Coronavirus Outbreak: DWP Response

I beg to move,

That this House notes the First Report of the Work and Pensions Committee, “DWP’s response to the coronavirus outbreak”, HC 178; and calls on the Government to increase relevant legacy benefits in line with increases to universal credit, to take steps to return people who have been inadvertently left worse off under universal credit compared with their previous benefits, and to suspend the no recourse to public funds visa condition for the duration of the coronavirus outbreak.

I thank the Backbench Business Committee for this opportunity. The new Work and Pensions Committee had an ambitious programme. Our first meeting in March was with the Health and Safety Executive, but in no time we were in lockdown and our programme was set aside. The Department for Work and Pensions has been key in this crisis as so many have lost the means to earn a living, and universal credit has delivered. I have been a frequent critic. I repeatedly pointed out that transition to universal credit could not be completed by October 2017, but the system that we now have has passed the test of this year. It is a national asset, which we should make the most of.

DWP staff have been on the frontline, with many redeployed to handle the tidal wave of claims. They have withstood enormous pressure. In our report, the Committee expresses thanks to them for their dedication and hard work, and that does need to be reflected in their pay; yesterday’s announcement was a heavy blow.

Ministers made good decisions at the start. After a decade of cuts, the £20 increase in universal credit and working tax credit, and the reconnecting of local housing allowance with actual rents, were key for many to surviving the crisis. I had understood that local housing allowance would be kept in line with local rents, so I was dismayed yesterday to hear that it will be frozen—decoupling it once again. My Committee agreed unanimously that the £20 increase should stay and many others have taken that view, including the Joseph Rowntree Foundation’s “Keep the lifeline” campaign. The campaign wrote an open letter to the Chancellor on 30 September with Citizens Advice, the Child Poverty Action Group, Feeding Britain, Oxfam, the Trussell Trust, disability charities and bishops. The Resolution Foundation says that otherwise,

“The basic level of support for an out-of-work single adult would fall to the level it was at when Margaret Thatcher left office”.

The Institute for Fiscal Studies warned of a significant decline in the incomes of 4 million families. The Chair of the Welsh Affairs Committee, the right hon. Member for Preseli Pembrokeshire (Stephen Crabb), a former Work and Pensions Secretary, called the £20 a lifeline and urged its retention. I very much regret that the Chancellor rejected those calls yesterday.

The spending projections show universal credit being cut by £20 in April, and people claiming universal credit are left fearing the worst. Our motion calls for the £20 uplift to be extended to legacy benefits. Yesterday, an increase of 37p per week was announced; Ministers must reconsider.

Not increasing jobseeker’s allowance and employment and support allowance for those out of work because of ill health was done on the grounds, we were told, that computer systems were slow to change, but they certainly could have been changed by now, and it is absurd that people in otherwise identical circumstances, claiming different benefits because of universal credit roll-out sequencing, are receiving such different support. It is legally questionable. People should not face extended hardship because their benefits are run on out-of-date systems. Ministers were absolutely right to introduce the increase; it should be extended to legacy benefits, too

Our report last month, “Universal credit: the wait for a first payment”, calls for other much-needed changes. The five-week delay between applying and the first regular payment causes great hardship; we called for non-repayable starter payments to tide people over. We also called for “advances” to be renamed “loans”, to make it clear they have to be repaid, because calling them “advances” obscures that.

The motion also highlights the people made worse off by claiming universal credit. Government online advice says: “Apply online for universal credit to get financial support if you’ve lost your job.” For most people, that was sound advice, but not for everyone: if someone on tax credits claims universal credit, their tax credits stop.

We surveyed experiences of the benefits system in the pandemic; 6,000 people responded, and I thank all of them. Some had not realised that claiming universal credit meant losing tax credits. For some, their universal credit entitlement then turned out to be zero—for example, one of my constituents with £16,000 saved. That person was left, as many were, with no support at all. That is benefit mis-selling; the Government should put it right.

In May, answering the right hon. Member for North Shropshire (Mr Paterson) here in the Chamber, the Secretary of State said that she would look “very carefully” at whether people should be able to return to previous benefits. That held out some hope, but now she says that allowing it would threaten to unravel the roll-out of universal credit; that is a very poor excuse.

Today’s motion highlights our call, also made by the Home Affairs Committee, for the no recourse to public funds immigration condition to be suspended for the pandemic. Some 3 million extra people have had to claim universal credit this year, but families working legally, with no recourse to public funds on their immigration status, do not have that safety net. They may get discretionary council help, but provision varies immensely. Indeed, Andy Jolly at the University of Wolverhampton has found that many families refused council help, so our report made this call:

“The Government should publish or at least clarify existing guidance for local authorities on what support they can provide for people with NRPF, including…whether measures such as the hardship fund are classed as public funds or not.”

