The purpose of universal credit is to replace an outdated benefits system, ensuring that people are better off in work and that support is targeted to the most vulnerable. We recognise the challenge that this cultural shift represents. We currently provide advance payments and a transitional housing payment to claimants coming on to universal credit. Furthermore, we will spend over £3 billion on transitional protections for 1.1 million households as part of our managed migration regulations.
I thank the Secretary of State for her answer. I welcome reports that she is considering scaling back the roll-out of the migration to universal credit for those on legacy benefits while problems with the system are identified and resolved. However, we have seen from the WASPI—Women Against State Pension Inequality—scandal that a letter from the Department is often not enough to stop even those who are not vulnerable from falling through the cracks. Why has the Secretary of State rejected the recommendation from her own social security advisory committee that legacy benefits claimants should be transferred to universal credit automatically? As a minimum, will she guarantee that nobody has their legacy benefits stopped without an application?
There was a lot in that question. I would like to reassure the hon. Lady that ensuring that the transfer from legacy benefits to universal credit is effective, fair and compassionate is absolutely central to the work the Department will be doing. The pilot announced some time ago, involving 10,000 people, will be taking place later this year. It will be absolutely central to ensuring that that is effective. I look forward to further discussions about that.
I welcome my right hon. Friend to her place. Her announcement is absolutely right. She knows the whole point of universal credit was the test and learn process, unlike, and learning lessons from, the mess of tax credits. Under tax credits, nearly 1 million people lost all their money. That will not happen under universal credit. I hope she will absolutely see the programme through.
I thank my right hon. Friend for his support and pay tribute to the incredible work he did to set up universal credit, particularly focusing on ensuring that universal credit helps people into work. We must remember that under previous legacy rates that took place under Labour, to which he rightly draws attention, there were marginal rates of tax of 90%. No wonder people were discouraged from going into work.
I am so confused. Might I ask the Secretary of State whether the best news we have heard since the benefit was introduced is in fact correct? Is she postponing the mass migration? Is she limiting it to the 10,000? Is she then going to see how those 10,000 are looked after in the transfer? If that is so, may I thank her and congratulate her, and say that it is a real pleasure that she has introduced so quickly a key recommendation of the Select Committee?
I am afraid the right hon. Gentleman is a little ahead in his fulsome praise for me, which I always appreciate. As I said to him in the Select Committee before Christmas, I will want to consider carefully when I bring to the House the vote for the 3 million managed migration, which is scheduled for 2020. I am still considering when to do that. I can reassure him that there will be a vote on that before it takes place. The 10,000-person pilot, which was announced some time ago, will, as always, inform us how we do that.
21. In Thirsk and Malton, some of my constituents get paid on four-weekly cycles. That means they can get paid twice in a month and can appear to be earning more than they actually do. What more can we do to ensure universal credit responds to such situations, so that people receive the right level of support at the right time?
I thank my hon. Friend for his question. He has raised this issue with us before. He is right that we need to ensure that universal credit delivers on what it intends to do, which is to give real time financial support based on an actual month’s assessment. We have recently updated the guidance for universal credit so that work coaches can adjust to ensure that where the situation he describes occurs, appropriate adjustments are made.
22. On 12 December, Neil Wright from Plymouth, who is disabled, received 1p in universal credit to live on. He is not able to claim another payment until 14 January. He said he had just 77p to live on at Christmas. Can the Secretary of State understand the utter hopelessness and anger that situations such as Mr Wright’s cause? Will she agree to review his case, and, no matter the good intentions behind universal credit, will she admit that the system still causes misery and poverty for far too many people?
I am sorry to hear of the particular situation the hon. Gentleman raises. He must write to me, and of course I will take a careful look at it. However, I would just say also that I visited a number of jobcentres last Friday and was shown the work that a particular work coach had done to get three different people advances on the day of their universal credit application—the Friday before Christmas. We must not underestimate the good work that so many work coaches do to help claimants, which is in their interest and in ours.
The Labour party often talks about benefit cuts, but can my right hon. Friend confirm that when universal credit is fully rolled out, there will be £2 billion more going into the benefits system than there would have been under legacy benefits, thanks to the changes in the last Budget?
I thank my hon. Friend for giving me the opportunity to clarify that. It is such an important point that by 2020 the total system will cost approximately £62 billion, which is £2 billion more than the £60 billion that would have been anticipated under the previous benefits, so we are investing in our benefits.
Just before I call the hon. Member for Bishop Auckland (Helen Goodman), may I say to her—I think I do so with the support of the House—how sorry I was to see that her predecessor, an illustrious representative of the Bishop Auckland constituency, Mr Derek Foster, later Lord Foster, had passed away? He was well respected in this place and gave great service to it, and our sympathies go to his widow and the family.
Mr Speaker, thank you. I am sure all the people who live in Bishop Auckland will very much appreciate those sentiments.
The Secretary of State may know that five years ago 30,000 people were fined for wrongly claiming free prescriptions, but last year that figure was 1 million. That is because when people get their awards, they are not told whether they are entitled to free prescriptions. It is a simple piece of admin—will she sort it?
I thank the hon. Lady for drawing that to my attention. I am aware of the changes that need to be made and some of the things that have already been addressed, but I will write to her further to set out how we are addressing exactly what she raises.