To ask Her Majesty’s Government what assessment they have made of the number of people who will be (1) living in poverty, or (2) unable to meet their basic needs, as a result of COVID-19; and what steps they are taking to support such people.
The Question was considered in a Virtual Proceeding via video call.
My Lords, I thank everyone who has put their name down to speak in this debate and apologise that the time available is so short. I hope this is something that the Procedure Committee will look at.
In the two weeks since we have returned from recess, your Lordships’ House has heard many times about the massive, far-reaching schemes that the Government have introduced in response to the Covid-19 epidemic, as we did in this morning’s government response to my Oral Question about growth dependency. Most of these schemes were introduced when both Houses were in recess, but we have now had opportunities to subject them to scrutiny and to share concerns that noble Lords and MPs have been hearing from members of the public, many of them desperate and frightened, who have pointed to the holes that the rules of the schemes have left many in. I am sure that in this debate we will hear many more case studies.
In the other place, my honourable friend Caroline Lucas has been pointing out how the scheme for the self-employed has left out those who took pay in the form of dividends, those whose self-employment was recent, and those who were self-employed part-time. I have been contacted by many—identified by #newstartersfurlough —who started a job after 28 February, and so their employers are not able to apply for the 80% wage subsidy for them. Can the Minister tell me how many people the Government know, or estimate, are in those two groups that are missing out on help?
There are also, no doubt, huge numbers of people who were on the minimum wage—which is not sufficient to live on, as the Living Wage Foundation makes clear—and are now on 80% of an already inadequate income, their employer failing to top up the Government’s furlough payments even if, as in the case of giant multinational companies, they could well afford to do so. Can the Minister tell me how many are so affected?
My Lords, as millions experience their employers’ struggle to keep businesses afloat and workers employed, the state has deployed radical measures on a scale unimaginable a few weeks ago. But Governments will continue to face difficult decisions, even when the virus is under control—trade-offs and ethical choices of lasting importance. As Paul Johnson of the IFS observed:
“We are not all in this together when it comes to the social and economic consequences of the virus and our response to it.”
This QSD poses the ethical choices in addressing poverty going forward. This crisis provides compelling evidence for mutual insurance, an effective welfare system and collective economic security. As a country, we will have to reappraise our values and reflect on what we expect from private and public institutions as we rebuild our economy. We need a clear framework for decision-making, not only opinions about the right decision. I ask the Minister: do the Government accept the need for such reflection and will they publish a framework for such decision-making?
My Lords, it is unlikely that we will know the full scale of the economic impact of Covid-19 for some time, but it is already clear that its consequences will be felt most profoundly by those on the lowest incomes and that many who have hitherto led relatively comfortable lives will be pushed into hardship and poverty.
It makes a mockery of parliamentary scrutiny that we have just one minute to speak on such an important subject, and it shows great disrespect on the part of the Government to those facing the most challenging circumstances in our country that they have not granted the time needed for a debate of this sort.
Given my limited time, I will focus on universal credit. Does the Minister recognise that, unless UC advance payments are shifted from loans to grants, a debt crisis will be imposed on already impoverished families? Will she urge her colleagues to announce that they will write off all advance payment loans during this period? Finally, will the Minister commit the Government to urgently scheduling a substantive debate on these issues, where they can be considered with the seriousness that they deserve?
My Lords, it is difficult to find any silver lining in this corona-cloud, but the response to Louise Casey’s request for help for some of the poorest in our society, namely the rough sleepers, is one such example. The target to end rough sleeping has been reduced from five years to five days. Some 5,400 rough sleepers have been rehoused, thanks to heroic efforts by voluntary organisations and local authorities, including St Mungo’s, Thames Reach, Look Ahead and the Passage, with Crisis providing logistical support, provisions and volunteers.
The challenge now is, first, to find move-on accommodation for those rough sleepers, with appropriate support where necessary so that they do not return to the streets and, secondly, to support initiatives such as No Second Night Out to prevent a new generation taking to the streets. If we can achieve those two objectives, something good will have come from this pandemic.
Three other housing issues arise from the Covid-19 crisis. The first is design. We can see now the horrendous problems of living in overcrowded conditions without a garden or even a balcony. We need to look at again at space standards in new homes and the enforcement of habitable conditions in existing properties.
The second is debt, especially rent arrears. We must sustain extended debt advice services and end heavy-handed collection processes that make the situation worse.
The third is the dependency on a fragile and fragmented private rented sector, where the potential evictions of those with arrears could magnify homelessness and harm. A massive increase in social housing provision is essential to achieve real affordability and security. More immediately, the Government were right to introduce a ban on evictions, but that measure runs for only three months. Will the Government accelerate their commitment to increased security to prevent a devastating wave of precipitous evictions?
My Lords, the Covid-19 crisis has amplified child poverty. The welcome measures that raised UC and increased LHA show that radical government action is possible, but they have highlighted two policies as unfair. The first is the two-child limit. Recent events demonstrate life’s unpredictability. It exposes the flawed view of how the two-child limit policy was set up. Children should not be penalised for changing circumstances. Up to 60,000 families may find themselves affected in the coming weeks. Next week, the Church of England and CPAG will publish a report exploring the policy’s impact on these families.
Secondly, many will not benefit from welfare increases because of the benefit cap. Current constraints mean that parents cannot escape by increasing working hours, finding a new job or moving into cheaper housing. Families are trapped in poverty. We must prioritise the poorest, with a compassionate, just safety net. Will Her Majesty’s Government consider suspending the two-child limit and benefit cap at least for the duration of the pandemic?
