1. What discussions he has had with the Secretary of State for Work and Pensions on the adequacy of social security spending in tackling poverty throughout the UK.
Thanks to our welfare reforms, we have been able to get more people into work, we have the lowest unemployment rate since 1974 and more than 667,000 fewer children are living in workless households than in 2010.
Some £30 billion of support to working-age people has been cut from the social security budget, and there is more still to come. Eight out of nine disabled people will not benefit from the measures introduced in last autumn’s Budget and over 4 million are living in poverty. In the Chancellor’s last few weeks in post, what will he do to right this wrong?
I do not agree with the hon. Lady’s analysis. The fact is that income inequality is lower now than it was in 2010 and absolute poverty after housing costs is at a historic low for children.
Can the Chief Secretary confirm that the number of children living in workless households is now the lowest ever record achieved in our country?
My hon. Friend is absolutely right. It is because of our welfare reforms and economic policy that more people are now in work and are benefiting from our cuts to basic rate tax, giving working families £1,200 a year extra in their pay packets.
The Chancellor has been brave recently, speaking out on how no deal will impact our economy. Poverty will only get worse if we face no deal, so will the Chief Secretary be as brave as the Chancellor and tell this House the truth about poverty and no deal?
I can tell the hon. Lady what would lead to greater poverty in this country: a Government who wanted to overthrow capitalism, declare business the enemy and ruin the private sector businesses that are employing people and giving them extra wages.
The Chancellor has been at the forefront of arguing that a decade of austerity was necessary. This has led to 24% of Scottish children and 30% of English children being in poverty. If the Chancellor believes that this pain was not ideological and unnecessary, will he vote against a Tory tax cuts for the rich Budget, as proposed by the Prime Minister’s most likely successor?
With respect to the hon. Lady, she clearly did not hear my earlier answer, when I said that absolute poverty after housing costs is at a historic low for children. That is true right across our country. Of course, the Scottish National party Government in Scotland could take steps to help children by improving educational standards; that is what they should be focusing on.
The Minister might not want to tackle inequality, but the Scottish Government do. The polls show that a majority of Scottish people support the tax changes that mean the Scottish Government can fund a £10 a week payment to families with the most vulnerable children, mitigating the ideological austerity obsession of this Conservative Government. If the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) becomes Prime Minister, 53% of Scots will support independence. And who can blame them, given the Scottish Government’s plans to support and help young people and this Government’s ideological austerity obsession?
The reality is that the Scottish Government are now forecast to bring in lower rates of income tax than expected, because they have not followed through on our raising of the threshold to £50,000, so people in Scotland on £50,000 are now paying £1,500 more tax. The fact is that raising tax reduces incentives for people to get up the earnings ladder, reduces economic growth and means that we do not have the opportunities and funding for public services.
As my hon. Friend the Member for Wirral South (Alison McGovern) said, the poorest, most vulnerable people in society, even those who are in work but struggling to make ends meet, will be hit particularly hard by a catastrophic no-deal Brexit. The Minister cannot get away with simply deflecting this into an attack, which I would share, on the economic policies of the Labour party. This is the clearest, most present danger facing our country, and surely she will not happily move towards a no-deal Brexit.
What the hon. Gentleman is missing is the fact that if we continue to delay Brexit, first, we would not be delivering on what British people voted for over three years ago; and secondly, there will be continued delay in our economy—a continued lack of investment—due to a lack of certainty.
Yesterday, the Chancellor slapped down both Tory leadership candidates for making irresponsible spending promises. Has the Minister noticed, as we have, that not one of those promises was aimed at lifting the 4 million children out of poverty? She is responsible for the management of Government finances—heaven help us! What does she think this says about the Tory party and the next Prime Minister?
I am incredibly proud of our record, as a Government, of reducing inequality. Income inequality is now lower than it was in 2010. We have also cut taxes for basic rate taxpayers by £1,200 a year and put an extra £630 into universal credit for working families.
2. What discussions he has had with the Secretary of State for Scotland on the economic effect on Scotland of the UK leaving the EU.
I regularly discuss EU exit with the Secretary of State for Scotland and other members of the Cabinet. The Government remain committed to securing a deal that works for the entire United Kingdom.
There might be two people competing to be Prime Minister, but I think there are at least five who think they will be the next Chancellor, so perhaps right hon. Gentleman should just get to stay in post and then they will all be equally disappointed. He seems to be concerned that they are somehow going to ruin his deal dividend, but is it not the truth that there is no real dividend from any Brexit, that the best possible deal for Scotland and the rest of the UK is the one we already have, which is membership, and that that is the case that he and other sensible Government Members should have the courage to be making?
I have consistently made the case and explained to this House that there is fiscal headroom within the current fiscal rules. If we have a smooth exit from the European Union through a transition that will remove the economic uncertainty that is hanging over our economy, it will then be safe to release that headroom and make it available for additional public spending or, at the choice of the next Government, to reduce taxation. Either way, we have the headroom available once we have removed the Brexit uncertainty.
Is it not the case that Scotland, like everybody else, will know the plans for future public spending, for fiscal headroom and for the economic effects overall if the comprehensive spending review were to be started sooner rather than later? Is the Chancellor able to tell the people of Scotland, the people in this House and the people beyond when the comprehensive spending review will be starting?
I announced at the spring statement that it is the Government’s intention to conduct a three-year spending review concluding this autumn, subject to a deal with the EU being completed. Departments are already commissioned to carry out the work necessary for such a spending review, but it will be for the new Government to decide whether the circumstances make it appropriate to conduct a full three-year spending review or a single-year exercise.
22. Mark Carney has warned that Brexit has already cost households up to £900, with the Fraser of Allander Institute suggesting that it could cost Scotland 100,000 jobs by 2030. Given that the Chancellor was a remainer himself, will he, as a Back Bencher—I wish him well in that, incidentally—vote against any deal removing us from the single market and customs union?
As I have consistently said in this House, I do not believe that a no-deal exit would be in the interests of this country, and I will do everything I can to ensure that we avoid it, but an exit based on a negotiated deal that allows us to continue a close trading relationship with the European Union can work for Britain, and that is what I will be arguing for.
Is the Chancellor aware that only 18% of Scottish exports go to the rest of the European Union but 61% go to the rest of the United Kingdom? Is not the Union that really matters to Scotland the Union of the United Kingdom?
Yes, my hon. Friend is exactly right. The Scottish economy would be far more adversely affected by a breach of trading relationships with the rest of the United Kingdom than it will by a breach in trading relationships with the European Union.
3. What progress the Government have made on establishing a shared prosperity fund.
5. What progress the Government have made on establishing a shared prosperity fund.
The Government will establish a UK shared prosperity fund to spread prosperity and opportunity across all four nations once we have left the European Union and the EU structural funds. The fund will seek to raise productivity, focusing on levelling up parts of our country whose economies are further behind. More details will be announced following the spending review, and the Government will consult widely on the funds.
Analysis of local enterprise partnerships by the charity think-tank NPC found that only 26% of board members were women and that only 5% were black, Asian and minority ethnic. When will the Government finally come forward with their consultation on the shared prosperity fund? Does the Minister agree that funnelling the UK fund through the LEPs would be a mistake unless they are made more representative?
We intend to consult later this year, following the spending review. Officials at the Ministry of Housing, Communities and Local Government have already held 26 engagement events and have met more than 500 representatives from across the United Kingdom. With respect to the hon. Lady’s very important point about representation on LEP boards, I should say that the LEP review conducted by MHCLG jointly with the Treasury last year did conclude that they needed to have broader representation from the groups that she mentioned—and from private sector businesses, large and small. Those rules and guidelines are now in force.
Shortly after the referendum on Europe, I asked the then Prime Minister David Cameron what would happen to the £726 million of European funding that we were due to receive in the north-east. He could not answer. We are now three years on and none the wiser about the supposed replacement—the shared prosperity fund. How can anyone have confidence in this Government and their handling of Brexit if they cannot give even that basic information to the region that is set to be the worst hit by any form of Brexit?
The people of the north-east of England voted to leave the European Union; I know that the hon. Lady takes a different view, but we are trying to deliver on the outcome of the referendum. Had she voted for the withdrawal Bill, these matters would, of course, be progressing. As my right hon. Friend the Chancellor has already said, we are guaranteeing funding to the beneficiaries of all EU structural funds to 2023, so there is a degree of certainty as we move forwards. But the sooner that this House can coalesce on a good deal and that we can leave the European Union in an orderly fashion, the sooner this matter can be cleared up.
My constituency and the rest of Cornwall continues to be one of the less developed areas, even though there is much going for where we are and where we live. What would the Minister say to my county, the Duchy of Cornwall, about how soon it can expect to really contribute to the process of the shared prosperity fund?
As I have already said, we intend to consult later this year. I strongly encourage my hon. Friend’s constituents to take part in that consultation; he and I have already spoken about this. I have met representatives from Cornwall Council, for example, to talk about the issue and some of the projects that they care strongly about—including, of course, the stadium in Cornwall, of which my hon. Friend has been a strong proponent.
Rebalancing the economy is not just about north and south or the different nations of the United Kingdom. Will the Minister ensure that the shared prosperity fund is distributed using a range of indicators, such as gross value added, the regional human poverty index and disposable income, so that areas in the west midlands in need receive their fair share?
Absolutely—those are exactly the kinds of questions that we dealt with in the consultation.
Some of the problems in our United Kingdom can be traced to the disparity between the regions and nations of the UK. Will the Minister ensure that the shared prosperity fund is not the end, but just the beginning, of ensuring that there is prosperity across the entirety of our nation?
The hon. Gentleman is absolutely right: there are disparities of income and productivity across the United Kingdom, and what he mentions will be one of the key objectives. But the shared prosperity fund is not our only intervention in this area: we are taking a range of measures, including significantly increasing the amount of public investment in infrastructure—to the highest levels in this country since the 1970s.
Despite pledges that the Government would provide details on the shared prosperity fund by the end of last year, the Chancellor has been silent on how much communities could lose from the £17 billion-worth of structural funds. The Chancellor has only now woken up to the danger, splurging nearly £10 billion, almost half that amount, on tax cuts for the well off—as advocated, of course, by the right hon. Member for Uxbridge and South Ruislip (Boris Johnson). Surely the only shared prosperity under the Conservatives is for those who are already well off.
Clearly, it is not possible to progress this matter until we have greater certainty about our exit from the European Union. Those Members of this House who want to see this matter progressed should be voting to leave at every opportunity, as we on the Government side have done. The important thing to point out on regional disparities is that this Government are investing far more than the previous Labour Government. In fact, £430 million a week more in real terms is being invested by this Government than under the previous Labour Government on infrastructure in all parts of the UK.
4. What fiscal steps the Government are taking to support the northern powerhouse.
The Government are supporting the northern powerhouse through devolution deals for, among others, Manchester, Liverpool, the West Midlands and, most recently, North of Tyne, as well as through over £13 billion of investment in better transport across the north. In addition, we have invested over £3 billion from the local growth fund in the region since 2015, and we committed at the Budget to announce a renewed northern powerhouse strategy later this year.
It is quite an achievement for the Minister to get up and say that without any sense of irony whatsoever. The truth is that we have had the incredibly disappointing news this week that Pacer trains in the north of England will not be removed by the end of this year, as previously promised. Despite the warm words about the northern powerhouse, the truth is that since 2014 spending on transport in the south of England has risen twice as fast as in the north of England. Will the Minister use the spending review as an opportunity to rectify these imbalances and finally give meaning to those words, “the northern powerhouse”?
With respect to the hon. Lady, she is not correct on the numbers. This Government are investing more in the north than the previous Labour Government. Over the course of this Parliament, central Government investment in transport infrastructure will be higher in the north of England than it will be in London and the south-east on a per capita basis. We have seen a 40% increase in central Government funding per person in the north under this Government.
Will my hon. Friend confirm that this Government have invested more than £500 million in the northern powerhouse, attracting more businesses and creating more jobs?
Over the course of this Parliament and the last, this Government will have invested £13 billion in transport for the north. With respect to Northern Powerhouse Rail, which was mentioned earlier, over the last two years we have given £97 million to Transport for the North to build the business case and prepare the ground for that project. In the course of the spending review—our zero-based review—we will be considering how to take forward that project.
My constituents in Barnsley Central and people right across the north of England will judge this or any Government on deeds, not words. Does the Minister agree with me that if the northern powerhouse agenda is to be taken seriously, we need to see schemes such as Transport for the North’s strategic transport plan, which includes Northern Powerhouse Rail, properly resourced by the national Government?
I agree with the hon. Gentleman, and that is why we have given funding to Transport for the North to prepare a properly thought-through business case. We of course have decisions to make in the spending review about which of those projects should be taken forward and which provide good value for money. In the hon. Gentleman’s own city and city region of Sheffield, we have of course given money through the transforming cities fund to improve inter-city connectivity for his constituents.
My constituency and the wider Humber region would greatly benefit if there were improved rail-freight connections east-west. What plans does the Minister have to fund those?
We have received representations from the midlands engine, and from Midlands Connect in relation to transport, about both road and rail east-west connectivity. We are considering them carefully, and they will form part of the spending review.
I spot the Leader of the House on the Treasury Bench, but I do not know whether he wants his old job back The Exchequer Secretary talks a good talk on fiscal steps to support the northern powerhouse, but the broader facts speak for themselves. Since 2015, for the first time in 50 years, the UK Government no longer provide regional investment aid in England, according to the Industrial Communities Alliance’s evidence to the Business, Innovation and Skills Committee inquiry. What is his explanation for that?
We give many other funding streams to northern communities, including £3.3 billion through the local growth fund and £13 billion for wider transport schemes.
So that’s an unambiguous no. The north is home to 15 million people in five major city regions, 265 towns and 1,000 villages and smaller communities. It has 29 universities, the UK’s largest airport outside the south-east and eight major ports, one in my constituency. Does the Exchequer Secretary agree that changing those eight ports, as suggested by the Foreign Secretary and the former Foreign Secretary, into not economic hubs of excellence but potential revenue-draining, tax-avoiding, money-laundering free ports—more like free-for-all ports—is no substitute for a focused, well-resourced and sustainable economic strategy for the north?
Perhaps unlike the hon. Gentleman, I am interested in any proposal that can drive economic growth in the north of England. Free ports are an interesting proposal, which we have discussed with a number of communities. We have urged them to come forward with well-thought-through business cases. We have yet to receive them from many places, but we have received one from Teesside and we will consider them carefully in future.
6. What estimate the Government have made of the number of promoters of loan schemes subject to the 2019 loan charge who have been convicted; and if he will make a statement.
10. What assessment he has made of the effect of the 2019 loan charge on people working in the (a) public and (b) private sector.
The loan charge tackles so-called disguised remuneration arrangements, which use loans to avoid tax. It applies in the same way to people in the public and the private sectors. A tax information and impact note published in 2016 and a report on disguised remuneration published in March 2019 both considered the impacts.
What more can be done to tackle the promoters of loan schemes who gave workers and businesses assurances, even though the Treasury had made it clear that the schemes were unacceptable? Should not they be brought to book? Have any of them been convicted yet?
My right hon. and learned Friend is absolutely right and HMRC will continue to take firm action against those who promote tax avoidance schemes. As he will know, and I think has been made public, it currently has more than 100 promoters under civil inquiry. It is important to be clear that although there are no criminal offences of promoting or marketing tax avoidance schemes specifically, HMRC may conduct criminal investigations and make referrals to prosecuting authorities where, for example, there is evidence that promoters have deliberately misrepresented the facts to it.
Perfectly innocent working people are caught in a terrible trap here and there have already been several suicides. HMRC said that “teams are trained to identify customers who are anxious, worried or need extra support to ensure they get the help they need.” Will the Minister confirm whether those people have had that training? Will a dedicated helpline be set up to help people who are under huge stress?
The hon. Gentleman is right that there is stress, but he should also be clear that a large number of people have been systematically using those means to avoid paying tax, and the potential amount payable is more than £3 billion. He should be protective of the tax base more widely when he reflects on those matters. He is right that HMRC is taking careful steps to ensure that it protects and supports those who may be in genuine difficulty, and those who have other personal concerns can of course be referred to outside agencies.
The reality is that many people caught up in the loan charge scandal were effectively mis-sold schemes that they were told had been QC vetted and were perfectly legal. That is underlined by the fact that no criminal charges are being pursued against any of the individuals who sold the schemes. Is not it time for this fresh Minister to take a fresh look at the Treasury’s approach to all this?
I think that my right hon. Friend misstates the case. A disclosure of tax avoidance number was associated with a large number of those cases. The people knew that they were in schemes that were potentially suspect. Every person is responsible for signing off their own tax return. I trust that my right hon. Friend will be reassured by the fact that recently six individuals were arrested on suspicion of promoting fraudulent loan charge arrangements. That speaks to a wider picture.
20. Economic crime defrauds the Exchequer of countless billions in revenue. Two and a half years ago, the Ministry of Justice launched a call for evidence on corporate liability for that. Incredibly, as of this morning, it says it is still analysing the evidence that it received. Clearly, cracking the problem is critical to the Treasury’s funding public services. What are Treasury Ministers doing to wake their colleagues up?
I can only admire the ingenuity of a man who can crowbar in a question about the Ministry of Justice, unrelated to the loan charge, into this issue. Let me point out to the hon. Gentleman that regardless of what may be the case on that, HMRC is taking tens of billions of pounds, relating to avoidance and evasion matters, that are due. He should be very grateful and delighted about that.
The loan charge all-party group claims evidence for four suicides relating to the loan charge and HMRC has referred itself with respect to one. When I asked a parliamentary written question on the assessment the Treasury had made of the impact of the loan charge on the mental health of the people subject to pursuit, the answer was, to put it mildly, less than satisfactory. Will the Minister now tell us what effect the Treasury believes its policy has had on the mental health of all the people subject to pursuit in both the public and private sectors?
May I put on record my surprise that a former chairman of the Public Accounts Committee, with its concern for the public finances, should take that view? Some people may have been very adversely affected in mental health terms and we must protect them at all times using all proper measures. HMRC is attempting to do that. However, there is a much larger number of people who are simply seeking to avoid paying tax due.
People were told that they could work particular jobs if they took on this way of remuneration. Will that be considered? Will the Minister take on board what the right hon. Member for Putney (Justine Greening) said and just take a fresh look at this issue?
I remind the hon. Gentleman that there were other signs that indicated to people that they were in tax avoidance schemes—for example, a very low or relatively low effective rate of tax. The signs were there and people would have been right to pick up on them. Even if they were mis-sold, that does not have a bearing on the question of whether tax is now due.
7. What steps his Department is taking to tackle stakeholders’ concerns on the roll-out of the off-payroll working rules to the private sector.
In response to stakeholder representations at Budget 2018, the Government announced that the extension of the off-payroll working rules reform would not take effect until April 2020. That was designed to allow organisations more time to prepare. The reform will also not apply to the smallest 1.5 million organisations. The Government have now consulted on the detailed design of the reform. Responses to that consultation will be taken into account when drafting the legislation.
Nevertheless, there are concerns within the private sector about the forthcoming adoption of IR35. What lessons are there from its application to the public sector?
That is a very important question. I hope my hon. Friend will be reassured. Independent research shows that the public sector reform has been meeting its objective of improving compliance with existing off-payroll working rules without disrupting public services or reducing labour market flexibility. The Government recognise that the private sector is much more diverse, but HMRC will continue to work with stakeholders to improve employment status checks and associated guidance. It will also provide a significant package of education and support to businesses to help with implementation.
It is only correct that contractors pay their fair share of tax, but the IR35 rule fails to equalise tax equally between them and employees, and is overly bureaucratic. Will the Minister join me in urging the Chancellor to ensure that the 2019 Budget and Finance Bill improve the rule or scraps it altogether?
I am sure the hon. Gentleman will be aware that there is only about a 10% compliance rate with proper tax payable in this sector. He should therefore be applauding, as I am, the means to raise the level of compliance. In many ways, this is a simplification of the rules, which is being carefully and deliberately handled.
8. What recent representations he has received from the Secretary of State for Education on the level of Government funding for early years education.
I regularly meet the Secretary of State for Education to talk about education funding. This issue will be settled as part of the spending review.
I hope the Chief Secretary has learned from those conversations and will go out to talk to early years providers. The shortfall in funding is having a huge impact. I visited a nursery in my constituency recently and it is clear that it is the staff who are bearing the brunt of it. They are on only just above minimum wage. I cannot help thinking that if the people working there were not women then perhaps their work would be valued more. Will she ensure that she makes representations, when the spending review comes, on lifting the freeze?
I point out to the hon. Lady that we are spending a record amount on childcare and early years support—£6 billion a year, which is £700 million more than in 2015—but of course we will look at representations as we go forward into the spending review and make sure we treat all parts of education fairly.
Will the Minister look particularly at funding for two-year-olds? Providers of early years education in my constituency tell me they lose money on providing that service for two-year-olds because there are significant additional costs in looking after two-year-olds but only a small uplift in the rate paid.
My hon. Friend is right to raise this issue. We will look at that. It is important to acknowledge the progress this Government have made by introducing 30 hours of childcare for three and four-year-olds with working parents and 15 hours of childcare for children with parents on low incomes. Those are important steps. Of course, we will look in the spending review at the rates and ensure they are fair right across the country.
Children with higher educational needs are losing out even more. My local authority overspent by £760,000 last year and will overspend by £1.3 million this year and £1.9 million next year. Those children need this vital support in order to grow. Will the Minister look at the funding of the higher needs budget to ensure that local authorities can support those families?
The hon. Lady is certainly right that we have seen demand for special educational needs funding rise. We need to look at that as part of the spending review, from both a local government point of view and a Department for Education point of view.
9. What steps he is taking to maintain access to cash.
I welcome the benefits that electronic payments are bringing to people and businesses across the UK. However, the Government recognise the importance of cash to many, particularly the most vulnerable members of society. That is why we have committed to safeguarding access to cash for those who need it. In the light of changing payment trends, the Government have created the Joint Authorities Cash Strategy Group. That Treasury-led group will seek to bring together the regulators and the Bank of England to inform and co-ordinate members’ activities related to cash and safeguard access for those who need it.
I recently sent a survey about access to cash to thousands of my constituents. There was an overwhelming response, because they are terrified that we are going far too fast into a cashless society. The next time the Minister meets banks, will he raise with them the impact that rural banking hubs could have on our local communities, just as the pilot business hub has had in Birmingham?
I recognise my hon. Friend’s excellent campaigning on this matter, which we have had meetings to discuss. The Government have no direct role in the matter, but we recognise the role that banking hubs have played for businesses across six trial sites. We are looking at that carefully, and I will be very happy to raise it with the banks when I meet them next.
Will the Government commit to working with cash machine suppliers to ensure that cash withdrawals remain free across the board? Charges disproportionately affect those on lower incomes, who make lower cash withdrawals.
Absolutely. We are looking into that. The Payment Systems Regulator, which was set up four years ago, is responsible for overseeing LINK. It has two schemes in place to safeguard access to cash in the most impoverished communities and to ensure that, when an ATM is vulnerable to closure, there is a responsibility to keep it open if constituents would have to go more than 1 km to access cash.
21. The town of Bungay has been without a bank branch and a free-to-use 24/7 town centre ATM since last May. That is causing serious challenges for traders, the elderly and those managing on a tight budget. Will the Minister put in place a regulatory framework to reverse this regressive trend?
I acknowledge the difficult situation that my hon. Friend has in Bungay. The Government-established Payment Systems Regulator is closely monitoring developments in ATM provision and, as I said, there are mechanisms in place to intervene. I am very happy to meet him to discuss the application of those to the situation in Bungay.
Given that post offices and credit unions provide easy access to cash, is it not now time to offer business rates relief to both to enhance the provision of cash and other affordable financial services?
Of course small businesses receive that relief. The Chancellor will have heard that representation for the next fiscal event, but it is not a matter that I can comment on specifically at this point.
11. What discussions he has had with the high street banking sector on closures of the last bank in (a) Staveley, Derbyshire and (b) towns throughout the UK.
While branch closures are commercial decisions for banks, I regularly engage with all key stakeholders on this issue and I recognise that it can be very difficult for some constituents, particularly if a branch is the last one in a community. The major banks have signed up to the access to banking standard, overseen by the Lending Standards Board, and that commits them to work with communities to minimise the impact of branch closures.
When the Government bailed out the banks, it was partly in recognition of the fact that banks were public services as well as profit-making businesses. I am disturbed—as will be the people of Staveley—by the Minister’s hands-off approach. Do not the Government either need to sit down with the banks and ensure they have a real commitment to having a bank branch in towns such as Staveley or adopt Labour’s proposal for a post bank so that we can have some Government control to make sure we have services where they are desperately needed?
I have looked into the situation in Staveley and it will be served by a mobile bank following the closure. The post office, where a 24-hour ATM is available, is just a six-minute walk from Lloyds. The number of people visiting the counter at Lloyds bank in Staveley reduced by 22% in the last year, so it is understandable why Lloyds has made that decision. The Government’s investment in the Post Office and its banking services facility is our solution.
The Minister should make no mistake: communities up and down Britain are being deliberately starved of cash and banking services as the banks, with the support of Government, are trying to create a near cashless society. Can he say a bit more about what he is doing to help the more than 1 million poorer people who do not have access to a bank account?
A bit more, but not too much more.
I recognise the difficulty and I am happy to meet my right hon. Friend to discuss the issues in his constituency. We have invested considerably in the post office network and I am meeting the Lending Standards Board to look at the mechanism for transfer to the Post Office and to consider solutions on a case-by-case basis.
12. Whether he plans to launch a three-year spending review before the summer recess; and if he will make a statement.
As the right hon. Gentleman would have heard me say if he had been in his place earlier, I announced in the spring statement that it is the Government’s intention to conduct a three-year spending review, concluding this autumn, subject to a deal with the EU being completed. He asks whether I plan to launch the spending review before the summer recess: I can tell him that Departments have already been commissioned to carry out the work necessary for such a review. It must be for the new Government to decide, in the circumstances, whether it is appropriate to conduct a full three-year spending review or a one-year exercise.