At the Liaison Committee in May the Prime Minister said that people in this situation should get “help” of one kind or another. I agree, but unfortunately they do not. Families facing destitution can apply for exemption, but it is extremely hard. The all-party group on immigration law and policy heard this week from the Unity Project that it takes about 100 pages of evidence; many people cannot provide that. The Home Office takes a month, on average, to determine an application. No destitute family should have to wait a month for the Government to decide whether they can claim benefit.

Our report in May also called for an impact analysis of the benefit cap in the pandemic. UC and the local housing allowance were rightly raised, but the benefit cap was not, so many families crashed into the cap for the first time. The Department told our inquiry that the number of people affected by that would be “very small”. We asked for a full analysis of the numbers and the characteristics of households newly subject to the cap, and of the impact on hardship. We now know that far from a very small impact, the number affected by the benefit cap has almost doubled in the pandemic.

In London, with high rents pushing up LHA, many have crashed into the benefit cap for the first time. People claiming benefit after losing their job have a nine-month grace period when the benefit cap does not apply. The employment Minister says that 160,000 households have a grace period due to end next month—the benefit cap will apply for the first time. I wrote to the Secretary of State yesterday, with the Committee’s agreement, about this issue. The Government were right to increase support for struggling families at the start of the pandemic, and there should be a cap easement for those about to be hit.

Our report in May pointed out that the future jobs fund did a great job of supporting young people in the last financial crisis. I welcome the kickstart scheme, with its identical structure, that was announced the month after our report. It was disappointing to see yesterday that spending on kickstart will be much lower than planned. That seems to be because employers have to offer at least 30 places, thus shutting out small firms. That should surely be fixed. The Committee will take evidence on the Restart scheme, which was announced yesterday. An evaluation of the Work programme was published on Tuesday. Major commitment to employment support is absolutely right, but we need it—this is unlike what happened with the Work programme—to do a good job with, for example, disabled people.

The importance of dependable social security has never been clearer. The UC system and Department for Work and Pensions staff have passed an extraordinary test, and they have our congratulations and our thanks. The changes outlined in our report are needed now to minimise damage from the crisis, and to look forward and build back better in the months ahead.

Order. I have asked Members to consider a five-minute limit. We are not putting the clock on, but Members who go wildly over five minutes will be doing a great disservice to those lower down the call list.

I pay tribute to the right hon. Member for East Ham (Stephen Timms) for securing the debate. There has been so much criticism of the Government in this place this year, much of it very unfair and political, and much of it fair and necessary in holding the Government to account for things that are going wrong. What we do not hear often from the Opposition, however, is recognition of what has gone right, which is why I note the generous spirit in which the right hon. Gentleman spoke about universal credit, acknowledging it as a “national asset”. That is good description of what has been achieved.

I honour Ministers at the DWP for the tremendous success story of 2020. There have been 3.2 million new UC claimants, a near doubling of the total case load, as I understand it, and yet despite all the protests about UC in recent years, I do not think that there been a squeak of protest in this place about the process of onboarding those claims. In my constituency, we have had nearly 3,000 new UC claims and, having just checked, I find I have had eight items of casework on UC this year, which represents a fairly small proportion of my total case load. I honour what has been done, and give my thanks to Jobcentre Plus staff and all the staff at the DWP. There are many heroes working behind the scenes in our country this year, and Jobcentre Plus staff are leaders among them.

I also wish to pay tribute to the coalition Government, and principally to my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for his role in designing and implementing UC. I can only imagine what would have been the case had we stuck with the old system and the myriad benefits, mostly with paper-based administration; it would have been a complete disaster. But we had a digital system, so when millions of people suddenly needed unemployment benefits, the computer said yes.

On that topic, the right hon. Member for East Ham raises the suggestion from his Select Committee in its report earlier this year that people should be able to go back to legacy benefits after being on universal credit. It is certainly true that, despite the significant increases in universal credit, some people appear to be worse off on it, but as we have seen, and as I have just described, UC is a far more agile system and the intention—I think of the whole House—is to replace legacy benefits. I agree with the Government’s position that it would not be right to let people go back. The right hon Gentleman mentions mis-selling: surely that is an exaggeration, but I do wonder whether more can be done to explain to people what joining UC means and to make sure that they are able to check properly whether it is the right move for them.

It is good to follow the hon. Member for Devizes (Danny Kruger), although of course in the 1600s this Parliament did not exist, so those laws would not have applied in Scotland, thankfully.

I thank the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Stephen Timms), and all its members, including my hon. Friend the Member for Glasgow South West (Chris Stephens), for the report. However, I might be the fly in the ointment when it comes to some of the issues it raised.