My Lords, I declare my interest as chair of the National Housing Federation, representing not-for-profit housing associations in England. This crisis cannot be allowed to entrench inequalities for generations to come. The OBR predicts that the crisis will cause the UK economy to shrink by 35%, with 2 million job losses—a potential economic disaster.
There are so many examples of organisations, including housing associations, working flat out to provide immediate support to soften the financial impact of this pandemic, but some people will still be in dire hardship. The Government have acted swiftly to secure incomes in the short term, but Ministers must do more to support people on the very lowest incomes.
I have two questions: will the Minister commit to suspending the housing benefit cap, and, echoing the noble Lord, Lord Young of Cookham, to ensuring that all rough sleepers have a permanent home once social distancing is ended?
My Lords, a lot of attention has been paid to reduced incomes, but little attention has been given to the likelihood of increases to the cost of living. There will be supply interruptions as the virus hits countries around the world and shortages lead to price rises. We import more than half our food, so my plea to the Government is that ferry companies and the haulage industry need better and dependable support so that goods keep flowing.
Even food produced here is affected because of the traditional reliance on foreign labour to harvest crops. We already faced a shortage of pickers this season but, because of Brexit and now this pandemic, the situation is critical. I hope the Government’s pleas are answered and lots of British people come forward to help, but food prices are still likely to rise.
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I acknowledge that gaps, such as those in the self-employed and new starter schemes, were inevitable, particularly given the speed with which these schemes had to be established. However, we might want to think about having prepared schemes for times of crisis in future. Perhaps, rather than abolishing these schemes when possible, the Minister could commit the Government to look at mothballing them and having the computer systems and legal frameworks held on standby. We live in an age of shocks—climatic, financial and health; we cannot know when the next one will strike, only that it will. Putting resilience—the ability to deal with them and to ensure that households are able to deal with them—at the centre of every government policy is essential.
For the immediate future, it is important that we know how large the gaps are—something that only the Government can establish. I hope the Government already have plans to adapt the existing schemes and slash the numbers falling through the gaps. That is one way in which the Minister could perhaps answer the second part of my Question, about how they plan to help those now without adequate, or even any, income. However many patches are laid over the gaps in these schemes, some people will always fall through; that is the nature of conditionality. If one of the conditions is having to apply, that is one way in which significant numbers will always miss out. I cite the example of pension credit, for which it is estimated that 15% of eligible pensioners do not apply, leaving them living—by definition—on tiny incomes.
I can already safely speculate that the Minister will say, “Ah, but there’s universal credit”—and yes, there is. On other occasions, your Lordships’ House has heard of its many limits, horrors and inadequacies, and I am not aiming to restart that debate today. At least with all sanctions suspended—as I understand it; perhaps the Minister can confirm that—some of its worst horrors, of people being left absolutely penniless through no avoidable fault of their own, are not currently occurring. I hope the Minister will also acknowledge that its level will not meet the commitments of many people who, suddenly and entirely unpredictably, have only it to rely on. I hope that the Minister will tell us today that the Government plan to make the ending of universal credit sanctions a permanent state of affairs. Taking away an already inadequate level of income and leaving people penniless for months or years is no way for a society to treat anybody.
Again, we have the problem of conditionality—rules being applied that some are unable to meet. In recent years, we have seen the level of conditionality in social security tightened, and tightened again. We have seen our politics dominated by the disgraceful and false distinction between so-called strivers and skivers, perhaps falling to its greatest depths with a former Chancellor’s obsession with the setting of people’s window blinds. That conditionality has led many to miss out on money they desperately need and should have a right to. In the age of Covid-19, that cannot be allowed to continue. That is why, as I pre-warned the Minister, I ask her whether the Government are considering a universal basic income—a payment going to every member of this society as part of the answer to the second part of my Question. Only an unconditional, universal payment can ensure that no member of our society is left penniless, in a Dickensian world of want and misery.
I have to tell the House that I am not co-ordinating this call with the First Minister of Scotland, Nicola Sturgeon, who yesterday told her House that Covid-19 makes
“the case for a universal basic income stronger than ever”
and that she would be putting that to our Prime Minister. That coincidence reflects calls from an increasing number of directions, party political and not, for a universal basic income. An unconditional regular payment at an adequate level, going to every woman, man and child in our society, could ensure that no one is left in poverty or unable to meet their basic needs. Surely, in a society that has the capacity to deliver it, that is a basic condition to call it decent and to fit the categorisation of a human rights-respecting society.
I hope that no Member of your Lordships’ House would deny the right to life, yet we do not currently guarantee the means to deliver life: for people to put food on the table and keep a roof over their head. Charity, particularly in the form of food banks, has increasingly been left to struggle to provide that most fundamental human necessity. In the age of Covid-19, of course, that is even more difficult.
Finally, today, much of the debate around Covid-19 is about ways out of the lockdown and this debate must look forward to that period. Initial government schemes to provide people with cash have been extended and are likely to be extended again but, at some time in the not too distant future, they will start to be unwound. Inevitably, that will mean that more gaps appear in the safety net, more people will not meet the changed criteria, or their circumstances will change, and they will be left in poverty without the means to meet their basic needs.
I am, and will remain, a proponent of a permanent universal basic income. One possibility for the intermediate period, to ensure that no one is left to the vagaries of conditionality and needing to rely on the stretched resources of charity and voluntary help, is a “recovery basic income”. I am aware of two such worked-through proposals, one from the UBI Lab Network, the other from Malcolm Torry of the Citizen’s Basic Income Trust and the London School of Economics. Again, I have shared these with the noble Baroness and, time allowing, I hope she might offer some thoughts on both the principle of a recovery basic income and the proposals—and maybe even on a general universal basic income. I also look forward to hearing the thoughts of the many other noble Lords taking part in this debate.