I can assure the Chancellor that I saw him give that response on television earlier. What would be the impact on the comprehensive spending review of either the proposal of the Secretary of State for Foreign and Commonwealth Affairs, the right hon. Member for South West Surrey (Mr Hunt) for a £13 billion cut in corporation tax and a £12 billion increase in defence spending, or the proposal of the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) for a £9 billion higher rate income tax threshold cut, £11 billion national insurance contributions cut and showing the public sector “some love”? Would those unfunded bribes be paid for by tax increases, cuts in services or both?
I fear that the right hon. Gentleman is manifestly asking the wrong person that question. I literally cannot answer it. The purpose of a spending review is that such matters can be looked at in the round, and the responsible way to do a spending review is first to set the envelope of what is affordable, and then to look at the different bids, which will—I can confidently predict—greatly exceed the available spending power, and prioritise. That is the difficult business of government, and that is why I am not in favour of ad hoc spending commitments or tax cut commitments being made.
The Chancellor is a clever chap, but his capacities do not include the capacity to penetrate the minds of colleagues, especially those in competitive vote-seeking mode.
Homes England indicates a current pipeline of some 15,000 community- led homes in England. That shows the significant positive impact of the community housing fund. Will my right hon. Friend confirm the continuance of the fund so that those much-needed homes can be built?
As my hon. Friend knows, we have signed off the Truro funding decision, and I am sure she is happy about that. The Prime Minister has made very clear that dealing with the challenges in the housing market is a priority for the Government, and in the spending review we will continue to prioritise funds to support both the housing market and the provision of social and affordable housing.
If the UK leaves the EU without a deal and the Chancellor is still in his post, does he envisage there being enough fiscal headroom following the spending review to give the top 10% of earners a tax cut worth more than £9 billion? Surely that is wholly unjustified.
I think the hon. Gentleman has sketched a highly unlikely scenario, but I can answer his question. We have built up about £26 billion or £27 billion of fiscal headroom, and the purpose of that headroom is precisely to protect the UK economy from the immediate effects of a possible no-deal exit. I have no doubt whatsoever that in the event of a no-deal exit we will need all that money and more to respond to the immediate impacts of the consequent disruption, which will mean that no money will be available for longer-term tax cuts or spending increases Let me go further: the Government’s analysis suggests that in the event of a disruptive no-deal exit there would be a hit to the Exchequer of about £90 billion, and that will also have to be factored into future spending and tax decisions.
I certainly agree with my right hon. Friend that we need to be careful with our spending pledges, but I think that investment spending is different, particularly when the investment is in the north. Has my right hon. Friend had time to consider our letter of 29 April—signed by 80 parliamentarians—which calls for £120 billion of investment spending over 30 years and a bringing forward of the Northern Powerhouse Rail programme?
We are committed to investment in infrastructure. One of the things that I have done in my three years as Chancellor is move the balance of spending towards investment in economic infrastructure, and we now have the highest level of public capital investment for 40 years. We have a National Infrastructure Commission to set long-term guidance for the Government on how to invest in infrastructure investment, and that will be considered in the zero-based capital spending review that sits alongside the main spending review. However, I assure my hon. Friend that this Government are committed to investing in the productive capacity of the UK economy, because it is the only way to raise real wages and living standards, and that is what government is all about.
13. What recent assessment he has made of the effect of his fiscal policy on living standards.
The Government’s decisions on tax, welfare and spending on public services have benefited households across income distribution, with the poorest gaining the most as a percentage of net income. That is supported by the distribution analysis published by the Treasury at the time of the most recent Budget.
That is nonsense. The UK is already the most unequal society in Europe, and the gap is becoming wider. In order to mitigate the worst welfare cuts and reforms, the Scottish Government are having to pay out £125 million this year alone. The Special Rapporteur on extreme poverty and human rights has said that the situation is “unsustainable”. Does the Minister agree that instead of arguing about tax cuts for the rich, Westminster needs to reverse those welfare cuts?
The United Kingdom is not the most unequal society in Europe; it is not anything like that. The Government’s policies, such as our policies of investing in infrastructure and in boosting productivity, have been designed to level up the parts of the UK that need it the most. When it comes to poverty and living standards, things are improving. Real wages have been rising for 10 consecutive months, and more people are in work. In the hon. Gentleman’s constituency, unemployment has fallen by 60% since 2010.
23. One way in which the Minister could easily help to raise living standards would be to pay those under 25 the same national living wage rates as those over 25. I know he will not announce that at the Dispatch Box, but will he tell us what concessions under-25s are given in their housing costs, insurance costs and living costs that warrant their being paid less than those over 25?
Our priority has been getting young people into work. In 2010 we inherited a youth unemployment rate of 20%; we have almost halved that. The priority for this Government will be ensuring young people get a great education; more young people are in good or outstanding schools than when we came into power in 2010, and we want them to get apprenticeships and get into work and get on in life.
14. What steps his Department is taking to help ensure that charities are able to claim timely VAT refunds.
Having run a capital project myself, I am keenly aware of the importance of good cash flow; I am grateful to the hon. Lady for her question. HMRC receives more than 2 million VAT repayment forms a year, and in 2017, the latest year for which figures are available, over 90% of them were paid within five days of receipt. A supplement is paid if it takes more than 30 days before payment is made, and HMRC also has a free dedicated charities help desk designed to help organisations with their tax inquiries.
4Louis is a charity set up in Sunderland in the memory of Louis, who was stillborn in 2009. It fundraised and built the Louis bereavement suite at Sunderland Royal hospital at a cost of £75,000, some £12,500 of which was paid in VAT. Another suite is planned at Durham at a cost of £100,000 and £20,000 of that is VAT. These huge amounts of VAT could be used by the charity to build another bereavement suite. What advice can the Minister give to it specifically on how it can attempt to get this VAT back?
The hon. Lady will understand that a range of schemes is available for some parts of the charitable sector. We recognise the concern that the hon. Lady is expressing; I cannot deal with individual cases, but obviously if she wants to write to me on the wider issue I will be happy to take it up with HMRC.
A much loved local provider of employment for my constituents with learning disabilities has been forced to consider closure after a change in interpretation of the VAT rules regarding the provision of services under the personal payments arrangements; the retrospective VAT bill of around £150,000 means that Spokes, the trading arm of the charity the Emily Jordan Foundation, faces closure with the subsequent loss of a very important local resource. Will my hon. Friend consider meeting with Chris Jordan on behalf of the charity in order to discuss a way forward that can save this incredibly important local business?
Again, I absolutely recognise the concern, although of course I am not familiar with the details. I cannot get involved in a specific case, but my hon. Friend is welcome to write to me and I will refer the matter to HMRC.
T1. If he will make a statement on his departmental responsibilities.
My principal focus is to ensure the continued resilience of the UK economy and public finances at this time of uncertainty. Thanks to the hard work of the British people, our national debt is now falling sustainably for the first time in a generation, but it is still too high and it is vital that the Government continue to get debt down to ensure that the economy is resilient against future shocks, to prevent the wasting of billions of pounds more on debt interest payments, and to avoid burdening the next generation.
Since 2013 this Government have given tax handouts worth £4.1 billion to the big alcohol corporations at a time when the NHS is short of 40,000 nurses. Would it not be a sensible choice to invest in the nurses, doctors and police officers who have to deal with the problems caused by cheap alcohol?
We have done so: by 2023-24 we will be spending an extra £34 billion a year on the national health service. That is a record cash injection to our national health service, which represents this Government’s commitment to it.
T5. Will my right hon. Friend the Chancellor confirm that he is absolutely committed to maintaining the independence of the Bank of England?
Yes, it is a vital cornerstone of our institutional structure that the Bank of England remains independent, and those who have suggested that they would seek to politicise appointments to the Bank of England would be doing a great disservice to this country and our economy.
The Chancellor, like most of us, has been watching the accumulation of spending promises by the Tory leadership candidates. They amount now—[Interruption.] They amount now to nearly £100 billion, and one of the Chancellor’s colleagues commented yesterday that they make me look like a fiscal moderate. May I ask the Chancellor what impact this level of unfunded commitments would have on his economic strategy, or can he tell us how they could possibly be funded?
There are many people who could comment on spending commitments that have been made by candidates in the Tory leadership competition, but the right hon. Gentleman is not one of them.
Let me try this one. Both Tory leadership candidates are threatening no deal. This morning, the Chancellor has eloquently set out the consequences of no deal. Bearing in mind what he said, may I ask him very straightforwardly whether he will join us and commit himself to doing everything he possibly can to oppose the prorogation of Parliament to try to sneak no deal through, and also to voting against no deal With your permission, Mr Speaker, if I may: this might be the Chancellor’s last Treasury questions and I just want to thank him for the civility with which he has always maintained our relationship. I also admit that there have been times when we have enjoyed his dry sense of humour. I gave his predecessor a little red book as a present. We have another red book today, but this is a guide to London’s rebel walks and we hope that he will enjoy it in his leisure periods.
That is very kind of the right hon. Gentleman; I much prefer this little red book to the one he gave my predecessor, although I have to say that I have not read this one and I have read the other one On the broader question, I have been consistently clear that I believe that a no-deal exit would be bad for the UK, bad for the British economy and bad for the British people. We cannot rule out that happening, because it is not entirely in our hands, but I agree with him that it would be wrong for a British Government to seek to pursue no deal as a policy. I believe that it will be for the House of Commons, of which I will continue proudly to be a Member, to ensure that that does not happen.
Hear, hear!
Thank you.
T6.   My constituent Karen Harrison-Taylor’s parents are among the tens of thousands of pensioners who are stranded in their homes due to shared appreciation mortgages saddling them with debts of up to nine times their original loan. What steps are being taken to assist those who are unfairly tied up in these schemes?
Borrowers who believe that they have been mis-sold a shared appreciation mortgage are able to take their complaint to the Financial Ombudsman Service. The Government are unable to comment on group action cases relating to this issue as we have no role in deciding whether cases may be heard in court. I note that the annual review of the Financial Ombudsman Service in 2003-04 said that in most cases it had not upheld complaints of shared appreciation mortgage mis-selling due to the information being satisfactory. That is the situation at the moment.
T2. The Chancellor of the Exchequer has much good advice given to him, but is he picking up the nightmare scenarios that I am getting from senior business people in the north of England who fear that we are heading for a new global economic meltdown? They believe that that, combined with our crashing out of the European Union, would be a disaster for their businesses and for the country.
The hon. Gentleman is right to point to storm clouds over the global economy. We tend to focus on Brexit-related issues and the domestic agenda, but I have just come back from the G20 in Osaka, and looking more widely, we can see that global growth is slowing and that global trade growth is slowing even more dramatically. A great deal hinges on finding a solution to the disputes between China and the United States. It is hugely in our interests that that dispute is resolved and that normal trading relations are resumed between the world’s two economic superpowers. As a middle-sized open economy, we are bound to be adversely affected if global trade slows down.
T7. Dean’s short- bread, based in Gordon, has been encouraged by the annual investment allowance to invest in new facilities. Does my right hon. Friend agree that this policy is stimulating business to release pent-up investment and that it demonstrates the confidence of UK companies?
I am delighted to hear the news of new investment in my hon. Friend’s constituency, and I take my hat off to Dean’s shortbread. As he knows, the two-year increase in the annual investment allowance, which the Chancellor announced in the Budget, is helping firms right across the country to invest in new plant and machinery. It gives 100% first-year tax relief on the first £1 million of eligible investments and helps small and medium-sized firms such as Dean’s shortbread to continue to grow.
T3. The west midlands has seen knife crime rise by 106% in the past five years, the average time for the Crown Prosecution Service to reach a decision has increased by 64% since 2013, and more than 2,000 police officers have been lost since austerity began in 2010. Will the Chief Secretary to the Treasury make money available to reverse 10 years of Government cuts to police services to ensure that my constituents can feel safe?
I reassure the hon. Lady that we have already put additional funding into the police grant, and we have raised spending power such that it increases in real terms. Additional surge funding has been put into the west midlands to acknowledge the specific issues in that area.
T8. I congratulate my right hon. Friend and this Government on the net zero emissions climate change commitment. What are his plans to achieve that goal?
We made an announcement this morning about our plans for green finance. Over the coming months and years, it will be essential to demonstrate how we are able to mobilise our capital markets and the instruments of a market economy to deliver on this huge enterprise. If we do not demonstrate how the market economy can provide solutions to decarbonising our economy, there are others with alternative solutions to present.
T4. During the Department for International Development estimates debate yesterday, there was a clear consensus across the House that the 0.7% of GDP aid commitment should remain and, for that matter, that DFID should remain an independent Department. Will the Chancellor restate that that remains the whole of Government policy, and does he believe that it should continue to be Government policy after 24 or 25 July?
As I think the hon. Gentleman knows, that position is enshrined in statute, and only this House of Commons could change it.
More of my Southampton constituents are in work than ever before, but many of their jobs are low-paid, with few career prospects, if any. What are the Government doing to improve employment opportunities for my constituents?
We have worked hard to build a stronger, fairer economy, dealing with the deficit that we inherited, helping people into work and cutting taxes for people, families and businesses, and the result is that the economy has grown continuously for the past nine years. Employment is currently at record high levels, unemployment is currently at the joint lowest rate since 1975, and real wages are rising again. We have created 3.5 million new jobs, but the next stage must be about increasing real wages by raising productivity, because that is the only sustainable way to raise the living standards of working people in this country.
T10. Last month, the Wandsworth food bank published its yearly report. It showed that 5,770 emergency food parcels were handed out in a year—a 76% increase over five years; that nearly half of referrals were due to problems with social security, specifically the five-week wait for universal credit; and that nearly two thirds of those supported by a food bank adviser were disabled or had a long-term health condition. The consequence of Tory austerity is that record numbers of people are relying on charity to eat. Since this is probably the Chancellor’s final oral questions in post, may I ask whether he is proud of that legacy?
The reality is that that we have got a record number of people into work. Universal credit has been shown to help more families get into work, and it has made work pay. We have also made adjustments to universal credit to shorten the wait time, and we have put in an extra £630 a week for families.
It has been a while since I asked the Chancellor about the blockchain and distributed ledger technology, so I was hoping that he could present an update on how the Treasury is embracing this new technology.
I thank my hon. Friend for his question. The UK’s digital economy is thriving and is growing 10 times as fast as the wider economy. We are pursuing a range of measures to reinforce that leading position, and that involves implementing a 10-year action plan to unlock over £20 billion in finance growth in innovative firms and a further £7 billion for research and development since 2016, with internationally competitive research and development tax reliefs to support investment.
As my right hon. Friend the shadow Chancellor has just pointed out, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) has made £30 billion-worth of spending pledges and the right hon. Member for South West Surrey (Mr Hunt) has made £13 billion-worth of pledges. The Chancellor has said it will not happen on his watch, but that seems to suggest that a magic money tree has been found in the barren soil of the no deal for which we seem to be heading I want to ask the Chancellor about the pledges announced by the current Prime Minister in the past few weeks, which unfortunately have not included any compensation for the infected blood community. How have the Chancellor and the Treasury prioritised and costed those announcements?
The Prime Minister has made a number of announcements since 23 May, including on modern slavery and mental health. All these announcements have been costed and are affordable within existing budgets for 2019-20.
What steps is my right hon. Friend taking to ensure that dementia care is adequately funded in the next spending review?
My hon. Friend makes a very good point about dementia care, which is one of the issues that will be looked at as part of the long-term plan for health. Due to the fiscal responsibility exercised by this Government, we are able to put extra money into health services to deal with issues such as dementia.
I welcome the Chancellor’s remarks about a no-deal Brexit and the disaster it would be for our country, costing jobs and livelihoods. Does he agree that both Conservative leadership candidates, who support a no-deal Brexit, should stop selling out the country to serve their own political ambitions? Will he commit to joining us in voting against a no deal when and if he returns to the Back Benches, and to voting with us on a no-confidence motion, if it comes to that, to stop a no deal?
At this stage of my career, I will not speculate on my future actions. What I will say is that the Government’s analysis shows that a no-deal exit would mean that all the regions, nations and sectors of the UK economy have lower economic output compared with today’s arrangements and compared with the White Paper scenario that the Government set out. It is important we all understand that preparing for a no deal, which is a perfectly sensible thing to do because it might happen to us without our volition, is not the same as avoiding the effects of a no deal.
Net zero emissions by 2050 is a desirable but very costly policy. Does the Chancellor agree that we must do everything to protect low-income families in my Cleethorpes constituency and elsewhere from bearing an unfair burden?
Yes. This is a huge commitment, but it is the right commitment to make. The Committee on Climate Change recommended that the Treasury should undertake a review of the funding and financing mechanisms to ensure that this huge undertaking can be funded, and that it will be funded in a way that is fair to families, households and businesses across the UK, which is exactly what we will do.
The “All Kids Count” report, on the impact of the two-child limit after two years, was published last week by the Church of England, the Child Poverty Action Group, Women’s Aid, Turn2us and the Refugee Council. The report illustrates the devastating impact of the two-child policy, particularly on working families who are unable to compensate for the £2,780 a year cut by working longer hours. Before the Chancellor leaves office, will he scrap the two-child policy and its devastating impact on families?
The universal credit policy has been designed to make sure that people who are being supported by the Government are in a similar position to families who have to make their own financial decisions based on the wages they earn every week.
The decision by the European Union to suspend the equivalence agreement with Switzerland seems to be very damaging. My right hon. Friend the Chancellor has done a fantastic job over the past few years. Will he confirm whether the United Kingdom was consulted on whether the decision should go ahead?
We have been closely involved in this issue, discussing it both in the EU and with the Swiss. I can tell the House that although on the face of it the withdrawal of equivalence had a very significant effect on the ability of UK shareholders to trade Swiss shares on the Swiss stock exchange, the measures that the European Securities and Markets Authority announced on Friday significantly mitigate the impact. So we very much hope that the European Union and Switzerland will be able to reach agreement, and of course there is a very direct relevance to the UK’s own negotiations with the European Union.
Will the Chancellor commit to enabling the 120,000 families on very low incomes who find out about a tax credit overpayment when they claim universal credit to have a fair chance to appeal against those deductions averaging £1,500 being made and to giving them a chance to raise themselves out of poverty?
I am grateful to the hon. Lady for the question, and I am happy to refer her to the welfare Secretary on the matter.
Does the Chancellor share my concern about the way some local councils are misusing Public Works Loan Board loans to speculate on commercial property, including many in Surrey?
My hon. Friend knows that I do share his concerns on this matter. The Public Works Loan Board is there to support local authorities’ capital spending. Some of the development activities of local authorities are perfectly legitimate: for example, the regeneration of urban areas. What is not legitimate is local authorities arbitraging the low interest rates of the PWLB to buy commercial property for yield, in order to develop income-yielding property portfolios. The Treasury is looking at how we can manage that situation.
Order. We have now had 20 topical questions. Whether this is the Chancellor’s last appearance at the Dispatch Box as Chancellor remains to be seen, but whether it is or not, he will always be able to tell his children that demand for him exceeded supply of him. He can say to them proudly, “I always left them wanting more of me.”
(Urgent Question): To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the Government’s response to yesterday’s protests in Hong Kong.
For a number of weeks now, the world has been watching massive yet largely peaceful protests in Hong Kong in opposition to the proposed extradition legislation. Unfortunately, a small number of protesters chose to vandalise the premises of the Legislative Council yesterday. Her Majesty’s Government strongly condemn any such violence but also understand the deep-seated concerns that people in Hong Kong have about their rights and freedoms. The vast majority of the hundreds of thousands of people who took part in the 1 July march yesterday did so in a peaceful and lawful manner The UK is fully committed to upholding Hong Kong’s high degree of autonomy and rights and freedoms under the “One country, two systems” principle, which is guaranteed by the legally binding joint declaration of 1984. We reject the Chinese Government’s assertion that the joint declaration is an “historic document”, by which they mean that it is no longer valid, and that our rights and obligations under that treaty have ended. Our clear view is that the Sino-British joint declaration of 1984 obliges the Chinese Government to uphold Hong Kong’s high degree of autonomy, and its rights and freedoms, and we call on the Chinese Government to do so. In respect of the recent demonstrations, the main responsibility for addressing this tension rests with the Government of Hong Kong, including the Chief Executive.
I thank the Minister for that statement. May I also thank you, Mr Speaker, for again allowing an urgent question on this ever-increasing and serious matter, which is heard not just in this country, but throughout the world? Last night, the hon. Member for Hornsey and Wood Green (Catherine West) organised a meeting in the House under the auspices of Hong Kong Watch, and she and I co-chaired it. It was a very well attended and, sadly, timely meeting, with more than 100 people, mostly Hong Kongers, present. The message from that meeting, especially from activists such as Tommy Cheung and Willis Ho, was clear: they worry that the Government of the People’s Republic of China will see yesterday’s events as an excuse for ever more direct intervention in Hong Kong’s affairs. They want to hear that this country will continue to stand with them against that threat Unfortunately, the images that dominated our television screens yesterday were those of the occupation of the Legislative Council building. There was much less coverage of the fact that on Monday, half a million families, young children and older people marched down major roads in peaceful protests. In his representations to Carrie Lam’s Administration, will the Minister make it as clear as possible that any consequences for the actions of the hundreds of protesters in the LegCo building should not be visited on the many thousands—in fact, millions—of people who have protested on Hong Kong’s streets in recent weeks The images broadcast around the world yesterday were ones of violence and vandalism, but they were also images of fear and frustration from people who are increasingly desperate that the world looks on at their plight and will do no more than wring its hands. Will the Minister make it clear to Carrie Lam that there is much more that she and her Administration can do to reassure her own population? It is surely clear to all that a suspension—even a suspension sine die—of the Bill to allow for the amendment of the extradition arrangements is not enough. The people of Hong Kong need to hear that the Bill has been abandoned completely The Hong Kong police have described the victims of police violence in recent weeks as rioters, when we know that they were peaceful protesters. Will the Minister impress on the Executive that such use of language must be withdrawn? Will the Executive instigate an independent inquiry into the police violence on 12 June Finally, the Chinese Foreign Ministry yesterday declared the Sino-British joint declaration to be meaningless. I welcome the Minister’s repudiation of that from the Dispatch Box, but will the Government will now consider all meaningful sanctions at our disposal, including the possible use of Magnitsky powers, to ensure that those who infringe the human rights of the people of Hong Kong will have no hiding place in the United Kingdom?
First, I genuinely acknowledge and recognise the right hon. Gentleman’s interest in and deep knowledge of this issue, and I commend him for the activity that he generates in the House, which is shared in by so many other Members from all parties. I thank him for his analysis and for what I consider to be a measured series of questions that go very much to the point. We all agree with him that any actions taken in response to the vandalism that took place should be proportionate and within the rule of law, and should not be taken against larger numbers than those who were actually involved in that vandalism As the right hon. Gentleman recognises, and as I said in my opening remarks, a lot of the ability to address the tension rests with the Government of Hong Kong and the Chief Executive Carrie Lam, in respect of the extradition legislation that has generated so much protest. Whereas we fully agree with the right hon. Gentleman that the joint declaration remains valid—again, I said that in my opening remarks—we are not here to dictate and instruct either the Chinese Government, or that of Hong Kong itself, to do what we believe they should be doing within the autonomy that has properly been granted to them. I am sure the House will appreciate the delicacy of our wanting to uphold the rule of law while having to be careful not to instruct either Government about what they should do in specific detail.
It is good to see my right hon. Friend responding on this matter; his broad wingspan now covers yet more of the planet The disgraceful behaviour of the demonstrators who entered LegCo yesterday and the misuse of the Union flag should be noted by Parliament, as should the damage done to the case that they are making. I looked at the statement by the Chinese Foreign Ministry spokesman, Geng Shuang, who said that “the SAR government decided to suspend work on the Fugitive Offenders and Mutual Legal Assistance in Criminal Matters Legislation (Amendment) Bill 2019.” He also said: “The Chinese Central Government expresses its support, respect and understanding for the SAR government's decision” Surely a period of dialogue and discussion is now required to try to reach a mutually agreed solution to this complex problem.
I am grateful to my right hon. Friend for pointing out that I am answering questions that do not normally fall within my responsibility. My wingspan has stretched wider than I or any Member would normally expect My right hon. Friend is far more expert on this issue than I am, but the one point on which we can all agree is that a period of de-escalation and dialogue would be far preferable to any continuing tension and violence. I very much hope that all those who are involved in this issue can pause for thought and try to plot a way through this without further escalating any kind of conflict.
The Hong Kong situation is spiralling out of control very fast now. It is unfortunate that, in the absence of a Minister with responsibility for the far east, the Foreign Secretary is not in his place. I agree with the remarks of the right hon. Member for Orkney and Shetland (Mr Carmichael). He set out well the events of yesterday. I want to concentrate on four questions for the Government. First, Hong Kongers have made it abundantly clear that they want the disastrous extradition laws to be abandoned for good. That is not an unreasonable request. Will the Government finally take the side of the Hong Kong people and call on Carrie Lam to scrap this legislation Secondly, I welcome and agree with the Foreign Secretary’s call for a public inquiry into the actions of the Hong Kong police force. Evidence has emerged that the order to fire tear gas on the protesters was given by Superintendent Justin Shave, a British expat now serving with the Hong Kong police, and that two other expat chief superintendents were two of the most senior officers in charge of crowd control on that day in June. What are Ministers doing to bring to book these British citizens who ordered the police brutality Thirdly, after firing rubber bullets on the protesters, the Hong Kong authorities accessed hospital data records in order to arrest them. That is random and unfair. Will the Minister join me in condemning this appalling behaviour? Clearly, yesterday, the events in the Legislative Council were unacceptable, but the police tactics appeared to have been totally confused. Finally, the root cause of the chaos is the fundamental democratic deficit in Hong Kong. The rights enshrined in the Basic Law and the promises to move towards universal suffrage are being trampled on. When will the Government listen to the voices of the citizens of Hong Kong and put democratic reform back on the agenda?
First, let me point out to the hon. Lady that, of course, my right hon. Friend the Foreign Secretary would like to be here, but there are compelling reasons for him not being here given that there are hustings for the leadership after which I very much hope that he will be picked as our next Prime Minister. The hon. Lady’s first question is a matter for Hong Kong and its Government. In respect of an inquiry, my right hon. Friend has already urged the Hong Kong Government to establish a robust investigation into the events of 12 June. With regard to universal suffrage, we believe that the terms of the joint declaration should, of course, be fully upheld.