From my perspective, and I hope that of the majority of Members on my Benches, the report provides a true exposition of the Government’s position on social security, and their ideological thinking about its role in society. At least on these Benches, we believe that a social security policy worth its name should be based on its role in defining society through support enabling equal access to security for all based on need, especially during a global pandemic. I am afraid that, at least from my perspective, the Government’s position and outlook seem to uphold a post-Thatcherite fundamentalism. It is as though they have offered a prayer to a dystopian Saint Francis of Assisi, “Where there is discord, may we bring more. Where there is error, may we entrench it. Where there is doubt, may we add to it, and where there is despair, may we embolden it.” I am afraid that I do not see UC as a national asset. I certainly see the members of staff who are having to deal with its consequences as an asset, because I and my team, and many other Members, know how much hard work they have done.

It is as though the Conservative party believes that the path to paradise begins in hell, but, just maybe, the long road to salvation actually lies in the Committee’s recommendations. For example, it says:

“The Department should continue to allow claimants to use their Government Gateway accounts to verify their identity once the lockdown has ended. It should also use this as an opportunity to reflect on what other changes to the process are needed, with a particular focus on the needs of people who are vulnerable and digitally excluded.”

First, I pay tribute to the Clerks, the staff and fellow members of the Work and Pensions Committee, and to the right hon. Member for East Ham (Stephen Timms) for the work he did on this report. It was an interesting inquiry to be involved with and, as I am sure he will agree, we heard a wide range of evidence about the Government’s handling of the covid-19 pandemic.

The report recognises the unprecedented and difficult circumstances that our social security system has found itself in. Most of the people who rely on it have found themselves having to do so for the first time as a result of this crisis. We heard stories of people who never expected to have to rely on social security now having absolutely to depend on it. What we also heard about, and what has also been shown, are some of the operational challenges that the Department has faced. However, I have been very heartened by my hon. Friend the Minister’s listening mood and approach to some of these issues.

I want to concentrate my comments today on three points that I pulled out of the report. I certainly do not wish to step on or repeat any of the comments that right hon. and hon. Members have made so far, but for me a number of elements stick out: the operational challenges that the Department has faced during this period; the support for the self-employed and its impact, nowhere more so than in my constituency; and how we ensure that those people who have to go to work during covid get support from the agencies that are meant to ensure that they remain safe.

I first thank the DWP staff, who have been absolutely phenomenal during this period—I am sure we all agree. They have had to step up, with many seconded into roles of which they have had no experience before, and they have got on with it, worked hard and ensured that people who need access to benefits get those benefits and the entitlements they need. We heard stories in the report about how people not only got access to benefits but felt supported by the staff. People felt that they, were being listened to and were being treated as individuals.

I thank everybody for showing great time restraint and understanding.

I congratulate my right hon. Friend the Member for East Ham (Stephen Timms) on securing this important debate. This report demonstrates how the coronavirus has exposed the critical shortcomings of our social security system, while highlighting issues that we have known about for a long time, such as the five-week wait for universal credit payment and the financial burden on claimants of repaying advance loans. It also criticised the fact that the £20 increase in universal credit had not been carried across to legacy benefits such as jobseeker’s allowance and employment and support allowance. That has resulted in people facing hardship as a result of the Government’s inhumanity. The Government must urgently level up their support.

The Institute for Fiscal Studies recently found that 4 million families face a significant decline in income if the Department for Work and Pensions goes ahead with its plan to scrap the £20 increase. It is deeply worrying that the Government are planning to cut universal credit amid an unprecedented economic crisis. That is especially concerning in Leicester East, as last month, over 5,000 of our residents claimed unemployment benefits—the number has more than doubled and has gone up by over 3,000 since the lockdown began in March. This means that our community’s unemployment rate is above the national average. It is also beyond belief that benefit sanctions resumed in July, during an unprecedented period of economic hardship.

The report highlights the impact of the callous “no recourse to public funds” condition during the pandemic, particularly on children. Thousands of UK residents who are undocumented and those who have no recourse to public funds have already been driven into destitution during this crisis. Recent Home Office statistics show that the number of migrants with no recourse to public funds who have applied for destitution funds increased dramatically, by 572%, in the months spanning the coronavirus crisis. This means that nearly 3,000 migrants facing total hardship could be waiting to hear whether they and their families will be able to avoid severe poverty—and that only includes the limited number of migrants who are aware of the destitution provision. Given the hostile environment for migrants, many do not know that they are eligible for any state support.

