support for people with long-term health conditions. I shall not repeat what I said in response to earlier questions, but the Green Paper that we are publishing later this year will outline the full range of reform options that we are interested in taking forward.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

7. What assessment his Department has made of the effect of recent changes to benefits on the number of children living in poverty.

[The Secretary of State for Work and Pensions (Stephen Crabb)]

We know that work is the best route out of poverty. The number of people in work is at a record high and the number of children living in a household where no one works has fallen by 450,000 since 2010.

[Shabana Mahmood]

My constituency has the third highest level of child poverty in the country, and 13,600 families currently receive tax credits, leaving them vulnerable to the Government’s cuts to universal credit. In his aborted bid for the Tory leadership, the Secretary of State said that he had a

“strong grasp of…the social and economic divisions in our country”.

If that is true, does he agree that cuts to universal credit will only compound the social and economic divisions in our country? Will he now commit to reversing those changes so that our children do not have to pay the price of his Government’s political choices?

Oral Answers to Questions

Shabana Mahmood Excerpts

Monday 7th December 2015 Commons Chamber

[Priti Patel]

My hon. Friend is absolutely right. He has drawn attention to two important facts: the fact that unemployment has fallen in his constituency and there are more people in work there, and the barriers—particularly mental health conditions—that prevent people from working. We will be launching a new Work and Health programme, and looking into how we can integrate services to provide the right kind of support to help such people to return to work.

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

Between June 2011 and June 2015 there were 10,920 referrals to the Work programme in my constituency, 21% of which resulted in jobs. Those figures would improve, and employment would be further reduced, if the assessment of claimants that is carried out at the beginning of the process were more adequate and consistent, and ensured that crucial characteristics such as drug problems were not missed. When will the Government introduce changes to the assessment process?

[Priti Patel]

The Select Committee and many others have said that the Work programme has been one of the most successful employment programmes that the country has seen. Naturally, we constantly review our work in respect of assessments, but we are focusing on targeted support for individuals, because we all want the right outcomes for them. We all want to help them to return to work, and to give them the tailor-made support that they need. Rather than adopting the hon. Lady’s disparaging approach, we are saying that those people need help, and that we will give them help so that they can get back into work.

Pension Schemes Bill

Shabana Mahmood Excerpts

Tuesday 2nd September 2014 Commons Chamber

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

It is a pleasure to wind up this relatively short but interesting and important debate. Despite points of difference and disagreement, it has provided some thoughtful and wide-ranging speeches from both sides of the House, proving that it is quality, not quantity, that counts. Two excellent examples were provided by my hon. Friend the Member for Aberdeen South (Dame Anne Begg) and my right hon. Friend the Member for Neath (Mr Hain).

My hon. Friend the Member for Aberdeen South made an important point about complexity and expressed her fear that increasing complexity as a result of the Government’s changes to pensions might hamper efforts to get younger people to engage with their pensions. She also rightly highlighted the increased risk of mis-selling that could result from any such complexity. I shall come back to that issue later. She also highlighted the importance of governance in relation to the collective defined-contributions schemes that are being introduced by the Bill. She was right to say that there was no obvious reason to omit those governance arrangements from the Bill and to leave them instead to be dealt with in secondary legislation. It is difficult to understand why the Bill is vague on that point, and I hope that the Financial Secretary to the Treasury will be able to illuminate the House further on that when he responds to the debate.

My right hon. Friend the Member for Neath, who is not in his place at the moment, made a powerful contribution to the debate, in which he set out the challenges posed by a rapidly ageing population. They are one reason why so much attention has been focused on pension arrangements. He also noted the challenges posed by the greater need for adult social care that results from a rapidly ageing population, the interplay between those changes, and the increasing burden on the present younger generation and future generations. He talked about our expectation of what those burdens would be like in the coming years. He was right to give us an historical perspective, particularly in relation to mis-selling during the years before 1997.

Pensions are an important issue for people. They worry about their retirement and their personal social care needs, and about whether they will be able to cope with those needs as and when they arise. They also worry about whether they will be able to leave anything behind for their children. As people live longer, it is more important than ever that they should make the best possible choices for themselves. As legislators, politicians need to ensure that the range of options available to people and the breadth of the arrangements they can make for their retirement are fit for purpose, especially as we are all living much longer. That poses great challenges for us all.

In that context, the Bill’s establishment of collective defined-contributions schemes—CDC schemes—is a welcome step in increasing the range of options available to people as they plan for their retirement. We will therefore not oppose the Bill on Second Reading, although there are areas in which we might seek to extend or strengthen it in Committee or on Report.

As I said, we support CDCs in principle. In sharing risk, they have the potential to give people a more adequate and reliable retirement income than individual defined-contributions schemes, because, unlike those schemes, CDCs can pool risk across and between generations. Given the difficulties and anxiety that many people feel about their living standards at the moment, we want to support working people who are struggling to set money aside for the future. We need to ensure that they have access to pension schemes that they can trust to give good value for money and a decent income in retirement.

CDCs are also well supported by the public. Research by the Institute for Public Policy Research carried out at the end of 2013 found that there was strong public support for a collective pension. It was the most popular of the options the IPPR tested and it appealed across those with different income levels, life stages and ages. If CDCs are to be well taken up and succeed, strong governance arrangements clearly need to be in place—that point was made by my hon. Friend the Member for Aberdeen South. As my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) said, the Bill is currently silent on governance arrangements for CDCs. The highest standards of governance are needed for schemes that are even more opaque than defined-contributions schemes because they have to manage pooled assets and conduct smoothing.

The silence in the Bill occurs despite the Government’s consultation “Reshaping workplace pensions for future generations”, which stated:

“Collective schemes are complex and can be opaque—because of the indirect relationship between contributions and benefits. This necessitates strong standards of communication and governance. We intend collective schemes to be overseen by experienced fiduciaries acting on behalf of members, taking decisions at scheme level and removing the need for individuals to make difficult choices over fund allocations and retirement income products.”

Failure to require all schemes to have trustees means that we will potentially have some CDCs run by trustees and others offered by private firms that seek to maximise their short-term returns.

The Minister will know that we have consistently argued that all workplace pension schemes must be run by trustees and have a legal duty to prioritise savers’ interests. Governance arrangements remain an issue for other defined-contributions schemes, which make up the majority of what is available. The Government could have taken more steps in the Bill to strengthen the governance of those schemes. The Government have declined to impose trustee boards, but have instead opted to require independent governance committees. We are concerned that they will be neither independent, nor governing in nature. In any event, IGCs contain serious conflicts of interest, so we will argue in Committee that the Government should instead follow Labour’s lead and require all pension schemes to have trustees and a legal duty to prioritise the interests of savers above all others.

Another issue discussed in the debate, which the Opposition will continue to press the Government on in Committee, is scale. The issue was raised by one Government Member and the Minister did engage with it when the point was made about whether small and medium-sized enterprises might be able to introduce CDCs or whether this would be the preserve of larger employers. He rightly said that it was going to depend primarily on scale and how popular these schemes end up being. The Bill, however, contains no measures that will help promote the scale which most independent observers believe is necessary for CDCs, and workplace pensions in general, to do the best they can for employees. We have long argued that measures to promote scale are vital to ensure the best possible outcomes for savers. So the Government could, for example, require that automatic transfers default into aggregators and the criteria necessary for qualifying as an aggregator should include scale. One or more of those schemes which met the qualifying criteria to be aggregators under our approach may then opt to be a CDC pension scheme.

As my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East noted, the House of Commons briefing note on the Bill also says that

“certain conditions, such as large scale and strong governance, appear necessary for—

CDCs—

“to operate successfully.”

Three-quarters of respondents to the consultation prior to the Bill thought that Government intervention would be needed to create the scale necessary for schemes to offer guarantees. We will look in detail at issues around scale and governance when the Bill is considered in Committee.

We will also look at the National Employment Savings Trust, which is a trusted body for providing workplace pension schemes. It could potentially offer retirement income products or CDC and in doing so help constrain the industry and ensure that it provides decent products to all savers. However, to do so most efficiently, it would need to have its restrictions lifted. As was mentioned earlier, the Government said in July 2013 that they would legislate to lift the restrictions as soon as possible, but they have not yet done so. It would be helpful if the Minister told us whether that is something that will be taken forward by the Government, and when it will be discussed in Committee.