Does my right hon. Friend accept that it is not unknown for Communist regimes to insert agents provocateurs into popular movements in order to discredit them? Will he bear in mind that the messages that we send to Communist China—for example, in sucking up to it over issues such as Huawei and our telecommunications infrastructure—need to be looked at through the prism of its human rights abuses?
It is not for me to speculate on whether agents provocateurs have been going about such business. That is a matter for the Government of Hong Kong to investigate. In respect of the Chinese Government, the Prime Minister did speak to Chinese Vice Premier Hu on 17 June, and we do speak very directly to them about Hong Kong and, of course, about human rights in general.
I thank the right hon. Member for Orkney and Shetland (Mr Carmichael) for once again raising this issue, and I thank you, Mr Speaker, for granting this urgent question. This is a deeply serious matter, and I think that that has been expressed by Members across the House. I welcome the remarks of the Foreign Secretary and of his deputy at the moment, the Minister for Europe and the Americas, that the authorities must engage in a meaningful dialogue and that the preservation of rights and freedoms are critical. I also welcome what was said by our partners in the European Union who have said that these rights need to be respected. There is never an excuse for violence—there cannot be an excuse for violence—but we must reflect on the concerns of non-governmental organisations such as Amnesty International and Human Rights Watch about the use of torture and also, as has been reflected on by the hon. Member for Orkney and Shetland, the concerns of the overwhelming majority who have undertaken peaceful protest; their voices must not be drowned out over the coming days. It is more important than ever that Hong Kong’s autonomy and the independence of the judicial system are respected. It will be good to hear the Minister’s plans to put that case, and also to urge the Hong Kong authorities to listen to legitimate concerns. The Foreign Office must do what it can to facilitate that and to work, where appropriate, to de-escalate tensions. Now is the time for calm heads.
I think that I agree with everything that the hon. Gentleman has just said. The autonomy of Hong Kong is very important. Hence we have to strike a balance between seeing what is happening but not dictating to Hong Kong how it should respond. On listening to concerns, it is, of course, the responsibility of the Hong Kong Government to listen to the concerns being expressed by their own people, but in terms of us expressing our concerns to them, we do so very forcefully and properly through proper diplomatic channels.
The Minister has couched his response in sensibly balanced terms. Does he agree that the Hong Kong Government have said that the extradition Bill will not be brought back to the Legislative Council until it lapses and that it is, therefore, effectively dead? Does he also agree that, whatever the frustrations of some protesters, the vast majority of the half a million people who marched yesterday do not want to see the vandalism that happened at the Legislative Council; and that Her Majesty’s Government should continue to balance strong support for the six freedoms enshrined in the joint declaration with support for the rule of law against violence, and encourage efforts to rebuild trust between the Hong Kong Government and the people of Hong Kong so that that the territory can revert to its peaceful and successful path under the one-country, two-systems formula?
I thank my hon. Friend for his excellent and well-informed question. His experience in the far east is very well known and understood by this House. He mentioned the procedural definition of whether the legislation is suspended or effectively dead. That is not quite for me to speculate on. From our own experience, we know the importance of procedure in this House, particularly as we are dealing with certain big issues at the moment that rely on it. As for the freedoms, indeed, the autonomy under the joint declaration is something that must be respected and not in any way diluted.
May I reiterate the calls from around the House for a calm head and for the violence that started last night to stop? What is being done to try to encourage talks between the student protesters and the LegCo? In particular, how can the Government stress the importance of young people? With just 1,200 people having a say over the leader of the LegCo, how can the concept of democracy, or even a consultation about democracy, get on to the agenda so that young Hong Kong people can feel that they have some hope?
The basic law specifies that the ultimate aim is for both the Chief Executive and the Legislative Council to be elected by universal suffrage, and that objective would be in the best interests of Hong Kong. In the meantime, as the hon. Lady sensibly says, we want to see a cessation of violence and the emergence of a dialogue, which has already been mentioned. In terms of us trying to persuade people to take those steps, I very much hope that this very moment in this House will be noticed in Hong Kong and elsewhere, so that people can see that a wider voice across the world is calling for such things.
Both Carrie Lam and the Chinese Government have repeatedly referred to the importance of upholding the rule of law in response to the protests. The Minister himself has spoken about and affirmed that principle at the Dispatch Box this afternoon, but does he agree that upholding the rule of law cannot be used as a pretext for suppressing legitimate and peaceful protest, and that when we speak about the rule of law we mean respecting absolutely the principle of one country, two systems and protecting basic civil freedoms in Hong Kong?
Yes. In addition to one country, two systems, the same principles about the rule of law that we would apply here should apply in Hong Kong—that is, that peaceful protest is legitimate and violence is something that we condemn. We can quite understand the grievance felt, and the millions of people who have been taking to the streets shows the intensity of that opinion, but in order to be effective protesters must, in their own interests, stick to peaceful protests and not allow a small number of people to destroy the credibility of their actions.
Behind the specifics of this incident, is there not a bigger, wider and more problematic concern, which is that the Chinese Communist party is fearful of losing its grip on its people? That is why it is tightening its grip—squeezing harder and harder—and Hong Kong is just a tiny aspect of that. Is there not an irony in the fact that China is trying to argue in favour of the rule of law when it constantly flouts the rule of law around the world, even though Hong Kong has done China proud over the last 50 years?
There is, of course, ample scope for analysing what is going on in Hong Kong within the broader question of what is happening in China and what role China wishes to play within China itself and across the world more widely, so the hon. Gentleman’s question is a valid one. However, with regards to the specific question we are addressing today, we should better keep our focus on trying to de-escalate tension in Hong Kong itself so that a path forward can be mapped out for the benefit of everybody there.
Is China in breach of the joint declaration?
We obviously call on China fully to adhere to the joint declaration. I hope that will lead to the implementation of the full details under the basic law.
I welcome the decision of the British Government to prohibit the sale of tear gas to Hong Kong. However, the South China Morning Post reports that approved British export licences of lethal weapons to Hong Kong include grenade launchers, mortar bombs, sniper rifles, machine guns and gun silencers. Are the British Government considering those export licences as well?
The primary focus of anything we have said so far in the context of these demonstrations has been about crowd control equipment. The Foreign Secretary announced on 25 June that we will not issue any further export licences for crowd control equipment to Hong Kong unless we are satisfied that our concerns raised on human rights and fundamental freedoms have been thoroughly addressed.
We all condemn the terrible violence that has occurred in Hong Kong over recent days. However, does my right hon. Friend agree that it is essential for Hong Kong’s future success that the full extent of its autonomy and rule of law as set out in the joint declaration and enshrined in the basic law is implemented? What more can my right hon. Friend do to encourage more dialogue between the parties in Hong Kong?
My right hon. Friend is absolutely right to focus on Hong Kong’s autonomy and upholding of the rule of law. It may well be that the most constructive way forward is to establish a dialogue in the next few days between the Government of Hong Kong and their own people that can help to reduce the tensions in Hong Kong that we have seen erupt on the streets over the past few weeks.
It is very good to see the Minister spreading his wings. In fact, I hope he will soon return to the Dispatch Box to say something about the disgraceful and disturbing decision by the Japanese to start whaling again—killing hundreds of whales this year On Hong Kong, the fact of the matter is that what we have seen in the last few days is out of character. My suspicion is, who is going to gain from instability in Hong Kong? Of course, the answer is the Chinese Government, not the Hong Kongese.
The hon. Gentleman is absolutely right that China should see Hong Kong as something that can benefit China itself. A prosperous and stable Hong Kong is not only good for Hong Kong; it is also good for China. There is a symbiosis that can be mutually beneficial. I very much hope that in honouring the terms of the 1984 agreement in the years ahead, that mutual benefit can be put into practice and that everybody can win from it.
Hong Kong is a really important partner for the UK because of our past ties and Hong Kong’s potential future prosperity. Will the Minister therefore confirm to the House that freedom of speech will continue to be enshrined in Hong Kong’s basic law as part of the one country, two systems principle, as we would expect from any partner that we trade and work with?
The basic law will not change. It is there in the 1984 agreement. I hope that all its elements will be fully upheld, and that should include freedom of speech and the proper implementation of the rule of law.
At a time when democracy and human rights are under attack by authoritarian regimes across the world, it is critical that Britain sets out clearly whose side we are on. I welcome the Minister’s statement that the Sino-British agreement is still valid, but what steps is he taking to validate that validity, as it were? Does he agree with the last Governor of Hong Kong, Chris Patten, that that might be more effective if we were not simultaneously trying to negotiate a post-Brexit trade agreement with China?
I do not think that it is really appropriate to link the two. We have the joint declaration in place; it is legally binding until 2047, and we expect China to uphold it. If there were to be a breach, we would pursue some resolution bilaterally, but in the meantime I hope that there can be an improvement of exchanges and dialogue between the Hong Kong Government and their own people to try to improve the situation that they are currently confronting.
What estimate does the Foreign and Commonwealth Office have of the number of Chinese People’s Liberation Army personnel in Hong Kong, and has there been any suggestion of an increase in that number?
I hope my hon. Friend will appreciate that I am not in a position to give him an exact number. In as much as we have such an estimate, I will certainly write to him and give him the benefit of what we believe we can pass on.
I welcome much of what the Minister has said today. Of course, we cannot in any way condone the vandalism or violence of recent days, but the Minister will be aware of assertions that those who are in control of the police have orchestrated the police response over the past 24 to 36 hours to aggravate the consequences of the situation. Will the Minister comment on whether he has any evidence that those assertions are true?
I am unable to confirm that I have any such evidence; I have not been advised as such. Obviously, it is very much our view that any police response should be proportional and lawful. Of course, if the demonstrations are peaceful, we hope that no such violent, or forceful, response is in any way needed, but if there are acts of vandalism, that would then put any such engagement into a different context.
While the escalation in violence in Hong Kong is deeply regrettable, and every effort should be made to de-escalate it, it is clear that there is continuous provocation by the Chinese side, particularly with regard to the repudiation of the validity of the 1984 Sino-British joint declaration that underpins the highly successful one country, two systems structure that has guaranteed Hong Kong’s success. Far from simply asserting Britain’s continued recognition of that declaration, what will we do to enforce it in practice?
We are not a position to, as the hon. Gentleman puts it, enforce it, but if there were a breach, as I said, we would engage China in a proper bilateral discussion. We speak very forcefully and loudly about upholding the 1984 agreement, and, in doing so, the hon. Gentleman is absolutely right in what he calls for.
Before I make my statement, Mr Speaker, I hope you will allow me to send my best wishes—and, I am sure, those of the whole House—to the Lionesses in advance of their semi-final match this evening. As you know, sport so often brings us together. The men’s football team did so at their World cup last summer and the women are doing so at their World cup this summer. We salute them for that. We congratulate them on their successes so far and wish them well for the game tonight This statement is about today’s announcement on support for those affected by problem gambling. While we all want a healthy gambling industry that makes an important contribution to the economy, we also need one that does all it can to protect those that use it. Problem gambling can devastate lives, families and communities. I have met those who have lost more than the UK’s annual average salary during one night of gambling online, and parents who are now without a child as a result of gambling addiction Over recent months, I have also met representatives from the gambling industry and colleagues from right across the House to discuss what more needs to be done. We can all agree that it is best to prevent harm before it occurs and to step in early where people are at risk, but we also need to offer the right support for those people who do experience harm. We have already acted to reduce the minimum stake on fixed odds betting terminals to £2 from £100. We have tightened age and identity checks for online gambling websites—an important step in protecting children and vulnerable people who may be at risk Today, five of the biggest gambling companies have agreed a series of measures that will deliver real and meaningful progress on support for problem gamblers. This announcement has been welcomed by the Gambling Commission, GambleAware and Gamban. These companies, together, represent about half of the British commercial gambling industry. At the heart of this package is a very significant increase in their financial contribution to fund support and treatment. Last year, voluntary contributions across the whole industry to problem gambling yielded less than £10 million. Now, five operators—William Hill; Bet365; GVC, which owns Ladbrokes Coral; Flutter, formerly known as Paddy Power Betfair; and Sky Betting & Gaming—have said that over the next four years they will increase tenfold the funding they give to treatment and support for problem gamblers. In this same period, they have committed to spending £100 million specifically on treatment. The companies will report publicly on progress with these commitments, alongside their annual assurance statements to the Gambling Commission Last week, as the House knows, NHS England announced that it is establishing up to 14 clinics for those with the most complex and severe gambling problems, including where gambling problems coexist with other mental health problems or childhood trauma. It has also been announced that the first NHS problem gambling clinic offering specific support for children is set to open. The funding announced today enables a huge boost for the other treatment services that complement specialist NHS clinics, and it will help us to place an increased focus on early intervention I know that Members across the House have argued for a mandatory, statutory levy to procure funds for treatment and support of problem gambling. I understand that argument. However, as the House knows, legislating for this would take time—in all likelihood, more than a year—to complete. The proposal made this morning will deliver substantially increased support for problem gamblers this year. It may also be said that receipts from a statutory levy are certain and those from a voluntary approach are not, but it is important to stress two things. First, these voluntary contributions must and will be transparent, including to the regulator, and if they are not made, we will know. Secondly, the Government reserve the right to pursue a mandatory route to funding if a voluntary route does not prove effective This is a clear financial commitment from industry to addressing the harms that can come from gambling. But this is not solely about spending money: it is a package of measures spanning a number of different areas to ensure that we tackle problem gambling on all possible fronts. First, a responsible gambling industry is one that works together to reduce harm and wants customers to be safe, whichever platform they use or however they choose to gamble. The companies already identify customers whose gambling suggests they may be at risk and take steps to protect them—their licences require this—but they will go further. We have already seen the successful launch of GamStop, the multi-operator self-exclusion scheme. I am pleased that companies have committed to building on this through the greater sharing of data between them to prevent problem gamblers from experiencing further harm Secondly, the five companies will use emerging technology to make sure that their online advertising is used responsibly. Where technology exists that can identify a user showing problem gambling behaviours, and then target gambling adverts away from that person, they have committed to using it. More generally, the industry has already committed to a voluntary ban on advertising during live sport during the daytime that will come into force next month Thirdly, operators have committed to giving greater prominence to services and campaigns that support those in need of help. They have pledged to increase the volume of their customer safer gambling messaging; to continue their support for the BetRegret campaign, which is showing promising early results; and to review the tone and content of their marketing, advertising and sponsorship to ensure that it is appropriate These are welcome commitments that represent significant progress in the support that operators give for those impacted by problem gambling, but as technology advances, we will need to be more sophisticated in how we respond. The five companies that have proposed these measures today will be working closely with the Government, charities and regulators so that we can address any new or developing harms. I commend the leadership of the five companies who have put these measures forward. They are proposals from some of the industry’s biggest companies. I believe that it is reasonable for the biggest companies with the largest reach and the most resources to do more and show leadership, but the industry as a whole needs to engage in tackling problem gambling, and we want other firms to look at what they can do to step up. And I repeat: it will remain open to the Government to legislate if needed, so this is not the end of this conversation. We will keep working hard as a Government to make sure we protect users, whether online or in the high street There is still much more to do, but today’s announcement is a significant step forward. It means substantially more help for problem gamblers, more quickly than other paths we could take. We must and we will hold the companies that have made these commitments to them, and we will expect the rest of the industry to match them. They will change lives for the better and contribute to the ongoing work we are doing to make gambling safer for everyone. I commend this statement to the House.
The whole House is united in supporting the Lionesses in their game at 8 o’clock tonight. The Opposition believe that we must capture the energy created by women’s football; 10 million people will be watching tonight. That is why we think that the next women’s World cup should be added to the “crown jewels” list of free-to-air sport I thank the Secretary of State for advance sight of his statement. Last September, Labour announced that we would introduce a 1% mandatory levy on gambling companies to pay for research, education and treatment of problem gambling. We stand by that commitment today: only a mandatory levy will do I am glad that the gambling industry has sat up and listened to what we and other campaigners, on both sides of the House, are saying on this issue. Credit where it is due: the big five companies have shown leadership and responsibility, which are sorely lacking in some other parts of the industry. Gambling addiction costs the economy an estimated £1.2 billion a year, yet the amount that the industry currently contributes to treating addiction is paltry The voluntary levy, as it currently operates, asks for 0.1% of gambling yield. That target is never met. The industry turns over £14.5 billion a year, yet contributes less than £10 million a year to GambleAware. Some companies contribute amounts that are, frankly, insulting to the voluntary system. SportPesa, which sponsors Everton, and Fun88, which sponsors Newcastle, gave only £50 each last year. Both are white labels of the company TGP Europe. Best Bets gave £5, while GFM Holdings Ltd gave just £1. Given that there are 430,000 gambling addicts, 55,000 of whom are children, that is completely unacceptable and deliberately insulting to those leading players in the industry who are trying to take responsibility. Will the Secretary of State tell us how he will make such companies take more responsibility if not through a mandatory levy The Secretary of State for Health and Social Care now supports a mandatory levy; Simon Stevens, chief executive of the NHS, supports a mandatory levy; the Gambling Commission supports a mandatory levy; and Gambling with Lives supports a mandatory levy. However, I cannot quite understand from his statement whether the Secretary of State, who has responsibility for this policy area, supports a mandatory levy—does he or not? We in the Opposition believe that a mandatory levy is the only way to provide the structure and consistent funding that a proper system of research, education and treatment needs, and with the NHS at the heart of the process. In the announcement today, the so-called big five have said they will fulfil the 0.1% donation to GambleAware, but where will the rest of the funding go? Who or what will establish the proper clinical models and guidelines for service provision? Can the Secretary of State tell us how the Government will ensure that the money does not just go on the companies’ pet projects After today, we will still have inadequate regulation and a Gambling Act that is outdated and not fit for the digital age. Gambling companies licensed in the UK are sponsoring UK football teams yet operating entirely abroad, behaving irresponsibly and fuelling addiction in countries such as Kenya. Companies are allowing customers to lose tens of thousands of pounds on multiple credit cards in a single sitting. There are companies that bombard customers who try to self-exclude with advertising emails and offers of free bets, then make them sign non-disclosure agreements when they settle The gambling market is broken, and it is up to the Government to fix it. We do not need a voluntary patch, but a full overhaul of rules and regulations. I fear that the Secretary of State and the Government will fail in that task.
I am grateful to the hon. Gentleman for some, at least, of what he has said. I reassure him on a number of points. First, as he says, he has always been in favour of a mandatory levy that will raise 1% of gross gambling yield. The commitment being made by the five companies in question this morning is to fund 1% of gross gambling yield, so they are offering him what he has asked for. It seems sensible and reasonable to accept that that is what they are doing; I shall come to his other points about where the money goes in a moment It is also right, as the hon. Gentleman says, that the rest of the industry needs to do better—I said as much in the statement. It is important that other companies follow the example set by the five who have spoken this morning. They need to take more responsibility in the way that he suggests. As I have made clear, we do not take off the table a mandatory levy, particularly for those companies that are not prepared to proceed on a voluntary basis as the five now are I do not doubt that the reason why those five are proceeding in this way is a result of pressure applied by many in this House, including those of us in government who have met repeatedly with them to make clear what our expectations are and to say that, if those expectations are not met voluntarily, they will be met in other ways. I make the same clear to all those companies that have not yet come forward as those five have The hon. Gentleman makes the fair point that people will want to know that the funding goes to the right places and does not simply find itself recycled back into the budgets of the five companies. As a result of what has been announced today, there will now be consultation with the NHS, the Gambling Commission, GambleAware and others on where the funding should go. Those organisations, of course, are best placed to indicate where the funding can best be used. Then, of course, it will be for the Gambling Commission to audit how that spending is distributed so that we all know where it is going and we can all judge whether it has been sent to the right places. If it has not, we reserve the right to continue to act in a different way.
Some years ago, as shadow Secretary of State for Culture, Media and Sport, I was sitting where the hon. Member for West Bromwich East (Tom Watson) is now. I witnessed the then Labour Government and their mammoth explosion of gambling, both online and elsewhere Despite repeated warnings, successive Governments have failed to tackle what is a pernicious problem, particularly among less well-off people. Historically, people with gambling and other addictions who have health insurance or money can get treated, so I very much welcome the fact that some of these companies are now going to fund treatment for the less well-off. But will the Secretary of State say a little more about how he envisages these clinics? Will they be sustained on a long-term basis? What is the geographical spread? Will the money be hypothecated? Critically, will the NHS match the money from the five companies to date I welcome the move today, but I have to say that I am not convinced that we will not need some kind of mandatory levy in the longer term.
I am grateful for my right hon. Friend’s comments. He is right to be sceptical: we are all sceptical and remain sceptical in government about this. However, it would be wrong not to recognise the significant step forward that this announcement represents In answer to my right hon. Friend’s point about hypothecation, I should say that it has been made clear that £100 million of the money announced today will be reserved for treatment over the four-year period. We will want to make sure that the requirements for treatment are met via this contribution and those that we expect the rest of the industry to make As I mentioned in the statement and as my right hon. Friend knows, commitments have already been made by my right hon. Friend the Secretary of State for Health and Social Care to spend money on gambling, which is a recognised and real health problem. The money I have announced today is to supplement that. We must make sure that there is not duplication but rather that these contributions reinforce the money that is already committed.
I thank the Secretary of State for foresight of his statement. I appreciate the progress that is being made. Having discussed many of these issues with the Secretary of State and his Department, I genuinely believe that he gets it and is improving the situation, but I would take issue with a number of points. The statement touches on the argument for a mandatory levy, but undermines it by saying that it would take a year to complete. That reminds me of the old adage that my hon. Friend the Member for Falkirk (John Mc Nally) often reminds me of: “When is the best time to plant a tree? Twenty-five years ago.” If we do not start now, we will not be any closer a year from now. Is the Secretary of State suggesting that the gambling companies would withdraw their offer? If not, there is nothing to lose by starting the ball rolling now. What we have now is an unacceptable compromise. Any amount that cannot be guaranteed, cannot be budgeted. If we are to provide education, research and support, it cannot be done piecemeal. We need to employ people, provide training and rent premises, and we need a strategy that can be followed over a five, 10 or even 15-year period. A voluntary levy does not provide such a platform. There is no continuity or security This offer is an attempted pay-off—a bribe—to appease the conscience of the gambling industry, and it takes the heat off. I fear it also allows the UK Government to absolve themselves of their responsibility. It leaves the commissioning of services to organisations favoured by the Gambling Commission, which is funded by the gambling industry. That is not a good model for commissioning harm-reduction services, or education and research. Will the Minister review the role of the Gambling Commission and its funding model to make sure it is effectively regulating gambling companies, including by legislating, if necessary, to ensure that responsible working practices are in place The draft statement says: “I have met users who have lost more than the UK’s annual average salary on credit cards during one night of gambling online.” Are we going to address gambling on credit cards? I see no word on that. It mentions fixed odds betting terminals, for which the maximum stake was set at £2, but let us not forget that the gambling industry was dragged kicking and screaming to the table on that particular one. I hope the same will not be said about harm reduction in years to come.
The hon. Gentleman started his comments with the mandatory levy. He is right, of course, that it will take time to do this. If someone is interested in how quickly they can do things, the sooner they start, the sooner they finish. All of that is true. I said it would take at least a year; it may in fact take nearer to 18 months because any of these changes will need to begin at the start of a tax year A mandatory levy would deliver a return of 1% of gross gambling yield. What is being put forward today—except by only five companies, but that represents about half of the commercial gambling industry—is exactly for that: 1% of gross gambling yield. We would not derive any more income from a mandatory levy than we will from this process, but via this process we will derive it more quickly, and that is a real advantage for the problem gamblers whom I know he and I are both very concerned to help I do not accept that this is a piecemeal commitment. It is a four-year commitment, which we—all of us; not just the Government—will have the opportunity to monitor. If it is not being met in the way we all expect, we can and will take further action The hon. Gentleman is right that the Gambling Commission receives its funding from the industry; that is generally the case with regulators. If we had a mandatory levy, it would still fund the same activities. However, I believe the Gambling Commission is the right body, as the regulator, to be able to give us the assurance, which the Opposition spokesman properly raised, that the money is being spent on the right things, not simply ploughed back into the activities of the five companies. The hon. Gentleman knows I take the view that there is more to do in relation to gambling on credit. He knows, too, that the Gambling Commission is in the process of looking at this in detail. I want to see what it concludes, but I believe a lot more can be done on gambling on credit to make sure that those who are particularly vulnerable do not find themselves more vulnerable by gambling on credit.
The Opposition spokesman mentioned an estimate of 55,000 children addicted to gambling. Do the Government accept that this terrifically large figure is accurate? If so, what proportion of it is a result of the advent of online gambling and what age verification measures are in place to supply at least part of the solution?
My right hon. Friend makes a very good point. It is difficult to be precise about the number of young people in particular who have problems with gambling, as my right hon. Friend will recognise, but it is a fair assumption that online gambling contributes significantly to that problem. As a result, we have already seen improvements in identification and age verification. We need to see further improvements to make sure that the trend decreases.
I have been contacted by the family of a constituent who is addicted to online gambling and is trying to recover. There are some measures, to which the Secretary of State referred, to prevent online gambling, such as the website GamStop, which allows users to put controls in place to restrict their gambling activity. However, it is not compulsory for betting companies to sign up for this, and it is far too easy to bypass the current controls. Will the Secretary of State look at making GamStop mandatory, and will he support tougher controls?
We will certainly look at what more we can do. The five companies we have talked about are signed up to GamStop, and it is important that more accept this as a useful mechanism to help those with problem gambling. It is also right that we look at banks to make sure mechanisms are in place to allow the people who choose to do so to indicate to their bank that they do not wish to spend money in these areas. We have already seen banks such as Monzo and particularly Barclays, which is a large bank, doing exactly this. Other banks are now looking at it, at our urging, because it is important that we have additional safeguards in place.
While I understand the arguments made by the hon. Member for West Bromwich East (Tom Watson) and sympathise with many of them because they are in the spirit of my ten-minute rule Bill, I cautiously welcome the Secretary of State’s statement, because I believe it will deliver money to start proper independent research and analysis on what can and should be done to protect the vulnerable With caveats, may I ask my right hon. and learned Friend to confirm: first, when will the voluntary levy start happening; secondly, can it be front-loaded, so that there is a pool of money to do the research as soon as possible; thirdly, who will determine who does the research; and, fourthly, how will those who have not yet volunteered be implored to join the party and to contribute a voluntary levy? Lastly, and slightly separately, what progress has been made on a ban on all gambling adverts during live sports?
Perhaps I may start at the end. My hon. Friend will know that in a few weeks—on 1 August—we expect to see instituted a ban on advertising during the currency of live sporting events before the watershed. Progress is being made, and we are pleased to see it I thank and pay tribute to my hon. Friend for the considerable pressure he has continued to apply to the industry. As I mentioned earlier, I believe the credit for this announcement goes not just to those making it, but to the many Members of this House on both sides who have applied consistent pressure to the gambling industry My hon. Friend asks when the voluntary levy will begin. As I indicated, one of the advantages of this approach in comparison with that of a mandatory levy is that we will start to see the fruits of it very shortly. By the end of this year, we expect to see additional funding coming through for the targets we wish to see addressed Secondly, my hon. Friend asks about front-loading. Of course, we want those who are going to be able to use this money to be able to set the parameters for how it should be used, so we must make sure that demand is met. At the moment, it is not likely that those who would be spending this money could spend £60 million a year. However, we of course want the industry to be receptive to requests for money as and when they are made, and it has indicated that it will be, so we must make sure we meet demand as it grows Thirdly, in relation to research funding and who will decide where it should go, as I have indicated, it will be for the industry to propose where this money should be spent, but it can be spent only in areas where the Gambling Commission and indeed others believe it is appropriate expenditure.
Last Friday, the inquest opened into the death of my constituent Jack Ritchie and I spoke to his parents shortly before the statement. He is one of too many young men who have taken their lives as a result of gambling addiction The BBC reports that a gambling industry spokesman has said that the welcome but modest—let us admit that it is modest—action today is to protect it from further, tougher action from us such as that on the tobacco industry. The gambling industry is right to draw the comparison with tobacco because it makes billions by creating misery and taking lives. Does the Secretary of State therefore agree that we need to go further? That would include banking the concession on the voluntary levy, but preparing now for a mandatory levy; effective, independent regulation of gambling products, and moving towards the comprehensive ban on advertising and sponsorship that applied to tobacco?
I am grateful to the hon. Gentleman. As he may know, I have met Jack Ritchie’s mother, and I am grateful to her, too, for the considerable work she has done with immense dignity and courage in this field. I reiterate that the credit for the changes is to be shared widely. It is not simply for those in the House to take; it is for many beyond it, and Jack Ritchie’s parents are foremost among them The hon. Gentleman’s points are fair. I will not comment on what people may have said to the BBC. We must stick to the facts of the proposals and what they really mean, which is that we will recover from those five companies—as I have said, they comprise about half the commercial gambling industry— at least the same amount of money as we would if we had a mandatory gambling levy. There are questions about how we can be sure that the money finds its way to the right targets. We have sensibly dealt with those this afternoon and we will need to keep our attention on them. However, the amounts involved are similar if not identical to those that a mandatory levy would recover The proposals do not protect the industry from tougher action, and we will need to pursue matters further in a variety of ways—through advertising and other protections. We are not insulating anybody from further action on gambling. The Government will continue to do what we believe it is responsible to do to protect those who are vulnerable. However, it is fair to accept that the proposals are a significant step in the right direction and will produce a significant step up in the funding that gets to those who most need it, whose lives have been damaged by problem gambling and who require help now. The change will help us to deliver that assistance.
I thank the Secretary of State for the statement and the progress that he and the Department have made on this urgent problem, which blights the lives of many people in my constituency. Will he explain the steps that he is taking to ensure that the rules around online gambling keep pace with those for offline gambling?
Yes. My hon. Friend is right that we all need to address the increasing prevalence of online gambling in the mix. She will know that the Department is currently concerned with a variety of so-called online harms, which we are trying to address more successfully than has been done thus far. However, one of the advantages of online gambling is that those companies know more about their clients because it is account-based gambling. Our expectations of them should therefore be higher, and they are.
It is right that the gambling industry fulfils its responsibilities in tackling addiction, so today’s news is welcome, but I agree with my hon. Friend the Member for West Bromwich East (Tom Watson) that much more needs to be done Will the Secretary of State acknowledge the unique position of horse-racing and its relationship with gambling in terms of the levy, sponsorship and live advertising? Does he also agree that millions of people like me enjoy a flutter on the gee-gees, a bet on the football and a visit to the casino or arcade without any difficulties, as an enjoyable pastime?
The hon. Gentleman is right. It is important to recognise that not all gamblers are problem gamblers and that we must focus our attention on those who are in difficulty. It is also right to recognise that, as I said at the outset, we want the industry to be successful. However, we also want it to be responsible, and I believe that the changes will lead to greater responsibility. The hon. Gentleman is also right to focus on horse-racing. I know that he is a huge supporter of the industry and does a great deal in this place to raise awareness, which he has done again today. He will recognise that the Government have introduced several measures, including last year’s changes to the levy itself, which brought in substantially more income—about £45 million more. We want to ensure that gambling can continue for those who enjoy it and do it responsibly and that companies take full responsibility for ensuring that any problems are properly addressed.
I welcome today’s announcement, which will lead to the biggest injection ever of funds to help with the treatment of problem gambling. I also welcome the commitment to take further action if required. Will the Secretary of State comment further on how we can use data to help solve the problem of gambling, particularly working with banks, credit card companies and the online sites, perhaps providing for the voluntary allowing of the use of data when people sign up to them?
My hon. Friend is right that we are in danger of missing some of the other important aspects of what has been proposed today. One of the proposals is that companies should share between themselves, with the consent of the individual gambler, information on any warning signs about problem gambling so that action can be taken by any provider of gambling services to which a problem gambler turns after starting with a different operator. It is important that that data is made use of so that people can be helped as soon as they arrive at the second gambling operator. If we can get consent to share that data, that will be a significant step forward.
First, I associate myself with the Secretary of State’s remarks about the Lionesses. I have enjoyed their performances, with the obvious and I am sure understandable exception of the Scotland match I give the statement a small welcome. It goes some way towards addressing the problem, but not nearly far enough, and Liberal Democrats will continue to argue for a compulsory levy. Gambling addiction is a public health problem, with clear links to mental health issues, and it needs a public health response first. The real cuts in public health under the Government are estimated to be between £700 million and £1 billion. Does the Secretary of State believe that today’s commitment will somehow help reverse the damage done by the Government?
First, I acknowledge the hon. Lady’s gracious comments about the Lionesses. I appreciate that she would not have enjoyed their first match, but I hope that she enjoyed the subsequent matches much more The hon. Lady is right that we are considering a public health problem. As I said a moment ago, the Government are approaching it as such, and further action will be taken in the NHS plans to deal with problem gambling, for both adults and children. She is also right about the significant overlap with mental health problems, which of course we need to address in parallel. The money we are discussing is to enhance and add to that provision, not to replace it. It is important to say that. It is £100 million that will be diverted to treatment over four years and I hope that it will add considerably to what can be done for people who suffer from those serious problems.
I invite the Secretary of State to consider a mandatory levy from a slightly different point of view. In the statement, he rightly said that the five companies represent half the British commercial gambling industry. Would not it be fairer, under a mandatory levy, to spread that contribution across the whole industry, bringing everyone on board sooner rather than later, rather than expecting those five to pick up the bill for others, including overseas companies?
The point is that those companies are taking the action voluntarily. I welcome that positive step forward. However, no one in the House has said that that lets anybody else off the hook—quite the reverse: it demonstrates that if those five companies can do it, so can others. It is important that all others across the industry look carefully at the proposals and that we hold them to account for producing a similar commitment. If they are unwilling to do so, I have made it clear that we do not put away the prospect of further action.
The growing nightmare of online gambling, which is destroying lives and families, has been successfully halted in places across the world, in Germany and elsewhere, by simply banning it in law. May I suggest to the Secretary of State that the problem of online gambling could be solved at a stroke simply by making all gambling cash only?
I think there is a different set of questions in relation to online gambling as an entire concept and gambling on credit. As the hon. Gentleman has heard me say, there is more we can look at specifically in relation to gambling on credit. I think we have to accept that the industry, like all others, is changing. As we live more of our lives online, people wish to exercise their leisure activities more online. I do not think it would be right to suggest that we should prohibit people entirely from gambling online if that is what they wish to do. As has been observed, most gamblers are responsible and able to gamble in a way that does not put them in difficulty. However, for those who do not have that capacity and do get into difficulty, we need to offer help. That help needs to be funded by the industry. That is what is being proposed here. For the rest of the industry that is not prepared to make the same commitment, we need to take further action.
The gambling industry is one that disproportionately preys on communities with the least disposable income and least able to afford the social harms caused. Glasgow, which is home to 26% of Scotland’s most deprived communities, has the highest per capita density of betting shops of any part of the UK outside London. Indeed, there are 2,588 people per betting shop in Glasgow, compared to the richest council area in Scotland where there are 12,000 people per betting shop. There is a clear statistically significant correlation with the impact that is having on poorer communities. In Glasgow, the social harms of gambling addiction alone are estimated to be £35 million a year. That accounts for half the revenue proposed to be generated from the levy. It is certainly inadequate to deal with the extent of the social harm caused. What will the Secretary of State do to redress the £35 million loss and social harm to the city of Glasgow?
The Government need to do a number of things, and I indicated that there are actions we need to take in relation to the health service, but I believe that a substantial amount of the responsibility lies with the gambling industry itself. Again, I stress that this is a very considerable increase in the funding that is being offered. The £100 million is what is specified over those four years for treatment, but the general commitment is to 1% of gross gambling yield—exactly the same commitment that is asked for by those who argue for a mandatory levy. This is an acceptance by the industry that it bears a share of responsibility. I hope the hon. Gentleman will not get the sense from anything I have said that the Government intend to let up the pressure. We do not.
The online gambling problem is significant, but betting shops present a problem on the high street. Will any of the levy go to help local authorities to tidy up the high street not just physically but in terms of crimes committed in the vicinity, such as drug dealing and violent acts, which do break out a lot around betting shops?
The hon. Lady is right to draw attention to the wider issues that occur. She will recognise that the commitment being made here and the conversation around the mandatory levy relates specifically to research, education and treatment. It is focused on those who are already problem gamblers and who need assistance in its treatment sense and in a research sense more broadly. We expect all partners—there are many—to work together to deal with some of the social problems she has identified. I take the view that the gambling industry is one of those partners.
I, too, give a cautious welcome to the Secretary of State’s statement. It is good news, as everyone says, that £100 million over four years has been pledged by gambling firms. However, does the Minister believe that that is not enough? Does he agree that the best way of dealing with this is not through a voluntary levy based on the least that can be gotten away with, but, rather, additional tax legislation on every gambling firm—those that have committed and those that have not—to help offset the cost to the NHS of dealing with gambling addiction?
The hon. Gentleman notes that the £100 million is specifically in relation to treatment, but more money is being pledged than that. He is right to draw attention to tax. As he will know, tax measures are already in place to derive revenue from the gambling industry. They raise about £3 billion a year at the moment and it is open to any Government to reconsider the tax regime if they think it appropriate to do so. At the moment, however, I believe we should approach this with an open mind. We should seek to ensure that not just these five companies make the contributions they are offering but that the rest of the industry does so too, so we can funnel that money to where it is most needed.
On a point of order, Madam Deputy Speaker. I would very much welcome your advice. You will be aware of the considerable issues with the Department for Work and Pensions processing all manner of benefits, including universal credit and employment and support allowance, and the huge impact delays can have on people across the country who are left in extreme poverty as a result. Sadly, yet another of my constituents is affected by what I can only see as incompetence. I wrote to the DWP on 18 April asking when my constituent John Russell could expect an answer to a personal query about his employment and support allowance of several months before. Despite several contacts, he has not yet received a reply. My own intervention has been ignored by the Department for some 13 weeks, even though we have chased it up. Can you tell me how I might break through this barrier of ignorance and get my constituent the answers he needs?
I thank the hon. Gentleman for his point of order and for giving me notice of it. It is obviously very concerning that it appears that the Department for Work and Pensions has been unresponsive to the concerns he has quite properly raised on behalf of his constituent. He has raised those concerns and they are on the record. I very much hope that those on the Treasury Bench have heard those concerns and will report them back to the DWP as a matter of urgency.
On a point of order, Madam Deputy Speaker. I wonder if you might be able to give me some advice. It has come to my attention that yesterday marked the 80th anniversary of the noble Lord Dubs of Battersea arriving in Britain on the Kindertransport on one of the last trains from Czechoslovakia. I wonder how I might be able to place on the record my admiration for Alf and his contribution to British political and civic life over many years, and to pay tribute to him from his many friends in this place.
I thank the hon. Gentleman for that point of order regarding a former Member of this House. I would say that he has very successfully expressed the views of the House and all our admiration for Lord Dubs.
I beg to move, That leave be given to bring in a Bill to entitle women aged under 40 and with a family history of breast cancer to breast cancer screening services; and for connected purposes May I begin by putting on record my thanks to the charity Breast Cancer Now, which has given me such a great amount of support in preparing the Bill? I thank my hon. Friend the Member for North Warwickshire (Craig Tracey) and the all-party group on breast cancer for their support. I thank all cross-party MPs who are backing the Bill. Even the Whip on duty, my hon. Friend the Member for Bury St Edmunds (Jo Churchill), is a two-time survivor of breast cancer. The issue affects so many in this House and I am grateful for such great support for the Bill I was moved to introduce the Bill thanks to an incredible young lady called Nicola Morgan-Dingley. Nicola was one of the most inspiring young women I have ever met. She was a healthy 36 year old non-smoking, marathon-running wife and mum when she was diagnosed with triple negative breast cancer, or as she called it on her blog, “the killer boob”. She came to see me not just about her own care, but about the care of all the other young women across the country. She had a passion, a calmness and a sense of spirituality that I have rarely seen in anyone. It was impossible not to want to help her I raised Nicola’s campaign with the Prime Minister at Prime Minister’s questions, and Nicola and I went off together to see the Health Secretary about her campaign to ensure that young women get the early screening and early detection that could save their lives. As we sat on the terrace after that meeting, and Nicola enjoyed a glass of wine and we put the world to rights, I would never have guessed that just two weeks later, at the age of 38, Nicola would lose her battle with cancer. I am here today as a tribute to Nicola, to carry on her campaign with what I am calling Nicola’s law The good news is that we are winning the war on cancer—more women are surviving the disease than ever before—but breast cancer remains the leading cause of death in women under 50 in England and Wales, with more than 920 losing their lives to the disease in 2017. Breast cancer is the UK’s most common cancer, with around 55,000 women and 350 men—it does not just affect women—diagnosed each year in the UK, and it is estimated that 5% to 15% of cases are linked to a family history of the disease We all know that the sooner a cancer is identified, the sooner treatment can begin and the greater the patient’s chance of surviving, so early detection is surely a vital part of any national strategy to reduce breast cancer deaths. Professor Gareth Evans recently undertook a major UK trial funded by Breast Cancer Now, which provided the strongest evidence yet that women aged 35 to 39 who are at moderate or high risk of developing breast cancer could benefit from annual screening, and that screening those women annually could pick up tumours earlier. The study found that when tumours were picked up through screening, most were smaller and less likely to have spread to lymph nodes than those in women who were not screened. Importantly, as my hon. Friend the Member for Lewes (Maria Caulfield) has pointed out, such screenings are an opportunity also to screen for ovarian cancer, which is often linked to the same gene We know that women with a family history of breast cancer have a higher risk of developing breast cancer themselves and are more likely to get breast cancer at a younger age. The degree of extra risk varies according to whether breast cancer was diagnosed among someone’s first-degree relatives, such as their parents, siblings or children; their second-degree relatives, such as their grandparents, aunts or uncles, or half-siblings; or multiple family members. Breast cancer risk is also inherited from the father’s side of the family. Familial breast cancer tends to be more aggressive than non-familial breast cancer. Prognosis also appears to be partly heritable: women whose mothers died of breast cancer are more likely to die from it, even adjusting for tumour characteristics. We know that women who have breast cancer in their family are more likely to develop it and more likely to develop its most aggressive forms, and we know that detecting breast cancer early gives women the best possible chance of survival Based on a thorough assessment of the available evidence, the National Institute for Health and Care Excellence—NICE, as we all know it—recommends that women with a confirmed family history of breast cancer should be offered annual mammograms from age 40, and that women at the highest risk may be offered MRI scans from age 30. That one word—“may”—literally means life or death to some women, because not all young women are offered that screening. Despite all the evidence, young women are not getting screened. Not all women with a family history of breast cancer get access to the extra breast screening currently recommended by NICE. Screening can save lives, so why is that happening NICE guidelines are not implemented uniformly across the country. We need to tackle that. There is a lack of clarity about the provision of family history clinics. Only some women at the greatest risk receive family history screening though the national breast screening programme. Other women at high risk, and those at moderate risk, may—again, “may”—receive family history screening through local family history services instead. However, some might not receive it at all, and it is those young women that the Bill aims to help The inconsistent provision of screening is risking lives. Some young women, because of where they live and the treatments available to them, will have their breast cancer spotted early and treated; some will not. Some will survive; others will not. Imagine having to bury your wife, your daughter or your granddaughter because early screening was not available in their town or area In reality, neither I nor the Secretary of State, NICE or the Minister knows the scale of the hole in provision. If the Minister does know, I would be interested to hear it, but everything I am told indicates that there is a lack of national oversight of family history screening for women at all levels of risk, which may result in women not being able to access screening in some areas. We just do not know where or why This issue may be exacerbated by the fact that some family history clinics, which assess and support women with a family history of breast cancer, may be at risk of closure. Those clinics are not supported by national funding, and there is lack of clarity about the current governance arrangements for the provision of those services. As a result, some clinical commissioning groups may choose to stop funding family history clinics in their area. I am sure the Minister agrees that that cannot be allowed to happen The Bill is intended to strengthen oversight of family history services for women with a family history of breast cancer by introducing a duty on the Secretary of State for Health to ensure the rigorous and transparent implementation of current NICE family history guidelines. The purpose is to ensure that every woman in the country with a family history of breast cancer is able to access services with a proven life-saving benefit, to which they should be entitled regardless of where they live. The Bill would also require NHS England to provide clarity about the current governance arrangements for the provision of services for women with a family history of breast cancer, including the obligations CCGs have for funding family history clinics Thanks to Nicola, I have met or corresponded with the people she called her “warriors”. I have been astounded by how they support one another through difficult times, in person, online and in chatrooms, and I was humbled to see so many of them at Nicola’s funeral, still supporting her and one another. They are watching on today, and they want action, so I beg the Minister to support the Bill, to help to deliver Nicola’s law and to help save the lives of thousands of young women in the future Question put and agreed to. Ordered, That Andrew Griffiths, Steve Brine, Fiona Bruce, Maria Caulfield, Marion Fellows, Carolyn Harris, Anna Soubry, Craig Tracey and Anne-Marie Trevelyan present the Bill Andrew Griffiths accordingly presented the Bill Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 413).
I inform the House that Mr Speaker has not selected either of the amendments listed on the Order Paper.
I thank the Backbench Business Committee for allowing me to lead this debate on the Department for Work and Pensions public spending estimates. In so doing, I shall explain what I think are the purpose and principles of the Department; where I feel that, unfortunately, it is currently failing; and what needs to happen to change that Today is about public spending. Most people in the House will know that the Department for Work and Pensions is the largest spending Department of all; it spends around a quarter of the Government’s money. However, although this is an estimates day debate, we should not focus on the money. The money is interesting really only in so far as it is for something—in so far as we spend it for a purpose and we carry out that purpose in accordance with our principles.
My hon. Friend has probably noticed that there is nothing in the estimates to help the women born in the early 1950s who lost out on their pensions. Does she agree that there will be a round of estimates coming up shortly, and we would like to know from the Minister what the Government are going to do about that, and whether the Department will include it in its estimates to the Chancellor for a future Budget?
My hon. Friend makes an effective point—which I will come to—about the position of the WASPI women, born in the 1950s. They dealt with challenges in the labour market that I have never faced. They fought for the changes that my generation benefited from, and at their point of retirement the Government undermined them. I will say why I think that is contrary to the principles on which we operate the welfare state in this country and I thank him for that appropriate intervention Before I come to the principles, I shall address the purpose. What is the purpose of all the money spent by the UK’s biggest spending Department? What is it for? The spending has a simple principle—and Beveridge articulated it in his report, which really commenced the modern welfare state in the UK—and that is to smooth incomes. The idea is that we spend to allow people to take money from the system when their income is low and to pay in when their income is high. It is very simple. If we allow people to smooth their potential for getting wages and income over their lifetimes, on average people will be richer than if they have to cope alone in the hard times. If we allow people to use social insurance to smooth their income, we are all better off. We pay in when we can, we take out when we need: that is how it works. It has a simple purpose. How does the system do that? It operates by some simple principles. It is a huge amount of money, but our welfare state adheres to a straightforward and simple principle—the contributory principle, one that any student of Beveridge will know all about. The idea is that we all pay in when we can and we are all entitled to take out when we need Why have I made those points about the simple purpose and principles of the welfare state? I do not think that very much has changed since Beveridge’s time when it comes to the fundamental way that the labour market operates and the risks that people face in their lives that will make them poorer if we do not have an effective welfare state. We are still fighting the same evils that Beveridge identified, and the reasons people might not have enough to get by are fundamentally the same as they were when he wrote his report. The one that we all know about is old age, as my hon. Friend the Member for Coventry South (Mr Cunningham) has already mentioned. That is why it is right that, in the 10 years since the crash, the incomes of pensioners in our welfare state have—by and large, with one notable, shameful exception—been protected. We have seen pensions keep pace with earnings and with the general movement of our economy. When the economy is growing, pensioners’ incomes have kept pace. We know that the uprating, the increase in spend on pensioners, has protected them from the possibility of poverty. No one wants to see people who have worked hard all their lives go without and struggle with poverty in their old age Of course, the WASPI women are an exception to that. The principle that they have paid in and that they should be able to take out in an equitable way has been undermined for them. For the reasons that have already been mentioned, that is shameful and must be changed.
I thank my hon. Friend for giving way and for the way she is introducing the debate. Does she agree that at a time when the Conservative leadership contenders are splurging billions of pounds in spending commitments, not a single penny is available for the WASPI women and that really shows where their priorities lie?
I thank my hon. Friend for his intervention. The Conservative leadership election feels like the reversal of politics as I had come to know it. I had always expected that Labour would be on the defensive when it came to public spending. I thought that my party would always have to prove that we were the ones who would deal responsibly with the economy, that we would always be on the defensive and the Tories would always be on the attack. But those competing in the Conservative leadership election seem to want to reverse that principle. They seem to want to be accused of splashing the cash. Given that one of the candidates found nearly £10 billion to be spent on tax cuts, I suggest that the debate should never again be about whether austerity was necessary, but should instead be a simple question of political priorities.
The hon. Lady is making some powerful points, many of which I agree with, and I am also concerned by some of the pledges in the leadership contest about the spending of taxpayers’ money. What does she think about Labour’s election manifesto pledges of £1 trillion of spending?
The hon. Gentleman asks about the 2017 manifesto. I simply remind him that before the publication of the manifestos in that election most people expected the Conservative party to get a stonking great majority so that it could push through its version of Brexit based on the quality of their manifesto as opposed to ours. I point the hon. Gentleman to the historical facts, as it did not turn out at all like that.
To return to the point about the WASPI women, I completely accept that we all want to make sure that people have dignity in retirement, but does the hon. Lady acknowledge that the Government’s figures show that reversing the impact of the decision to raise the state pension age in line with rising life expectancy would cost £181 billion? Where on earth would we find such a sum of money?
The hon. Gentleman is a fellow member of the Treasury Committee and I thank him for his intervention. That is an interesting forecast. I do not think that dealing with the injustices would cost anything like as much, but if he wishes to have the discussion, we have many hours on the Committee together and I will happily discuss his spreadsheet any time he wishes.
Before my hon. Friend gets to that spreadsheet, she is making an important point. The budget has been brought more into balance by the cuts in welfare benefits, which have been concentrated on families with children. In our constituencies, many people have been pushed into hunger and destitution for the first time in their experience, not because they have lost talent or the ability to manage, but because for the first time in a century we are cutting benefits to the very poorest.
I thank my right hon. Friend and constituency neighbour for that intervention. He brings me to the point that I was just about to make, which was what Beveridge might have thought of what we have done to family benefits. When we have children, life costs more. Beveridge knew that in the 1930s and 1940s, and family benefits were always designed to be a solid part of the modern welfare state that would help our country rebuild after the second world war. That is also because those benefits rely on the contributory principle. How on earth do we expect to get responsible adults who are able to use their talents for the benefit of our country and get to the point in their lives when they can adequately pay back to the welfare state if children’s ability to grow and learn has been undermined at the very point when they needed the welfare state to pay out for them? We take out when we need, and we pay in when we can. That goes for family benefits along with everything else.
The hon. Lady is making a powerful speech, as I would expect of her. Last week the Scottish Government introduced a new Scottish child payment which, when delivered in full, will mean an extra £10 a week for more than 400,000 children. The Child Poverty Action Group has described it as a “game changer” for tackling child poverty. Does the hon. Lady agree that that is the sort of proposal that this Government should be implementing for the whole of the United Kingdom, and to which the Labour party should commit itself?