The statistics also reveal that it took the Home Office an unacceptable average of 30 days to decide on these life-or-death applications. This process must be considerably speeded up, but better still, the concept of no recourse to public funds must be suspended for the duration of the pandemic at least. That would be the more humane approach. It is appalling that the Home Office does not even record the number of UK residents with no recourse to public funds, despite a recent intervention from the Office for Statistics Regulation, which expressed alarm at the Home Office’s repeated refusal to do so. It is contrary to reason to develop policy without knowing how many people the condition affects. The Government must adopt this most basic of tasks.

I congratulate the right hon. Member for East Ham (Stephen Timms) on securing this debate. I think it fair to say that he is well regarded on both sides of the House for his approach to these issues and for his expertise on them, which was reflected in his opening remarks and in his Committee’s report.

I wanted to speak in this debate because I think the performance of the Department for Work and Pensions during the pandemic has been one of the unsung successes of this period. It saw an increase in claimant numbers between February and August from 2.9 million to 5.6 million. Few services saw that level of increase. A lot of services saw a decrease. Some did see an increase, and obviously the biggest pressure was on the health service, but few saw such an increase in this period, and the fact that 93% of people were paid on time is a huge achievement.

I accept that for those among the remaining 7% those delays are very distressing, although I know from my own constituents that the delays are sometimes caused if the Department does not have all the information it needs. I am not saying that that accounts for all the delays—I am sure there have been some things that have gone wrong for that 7%—but I wonder how many services, public or private, could claim a 93% success rate in the past decade or, indeed, the past two or three decades.

I want to pay tribute to the DWP staff. I was at the jobcentre in Didcot just last week, and their commitment and dedication to ensuring that every jobseeker gets the right support hit me in the face the moment I walked in.

I thank the hon. Gentleman for his kind remarks. Does he think the staff should get a pay rise?

We could make the case for all public servants to be given a pay rise at all times, but of course we have to keep good control over the expenditure that the Government make on behalf of taxpayers. Considerable support has been given, in one of the most generous packages in the world, through the covid period, and I think that has to be taken into consideration when we talk about a pay rise. And of course some public sector workers are getting a pay rise; in fact, I think the majority still are.

I also want to give credit to the ministerial team and the way in which they have worked flexibly, whether in bringing forward the use of Government Gateway identification by six months or in suspending the conditionality on jobseeking for this period. All those things mattered and played an important role. Some of the criticism that has been made of the DWP involves things that I think are reasonable. For example, I think it reasonable still to require evidence of health conditions if someone wants to claim health-related benefits.

I accept the point about not everyone having the right level of digital literacy, but on the other hand, we wanted a system that was quick and easy to access, and we were keeping everybody inside, and I think that probably affected a small but not insignificant minority of people. Some of the other criticisms are about problems that people have with the system as a whole, such as the benefit cap or no recourse to public funds. I am not saying that those issues have not been exacerbated, but they are broader questions than just the performance of the DWP during this period. I agree with some of the criticisms, however. The delays to mandatory reconsiderations, for example, are a problem. I have seen that for myself, and we have to sort it out. I know that the Department is committed to doing so, and the faster it can do so, the better.

After the Health and Education Departments, the DWP has had the most tremendous pressure placed on it, and the reason we have heard a lot less about it is that things have gone so well. That is not the case with everything, but it is a service that has worked a lot better than could have potentially been expected at the outset of this crisis, given the increase in the number of claimants. That is backed up by the statistics. The bottom 10% saw no reduction in the income level that they received, and the Government’s package overall reduced the scale of losses by up to two thirds, in the majority of cases, for working people.

I pay tribute to the members of the Work and Pensions Committee and its Chair, the right hon. Member for East Ham (Stephen Timms), for the important work they have been carrying out during the coronavirus pandemic. I welcome the recommendations in their report.

For many of my constituents, this crisis has been the first time that they have engaged with the benefits system. While it is important to note that, as we have heard, there have been some successes, many of my constituents have been shocked to find out that what they believed to be a safety net has some significant holes. I want to limit my remarks to the issue of those left worse off, and one particular constituency case.

One of my constituents, Lara, wrote to me. She is a student mental health nurse, and the previous academic year was the second year of her studies. During the pandemic, like all second-year student nurses, she was offered a fixed-term contract to help the NHS that would run until August. She said:

“It was fantastic to be recognised as having the skills that were needed, and like my classmates, I felt it necessary to take this offer. Should I have declined, I would then have needed to extend my studies by 6 months as in order to register as a nurse, 2300 placement hours must be worked.”

Many student nurses work alongside their studies to top up their nursing bursary, but Lara was unable to do that owing to disability, and, as a result, was eligible for housing benefit and for employment and support allowance, as well as the personal independence payment. She said that this was able to help her have a place of her own, which has vastly improved her health, something of which she feels the benefit daily. When she took on the fixed-term contract, that meant that she was receiving a wage, which meant a temporary pause in her benefits. She told me: