Universal Credit: Delayed Roll-Out

We now come to the first urgent question, which I expect to run for 45 minutes.

(Urgent Question): To ask the Secretary of State for Work and Pensions to make a statement regarding the delay to the full roll-out of universal credit.

The Secretary of State and I informed Parliament yesterday that we had revisited our forecast for universal credit and were extending its completion date to 2024. Our planning for universal credit relies on assumptions about the number of people whose circumstances will change each day, thereby naturally migrating. Our forecasts to date have relied on 50,000 households experiencing a change in circumstances each month. Based on this, we had predicted that the process of natural migration to universal credit would be completed by December 2023.

Information collected on changes to people’s circumstances suggests that natural migration is happening less frequently than we expected. This suggests broad stability in people’s lives and can be attributed to a number of reasons, including the robustness of the labour market. We now estimate that 900,000 fewer households will naturally migrate between now and December 2023 than we had forecast. Given that we expect to manage about 100,000 households to universal credit each month, it necessarily follows that if we are to protect the interests of claimants and move them to universal credit safely it will take a further nine months to complete the implementation of universal credit.

I can assure colleagues that claimants will not lose money from their universal credit award owing to this forecasting change. We will always put the best interests of our claimants first, and as we move into the managed migration phase protecting the vulnerable will be our utmost concern.

Thank you, Mr Speaker, for granting this urgent question, which I believe is the first to be granted to the SNP under your speakership.

The UK Government still have no respect for the House. They let the BBC announce this delay as part of a news trail for the documentary being aired tonight, without a written ministerial statement—I have not seen one, so can the Minister tell the House where it is?

I feel for the Minister, being forced to stand here today, because I know it was not his decision to withhold that information from colleagues. Where is the Secretary of State? This should have been an oral ministerial statement.

Quotes from the documentary seem to suggest that this decision was taken by a senior official, not the Secretary of State. Has she abandoned decision-making oversight? When did she sanction this decision? Perhaps there was no oral ministerial statement because she found out only last night, like the rest of us—what an absolute shambles.

Universal credit was supposed to have been fully rolled out by 2017. This further delay means that it will have been delayed by a further seven years at a potential cost of £500 million. It highlights how far universal credit is from getting it right, as does the fact that this delay is needed to avoid further hardship to those in receipt of the benefit.

Ministers say, as the Minister said again just now, that the delay is needed because people are scared to go on universal credit. They say it like they are actually surprised. The great irony is that if this Tory Government were to listen and do what expert charities and those actually in receipt of universal credit were saying, these delays would not be needed.

Will the UK Government use this delay productively by making a meaningful investment in universal credit to see it fixed, scrapping the two-child cap and rape clause, ending the debt and poverty-inducing five-week wait and making work pay by fully restoring work allowances?

I have not yet seen the BBC documentary, and I suspect that the hon. Gentleman has not done so either, because it is due to be aired shortly. However, it is important to stress that officials discussed advice to be sent to Ministers late in 2019, and the final discussions were held with Ministers in 2020. Parliament was then informed. This relates to the back end of the timetable, which concerns people moving to universal credit in 2024-25, so the change was communicated in good time.

The hon. Gentleman referred to cost, and it is important to put that in context. This is additional money that will go into the pockets of our claimants, some of the most vulnerable and disadvantaged in our country. About 900,000 people could now receive transitional protection who would not have been able to receive it through natural migration.

I welcome my hon. Friend’s clarification of the need for this reforecasting. May I invite him to restate the Government’s total commitment to a universal credit arrangement that simplifies the system? It means dealing with one Department rather than three, it combines six benefits into one, it helps people to get into work more quickly, and it smooths their transition into work thereafter.

I thank my right hon. Friend for his question, and for all the work that he did in our Department. He is absolutely right: universal credit is a modern, flexible, personalised benefit that reflects the rapidly changing world of work. Conservative Members believe that work should always pay, and that we need a welfare system that helps people into work, supports those who need help, and is fair to everyone who pays for it.

Yesterday the BBC reported that the Government had decided to delay the roll-out of universal credit until September 2024, adding £500 million to its overall cost. That is hugely embarrassing for the Government: yet again, they have had to delay what is meant to be their flagship social security policy. Last week the Minister told the House that they had managed to process fewer than 80 households since July, as part of what was meant to be a pilot of up to 10,000 households in Harrogate, and that only about 13 of those households had transferred to universal credit. At that rate, it would take the Government more than 380 years to complete their managed migration pilot.

Universal credit was supposed to make work pay, but instead it has caused misery for thousands across the country. It seems from yesterday’s report that senior civil servants think people are too scared to transfer to it. Can the Minister tell us why so many people are scared? Is it because of the five-week wait that is pushing so many families into debt and rent arrears, and making them turn to food banks to survive? Is it because of the two-child limit, which the Child Poverty Action Group has described as

“a policy designed to increase child poverty”?