The hon. and learned Lady will know that I believe in the pooling and sharing of resources across the United Kingdom. If the Scottish Government have found evidence that there is a way of aiding children that can work, I will be learning the lessons, but I firmly believe that the way the United Kingdom’s welfare state pools and shares resources is the most powerful tool that we have with which to tackle the child poverty that worries me today We know that the projections for child poverty over the next few years are a disgrace. We will see it rise to record highs, and if we do not make a decision and do something about it, it could affect more than 5 million children by 2024. I do not know about you, Madam Deputy Speaker, but I am not prepared to stand by and see the welfare state that this country has built over many years fail at that level. I am not prepared to see the contributory principle that says that we pay out to people in need so that they can pay in when they can, become fatally undermined by the growing wound in our country that is child poverty I should like all Members who are present today to ask themselves a simple question. On the basis of the purpose of the welfare state and the principles by which it operates, is the DWP’s current spending a success? We all know the answer to that question. It stares us in the face when we think about what is going on in our own constituencies, and the people whom we see in our surgeries. It stares us in the face when we walk through the doors of the House of Commons and see the destitution, and when we know that a person died on our own doorstep. It stares us in the face when we hear from the Trussell Trust that last year it handed out 1.6 million food bank parcels My right hon. Friend the Member for Birkenhead (Frank Field) made exactly the right point. Do we think that there were 1.6 million incidences of fecklessness? Do we think that there were 1.6 million incidences of people being so unable to deal well enough with their lives that they had to turn to food banks and beg for help? Do we think that there were 1.6 million incidences of error, or mistake, or confusion? Quite clearly not. What we have seen are 1.6 million incidences of injustice and unfairness.
I thank my hon. Friend for giving way yet again; she is being very generous. One of the main contributions to poverty is poverty wages, as a result of which people have been driven to food banks. A couple of months ago, I visited a food bank in my constituency. Think about it: in a semi-rich city like Coventry, 22,000 people used a food bank last year. Does that not tell us a story?
My hon. Friend has made his point well. We all know that the DWP is failing because we see it every day, but why is that failure happening? I think it is pretty obvious from the DWP’s policies that it has radically misunderstood poverty. While its aims and objectives in dealing with poverty are all absolutely worthwhile and worthy, they will never get to the root cause of it The DWP’s policy paper sets out its next steps for action on poverty. It wants to help through the troubled families programme, and it wants to identify people with complex needs. It talks about addiction, and it talks about education. The problem is that while those are factors in people’s lives that are associated with poverty—of course lower educational achievement is a risk for people who grow up in poverty, and of course addiction is a problem in communities that have less wealth—it is possible to do very well at school and still be poor, and it is possible to be poor and not addicted to anything. It is possible for people to have excellent family relationships, to look after each other and be able to take care of their families, but still to suffer the consequences of low incomes, because the root cause of poverty is not any of those other things; it is not having enough money. What my hon. Friend the Member for Coventry South said about poverty wages was right, and that is why the DWP must change course.
The hon. Lady is making a powerful speech, and no one would question some of the things that she has said, but does she not understand that when people suffer from addiction—the terrible pain of addiction—that is why they struggle to get into work, and to earn and look after themselves? Addiction is a root cause of poverty. [Interruption.] Of course it is; don‘t be ridiculous.
I thank the hon. Gentleman for his intervention, because he has illustrated exactly the point that I am making. I have every sympathy and every empathy with people who suffer from addiction and associated mental health conditions, but those conditions affect everyone in society. They are not solely about people who are poor. Moreover, there are plenty of people who just do not have enough money, and who do not suffer from any of those problems. The point that I am trying to make is that the DWP is failing because it has missed the central point. The cause of poverty is not having enough money, and it is our duty in the House to do something about it.
rose—
If the hon. Gentleman really wants to argue with me, then be my guest.
I very much want to argue with the hon. Lady. The truth is, is it not, that poverty is a result of some of the problems that people face in society. If those problems are removed, people are considerably less likely to be poor, because they are more likely to be able to work. I have met people who have started out in life from a very good position, but have suffered terrible heroin addiction and have consequently been unable to work. The reason those people have no money is that they have suffered from heroin addiction.
Let me try this another way. The people whom the hon. Gentleman has mentioned who are suffering from addiction deserve our sympathy, empathy and solidarity, and they deserve help, but so does the kid at school who is working hard, who has great teachers, but who goes home and sees his parents struggle. The cause of poverty is a simple thing: it is not having enough money. It is possible for the Government to have brilliant programmes in all other spheres and still fail to deal with the wound in our society that means people turning up at food banks and children who are unable not to be hungry during the holidays because they can no longer rely on free school meals I simply say to the hon. Gentleman, “Ask yourself this question: if we had dealt with every addiction problem in our country, would that necessarily solve the problem of poverty if wages were still too low and this Government were still hellbent on taking money, year after year after year, out of the welfare state which is there to support the family of that child who is working hard at school?” What, then, has to change? We have to reassess the contributory principle as it affects families, and we have to decide that in this country we will ensure that families can make ends meet. That is why I—along with a number of other Members and the former Prime Minister Gordon Brown—have set out over the summer to try to establish the principles of a programme that could enable them to make ends meet I believe that the programme should look like this. Step one must be to end the policies that are breaking the principle of Beveridge’s welfare state. We know what they are. The two-child limit means that 800,000 families with three or more children who are currently receiving tax credit are at risk. While the Government say that the two-child policy will save them billions of pounds, we know that every child matters—every child counts for something—and that is why that policy cannot be allowed to continue. If it does, we know from all the evidence and the child poverty forecasts that it will drive up poverty for children in this country living in a household with three children or more. If anybody thinks that somehow knowing that the Government are going to punish the third child in a family will help to guide families as to family size, I simply say they have probably missed the fundamentals of reproduction. We do not hold children responsible for the actions of their parents, and our welfare state should not do that.
The hon. Lady is making a very important point extremely well. Does she agree that one of the unbelievable aspects of the two-child cap is that it does not take into account that not everyone who has two children and decides to have a third is on benefits when they make that decision? A family’s circumstances can change overnight through no fault of their own, yet the Government seek to punish them for that.
I thank the hon. Lady for making that important point, and that is the entire point of the welfare state at all: our circumstances can change overnight through no fault of our own. And the idea that the Government have set up this arrangement of the two-child policy because they want to send some sort of political message to people about having children or not is crazy; there is absolutely no evidence that it works The second thing that has to change immediately is the benefits freeze for working-age people, specifically families. We know the cost to families of the four-year freeze that people have already lived through. That should come to an end this year, but who knows—who knows what the next Tory Prime Minister will choose to do; who knows if they will still choose to punish families. But we know that the reality is that working-age families have not had that lock that pensioners have had; they have not had that connection between the wages going up for everybody else in society and the money that they have to support them. It is simply neither fair nor effective to have a welfare state that does not help families grow up with enough to get by. We are simply undermining the ability of our next generation to contribute to the welfare state when it is their turn Thirdly, we need to reappraise the welfare state and find a balanced approach of universal benefits and targeted benefits. We do not have time to go into the intricacies of the ways in which universal credit has failed, but we know that it has. We know that the sanctions regime has caused destitution, and we know that so many of the ways in which UC was supposed to make life easier for people have not turned out to work like that in practice, which is why the Government are yet to deliver the UC roll-out; we know it and they know it. That is why for the future we need a range of benefits, some of which are simpler to claim, like child benefit. Child benefit is easy. Those who have a child are, by and large, apart from the highest earners, entitled to it; it is easy and straightforward, and it would be an excellent way to stop child poverty rising if we were prepared to invest in child benefit while we also still use targeted means-tested benefits to get money to the poorest Finally, we need a mix of the work that the DWP does through the welfare state and through cash transfers to deal with poverty with all the other things that we know help families to get along and move forward, whether that is services for early years, nursery school, childcare or skills development, so that people can move on and move up. We know that the problem is not just low pay; it is also families being able to have enough time to build up their skills so that they can move on to the next job and get higher wages. So we need that balanced approach of universal benefits, targeted benefits and a balanced mix of the welfare state and other services that the Government can provide to help families But in the end my point here today is really very simple: the DWP has failed in its purpose of helping people balance their incomes throughout their lives simply because it decided that families in the UK would carry the burden of the cuts they wanted to see to the state. It has failed to adhere to that simple Beveridge principle that we pay in when we can and we take out when we need, because if we cannot fund children who really need help and support, how on earth will they grow up to be able to pay in when they can? The DWP under this Conservative Government is a failure; it is time that changed.
Order. This is a well-subscribed debate, as is the next one. I do not want to impose a formal time limit at this point, but if colleagues could take eight minutes or less that would be very helpful.
It is a pleasure to follow the hon. Member for Wirral South (Alison McGovern) In speaking today I want to commend the excellent work of my local work coaches whom I recently met at the Whitehaven Jobcentre Plus office in Copeland. They are doing a tremendous job in helping many hundreds of people in my constituency into work I think back to the time when I owned and managed my own children’s day nursery and remember speaking with women who did not want to work for more than 16 hours a week because it would scupper their benefits. The benefits system was a clear disincentive to work, and that has been one of the greatest changes from the introduction of UC. Under the previous welfare system people could lose over £9 of every £10 they earned, creating no financial incentive whatever to get up in the morning and go to work As my business was looking after other people’s children, I heard the experiences of many parents. Under UC 85% of childcare costs can now be paid regardless of how many hours a parent works, which is a huge increase in support compared with tax credits. Under the previous system it often made no financial sense to work more than 16 hours a week; now, under UC, work pays The recent decision to remove the two-child limit under UC for those born before 2017 is welcome. When my four daughters were all aged under five I had to combine my full-time employment with taking care of my young girls. As a direct result of this Government’s intervention a working family with two children can now receive up to £13,000 a year for their childcare costs because we have increased the available support from 70% to 85% We must also remember that an extra 15 hours of free childcare has now been available to working parents of three and four-year-olds since September 2017, which is enabling more parents to make work pay. Particularly for women, this makes all the difference; we now have more women in the workplace than ever before—since records began in 1971—which is making a significant difference to families’ take-home pay One of the greatest influences on a young person seeking employment themselves is seeing their parents enthusiastically going out to work in the morning and positively speaking about their work when they return home, as I do with my own daughters, their friends and boyfriends. There are 458,000 fewer young people out of work than in 2010, which amounts to a 50% decrease in unemployment, and welfare reform has supported the impressive figure of 1,000 jobs on average being created every day since 2010.
Will the hon. Lady kindly cite the evidence to support her statement that welfare reforms have actually led to the increase in employment, because I have evidence to show that employment has increased in spite of the welfare reforms?
I explained earlier in my speech that previously women in particular were restricting their working hours to 16 hours a week because of the benefit system, and in terms of the evidence the hon. Lady is surely not doubting that the unemployment record is at its lowest since 1971 UC is one of the most important reforms the Government are making. I want to see high quality, affordable, flexible childcare in every town and village, and I would like to hear from the Minister what steps he and his Department are taking to make that possible. Certainly the welfare reforms are making it a more achievable goal in my community, and I welcome the Government’s efforts.
I congratulate my hon. Friend the Member for Wirral South (Alison McGovern) on her absolutely excellent speech. She set out what social security should be about. It is about the type of society that we want. The key thrust of her message was to ask whether it is acceptable that so many children are living in poverty—one in four currently grow up in poverty, and one in five are in persistent poverty—when we are the fifth richest country in the world. Is this the sort of society we want them to grow up in, when, despite being the fifth richest country in the world, we also have the highest child mortality in western Europe We know the causal relationship between poverty and early childhood death. Is this acceptable? To my mind, it is not, and I am sure that many people across the Chamber agree with me. That is why I asked the hon. Member for Copeland (Trudy Harrison) for her evidence. We have to look at the evidence. There will also be issues with addiction, but are we seriously saying that all poverty issues relate to addiction? There is no evidence to support that. I shall get back to the point of whether this poverty is acceptable. If it is not, we need to look at mechanisms that will ensure that in the civilised society that we aspire to lead we have the policy measures to ensure that this does not happen.
Is it acceptable to be in a party that has always left office with unemployment higher than when it entered office, or is it acceptable to be in a party that has delivered record numbers of jobs?
I respond to the hon. Gentleman by asking whether it is acceptable that we have the highest level of in-work poverty and that two thirds of the children living in poverty are from those working families. I throw that back at the Government.
The hon. Lady makes the point that I was about to make, which is that we are in the completely unacceptable situation in which two thirds of the children living in poverty in this country live in households where at least one parent is working. Does she agree that that is not just a failure by the Government to protect those children but an abject failure on their part to protect the welfare state and provide a continuing welfare state that works for the people who need it most?
I could not agree with the hon. Lady more I am going to carry on with my questions about what we deem acceptable in our country. Is it acceptable that sick and disabled people are being isolated and excluded across our society? I believe that, in addition to children, it is sick and disabled people who have borne the brunt of this Government’s cuts. That shames us all. Nine out of 10 disabilities and illnesses are acquired. Would we want this for ourselves or for our nearest and dearest? I am sure that the answer is no, so what does that mean for our policies for sick and disabled people? Many of us on both sides of the Chamber do not think that this is acceptable. We need a thriving economy, but the present levels of inequality are stifling the growth that we need—[Interruption.] That is evidence based. I can provide evidence for the fact that inequality is stifling growth in the economy We need a social security system that is there for all of us. I would like to see our social security system held in the same esteem that we have for our NHS. It should be there for each and every one of us, providing dignity and security in our retirement and the support we need if we become sick or disabled or if we fall out of work. Let us face it: with the current flexibility in employment, people are going in and out of work, and the system needs to be able to reflect that. It also needs to be able to protect us from poverty, because that is what a civilised society does. As my hon. Friend the Member for Wirral South said, this should be about smoothing out our incomes so that we do not have to be plunged into poverty when we experience extreme events. A decent social security system is a vital weapon for tackling the poverty and inequality that are now rampant across the UK We know that, although work and pensions spending has increased since 2010, working-age support has actually been reduced by £30 billion because of the decisions that the Government have made. We also know that those savings are set to increase even further to £38 billion by the end of the forecast period in 2023-24. These figures should include the effect of the measures announced in the 2018 Budget, which included annual spending of £1.9 billion by 2023 on universal credit. Unfortunately, although some people have benefited from universal credit, 3 million people will still be worse off under it. As I mentioned in Treasury questions this morning, 87% of all disabled people will not benefit from those Budget measures and will remain worse off under universal credit, alongside 640,000 self-employed households and 475,000 working lone-parent households As my hon. Friend so eloquently put it, we have seen the rise and rise of food banks and an increase in in- work poverty. We know that 4 million sick and disabled people are living in poverty, as are 330,000 more older people. I mentioned the stifling effect that this is having on the economy. The Office for Budget Responsibility’s own model has shown that the independent effect of austerity has been to stifle economic growth by at least £100 billion in 2018-19, which is the equivalent of £3,600 per household. That is my evidence to the House I have mentioned the human toll of these policies. In Work and Pensions questions yesterday, I mentioned Amanda, a lone parent who was pregnant and had significant mental health issues. She had her universal credit claim closed in the final weeks before she was about to deliver her child. She did not know why this had happened, but it was revealed that it was because she had not undertaken an independent review. I am pleased that the Minister said that he would take the matter up, but let us just imagine if this happened to us. How would we feel if we suddenly had our income ripped away from us and we did not know what was happening, just as we were about to have a child? This is simply unacceptable We know that, between 2013 and 2018, 60 disabled people a month died after their personal independence payment claims were rejected. Many others have died after being found fit for work. A Government’s first duty is to keep their people safe, and that includes their vulnerable citizens. They are failing to do this. Poverty and inequality are political choices. Many of us have made suggestions on how we can tweak the current social security system, but I believe that we need a radical transformation. As my hon. Friend said, we need a new social contract with the British people, built on the Beveridge principles, to define a 21st century social security system that treats its citizens with dignity and respect and protects them from poverty, destitution and even death.
I congratulate the hon. Member for Wirral South (Alison McGovern) on securing this important debate. It is always good to have the opportunity to debate the vital work of the DWP The hon. Lady set us a really good challenge because—I hope I have got this right—she was basically asking, “What is the DWP for?” She articulated well Beveridge’s aspirations in the creation of the welfare state, but in addition to what she said about ensuring the smoothing of income and providing a good safety net for people when they need it and for those who are unable to work, the DWP is also about promoting the health and wellbeing of people in employment. It is that important part of the DWP’s work that I will spend some time discussing today, because it seldom gets debated in the House The health of the nation’s workers has never been more important. Modern society and the world of work are changing rapidly, bringing new challenges for our physical and mental health. We all spend at least a third of our lives at work, so employers have an important role to play to help workers stay healthy. Fulfilling and meaningful work can be a huge source of wellbeing and having a supportive employer can make a real difference to someone grappling with a physical or mental health condition. Crucially, four in five UK workers say that support from their employer could help them to recover quicker from an illness. Much is being done by employers but, of course, there is so much more that we can all do together. Recent research conducted by the John Lewis Partnership revealed that, by working together, Government and industry can unlock £38.1 billion for the UK economy by 2025 through fast access to psychological services and physiotherapy for employees grappling with a physical or mental health condition. We know that the main two reasons for people falling out of work is poor mental health or a musculoskeletal condition The Working Well coalition is a new and growing group of MPs, charities, employers and think-tanks, and together we are committed to do more to improve the health of the nation’s workers. To achieve that, we all need to play our part. We need businesses to take a leadership role in promoting good physical and mental health at work, and I saw during my time at the DWP what some of the UK’s best employers are doing, supported by the Health and Safety Executive. Business can be a real force for good in society, and we want to do more to support other employers, large and small. We want to galvanise others behind the business case for action and to work in partnership with our public services to promote a healthy society The Government have an important enabling role to play to make free occupational health services for workers a non-taxable benefit in kind to promote investment from employers. Currently, such services are subject to employment taxes at an effective rate of 40%. Government and employers need to explore and draw together practical advice on physical and mental health to help employers, building on existing good practice. Many employers want to invest in health and wellbeing, but they just do not know where to start The Cornwall and Isles of Scilly local enterprise partnership has started a beacon project, backed by £500,000 of DWP investment. It was launched last September at Cornwall’s GrowthFest, and it aims to provide businesses with tailor-made support to enable them to build inclusive workforces. The Evident Agency is developing a scalable digital project that will deliver advice and ongoing support for businesses, working with the Cornwall growth hub and other partners to provide a single point of contact for employers developing an inclusive work place With record employment, many businesses in my constituency and across the country are struggling to recruit. We want to make it easier for businesses both to find the right person and to support existing employees who may have a disability or long-term health condition. In developing a digital solution, Evident Agency has engaged with several local businesses through surveys and face-to-face interviews to explore how businesses respond to mental health and disability in the workplace. It is clear that no two businesses are the same and that a one-size-fits-all approach simply does not work. Navigating businesses through the range of advice and support and following through with ongoing support is key. Developing a peer to peer network will be part of the solution, as will the support that large businesses could give to small businesses in their supply chain I welcome the recent announcement made by the Prime Minister and Secretary of State for Work and Pensions of a consultation on new measures to help employers better support people with health conditions in work. Much-needed reforms to statutory sick pay will enable it to reach those on the lowest incomes, to be more flexible, and to offer the support that people need to help them return safely to work. The Government propose to extend occupational health so that more employers are able to offer the service, and I hope that my suggestions about changing the tax system to incentivise those changes will be taken into consideration as part of that consultation, because this is the perfect opportunity to spark a revolution in workplace health and wellbeing A healthy society underpins a healthy economy, and we hope that this can be the start of a new dynamic partnership between the Government, employers and charities to support the physical and mental health of our 32.7 million workers and, most importantly, to close the employment gap for people with disabilities and health conditions who really want to work and play their full part in society. Surely that is a goal that everyone across the House can unite in achieving.
I welcome this opportunity to scrutinise the DWP’s spending, because when I sit in my surgery, week after week, listening to the stories of people living in poverty and struggling to survive while facing a continual battle with the benefits system, I find myself wondering just where nearly a quarter of all Government spending is going. It is certainly not reaching the people who need it most in my constituency. People have had overpayments, underpayments, long initial waiting periods, inaccessible and complex online forms that lead to uncompleted claims, a lack of support with claims, and cruel disability benefits tests, with fines consistently being overturned at appeal We have had plenty of debates about universal credit, and it is not working. The five-week wait for initial payment is driving people into poverty, debt and rent arrears, forcing them to turn to food banks to survive. We have already heard about the number of people using food banks. In my constituency, like everywhere else in the country, the numbers are going up year on year at an alarming rate. Despite the Government’s claim that nobody will be worse off under universal credit, we now know, thanks to the Institute for Fiscal Studies, that 1.9 million adults will be at least £1,000 worse off While the Office for Budget Responsibility’s report at the start the year upheld the Government claim that 1 million ESA households will, on average, receive an extra £110 a month, it also showed that exactly the same number of ESA households will lose, on average, £217 a month. It is no wonder, therefore, that the UN special rapporteur, Professor Philip Alston, accused Ministers of window dressing to minimise the political fallout. That is both damning and shaming I have spoken on many occasions about the cruel, unfair disability benefits tests that my constituents have to go through, and for what? Record numbers of people are winning appeals against the Department, and it just looks like the whole process is a stick to beat people with. As we have heard, more than 70% of personal independence payment and employment and support allowance appeals will find in favour of the claimant. One of my constituents was assessed five times in eight years of being on ESA, and despite being found fit for work each time, they won every time on appeal. How flawed must the assessment process be to be so consistently wrong? How can the cost of defending five separate appeals be justified when the decision is the same each time More than 16,000 appeals have overturned a PIP decision in the first three months of this year, and nearly three quarters of the 22,000 that went through a tribunal also ruled against the DWP. Waiting times for a PIP appeal are coming up to a year in my constituency—nearly a year in which some of the most vulnerable people in our society are denied the financial support that they need. Things can get worse, because if they have a Motability vehicle, they can lose that as well. I met someone last week who clearly could not get to her job on public transport, but she now faces losing her car due to a PIP assessment. I have little doubt that she will win her appeal, but what consolation will that be if she loses her job in the meantime?
Does my hon. Friend agree that this poor decision making fatally undermines the relationship between the citizen and the state, and that it must make his constituents wonder what kind of country we live in?
I thank my hon. Friend and constituency neighbour for her intervention. I do sometimes wonder what kind of country we live in when vulnerable people feel the cards are so stacked against them that it is not even worth their while to appeal. Those are the people who come to see me. I do not know what happens to the people who are so beaten down by the system that they just give up, which I feel is the unintended consequence—or possibly the intended consequence—of this policy time after time We know that the cost of successful PIP appeals was £27 million last year. ESA is not included in that figure, but 74% of those claims were successful, too. Let us not forget the figures I uncovered towards the end of last year, which show that the Department is not even turning up to four in five appeal hearings. We know what would happen if my constituents did not turn up to four in five appointments with the DWP: they would be sanctioned straightaway I also hear from parents whose children are not eligible for free school meals because their household income is just a little too high, and they are struggling to provide their children with a school lunch because they cannot afford it. Many of these families are struggling to make ends meet We now come across parents who are eligible for help but who are not getting it due to the complicated application process and the long waiting times. I have constituents who, in the period before the first universal credit payment is made, are desperate for support but are told that they are not eligible for free school meals. Surely we can do this better and provide eligibility for free school meals when the universal credit application is made, rather than waiting until the first payment comes through Briefly, on access to benefits for people at the end of life, the current special rules for terminal illness—SRTI—exclude many people with terminal illnesses. I am meeting the Minister next week to discuss this, and I hope we have a constructive conversation, but I raise it now so that people are aware of some of the difficulties and of the money and time being wasted on inappropriate and unnecessary assessments Only 45% of people with motor neurone disease are claiming personal independence payment under SRTI. The majority of people in that situation are still using the standard claims route, which is inappropriate for their situation. They are required to fill in a long form, attend a face-to-face assessment and then wait weeks before the benefits are received.
I commend the hon. Gentleman for his speech. Is he aware of Social Security Scotland’s plans to ensure that all medical evidence is available to decision makers at the application stage, so that a correct decision can be taken without the need for often demeaning, demoralising and horrible assessment processes such as the one he describes? Will he support my call for the UK Government to follow Scotland’s lead?
The hon. Gentleman makes a helpful suggestion. Certainly those who have, by definition, a very short time to get these matters sorted due to terminal illness should have as much of the process done at an early stage to avoid such difficulties It is highly insensitive that people who have been diagnosed with what can be a devastating condition that will end their life, possibly within 12 months, have to face this extra hoop-jumping when they should be focusing on spending what time they have left with their loved ones The majority of people with motor neurone disease are awarded the enhanced rate of PIP anyway, so we need to make it easier for them to claim through SRTI instead of the standard route, which many are currently going down. There are a number of helpful suggestions that we can discuss with the Minister next week My hon. Friend the Member for Wirral South (Alison McGovern) spoke passionately and eloquently about the Women Against State Pension Inequality Campaign. She rightly drew attention to the scandal, which will not go away. The WASPI women are there, and they are growing in number. She is right that, while the Tory leadership candidates continue to spaff cash up the wall with spending promises on tax cuts for the most well off in society, for big corporations and for whatever else they decide when they wake up in the morning, it is damning that not one penny has been committed in the leadership hustings to the WASPI women Ultimately, it comes down to priorities, and it is clear that WASPI women are not a priority for this Government and will not be a priority for the new Prime Minister, either. The hardship, the injustice and the erosion of the contributory principle that underpins the welfare state are clearly not a priority for this Government, and it is to their shame that they continue to ignore this campaign in the face of overwhelming evidence that a real injustice is being done.
It is a privilege to take part in today’s debate, and I congratulate the hon. Member for Wirral South (Alison McGovern) on opening it. This is an important issue, and we all know that the DWP goes to the heart of so many of our constituents’ lives I welcome the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Colchester (Will Quince) to the Front Bench. He has done important work on all the issues surrounding bereaved parents over the past few weeks, and I think everyone on both sides of the House welcomes the Government’s new position Over the two years I have been an MP, I have seen at first hand the hard work, considerable commitment and personal dedication put in by the staff at Loftus jobcentre. I have seen it in the context of the redundancies at the Boulby potash mine in my constituency, which were caused by the move from mining potash to mining polyhalite. The way in which the emergency response team moved, and the work it did to support the workforce into productive and fulfilling jobs was impressive That speaks well for the professionalism of the men and women in our jobcentres, many of whom are sometimes unfairly miscast as people who either do not know or do not care about the lives of the people they help—that is certainly not my experience. I do not recognise the Opposition’s characterisation of so much of the front-facing work of the DWP. I tend to find that, if anything, the jobcentre workforce are unbelievably adept, graceful and kind.
To be clear, not one thing that I or any Opposition Member said criticised the work of the people on the frontline for the DWP. It is the Conservative party’s policies relating to the DWP that are at issue.
I would not ascribe it to the hon. Lady’s speech, but I have heard speeches in this place from Labour Members that have come very close to blurring the line between the policy and the people. There is sometimes a real determination to make people afraid of their experience of programmes such as universal credit by stoking up concerns, rather than pointing out the progress on rolling out this fundamentally important reform, which originally enjoyed the Opposition’s support—mainly because it is the right thing to do The hon. Lady rightly referred to the Beveridge principle of a welfare state that acts as a strong safety net to help those in need when the chips are down. That is not what we had under the last Labour Government, when the cost of welfare benefits rose by some £84 billion—an enormous sum of money. Welfare has to be fair to the taxpayer, as well as to recipients. This is an important issue. The balance was lost, and the public knew it was lost That was one reason, among many, why we won the 2010 general election. There was a widespread perception that the welfare system had strayed from its moorings and was no longer necessarily about helping people into work, or helping them to stay in work longer. For too many, it allowed a lifestyle based on the trap of dependency—my hon. Friend the Member for Copeland (Trudy Harrison) referred to that trap. For too many people, the logical incentive created by the system was not to work, or not to work more hours. There was nothing kind or moral about that. It was, in fact, profoundly the opposite, as the system did not help people take the true route out of poverty, which is, of course, work.
The hon. Gentleman is being characteristically generous with his time. Will he answer a simple question? How does the two-child policy provide an incentive to work when children, by definition, cannot work?
Child benefit is, obviously, a sensitive issue, but the point is that a family not in the welfare system, perhaps just above the entitlement level for welfare support, has to make rational choices in their life. All families have to make rational choices in their life about the size of the family they can afford and the choices they want to make. Lots of people find it wrong that the system would allow people to have any number of children, whereas those people not in the system have to make budgetary choices. That is not a principle I am uncomfortable defending Let us go to the wider point, as we need to go back to first principles on this. I do not doubt the sincere differences we have and Labour Members’ concerns, but they have to justify the fact that under their Government 1.4 million people spent most of 2000 to 2010 trapped on out-of-work benefits, with some receiving more than the average wage. Some 50,000 households were allowed to claim benefits worth more than £26,000 a year. I represent a low-wage constituency in the north of England and I simply cannot justify a situation whereby the logical thing was for people to stay earning that amount of benefits rather than to be in work. That has profound and adverse social consequences.
I think what we are trying to do with this debate is look at where we are now. The hon. Gentleman is right, and we did not get everything wrong, but what we need to do is look at the system now. It is clearly not fit for purpose. The way he was talking made it sound as though he also had concerns about the number of children, and the number of sick and disabled people, living in poverty. I am sure he was not suggesting that all the sick and disabled people who require support are shirkers or scroungers, and that there is nothing wrong with them. So what do we do now?
The hon. Lady is absolutely right; of course, there are lots of people who, for reasons that are totally out of their control, need our support and compassion. No Conservative Member would argue with that. I would argue that we get more money for those people by ensuring that the system has the resource available to devote to those families and those individuals, rather than to those who do not need that support and need to be in work. We have seen a record number of people come into work. We are seeing record female employment. We are seeing a record number of disabled people move into work. We should celebrate all those things. Just as those on the other side are quick to point out the problems with the system—and any system run by Government that is as Byzantine as the welfare system will always throw up hard cases that need to be looked at carefully—we also need to recognise the considerable social policy success that has been represented by helping the equivalent of the entire population of Wales, more than 3 million people, move into work during this Government’s time in office. That is a really important shift and we do not want to see this go backwards because we have changed the incentives in the system That is one reason I was so profoundly opposed to the amendments tabled by my right hon. and learned Friend the Member for Beaconsfield (Mr Grieve) in this debate. I do not think it was appropriate for this debate and these estimates to be drawn into the context of the Brexit debate. That was profoundly unwelcome. No matter which side of the House someone sits on, we have to try to keep certain aspects of the debate separate. It will be interesting to hear from the shadow Front Bencher what the Labour party’s position would have been had the amendment been accepted and what it would be were a future such attempt to be made. It is important to put on the record that there are some aspects of this debate that are simply more important than the issue of the UK’s membership of the European Union—or not. In truth, the two things are fundamentally discrete.
I am glad to be speaking for the Scottish National party in this debate, because it is an important issue on which I have campaigned for some time, particularly in relation to the two-child limit. I will discuss that in my speech It is perfectly clear that the welfare state is no longer a safety net for those who need it. It is a labyrinthine maze of bureaucracy, traps and loopholes to cheat people out of ever feeling safe or supported. The safety net is full of holes. This Chancellor, like the one before him—and, no doubt, the one to follow—has attempted to balance the books on the back of sick, disabled and vulnerable people. Even by the UK Government’s own flawed criteria, they have abjectly failed. The IFS has said that the Chancellor’s plan of running a budget surplus by the mid-2020s is no longer a sensible proposition. Public spending was as high in 2018 as it was in 2008, but what have we got to show for it? We have a rise in child poverty, in homelessness, and in food bank usage. In the fifth richest country in the world, that is a shameful situation. The two-child policy alone is expected to push thousands of families into poverty by the end of this Parliament. The Child Poverty Action Group has said that if we were to intentionally design a policy to put children into poverty, we could not do much better than that one The report “All Kids Count: the impact of the two-child limit after two years” was issued last week by the Church of England, CPAG, Women’s Aid, Turn2us and the Refugee Council, with support also from the Interlink Foundation, representing the Orthodox Jewish Community. It paints a stark picture: of families forced into poverty, debt and borrowing money from friends and family. I have to say that the hon. Member for Middlesbrough South and East Cleveland (Mr Clarke) is absolutely incorrect in so many of his assertions on this policy, because it will affect families in so many different ways and it absolutely traps them in a situation where they cannot work their way out of poverty. I commend this report to him, because it has modelled this. I commend him to read all of its details, because it makes it absolutely clear that families cannot compensate for the two-child poverty through work. The report gives the example of a single parent with three children working 16 hours a week at the national living wage—the pretendy “living wage”—and says that she “cannot ever compensate for the loss of a child element by increasing her hours, if she incurs childcare costs from doing so (because these are never covered in full by universal credit). Only if she can access free childcare (e.g. by using help from family members in addition to the free entitlement for 2-4 year-olds), can she compensate for the loss, but she would still have to more than double her hours from 16 to 40 per week.” This is also true for families where there is a couple and for others: nobody can work their way out of the poverty caused by this policy The findings from a survey done on the two-child limit by those who are claiming are stark—the impact on those families is dreadful and in some cases it results in family breakdown. That ought to concern the Tories, who seem to like to maintain the family in all circumstances. I will read out some of the quotes. One read: “I’ve recently split with my long-term partner and father of my four children. When I had my children, I did not intend to be a single parent— and now that I am, I feel like I’m being penalised by the government.” Another read: “My partner became ill and unable to work due to disability and I’m now at home having to care for him and our four children. Me and my partner are literally not eating at all during the day to feed the children.” I would like to see the hon. Member for Middlesbrough South and East Cleveland try to justify why that is fair, because it is absolutely not The report shows 95% of families who responded reporting that the two-child limit has affected their ability to pay for basic living costs, with 88% saying it had affected their ability to pay for food, 88% saying it had affected their ability to pay for clothing, 71% saying it had affected their ability to pay for gas and electric—and the list goes on. This is absolutely catastrophic for these families and they cannot do anything to get out of the situation.
I thank the hon. Lady for bringing that report to the House. Does she not agree that, contrary to what the hon. Member for Middlesbrough South and East Cleveland said, life is full of unforeseen and unintended occurrences and the welfare state is simply there to help us out with all of them?
None of the families in this report could really have predicted their circumstances when they had their children, and this has been acknowledged by the Government, because they said that if the child was born after the cut-off date in April 2017, it would be unfair to bring this in. They have acknowledged that it is unfair for some families but not for all families, but if they acknowledge it is unfair for some, they should just scrap this brutal policy for all and for ever Despite all this, families are trying to cut back. They are trying their best to get by. One parent said: “We try our best to make sure— the children— “are well fed and pick up the leftovers if they leave anything, or just toast.” So families—parents—are living on just toast, at best. What kind of society is this that the Minister presides over? Families are not able to pay their bills and are going into arrears—into debt—which means they risk going into homelessness and losing the roof over their head. They are relying on other members of the family to try to support them. One woman said: “At 36 years old you shouldn’t have to rely on your mum and dad” to feed the children. People are going into debt because they are not able to pay for things because there is no spare money. They are going into debt on credit cards and with the other types of lenders. Families are so far away from being able to pay for these things that it puts tremendous financial strain on them The two-child limit also has an impact on other members of the family. Other children feel as though they are losing out because of their baby brother or sister. That is really quite sad. It gives me a lot of pain to think that children feel as though they are losing their ability to go out and have fun, to live their lives, to go swimming or to do anything else they want to go to, because their parents were unfortunate enough to have a third child. That is absolutely appalling, and it affects families’ mental health and wellbeing, as I have said The two-child limit has lots of other impacts. There is good evidence from the survey—which should concern all Members, regardless of their opinions on the policy—that families are choosing to abort healthy babies because they are worried about how the two-child limit is going to affect them. [Interruption.] The hon. Member for Chippenham (Michelle Donelan) shakes her head on the Front Bench, but there is evidence. She should read the report and do something about it There are also issues for women who have come through refuges—through domestic abuse—and who have to use the rape clause to claim for a third child. Nobody should have to fill in a form to prove that they were raped, just to put food on the table. That is unacceptable, and the Government’s policy is despicable. Last year, 190 women were forced to fill out the form. The figures are not yet out, so I do not know how many women are affected this year, but my bet is that it will be more The impact of the rape clause is such that those 190 women are not even all the women who are likely to be eligible for support. There is in the report a good and heartbreaking case study about a woman called Sabrina. The name has been changed, but it says Sabrina in the report so that is the name I shall use. It says: “Sabrina had been experiencing abuse at the hands of her husband for almost a decade when she and her two young children came to a Women’s Aid member refuge in England. Whilst in the refuge, Sabrina discovered that she was pregnant…Sabrina wept at the news—tears of anxiety and worry about how she was going to cope financially when she eventually moved out of the refuge. Sabrina knew that, because of the two-child limit, she would struggle to bring a third baby into the world. She couldn’t bear the thought of having to tell the government how the child was conceived—out of abuse and fear—in order to get the money she was entitled to. Soon, she packed her family’s bag with the few belongings they had and returned to the home she had shared with her abuser, utterly defeated.” That is not a situation that this Government should be putting women in. They should be helping women out of abusive relationships, not sending them straight back to their abusers for fear of losing out. I do not want to hear about how a form can be changed and what could happen to make the process better; it should not exist at all. There should be a universal support system for everybody, and that is why it is such a fundamentally important issue Although I know that others wish to speak, I could go on all afternoon about the injustices of the two-child policy, because it also affects religious minorities who cannot or will not use contraception or abortion, and it affects refugee families, who come here, wait a long time to be processed, and then find that they are not able to get the entitlements that they had hoped to get to support themselves and their families. The impact of the policy is devastating, and it disproportionately affects families who are already in work. The Minister should look at the report, look at the evidence and scrap the two-child policy, and the rape clause that stands part of it, immediately.
It is an honour to have the opportunity to talk in this important estimates day debate. I congratulate the hon. Member for Wirral South (Alison McGovern) on introducing the debate Record and rising employment is the central fact of the Government’s economic record. It is sometimes easy to brush over the fact that we now have the highest rate of employment in this country than at any time since the early 1970s. That is not only important on an economic level, although obviously it has wonderful economic benefits for the country, but extremely important on a social level and a personal level, because of the way it benefits families and communities and gives people opportunity and optimism that they otherwise might not have For four years before I came to this place, it was very much my privilege to serve as the director of policy at the Centre for Social Justice, which is a think-tank that looks at the root causes of poverty in the UK. That background is what lies behind my exchange with the hon. Member for Wirral South earlier. One can of course say that the root cause of poverty is people not having enough money. It is true that poverty is people not having enough money, but it is unquestionably the case that the reason why some people do not have any money is that they do not have a job in order to earn money, and that the reason why some people—not everybody at all—are unemployed is that something has gone badly wrong in their life, and that thing needs to be corrected with the help of public services, with the support of their family and with their own personal determination. That must always be an absolutely essential part of any welfare policy, which is why it is so important that the significant changes that have been introduced in the Department for Work and Pensions have been coupled to the work of the troubled families programme in the Ministry of Housing, Communities and Local Government. It is by helping people to overcome some of the root causes of poverty that we can help more people to move into the workplace and so help to support themselves and their families There is a group of people who are lucky enough and fortunate enough to come from stable homes, to get a decent education and not to suffer from addiction or any such problems, who still find it difficult to make ends meet, which is why it is extraordinarily important that any Government have an economic policy that generates jobs and drives up wages. The Government have been extraordinarily successful, without parallel, in the creation of jobs. Life has undoubtedly been harder in the generation of higher wages, but it feels like in recent months—over the past 15 months, I think—we have turned a corner on that score and, for the first time since the financial crisis in 2008, we are starting to see wages rise above inflation. Ultimately, that is excellent news for people who are moving into the jobs market and for people who are starting off on low salaries It must be remembered that none of that success was predicted by commentators before the 2010 general election. I remember in 2009 listening to a Bank of England economist forecast that the incoming Chancellor of the Exchequer would have to deal with unemployment of more than 5 million. In 2011, he repeated that the policies of the Conservative and Liberal Democrat coalition would unquestionably lead to record unemployment and a massive social security problem. That simply did not happen, because of the business-friendly policies that the Government adopted, which increased investment and business growth and saw employment rise in very many parts of the country It was a pleasure to sit and listen to the speech by my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke). I do not believe it can be an accident or a coincidence that his constituency has not traditionally had a Conservative MP, yet after seven years of Conservative employment growth in his area, it elected a Conservative. After seven years, following a major economic meltdown under the previous Labour Government, the Conservatives delivered the job growth in his area that Labour had been incapable of doing for the 13 years that it was in power. We see it not just in Middlesbrough, but in a whole range of seats from Mansfield to Stoke-on-Trent. This new era of Conservative representation in parts of the midlands and the north is a result of this policy, which has helped people to find jobs and improve their lives and the lives of their families. This has been termed the British jobs miracle, because unemployment is now at about 3.8% in the UK, compared with 7.5% in the euro area.
I do not doubt that properly paid work is the best route out of poverty, but when will the hon. Gentleman’s so-called jobs miracle extend to children living in poverty? How can he explain what is currently going on when we see that two thirds of all children living in poverty do so in a working household?
The hon. Gentleman raises a very good point, but, as I have already said, we had a long period of employment, but with little or no wage increases. We have now started to come out of that period. What he will see is that, if wages and wage growth are maintained in the months and years ahead—as I have no doubt that they will be—we will start to see the number of young people in poverty go down. We will see that their parents have more money because they are in work and their wages are rising above inflation. I am sure that he would accept that point.
Will the hon. Gentleman not accept that, while we wait, children remain in poverty? What are his Government doing? They are continuing to cut universal credit, which is supposed to help move these families away from poverty. Why is this continuing to happen? Why do they have to wait all this time for the never-never of jam tomorrow?
I do not believe that it is correct to say that the Government are taking money out of universal credit. I am sure the hon. Gentleman remembers the previous Budget when a considerable amount of additional money was put into universal credit. I think that he is, perhaps, slightly out of date on that score.
The hon. Gentleman has obviously missed the fact that working age benefits have been frozen for four years. That is a real terms cut. Will he just explain to the hon. Member for Glasgow Central (Alison Thewliss), who talked about a single parent with three children who simply cannot put any more hours a day into her working life, how, if benefits stay frozen, people are supposed to see their incomes rise and their children lifted out of poverty?
The hon. Lady makes a very good point about the benefits freeze. That is something to which I intend to return at the end of my remarks. It is unquestionably the case that the benefits freeze has hit people—and hit some people very hard. She is aware of why the benefits freeze was needed: it was needed because of the disastrous condition in which her party left this country’s finances when it left office in 2010 The DWP is playing its role in helping people back to work and helping them to find, sustain and progress in work. If Members talk to work coaches across the country, they will find that those coaches now have the tools and a service at their disposal to help them to form a working relationship with the people they are seeking to help. They understand that people who come into the jobcentre are, effectively, in work to find work. The agreement of claimant commitments between the jobseeker and the jobcentre creates an environment in which both the work coaches and the people with whom they are working can get results. No one who has spoken to work coaches across the country can doubt in any way that this has been substantial improvement Universal credit, as it is rolled out and improved, is helping to make work pay. It has overcome the terrible problems of the 16-hour cut-off that was raised by my hon. Friend the Member for Copeland (Trudy Harrison). It has helped to overcome these crazy marginal tax rates that popped up at different points in the system. Obviously, it is being rolled out in a test and learn environment. As it is tested, so DWP has learned, which means that a range of improvements have been made As a member of the Work and Pensions Committee, under the chairmanship of the right hon. Member for Birkenhead (Frank Field), who is no longer in his place, I was particularly pleased that we managed to work with the Government to scrap the seven waiting days, to ensure that people received their money sooner, to see advances of up to 100% on full monthly payments to claimants, and to develop the landlord portal to make it much easier for housing benefit to be sent to landlords and so on and so forth. These are important changes, but I have no doubt that there are still additional beneficial changes to be made. There is further to go—much further to go The hon. Member for Wirral South mentioned the benefit freeze. I very much hope that, in the comprehensive spending review at the end of this year, the benefits freeze is ended and the headroom that the Chancellor has built up is put to good use.
It gives me great pleasure to speak in this debate; I thank the hon. Member for Wirral South (Alison McGovern) for bringing it to the House and for beginning so powerfully I want to speak about not just the amount of money in the system, but the impact of our benefits system on a whole range of people including disabled people, people who have children, pensioners and people who are unable to work, because it seems to them that they are being punished for being poor and for being unable to work from the very start of making an application for benefits. For example, the personal independence payment form is 33 pages long and includes very cryptic questions. People know that they are supposed to answer those questions in certain ways, but they just do not have the guidance on how to do so People have to claim for universal credit online, which means they need to have computer skills, a computer and access to broadband to make a claim and to manage that claim on an ongoing basis—to retain control over their finances and their benefits. We have seen that a majority of people need support to make their universal credit claim and to be supported throughout the process. And it is not just an online claim form, but effectively a 10-stage process whereby the claimant has to make a phone call, complete a claim form online, go along to a jobcentre, provide 14 bits of documentation and evidence, return to sign their work conditionality agreement, and log on to their journal on a mobile phone or portable device. That is a huge amount of bureaucracy for anyone to have to undergo—much less somebody who is not used to IT systems and who, in an area such as mine, has to spend £7 each way to get a bus to the jobcentre and has to meet those costs upfront before they can even start claiming them back Someone applying for the personal independence payment needs to go for an assessment, and we have heard so much about those assessments, particularly those of us who are members of the Work and Pensions Committee. I heard from a group of women who were survivors of sexual abuse, who were assessed on how that abuse continued to affect them years later. They found the whole process absolutely terrifying, as they had to attend cold, informal assessment centres that were often in a tower block in the middle of a city, but away from public transport routes.
In Northern Ireland, we are seeing the roll-out of the horror story that the hon. Lady has mentioned. Statistics published in February this year show that there have been 193,000 applications for PIP, 32% of which were turned down. The resulting appeal from 50,000 turned-down applications has cost us £5 million to process. It is a disgrace.
I agree; it is a disgrace, and not just when it comes to the number of applications being turned down Over a year ago, the Government signed up to the assessments being recorded so that their quality could be improved, but we have seen no progress in that regard. People in my constituency want to see a video recording of their assessment because they are so terrified after previous experiences. For example, people who are suicidal have been asked why they did not go ahead with committing suicide. They are now terrified of attending another assessment for disability benefits and are desperate for their assessment to be recorded. However, in order to have the assessment recorded, people have to phone up three days in advance and get specific recording equipment that can produce two recordings at the same time. These pieces of equipment are rare nowadays, as cassette tapes are required to produce such recordings. This is the current guidance from the DWP. People have to source that equipment in order to have their assessments recorded, well over a year on from the Government’s commitment that they would ensure that that was the case in every assessment where people wished for it Not only do people have to undergo these cold, terrifying and impersonal assessments where they are concerned that they are being marked down—the Minister appears to disagree—but I have heard from women who say they have been curled up on the floor crying at having to remember their sexual abuse, with the assessor not even looking at them but simply repeating the question. So I am sorry, but I do not accept that those assessments are personal and that they take people’s circumstances into account, from the accounts I have been given that are so distressing to hear The hon. Member for North Antrim (Ian Paisley) is right to say that 32% of PIP applications are turned down. That is actually better than in my part of the country, where 46% of applications from those moving on from DLA have been turned down. Some of these people go on to mandatory reconsideration. We used to have 80% targets for the refusal of mandatory reconsideration. I would love to hear from the Minister what the current rate of refusal is. With regard to the tribunals, although 74% of people who undergo them are successful, they take 48 weeks to take place—over a year on from the start of the process People are absolutely terrified, all the way through, of losing their benefits. In too many cases, they are having to go to the jobcentre and claim universal credit if they cannot access their employment support allowance any more, and then being deemed fit for work. Doctors have been written to and told that they cannot sign people who are sick off work any more—that the DWP will not accept their professional medical judgment because its assessors have deemed people fit for work. One of my constituents who was going through the process of appeal was forced back into work, and, on the first day back, suffered a heart attack and died. My constituent and his wife and family cannot get that life back, but we can seek to improve this system that does so much damage to so many people Even if people on benefits end up being successful in getting through a tribunal, the amount of benefit that they are on is reduced. Under universal credit, they have to wait at least five weeks in order to get their first proper payment. Yes, they can get an advance of that payment, but they have to weigh it up—do they want to spend the next 12 months in debt because they are having that advance payment deducted from their already low amount of universal credit, or do they try to muddle through? People end up getting into debt with family and friends or with loan sharks and online loan organisations. We have heard that 3 million households are still worse off under universal credit. Despite that, local housing allowance is meeting only 3% of market rents in many areas, including some in my own constituency, so people are seeing a reduction in their benefit. They are having to make up their rent because local housing allowance does not meet it, and over half of universal credit claimants are having deductions made from them as well It is no wonder that people end up in poverty. Some of my constituents end up with just £20 a week to pay all their bills. As if that is not enough, people on universal credit are being hit more and more with civil penalties of £50 for being late in supplying information or late for an appointment. Answers to parliamentary questions that I put yesterday show that nearly £400,000 of such penalties has been passed on to debt collectors by the DWP in the past year. These are people who are already very poor. They are already suffering from having a penalty imposed on them, and then they are having to pay debt collectors the £135 fee that they charge on top of trying to seek the £50 fee. How is this being fair to people who are poor? How is this supporting people back into work? It is no wonder that we have seen the number of people visiting food banks rising, homelessness rising, and in-work poverty rising I could say much more as chair of the all-party parliamentary group on universal credit: time and again, we hear about the problems with the system from fantastic advisers who, day in day out, try to support people. In many cases, those advisers—Citizens Advice, Derbyshire welfare rights—have to come to us as constituency MPs to try to sort out problems that they are not empowered to sort out on people’s behalf I am sorry to say that my advice agents across Derbyshire are having to come to me to see whether I can help constituents in other parts of the county whose MPs refuse to help them. It is not right that we should be getting to the point where MPs—on the other side of the House, I am afraid: every one of those requests has come from Conservative constituencies—are not prepared to listen to and support their constituents, who need such support to be built into the system People feel absolutely powerless. No wonder we have seen a huge rise in debt and mental health difficulties, especially among young people growing up in poverty and in families struggling against this system. Please let us not just change the amount of money that goes into the system, but the whole way in which people are treated. They must be supported and empowered to live fulfilling lives.
It is a pleasure to be the last, I think, of the Back-Bench speakers today on the important issue of the spending of the Department for Work and Pensions and its estimates. That vital Department takes a quarter of the £800 billion-odd spent each year on public services. I congratulate the hon. Member for Wirral South (Alison McGovern) on securing this excellent debate. I spent a happy year sitting behind Ministers PPS-ing at the DWP. I was really passionate about working there, because it is a Department that can really make a difference; it has a huge spend and a vast range of levers to really help people and make a difference. Alternatively, if things go wrong, we see where people are hindered In his excellent speech, my hon. Friend the Member for Brentwood and Ongar (Alex Burghart) referred to a number of Conservative Members elected in 2017 to seats that might previously have been described as the Labour heartlands. I want to add North East Derbyshire, a seat we won in 2017, to the list. I stood for that seat in 2010 against Natascha Engel—a former occupant of the Chair, Madam Deputy Speaker, and an excellent MP. I spent two and a half years there. I remember how toxic the benefits culture there had become: an issue that set neighbour against neighbour People were concerned that they were working hard while they saw other people who they thought were not putting in the shifts. At times, that was unpleasant and unfair: it is very difficult to tell who is capable of work and who is not, and neighbours are not necessarily able to make the distinction. But I was troubled by the situation and by the statistics showing that, in 2010, 1.4 million people had been on long-term benefits for nine years and 2.6 million had been on them for five years. Clearly, that was a difficulty The big challenge for any Government elected in 2010, whether Labour or Conservative, was to work out how to get people capable of work off benefits and give them the tools, access and ability to step into work, thus reducing the benefits bill and focusing funds on those who really could not work. It was about helping and empowering those who could work to get into and rise up the jobs market I think my hon. Friend the Member for Brentwood and Ongar is right about electoral success. Fast forward to now, and we see that the approach has gone down incredibly well with voters—not only those who saw people on benefits who perhaps should not have been, but those people themselves, who wanted the help and were given the encouragement.
rose—
I will give way only once, as we are short of time.