The second part of the debate dealt with the new arrangements around flexibility. As my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East stated at the outset, we have supported greater flexibility in relation to pension arrangements, but we have set out three tests for the new flexibility. First, is there robust advice for people who are saving for their retirement? Secondly, is the system fair to those on middle and lower incomes who want a secure retirement income? Thirdly, are the Government sure that the changes will not result in extra costs to the state either through social care or by increasing housing benefit bills?

In relation to the first test, the expectation is that the Government will propose an amendment to the draft Bill around the guidance guarantee. As it has not yet been published, it is not clear whether it will be robust enough. It would be helpful if the Minister gave additional information to the House now so that we are not waiting until the Bill reaches Committee before we know what is happening about guidance.

As many Members noted, guidance will have to be well thought through and reflect the practical steps that people take as they move towards retirement. To be effective in practice, guidance will need to include a discussion of the effects of drawdown on the individual’s tax situation. It will also need to explain the consequences of decisions regarding the different forms of saving on the extent to which local authorities can seek to recover sums for long-term care. The Government’s response to the consultation “Freedom and Choice in Pensions” indicates that drawdown is likely to be treated similarly to annuities in that income and not capital is assessed. Again, that is something that we will have to look at and examine further in Committee.

Some specific questions arise as well. For example, if guidance is a single event, how will it assist an individual seeking the necessary later event, perhaps 20 years later, of switching from a drawdown product to an annuity? Draw-down products are likely to be insufficient on their own for savers and individuals will need to insure against longevity risk to ensure that they do not run out of money during their retirement. Will there be a requirement for products to include a regular review of when the optimal moment for switching to an annuity should occur?

We have had a number of debates, both on the Floor of the House and in Committee, around the issue of advice and guidance and the very clear difference that there is between the two. There is a fear among many Members across the House that guidance on pension changes alone might not be enough to help people make the best possible choice. Ultimately, the course that the Government choose will have to be carefully scrutinised and reviewed. As I have said, this matter is of great interest to Members on both sides of the House.

[Mr Hoban]

Will the hon. Lady make her position clear? Is she saying that what should be offered to every person retiring is regulated advice?

[Shabana Mahmood]

No, we have not called for regulated advice, but I am sure that the hon. Gentleman will agree that these are big decisions for people. We must ensure that what the Government envisage will be up to the job of ensuring that they have all the information they need before then to make the best possible choice. As I have said, we have had a number of debates on this subject and the Government have given us some idea of the guidance they envisage, but I think we will have to return to these issues in Committee to ensure that that guidance is as robust as it can possibly be.

[Mr Hoban]

I am grateful to the hon. Lady for giving way, as she is being very generous. If she does not want to see regulated advice given, what is she looking for?

[Shabana Mahmood]

To the extent that we have this debate about advice and guidance, I am sure that the hon. Gentleman will recall that it was the Chancellor who said in his Budget speech that advice would be provided to people about making their decisions. We then moved quickly into the world of guidance and the two are, as I am sure the hon. Gentleman will acknowledge, very different. That is why we are concerned that the guidance on offer will not be quite as good as we might expect if advice were on offer. That is why it will be important that Members on both sides of the House stress test the final package that the Government come up with.

The TUC has rightly questioned whether guidance on its own is sufficient. It states:

“Independent guidance is clearly better than that provided by company sales teams, but half an hour of the best possible advice will not equip people for what could be thirty years of managing their pension pot… Expecting the market to deliver retirement income solutions that work for the great majority is unrealistic. The annuities market was broken, but what we need is the same careful consideration of policy, consumer preference and evidence that led to pensions auto-enrolment.”

It is clear that a number of very complex factors will play against each other, with some inherent tensions that were noted by Members on both sides of the House in their speeches. It is important that we stress test the measures properly in Committee.

The Bill introduces a number of measures that we support, and as I have highlighted, there are some issues on which we think that the Bill could be strengthened. We look forward to picking up those issues with the Minister in Committee.