Is it because of the sanctions regime that has made some of the most vulnerable people in our society destitute? Or is it down to the fact that, according to the Government’s own research, nearly 50% of claimants were not able to make a claim online unassisted?

It is clear that the Government have been forced to delay universal credit yet again because people do not have confidence in the system. Can the Minister tell us what they intend to do with the extra time? Will they get rid of the five-week wait? Will they scrap the two-child limit? Will they call a halt to the sanctions regime that is pushing people into destitution? And will they now apologise to all the people whom they have pushed into hardship through universal credit, and create a social security system that protects people from poverty and treats them with respect?

The hon. Lady says that I should be embarrassed. I will never be embarrassed about putting the most vulnerable and disadvantaged people in our society first, and neither will the Government. She talked about cost. As I have said, this is up to £500 million of additional money that will go into the pockets of our claimants. When she referred to the pilot, she was conflating two very separate issues. She also said that people were scared. Perhaps if members of the Labour party desisted from their scaremongering and spent more time in our jobcentres speaking to work coaches, they would have a better understanding of universal credit and how well it is working.

I am certainly no fan of the Department for Work and Pensions and its campaign to improve universal credit, but I do know that this Minister cares about making universal credit work, and this Minister has my full backing to make it work—and I have worked with many Ministers over the last 10 years. Will he tell me clearly, however, whether my constituents will be better off or worse off because of the way in which the migration works?

I thank my hon. Friend for his question and for his kind words. The answer is a categorical yes: his constituents will be better off. Under our forecasting, around 900,000 people will now be eligible for transitional protection, and as a result they will be better off.

I congratulate the hon. Member for Airdrie and Shotts (Neil Gray) on securing this urgent question. Claimants are extremely reluctant to be moved on to universal credit. It has a dreadful reputation, largely because for the first five weeks that they are on it the only help they can get is a loan. Claimants on universal credit are two and a half times more likely to need a food bank than those on the previous benefits. Will Ministers look urgently at drastically cutting that five-week delay?

First, I congratulate the right hon. Gentleman on his election as Chairman of the Work and Pensions Committee. I take all issues around policy in my Department, in the areas in which I have control, very seriously and I am happy to work with him. Are there improvements that we can make to universal credit? Yes, of course there are, and I look forward to working with him find some of those solutions.

Is the Minister as surprised as I am that, when questions about universal credit come up, people have a clear tendency to forget that the legacy benefits system leaves a lot to be desired and traps people in jobs where they cannot work more hours? Universal credit is a massive improvement. Of course there are going to be issues, but I for one am pleased that the Minister is taking this cautiously and carefully. Universal credit helps people to get into work and makes work pay, and he should not be embarrassed about it at all.

I thank my right hon. Friend for his question. The previous system has been described as clunky and confusing, as leading to overpayments and therefore ongoing deductions, as acting as a disincentive to work through cliff edges at 16, 24 and 30 hours, and in some cases as a marginal tax rate of 90p in the pound. Labour was content to have people trapped in a life on benefits. What did that mean for the life chances of people and their children? Under universal credit, it always pays to work and increase your hours.

The final delivery of universal credit seems to be even later than a Northern train. It is a demonstration of the incompetence of this Government that they have wrecked the benefits system in this way. When universal credit was rolled out in my constituency as one of the experiments—they never do experiments in their own constituencies—it caused a tenfold increase in food bank usage and huge hardship—[Interruption.] The Minister can pretend all he likes that that did not happen, but I know from my own advice surgery that this benefit causes misery.

Let us instead look at the facts. Universal credit will give claimants an extra £2.1 billion a year, once it has been fully rolled out, compared with the system that it replaces. Around 1 million disabled house- holds will receive an average of around £100 more a month, and 700,000 families will get the extra money that they are entitled to—around £285 a month—under universal credit. Claimants will have access to around £2.4 billion of previously unclaimed benefits—benefits that they did not receive under the legacy benefits system of the previous Labour Government.

I simply do not understand why Opposition Members are so against this system, which is helping people into work. I have visited my jobcentre in Poole, where work coaches are so positive about the universal credit system because it gives them the tools to get people into work. It is not just Conservative Members who support universal credit; it is also those who have been helped into work by our work coaches.

My hon. Friend is absolutely right, and I thank him for visiting his jobcentre. If more Members across the House did so, they would have a better understanding of the system and of how our work coaches feel about it. They would find that, as my hon. Friend rightly says, it is a valuable tool to help people to get into work and to progress in work. We should all be proud of it.