The hon. Gentleman continues to make the assertion that welfare reforms have driven the increase in employment. There is no evidence to support that: the National Audit Office, for example, disputes it On the issue of working as the route out of poverty, I should say that, according to the Joseph Rowntree Foundation, four out of five people in low-income work will still be in such work 10 years later. It is an absolute myth that work is a progression. That does not mean that we should not do stuff about that issue—of course we should.
Well, we can argue about statistics, but try this one. [Interruption.] The hon. Lady wants to throw one at me, but then will not let me respond with one, which I find slightly dictatorial. Some 2.2 million people were unemployed when we took office in 2010; that figure is now 1.4 million. I can give her the number of those who have clearly moved off unemployment benefit into work. We can argue about this all the way through—
Will the hon. Gentleman give way?
I am not going to take any more interventions because, to be fair, those making them have had a lot of time to speak, and I am not going to get much of a chance We have seen people moving into work, and that has been a huge success. From listening to Opposition Members, one would think that the benefits system was completely rosy. As I have said, not only were too many people on benefits—trapped on benefits—but if we look at the tax credits system and the attacks on universal credit, we can see that universal credit has been rolled out in a slow, progressive manner, and we have changed it as we have gone along, while tax credits, which were rolled out in one big bang, were overpaid by over £7 billion, and over £2 billion had to be clawed back from those who were actually the poorest. I do not want to take too many lectures on how to introduce a successful benefits system, because we have seen how things have failed before. What has most impressed me about the Department is that it has learned from the failings over the years and has tried to do things better I am absolutely passionate about universal credit, because I have spent time with my jobcentre and seen the enthusiasm that the work coaches have for it. When we go into a jobcentre now it is not like going into some cold, austere office where people are too scared to go in and get any help. It feels almost like a recruitment centre to help people. There are help points and people who are passionate about helping people into work I am really proud of this Government’s record. I believe that every Government should be judged on what they have done in helping people into work. As I have said before, on every occasion the Labour party has left office, it has done so with unemployment higher than when it entered, which has got to be considered a failure. The Conservative party has been able to secure 3.6 million extra jobs. We have also increased the living wage, taken people out of tax and incentivised them. We have tried to focus on people who need help the most. It is said that all these jobs are low-paid, but 70% of them are highly skilled. It is said that wages are not going up, but for the 15th month in succession wages are going up by more than inflation. The proportion of jobs that are low-paid stands at its lowest level for 20 years as a result of the national living wage. Yes, there is more to do, but let us not knock the record that we have delivered I am going to make one suggestion, and I am echoing a point made by the hon. Member for Ellesmere Port and Neston (Justin Madders), who talked about the Motor Neurone Disease Association. He and I played football against that organisation, and I found it the most extraordinary moment. It was incredibly touching to play alongside them, and I then met that team. The organisation makes the very good point, which is also made by the Marie Curie cancer organisation, that it cannot be right that we have to test those with terminal illnesses for their disability benefit. They are reliant on a doctor saying that they will die within six months, but GPs are not comfortable saying that. The challenge for us as a Government is really to listen, and to look at how much such a change would cost. We know those people are going to be able to claim benefits in the main, so it is only a delay while they have to wait. However, they do not have time to wait, and I would like our Government to look at that. It is not just about those in that period of six months, but also those who have managed to survive their terminal illness three years and then have to be retested While I am very proud of the Government for what they have done in putting people into work and in targeting support, with almost an extra 1 million disabled people in work as well—we have record levels—we still have individual policy areas that we need to fix and on which we should do better. We must never rest on our laurels.
It is a pleasure to follow the hon. Member for Bexhill and Battle (Huw Merriman). May I again point him to the Scottish Social Security Agency and the way we in Scotland propose to treat people with a terminal illness? I think he will find that quite illuminating, and it has suggestions for this Government It is a pleasure to speak for the SNP in this debate. I congratulate the hon. Member for Wirral South (Alison McGovern) on securing it. There have been a number of interesting speeches, not least that of the hon. Lady herself. She set out very well a strong defence of the welfare state. She rightly contrasted how pensioners, other than the WASPI women, have rightly been protected, while others have not. I will develop that point later in my speech. She also mentioned the fact that austerity is a choice, and she was right to draw attention to the 1.6 million food parcels handed out by the Trussell Trust as a stark reminder of the impoverishing failure of austerity. Best of all was her stout and clear argument that lack of income is the driving force behind poverty The hon. Member for Copeland (Trudy Harrison) was right to welcome the Government’s cancelling the expansion of the two-child limit, but I question why she does not expect that policy to be scrapped I always enjoy listening to the hon. Member for Oldham East and Saddleworth (Debbie Abrahams) in these debates. She rightly asked why we do not hold the social security system in the UK in the same high esteem as the NHS. We should all ponder that, as should some in the fourth estate The hon. Member for Truro and Falmouth (Sarah Newton) made a thoughtful speech, but I think that my hon. Friend the Member for Glasgow Central (Alison Thewliss) made the best speech today. It was brilliant and rightly contradicted the Tory rhetoric on the two-child limit, highlighting last week’s report by the Child Poverty Action Group, the Church of England and others. I know it gives her no pleasure—it certainly gives me no pleasure—to say that the report proves that the warnings we gave at the time were correct. No mother—no parent—should have to choose between poverty and an abortion, but sadly that is the stark choice that faces some because of the two-child limit. The hon. Member for Brentwood and Ongar (Alex Burghart) is simply wrong about universal credit. The last Budget made up for just half the cuts that the 2015 Budget inflicted on universal credit The hon. Member for High Peak (Ruth George) was right to highlight the non-financial problems with universal credit and other benefits. The hon. Member for Bexhill and Battle (Huw Merriman) was right to point to the DWP’s influence. Policy drives poverty—we should remember that Sadly, so much of the debate has been characterised by raking over decade-old ground rather than addressing the issues that we face today, and I wish that some Members had spent more of our time on the latter. The estimate for DWP spending is still driven by the policies of austerity that have ravaged the Department since 2010. The estimate may have risen by 3%, but, as the Library briefing makes clear, that is largely down to the Department’s accepting greater responsibility for spending that was previously made by other Departments—for example, taking tax credits from HMRC Most people who rely on social security do not see any rise in their weekly family budgets. The hon. Member for Ellesmere Port and Neston (Justin Madders) made that point well when he said that 1.9 million people were worse off by £1,000 under universal credit according to the Institute for Fiscal Studies. Family incomes have been slashed, thanks to the austerity agenda that the Tory-Liberal coalition led and the Tories continued after 2015 Even the modest rises in the state pension leave the UK state pension as one of the most miserly in the developed world. Thousands of people in Scotland and across the UK have been hit by the benefits freeze, the two-child cap, and cuts to disability benefit and universal credit, leading to a rise in food bank use and in-work poverty. That is why we want the UK Government to think again about their budget for the DWP. It is also why SNP Members will vote against the estimate. We do not do so to deny the funding to the Department; we are using the vote as the only blunt instrument we have to protest about the way in which the Department is funded and the way in which the estimates process is scrutinised. In Holyrood, Members can amend the Budget, but that is sadly not the case here The Budget allocation will not allow the Department to remove the two-child cap or the benefits freeze, to fix universal credit, or to mitigate the hardship suffered by women born in the 1950s because the state pension age increased without adequate notice or lead-in time What is the real world result of the Government’s spending cuts to the Department? It is increased poverty and food bank use. The Trussell Trust, the largest food bank network in the UK, has reported steep rises in demand for its services year on year. In this year’s report, it points to increased food bank use among working families. That should be a stark warning to us all The Secretary of State was the first in her role to acknowledge the long-stated link between social security cuts and increased food bank use, but the Government have done little to put the money where it is needed and stop the cuts that hurt the most, such as the benefits freeze and the two-child cap. The investment in universal credit at the last Budget did not even cover the cuts that were inflicted by the disgraceful 2015 Budget, which cut universal credit and other social security benefits to ribbons Everything in the estimate before us could be moot as we are going to have a new Prime Minister, a new Chancellor and probably a new Secretary of State for the Department for Work and Pensions by the end of the month. My questions for the two remaining candidates for Prime Minister are these. What are their plans for social security? What are they going to do about child poverty? Are they going to follow the model set out last week by the Scottish Government, with the Scottish child payment? That measure alone, which will be delivered earlier than predicted to tackle the increase in child poverty perpetrated by the UK Government, is predicted to lift 30,000 children out of poverty. The Child Poverty Action Group described that as a game changer in the fight to tackle child poverty, which is quite the contrast from CPAG’s comments on the Tories’ two-child cap: “You could not design a better policy to increase child poverty than this one” Whichever candidate wins, we want to know whether they will follow our example in putting money where it is needed, or whether will they continue with the pernicious cuts to social security we have seen them support since 2010 It is unlikely that the frontrunner, the former Foreign Secretary, will have the ideological or economic space to address the problems with universal credit, as he will be spending Scottish taxpayers’ money on delivering a massive tax cut that the IFS has said would primarily benefit just the top 8% of earners. Quite how the 4.5 million UK children in poverty will benefit is anyone’s guess, but it is all a guessing game with this candidate. Indeed, yesterday I suggested it might be the Secretary of State’s final outing at DWP questions. Little did I know how prophetic that statement was. Today, we found out that the Foreign Secretary apparently wants to get rid of the DWP altogether. What an absolute farce I also raised yesterday the issue of child poverty. The Work and Pensions Secretary said that she saw work as the best route out of poverty. I agree, but it has to be properly paid work and the evidence shows that in-work poverty is rising. Incomes matter, which is why the new Scottish child payment is so important. So is addressing the chronic shortage of social and affordable housing, on which Scotland is leading the way. So is getting more employers to pay the real living wage, on which Scotland is leading the way. Those are just some of the reasons why Scotland has a lower child poverty figure than the rest of the UK Sadly, we have so much more to do. The UN special rapporteur on poverty and human rights, Philip Alston, recognised the work that is being done in Scotland to address poverty, but he also pointed to UK social security policies as driving poverty levels in Scotland. The Scottish Government, local authorities and third sector organisations are doing fantastic work to alleviate poverty, but we are pushing against the tide of UK cuts. The problems need to be fixed here One of the problems is the five-week wait that is built into universal credit. The waiting period is driving up indebtedness through rent arrears and commercial debt. One way of sorting it could be to use the assessment period for the advance payment of UC proper. If there is an acceptance that people need an advance at the start of universal credit, why say that that money has to be paid back? People cannot be expected to live off fresh air and they should not be expected to prolong indebtedness or financial hardship either. Advance the first payment of universal credit and stop the cycle of hardship. I have already mentioned the two-child cap and the benefit freeze, which, I think we are starting to realise, needs to get sorted. Taken with the five-week wait, fixing them would go a long way to stop the projected rise in poverty In terms of treating people with dignity and respect, there is an urgent need to sort out the disability assessment and to ensure there is a “do no harm” approach. Ministers will be aware of the work being done in Scotland to set up the new Scottish social security agency, which is soon to take responsibility for personal independence payments. One of the things we have confirmed we will do is to ensure all medical information about the applicant is available at the application stage, so as to avoid the need for the face-to-face assessments that so many disabled people find demeaning and irrelevant. It is hoped that by doing so we will cut the staggering appeal rights currently seen in the UK system, as we will get the decision right first time. The current Minister for Disabled People, Health and Work, the hon. Member for North Swindon (Justin Tomlinson), once said from the Back Benches that he was sympathetic to that idea. I hope he might be influential in the Department now in looking to follow Scotland’s lead in this area The pensions landscape still needs to be properly mapped out. I have repeatedly raised the issues faced by the 1950s-born women. I still believe that UK Ministers have an obligation to act, but we continue to be stonewalled. One issue picked up this morning, in a roundtable that my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford), my hon. Friend the Member for Paisley and Renfrewshire South (Mhairi Black) and I had with pension stakeholders, was lost pension assets. The Association of British Insurers and the Pensions Policy Institute analysed that relatively recently and found that there are 1.6 million lost pension pots, averaging £13,000 each. In total, about £20 billion is unclaimed. Astonishingly, those figures are for defined-contribution schemes alone. Obviously, defined-benefit schemes are harder to analyse, but the total is expected to be far in excess of the £20 billion unclaimed from DC schemes What I find most frustrating is that, although the industry has been trying hard to return those assets to their owners, the UK Government have not been terribly helpful in providing the necessary information to allow it to do so. I hope that changes. Phoenix, one of the contributors to our meeting this morning, spent two years researching lost pension pots and managed to reunite people with £13 million from more than 2,300 pots. Clearly, the UK Government need to look at what they can do to help the industry, as we are talking about substantial amounts of money We await publication of the pensions Bill. I hope there is serious cross-party work to advance key issues such as the pensions dashboard and our idea for an independent pensions commission. Sadly, this debate has shown that although there is general consensus on the pensions scene, there is very little in other areas of social security—there are some exceptions—that we agree on across the House. However, the facts speak for themselves. When we invest in families and ensure they receive proper support, poverty drops. Poverty is policy driven, and right now UK policy is impoverishing. That is why we cannot support these estimates this evening.
It is a pleasure to follow the hon. Member for Airdrie and Shotts (Neil Gray). I congratulate my hon. Friend the Member for Wirral South (Alison McGovern) on opening this vital debate and thank the many Members who have contributed Sadly, there are far too many things that Members could have chosen to focus on when considering the spending approach of the Department for Work and Pensions. Certainly, there is no shortage of examples of delivery failure, catastrophic underfunding and policy approaches that hit the most vulnerable the hardest, including 1950s-born women and citizens who are terminally ill. However, as Members highlighted, there is one area in which many of the Department’s failures come together and one group who all too often suffer the consequences of multiple cuts and changes in policy: children It shames us as a society that the Government have allowed children to bear the brunt in such a shocking manner. We therefore welcome this opportunity to scrutinise Department for Work and Pensions spending, and we welcome my hon. Friend’s choice of subject. When the future of some of our most vulnerable children is at stake, it is absolutely right that we should hold the Government to account for their poor decisions Shockingly, by 2022, the Department’s spending on social security will be £36 billion less per year than it was in 2010. Social security has become a vehicle for cuts—a political choice that saw 1.6 million emergency food parcels given out last year alone, 577,000 of them to children, and that has seen this Government dragged through the courts on several occasions. For example, 210,000 people who were underpaid employment and support allowance will now rightly receive the £920 million they are owed Consequently, as we have heard, the number of children living in poverty has increased by half a million to 4.1 million. As my hon. Friend the Member for Wirral South said, that figure is likely to rise to more than 5 million. In-work poverty is rising faster than employment. Absolute child poverty has also increased over the past year, showing the negative impact of low pay, universal credit, the five-week wait, the four-year freeze and the two-child limit on family income. When poverty and food bank use are rapidly growing industries, tackling and preventing child poverty is clearly not a priority for this Government. When tools that should be used to support people, such as the flexible support fund, are regularly underspent, it prompts a question about whether the Government are even trying to support those most in need through the tools at their disposal Even if we were to ignore all the evidence and be generous to Ministers when they say that tackling poverty is a priority, it is clear that they are not doing so with the necessary vigour, success or compassion. When they have applied new policies, they have failed. There have been persistent problems with the personal independence payment, as highlighted by my hon. Friend the Member for Ellesmere Port and Neston (Justin Madders), with more than 70% of appeals against decisions to remove PIP being successful, at considerable cost to the public purse and, more importantly, detrimental to the life chances and wellbeing of people. The many thousands of families who budget down to the nearest £1 every week to make sure that they can feed and clothe their children and provide a roof over their heads could certainly teach the two candidates rutting to be the next Prime Minister a thing or two about how to prioritise and manage budgets effectively Of course, there are many families for whom all the budgeting and prioritising in the world is still not enough to cover the costs of the Government’s draconian cuts to social security. They are victims of the Government’s insistence on continuing to plough on with universal credit and the freeze to working-age benefits, when all the evidence shows that those cuts are causing severe hardship and poverty As my hon. Friend the Member for Wirral South has highlighted, poverty is poverty, and food poverty is not separate to it, but a symptom of it—a symptom of low income. It cannot be divorced from the overall effect of Government policy, or wished away by Government-supporting MPs, who think a selfie at a food bank will solve the problems or absolve the Government of their responsibility as the architects of austerity Britain We have heard much of the evidence today. My hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) mentioned a case in which a pregnant woman had universal credit denied to her—I think the phrase my hon. Friend used was “ripped away”—in her time of need. The hon. Member for Glasgow Central (Alison Thewliss) said that social security should be a safety net, but it is a net that is full of holes. She highlighted the immorality of the two-child limit. My hon. Friend the Member for High Peak (Ruth George) spoke about the insensitive assessments applied to the most vulnerable in our society Such stories are the real indicator of how we should view the Department and the Government’s record on poverty and their approach to social security. They are committed to the continuation of failing policies, and they would rather trumpet a jobs miracle that in reality, for many people in real communities, is nothing but a mirage; the reality is that most children in poverty live in working households. The Government’s approach has ensured that, for thousands of people, work is not a route out of poverty, given poverty wages and insecure work. That is a damning indictment of their record and of our current economic system. It needs to change In just three weeks’ time, we are likely to have one change at least. The leader of the Conservatives, and therefore the Prime Minister, will be someone different. Perhaps the Cabinet Minister responsible for the Department we are scrutinising today will be different too. However, given we have already had six of them in the past three years, that would be less remarkable. If the Government had shown the same willingness to change direction as they have shown to change Ministers, we might be in a different place. But it is not the changing of names around the Cabinet table that will make a difference, or even as some in the media reported yesterday, the scrapping of the Department. It is the changing of policy, the changing of attitude, and the changing of approach that will make a difference I ask the Minister to leave a legacy, and heed the clarion call from organisations such as the Child Poverty Action Group and the many voices in the Chamber today. Will the Minister commit himself to ending the five-week wait for universal credit, removing the two-child limit and the benefit cap, scrapping the benefit freeze, paying up-front childcare costs, and putting a stop to punitive sanctions and work capability assessments? Or, better still, let us have a general election and let the people decide.
It is a pleasure to respond to a vital discussion of how the Department for Work and Pensions supports the 22 million people who rely on our services We have heard a huge number of valuable contributions, including those of the hon. Member for Wirral South (Alison McGovern)—whom I congratulate on opening the debate—and my hon. Friend the Member for Copeland (Trudy Harrison), the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), my hon. Friend the Member for Truro and Falmouth (Sarah Newton), the hon. Member for Ellesmere Port and Neston (Justin Madders), my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke), the hon. Member for Glasgow Central (Alison Thewliss), my hon. Friend the Member for Brentwood and Ongar (Alex Burghart), the hon. Member for High Peak (Ruth George), and my hon. Friend the Member for Bexhill and Battle (Huw Merriman). Later in my speech, I will respond to some of the key points that have been raised I have been in my post for three months, and over that time my key focus has been on supporting the most vulnerable in our society. No one in the Government wants to see poverty rising, and, while the latest “Households below average income” statistics, from 2017-18, do not reflect the £1.7 billion-a-year cash boost for our welfare system that was announced in the Budget, the Secretary of State and I recognise that there is more to do We know that children in households in which no one works are about five times more likely to be in poverty than those in households in which all adults work. We are committed to helping lone parents into jobs that are flexible in relation to their caring responsibilities, and more than 1.2 million are now in work. To help parents into work, the Government spend £6 billion on childcare each year. We are able to do that because we have doubled the number of free childcare hours to 30 a week for nearly 400,000 working parents of three and four-year-olds; introduced tax-free childcare which is worth up to £2,000 per child per year; and made changes in the flexible support fund to help people to pay up-front childcare costs. However, we recognise that we need to continue our work in this area. That is why the Secretary of State and I have publicly committed ourselves to tackling poverty, and child poverty in particular. As we get closer to the spending review discussions, my ministerial colleagues and I are reviewing our bids, in collaboration with other Departments, to ensure that those who can work do work, and that those who cannot are supported. I can confirm that there are no plans to extend, or maintain, the benefit freeze after March 2020.
I thank the Minister for the commitments that he has just made. Will he also tell us what more the Government can do to ensure that vulnerable claimants can have access to universal credit?
My hon. Friend has made a very good point. We know that about 20% of people seek help when claiming universal credit. That is why we introduced the Help to Claim service, working with Citizens Advice and Citizens Advice Scotland. However, I am acutely aware that a number of vulnerable groups in my portfolio—care leavers, prison leavers, survivors of domestic abuse, and those who are homeless or sleeping rough—need extra support, and the Secretary of State and I are carefully considering a number of further options ahead of potential spending review bids.
Will the Minister also confirm that it is now always worthwhile to go to work and that people are better off in work, contrary to what we have just heard?
My right hon. Friend is right. By removing the cliff edges, universal credit ensures that work always pays. That was not the case under the previous legacy system DWP Ministers always listen and act on feedback. That is why we recently announced that we will end three-year sanctions, initiate programmes to investigate how we can help those in work to progress, work with the Social Metrics Commission on a measurement of poverty, and no longer regularly review those on PIP who have reached state pension age. In addition, I continue to work closely with charities, stakeholders and Members on both sides of the House, using real-life experiences to shape improvements in the Department’s work We have worked with the real experts, the stakeholders, including Refuge and Women’s Aid, which have backed training for our work coaches to help victims of domestic abuse so they can better identify, refer and support those in need.
Will the Minister give way?
With respect, I will not give way to Members who have not been present for any of the contributions to the debate In terms of supporting victims of domestic abuse, we want staff to be able to better identify, refer and support those in need We worked with the Ministry of Housing, Communities and Local Government on the commitment to end rough sleeping through the homelessness and rough sleeping strategy and the Ministry of Justice to ensure prison leavers have access to welfare support from day one. Only last week the Secretary of State announced an extension to the UC pilot in HMP Perth and HMP Cornton Vale.
I thank the Minister for giving way and will pass on the intervention from my hon. Friend the Member for Central Ayrshire (Dr Whitford). Will he give separate payments to women who have suffered domestic violence?
As the hon. Gentleman knows, split payments are available. I know the Scottish Government are looking at split payments by default, and that is an area I am looking at very closely indeed. It comes with huge complexities, as indeed the Scottish Government recognise, and we are working very closely with them. The Secretary of State has done a huge amount of work in this area—we would expect nothing less from a former Home Secretary who has done an awful lot of work around domestic abuse. So this is an area that I am looking at very carefully; I am conscious of it and am very happy to commit to continue to work with the Scottish Government to try to find solution to what is a very complex issue Supporting the most vulnerable in society is at the very heart of our compassionate Conservative Government and my Department does exactly that.
Will the Minister give way?
Last year we paid 20 million citizens—more than half of all adults in this country—a huge range of social security entitlements and benefits, from state pension and cold weather payments to universal credit and disability benefits. In total the Department spends £190 billion a year—spending that is equivalent to the GDP of Portugal.
Will the Minister give way?
Through our welfare reforms and our reforms to make work pay we have got spending under control while ensuring that we do not trap people on welfare. [Interruption.] Under Labour, 1.4 million people spent most of the last decade trapped on out-of-work benefits, with some receiving more than the average wage. Some 50,000 households were allowed to claim benefits worth over £500 a week or more than £26,000 a year, higher than the average wage at the time. [Interruption.] We are creating a welfare system in which it pays to work, with universal credit simplifying the complex legacy benefits—[Interruption.]
Order. The Minister is clearly not giving way.
Thank you, Madam Deputy Speaker. The hon. Member for Oldham East and Saddleworth has already had an opportunity to contribute to the debate. She has intervened numerous times and, as I said at the beginning of my speech, far from being frit I will address a number of the key points raised during this debate We are creating a welfare system in which it pays to work, with universal credit simplifying the complex legacy benefit system that thwarted opportunities to work through punitive tax rates and a cliff edge for those wanting to do more work and that mired people in debt. We are establishing jobcentres that help people into work, not just to sign on—jobcentres where one-to-one personalised support is provided to a claimant from their work coach, offering advice and access to services to help the vulnerable, and where staff create links with businesses to make it their personal mission to help people not into just a job, but into the right job This is not to speak of the huge wider support that this Government offer. Our welfare reforms are assisting the incredible employment statistics we see month on month. The recent labour market figures show the importance of helping people into work, and this Government have created more than 3.6 million more jobs since 2010, helping people out of poverty and creating aspiration and a huge sense of purpose for millions. The employment rate is at a record high, while the unemployment rate has halved since 2010 and has not been lower since the 1970s. As my hon. Friend the Member for Bexhill and Battle rightly said, no Labour Government have ever left office with unemployment lower than when they started, meaning that more people were denied the security of a regular wage. From May to July 1997 to March to May 2010, the unemployment level increased from 2.1 million to 2.5 million. There are now almost 1 million fewer workless households, giving more than 600,000 more children a role model in their home who is in work. The number of children living in workless households increased under Labour, meaning that fewer children were living in a financially stable household with a working role model.
rose—
Labour failed to help people into work so that they could provide for their families, with workless households increasing between 1997 and 2010.
rose—
The number of young people who are unemployed has almost halved since 2010. Female unemployment is at a record high, and wages are growing at their joint fastest rate in a decade. These are the reasons why our labour market is outperforming many—
On a point of order, Madam Deputy Speaker. Call me old fashioned, but I thought the purpose of the Minister coming to the Dispatch Box was to reply to the debate. He has now been on his feet for 10 minutes, and all he is doing is reading out his civil service brief. This is becoming a habit among Ministers. He said that he was going to refer to Members in the debate, and I think he should start to do that—
Order. I would have stopped the right hon. Member for North Durham (Mr Jones) a few seconds earlier, but the House must forgive me for being unable to speak volubly today. He knows that this is not a point of order, and that it is up to the Minister to answer the debate however he wishes to do so. The Minister is perfectly in order.
I have taken numerous interventions already, Madam Deputy Speaker, and I stress that the point of a debate is actually being here to take part in it These are the reasons that our labour market is outperforming those of many other developed countries. More people have moved into work in the UK since 2010 than in France, Spain, Ireland, the Netherlands, Austria and Norway combined.
rose—
We are at record levels of employment and, once fully rolled out, universal credit will support another 200,000 people into work and help those already in work to increase hours. But we do not want people to have just any job; we want them to have good jobs where they are able to progress, and universal credit will enable this while providing an economic benefit of £8 billion a year to our economy and saving the Exchequer more than £3 billion annually But this is not “job done”. I know as well as anyone the importance of supporting people into work, particularly among vulnerable groups. That is why we have worked hard to create a safety net that not only supports people when they fall on hard times but gives them a hand up. That is vital. We are spending more than £55 billion this year to support disabled people and those with health conditions. That is more than any Labour Government did. Disability benefit spending will be higher in every year to 2023 than it was in 2010. Under universal credit, disabled claimants who cannot work will receive an average of £100 more each month than under the legacy system. So we are supporting those who have worked their whole lives and paid into our social security, and who now deserve to enjoy their retirement. We created the triple lock on state pensions, which has increased the amount of the basic state pension to almost £1,600 more than it was in 2010. We are further protecting the poorest pensioners through pension credit. This means that in total we spend more than £120 billion on benefits for pensioners in this country. As a result, pensioner poverty is now close to historic lows, which is where we want to keep it.
rose—
I will turn now to some of the points made in the debate. The hon. Member for Wirral South talked about the WASPI women. This Government have introduced transitional arrangements costing £1.1 billion. This concession reduced the proposed increase in the state pension age for more than 450,000 men and women, and it means that no woman will see her pension age change by more than 18 months relative to the 1995 Pensions Act timetable. As numerous hon. Members have pointed out, if we were to reverse the state pension changes made under the previous Pensions Act, it would cost more than £200 billion up to 2025-26 Moving on, the two-child policy ensures that parents in receipt of benefits face the same financial choices when deciding to grow their families. As announced in January, we will no longer be extending the policy for new claims for children born before April 2017. Turning to the benefit freeze, I have already made it clear that we will end the freeze in 2020. As for universal credit, the principle is to have a simpler system, with six benefits rolled into one. When it comes to supporting children, I play a role in the early years ministerial group, which was chaired by the former Leader of the House, my right hon. Friend the Member for South Northamptonshire (Andrea Leadsom). That group is looking at numerous options around cross-departmental work on supporting children.
Will the Minister give way?
I will come to the points made by the hon. Lady The hon. Member for Oldham East and Saddleworth raised several points. The Government are spending £55 billion a year on benefits to support sick and disabled people. In 2019-20, our spending on main disability benefits is £9 billion higher than in 2010, and main disability benefits are exempt from the benefits freeze. On universal credit, as I have pointed out already, around 1 million disabled households will receive an average of around £100 more a month I agree with my hon. Friend the Member for Truro and Falmouth, who is no longer in her place, and she will know that we are working with employers through our disability confident scheme, giving them the tools and advice to support staff with a disability or long-term health condition. Over 12,000 employers have now signed up. The Minister for Disabled People, Health and Work, the hon. Member for North Swindon (Justin Tomlinson), will pick up her suggestions. I thank her for the work she did when she was in the Department The hon. and learned Member for Edinburgh South West (Joanna Cherry) made an intervention in relation to the Scottish child payment. I understand that the Scottish Government have laid out their plans to introduce an additional £10 a week for eligible children in Scotland, and I should say that we welcome the overall commitment to tackle poverty, but we note the challenge and look forward to understanding the impact of the payment in detail. We will continue to work with the Scottish Government on the impact and introduction of that payment Turning to the remarks from the hon. Member for Airdrie and Shotts (Neil Gray), the pensions dashboard is a digital interface that will allow individuals to see their pension savings online in one place to assist with their retirement planning, and I welcome the cross-party collaboration on that. On the pensions Bill, we intend to bring forward legislation when parliamentary time allows We are a Government determined to help the most vulnerable, to support them into work, to support them to stay in work, and to support them when they cannot work. We will continue to do that through all the support that the Department offers, and we will continue to assess and adjust that support by listening, learning and improving. I have met and visited several stakeholders, valuing and taking on their expert views, so we are always listening to colleagues, stakeholders and, most importantly, our constituents, whom we are here to serve and support Question deferred (Standing Order No. 54).
I inform the House that Mr Speaker has not selected either of the amendments.
I start by thanking the Backbench Business Committee for allowing this debate on this incredibly important matter. I thank the hon. Members for Hackney South and Shoreditch (Meg Hillier), for Sheffield South East (Mr Betts), for Birmingham, Ladywood (Shabana Mahmood) and for Newton Abbot (Anne Marie Morris) for supporting the application, along with all the members of the Public Accounts Committee. I also thank the hon. Members for Redcar (Anna Turley) and for Warwick and Leamington (Matt Western), who submitted similar applications that have been lumped in with this debate. I also give my thanks in advance to everyone who wants to speak today; I will be as quick as I possibly can Local government spending is a story of unsustainability and inequality. According to the Local Government Association, which is holding its conference as we speak, funding to local government and business rates have fallen by £4.1 billion since 2015. Councils have far less spending power, but here is the rub: our local councils are having to deal with a big growth in demand for key services. Taking into account the decrease in Government grants, subsidised a bit by the increase in council tax, our councils have lost nearly a third of their spending power over the last nine years, and key services are suffering We all know what that means, at its heart, for the most vulnerable in our communities. Since 2010 the number of homeless households has risen by 33%, the number of looked-after children is up by nearly 11% and the number of people aged 65 and over in need of care has increased by 14%. It is great that we are living longer, but central Government have not grasped the nettle Combined with higher national insurance contributions, the apprenticeship levy and the national living wage, councils are at breaking point. Given the major stresses on children’s services and adult social care, I will focus on those today, but there are many others, and I look forward to other Members making contributions about their local area.
For childcare and other local authority services, central Government have shifted funding away from a grant system and on to business rates. Shopkeepers, in particular, are now finding it difficult to carry on their business. Central Government have also failed to deliver on social council housing, which is an indictment against them.
I thank the hon. Gentleman for his contribution. In fact, spending on services has decreased by 19.2% in real terms, which is not sustainable In my local area, Vale of White Horse District Council is a good example. We won the council off the Conservatives in the last round of local elections, and now we have sight of the finances. I am sure this is not unique in the country, but there is not enough money to fund the basic statutory services that the council is expected to deliver. The council is therefore eating into its reserves at an alarming rate. Coupled with that, an outsourcing agreement that was meant to save the council £50 million, and in fact has saved nothing, is projected to cost the taxpayer money. We are in a dire situation in the vale.
The situation in the hon. Lady’s area is mirrored in Harrow, where the council has lost over 97% of its revenue support grant since 2010 and is really struggling. Is it not therefore particularly sad that neither of the two Conservative candidates for the premiership are talking about these issues at their hustings?
I hope today’s debate will be a clarion call to them and others about the importance of local government in delivering key services The resilience of local councils across the country is a focus of the National Audit Office’s work, and it has real cause for concern. The message I have received from my friends at today’s LGA conference is twofold. First, we must remember that councils are multi-million pound companies, yet they do not know where their funding is coming from past next year. How on earth are they expected to plan without any sense of the medium term, let alone the long term Secondly, if we are to shift the burden from central Government to local government, income generation needs to be made easier. Across the country, I am not aware of a single council that has successfully used the referendum mechanism to raise council tax. This is not working. We need another way to make sure councils are properly funded.
Between 2011 and 2015, according to the NAO, 25% of the central Government grant to councils was cut. Does the hon. Lady regret the role of the Liberal Democrat coalition Government in such a heavy level of cuts?
When I was a candidate, I, too, fought against these cuts, particularly those to children’s services. As the hon. Gentleman knows, I am a teacher, and I was seeing the effect the cuts would have. Interestingly, when we look at the data, we see that some of that was meat that could have been trimmed off. [Interruption.] Let me finish. [Interruption.] Just look at the transcripts from the Select Committee on Housing, Communities and Local Government. In 2012-13, there was an increase in efficiency, but I will concede that after that point the cuts should have stopped. The point of today’s debate is to move forwards. Having been elected in 2017, I hope the hon. Gentleman will join me in looking forwards and not backwards.
rose—
I am moving on. I am not going to give way.
The hon. Lady just referred to the Select Committee.
I will come back to the hon. Gentleman in just a second Let me move on to adult social care, because it is really important. The Chancellor’s extra £750 million for social care in 2019-20 falls drastically short, given that the funding gap for adult social care is expected to reach £3.6 billion by 2025, according to the Local Government Association. This is a vital government service and central Government responsibility is shared between two Departments. I have many questions for the Minister, but one is: where on earth is the adult social care Green Paper? The situation is no longer sustainable. The adult social care sector in England accounted for 1.34 million jobs in 2016-17, yet, according to the National Audit Office, it has been 10 years since a national workforce strategy has been published. Furthermore, 43% of those aged 80 or over in England in 2016 needed help with activities for daily living, yet only 20% actually received the help they need. Demand is increasing and less is being provided—and to fewer people.
rose—
And of course I happily give way to the Chair of the Select Committee.
I am not sure the hon. Lady will be quite so happy when she hears what I have to say about the matter. Again, this is typical of the Lib Dems, is it not? We see collective memory loss about what happened between 2010 and 2015, and them washing their hands. Does she accept that the biggest cuts in real terms per year in adult social care happened between 2010 and 2015, and she and her colleagues in the Lib Dems bear equal responsibility for that?
I thank the hon. Gentleman for his point. As I say, I am looking forwards On adult social care, the Liberal Democrats are proposing—I would be curious to know whether Labour is planning the same—a penny in the pound on income tax to add to the social care budget, in order to sort out the short-term funding issues. That has to be just a short-term solution. The longer-term solution is not this tit-for-tat political to-ing and fro-ing; it has to be a cross-party effort to find a long-term settlement that will last for decades, not years.
I entirely agree with the hon. Lady on this. The Select Committees on Health and Social Care and on Housing, Communities and Local Government issued a joint report on the future funding of social care. One of its recommendations was a social care premium—an insurance based model like the German model. Would her party engage with that, on a cross-party basis, involving Conservative Members and Members on those Benches?
I absolutely agree with that. Those calls were led by my right hon. Friend the Member for North Norfolk (Norman Lamb), who has been working on this issue on a cross-party basis. We have to do this together or we are not going to do it at all I now come to children’s services, an issue that, as a former teacher, is very close to my heart. Councils are overspending on these services, too—they did so by £872 million in 2017-18. The Public Accounts Committee has reported that 91% of authorities overspent. We are talking about young vulnerable children here. Something odd is happening, because although the number of children in the population has gone up, increasing by 7% since 2010, the number of child protection assessments has increased by 77%, on average, across the country. Worryingly, however, the figures are really different depending on the area of the country, suggesting that best practice is not being spread. For example, Camden Council has decreased the number of children that it has in looked-after care but other parts of the country have increased this by more than 90%. What are the Government doing to ensure that what some councils are clearly doing right is being spread? Meanwhile 42% of all local councils are rated as good or outstanding by Ofsted—but that means 58% are not. That is atrocious. We need to make sure that councils are held to account. My understanding is that Ofsted is so overstretched that it has for the moment suspended the rating of local councils. Will the Minister clarify whether that is true The final thing I wish to talk about is prevention. I serve on the Public Accounts Committee, and my colleagues and I are interested in value for money for the taxpayer. I am deeply concerned that the changes to children’s centres and youth services are not delivering value for money. In fact, worse than that, they are failing the young people of our country. The decrease in the number of Sure Start centres in Oxfordshire has meant that we cannot reach the same number of families as we did previously Meanwhile, the head of Ofsted said in her annual report: “The evidence suggests that these cuts to youth and other services are a false economy, simply leading to greater pressures elsewhere.” The Minister will know that in 2015 the Government axed the Audit Commission. Who is looking after the money? When something is cut in one Department, what effect is it going to have elsewhere? I am told that the responsibility is now in the purview of the Ministry of Housing, Communities and Local Government, but it is not transparent. In the reports that the Public Accounts Committee has seen, it was not obvious that everyone knows what is going on. That is a key ask of the Minister: who is looking after the money? From what we have seen, not enough people are The lack of someone looking after the money has an effect on things such as the schools system. Schools have now become a repository for every other issue that has happened in local government, and we see the same with our police. I am sure many Members know of similar issues to those that I see in respect of special educational needs and disability funding: there just is not enough money adequately to support the children who need education, health and care plans. Why, when schools are already under funding pressure, are they being asked to provide the first £6,000 towards any plan? Surely it would make more sense that if a child has a need, that need is fulfilled Similarly, when are we going to see the Government address inequalities in the system, such as those relating to young carers? They are required in statutory legislation to undergo an assessment of what they need, but there is no legislation that follows through on that and says that they have to be provided with the things they have been assessed as needing. Who is dealing with those kinds of inequalities?
One pressure that the hon. Lady has not mentioned is homelessness. Although we on the Opposition Benches will not be surprised by the Government’s lack of additional revenue to tackle homeless, does she not think it particularly odd that the Conservative party, which claims to be the party of the armed forces, is doing nothing about the scale of rough sleeping among veterans?
As I said at the beginning of the debate, we have seen a rise in homelessness. It has been a particular focus of mine on the Public Accounts Committee, and the hon. Gentleman might be aware of my campaign to scrap the Vagrancy Act 1824. We need to make sure that the fact that we are a compassionate nation is reflected in all parts of policy. I could not agree with his point more. As he rightly pointed out, there are many things that I have not touched on, but I am sure other Members will. This has just been a quick canter around the finances in the estimates I hope that the Public Accounts Committee’s reports on local government spending and sustainability are bedside reading for all Ministers, because they make recommendations that I sincerely hope Ministers will take seriously. When the Minister responds to the debate, please can we have answers on the following? First, where is the spending review? How on earth can we expect councils to plan for the medium and long term when they do not even know where next year’s money is going to come from? Secondly, where is the fairer funding review? The Government have moved the burden of taxation from central Government to local government, but the underlying inequity in the system still exists. Thirdly, linked to that, where is the business rates review? As was alluded to earlier, local economies are suffering because of a lack of joined-up thinking. Finally, a refrain that I hope and am sure others will continue: where is the social care Green Paper We need all four together before we can achieve genuine value for money in what local councils deliver. Anything else is a false economy. All of us see the knock-on effects of these Whitehall spending decisions in our postbags. We also see the desperation of people who come to us because they feel that their local councils have failed them. However, half the time, it is not local councils that have failed them; it is central Government. Local government is vital. It is the coalface—it is where real policy meets real people. I hope that today’s debate will be a clarion call. Local government may not always be sexy, but it is certainly significant. I thank all colleagues for being here and the Backbench Business Committee for enabling us to have today’s debate.
Order. There is quite a lot of time for the debate this afternoon, but, as the House can see, a great many people wish to speak. I hope that we can manage without a formal time limit, because the debate flows better without one. We can do so if hon. Members are courteous enough to speak for around eight minutes. If Members do that, everyone will have a fair and equal chance to contribute. If not, we will have a time limit.
I am grateful for the opportunity to catch your eye in this debate, Madam Deputy Speaker I pay tribute to the hon. Member for Oxford West and Abingdon (Layla Moran), who is a highly valued member of the Public Accounts Committee, of which I have the honour to be deputy Chair. It is clear from her speech that she is extremely knowledgeable about this area, particularly about education, on which she is the Liberal Democrat spokesman I also pay tribute to other Members who have helped to secure this really important debate. The reason it is so important is that local authorities are by far the largest devolved form of government in England. They deliver a range of vital services, such as education, planning and social services. The money devoted to local government, and therefore to the effectiveness of these services, is vital to the people of this country, which is why, for the first time in 27 years in this place, I wanted to speak in an estimates debate, but particularly in this one on the Ministry of Housing, Communities and Local Government It is a disaster for the people covered by a local authority area when it runs out of money and centrally appointed commissioners are brought in to oversee the finances, as we have seen in Northamptonshire County Council. We need to look very carefully at the role of section 15 officers, who have issued more than 114 notices of loss of financial control since 2010-11. We particularly need to encourage the Government to be intrusive in their inspection of local audits, because it is possible to spot where a local authority is beginning to get into trouble far sooner than was done with Northamptonshire, thereby possibly avoiding bringing in the local commissioners As the hon. Member for Oxford West and Abingdon said, the finances of local government are fairly parlous at the moment—resources fell by 34% in real terms between 2010-11 and 2017-18. Paragraph 12 on page 9 of the National Audit Office report states tellingly that overspending and the use of resources were not fully financially sustainable over the medium term. I encourage my colleagues on the Front Bench to look very carefully at this whole matter Local government is now facing a funding gap of £3.1 billion by 2019-20, which is estimated to rise to a staggering £8 billion by 2024-25, according to the NAO. Local government spending is being stretched significantly as we face the demand for services way outstretching available funding. This year, for example, Gloucestershire County Council has had to raise its council tax in every district to make £21 million of savings to deal with the financial pressure. To simply keep up with the county’s demand for services, council tax payers now need to provide nearly £295 million Children’s social services are a particular worry in the county and across many education authorities. It is the No. 1 financial pressure on Gloucestershire’s 2019-20 budget, as the authority will spend an additional £16.3 million on the most vulnerable children and young people in the county. Ofsted made a monitoring visit to Gloucestershire’s children’s social services in April—its sixth monitoring visit since our local authority was judged to be inadequate in March 2017. It is promising to see that progress has been made. However, that progress was deemed to be slow, and we cannot continue to fail to provide good enough social services for our most vulnerable children and young people Throughout the country, 42% of children’s social services are rated good and we spend some £8.8 billion on them, but 91% of local authorities have overspent in this area and we need to understand why. We had the education debate yesterday, and although there is a record amount of money in education overall—rising from £41 billion in 2017-18 to £43.5 billion in 2019-2020—the problem is with distribution. That is the case for my local authority, and I suspect that some of my colleagues on both sides of the House who are in the f40 group would agree that the distribution of money is critical. For example, an authority such as Hackney is getting £6,500 per secondary place, yet some schools in Gloucestershire are below the fair funding amount of £4,800 per secondary place.
I apologise for intervening, as I have already spoken for a long time. I am a vice-chair of the f40 group. Does the hon. Gentleman agree that the current calls from the f40 are about not just distribution but quantum? The “Together for Education” event that took place across the way in Westminster on the weekend before last called for an extra £2.2 billion a year in the education budget, because the f40 group recognises that we can redistribute all we want but the quantum also needs to rise.
I accept what the hon. Lady says. The problem is that it is about not only the amount of money that schools get, but the amount of costs that central Government keep imposing on schools—pensions, the apprenticeship levy or other expenditures. The costs keep going up, so the amount that schools have to spend is squeezed every year The Government need to do two things. First, they need to consider the quantum, as the hon. Lady has said. Secondly, when they impose an additional tax or an additional cost on a school, they need to consider very carefully how that school’s budget is being squeezed. We want to give our children the fairest possible start in life, and allocating adequate resources to education is almost the most important thing a Government can do, which is why I feel so strongly about this issue. I also feel strongly about children’s special needs. The amount that Gloucestershire is spending in this regard is going up and up. I am grateful to the Government for providing an additional £1.35 million this year and next to deal with the problem, but they need to understand the causes of the increased demand in special needs, and education, health and care plans. The Government probably need to ring-fence this budget so that we do not get into the situation that we did this year, whereby Gloucestershire County Council was going to top-slice its general schools budget by up to 0.5% to deal with the problem. It is currently entitled to do so, but that is not fair on schoolchildren in general, which is why the Government need to ring-fence this budget Local enterprise partnerships—where local authorities contribute a significant amount of money, certainly some of the expertise and some of the governance—are rather variable, as we discovered from the NAO report. Some work extremely well; some work far less well. Some are governed extremely well; some are governed less well. There is geographical overlap in some, but not in others. If the Government wish to deliver their industrial strategy to the best possible degree, they need to look at the whole matter of LEPs quite carefully The fire and rescue service in Gloucestershire is currently run by the county council, but there is considerable pressure from the Home Office to transfer it to the police and crime commissioner. We have already had one inquiry and the proposal was rejected, yet the police and crime commissioner still wishes to overturn the decision. I say to my colleagues on the Front Bench that a considerable amount of resource and effort is being wasted by continually bickering over this matter. The fire and rescue service, I say loud and clear, is well run in Gloucestershire. The county council supports it, as do, I think, most Conservative colleagues—certainly, I support it very strongly. It should remain where it is We need to get local government funding functioning properly. This is a really serious problem. The Government wish to move to a new form of funding—the core rate support grant—in local government in 2021. That means that there are vital decisions that they need to make quite quickly. The proposal is that councils should keep three quarters of the revenue, down from 90% originally, but fundamental decisions on how this will work are coming very late in the day. No council should be under financial pressure, because of the tier splits, to move to 75% retention. We need to decide what the distribution system should be. If Westminster Council, for example, keeps 75% of its rate support, it will be awash with money, whereas a council in the north that keeps 75% will be in severe shortage. The councils need to know. As the hon. Member for Oxford West and Abingdon says, it is only fair that the funding system for councils both for next year and the year after are made very clear fairly soon The other side of the coin is that the Government have a target for building 300,000 more homes each year. Councils will be able to do that only if they are properly incentivised by the council tax system. They need to be able to work out what that system is going to be. As part of the local government finance reorganisation, what will the incentives be for councils that want to expand their council tax base, as with the incentives to expand their business rate base? Again, the Government need to make some decisions on this. They need to tell us whether the new homes bonus will remain, and in what form, to give councils that incentive This is a huge field. I think I have cantered over some of the main areas, and others will do the same.
I remind the House that I have been told that there is an informal eight-minute limit. If we can stick to that, we will help everybody.
I thank the Library and the National Audit Office for the briefings we have had, as usual. Laraine Manley, the director of place at Sheffield City Council, has given me some information about housing as well The Housing, Communities and Local Government Committee has produced a number of reports over the years covering many of these areas. The whole remit of the Committee is unique in Government in that while the Ministry has limited budgets of its own to deal with certain specific issues, it has oversight over local government as a whole, including spending by other Government Departments. The Ministry is supposed to act as a glue that brings all that together. However, there are concerns, as highlighted by Amyas Morse when he commented that there are no evidence-based efforts in Government to reconcile the funding to local needs. That is really quite a dramatic statement to make. In other words, Government do not have a clue what local government should be spending. That is not a direct comment about the Minister on the Front Bench or his colleague; it is a comment about Governments over the years. There has not been oversight of local government and an assessment of what it needs. All we get is, every so often, a divvying up of the money that is available between different councils, or the new burdens rule where something new is added and a council will get a bit more to pay for it—a bit more out of the system The figures are there. We have seen a 50% cut in Government grant to local councils since 2010, the biggest local government cuts to any service—not denied, I think, by Ministers—and a 30% cut in spending power. The pressures on social care, both for adults and children, continue to rise. The Government’s response to our report on children’s services is out today, and I think they have accepted a lot of the problems that exist. There will be a lot more work to do on this. As care has taken a bigger slice of a smaller cake, all the other important services such as parks—which we have done a report on—highways and buses, libraries, environmental services and refuse collection are getting cut even more, by between 30% and 60%. I am really worried, as I have said before, that we are seeing a hollowing out of local democracy where, in the end, councils just become the messenger boys and girls doing what the Chancellor and the Secretary of State want on a very narrow range of statutory services. That is a real worry, and we should all take account of it In the end, councils can only do their best. They have done marvellously well with efficiency savings: we are now making real cuts to real services that are affecting real people. Yes, council tax has been put up in many cases, but that is a regressive tax. On business rates, in the end local authorities have virtually no discretion at all anyway There is massive uncertainty now. We may possibly have the four-year spending review—nobody is quite sure whether it will happen; I do not really think the Minister even is. The other day, the Chief Secretary to the Treasury seemed to indicate that it was not going to happen. As Gary Porter said the other day at the Local Government Association conference, local government is in a state of complete uncertainty—it has no idea at all what is going to happen from next year. Are we going to have a spending review for four years or for one year, because the four-year one will be postponed? If we have the one-year review, we cannot do the fair funding review because there will not be enough time for it to work through What is happening with the 75% business rate retention? Can that be done at the same time as all the other changes or will that be too much for local authorities to absorb? The Minister accepted at the Housing, Communities and Local Government Committee evidence session the other day that the business rate retention scheme is probably the most complicated part of a very complicated system. Can this all be brought together and made sense of? I have not yet mentioned the shared prosperity fund, which is somewhere out there, to be considered at some point. All those things give massive uncertainty to councils and councillors providing important services to the people who matter at the end of the day. Councillors are uncertain and so are the communities out there about what they are going to get as a result of the changes As the LGA and the Institute for Fiscal Studies have said, what is really worrying is the prospect that 90 councils will simply run out of money during the next spending review unless more is provided. Council treasurers are saying that; that is the situation. Councils have done terribly well, but they cannot carry on using reserves as they are having to now I turn to the issue of housing, which represents the other part of the money spent directly by the Department. Everyone wants to see us meet the ambitious target of building 300,000 new homes in this country. My personal view is that that cannot be delivered unless about half are provided by the public sector—councils and housing associations; historically, the private sector has never consistently gone above 150,000. If we are going to do that, it is not enough to say that we have lifted the housing revenue account cap and councils can start to build. I hope that they can, but Laraine Manley, director of place at Sheffield City Council, has spelt out the situation there We have a really ambitious council in Sheffield, including Councillor Paul Wood, the new cabinet member, and Councillor Sophie Wilson, who is down today to celebrate 100 years of council housing. Both want to build council houses, but the issue is not just the borrowing but the revenue to support the borrowing. That also matters. The revenue comes from rents. One of the most damaging things the Government did was to restrict rent increases on local authority and housing association homes in the last spending review. Sheffield City Council estimates that that took a startling £800 million out of its long-term business plan—money that would have gone into supporting new house building and important maintenance of existing homes. That figure is staggering. Although the rent increase in the next round will be the consumer prices index plus 1%, that will not be sufficient to build back the loss that has already occurred. At some point, the Government will have to consider greater freedom for councils and housing associations to raise rents to fund new building in the future Apparently, about 70% of the costs for building new homes will come from existing rents in the housing stock; the rest will come either from grants from Homes England or from receipts, although apparently receipts and grants cannot be used for the same home. The Government may also want to have a look at that—and, again, address the issue of why more right-to-buy receipts cannot go to councils to support house building in future Those are big issues, and the Select Committee will shortly do an inquiry into social house building and how we can ensure that the homes needed are actually built. That will be interesting Finally, I will mention the other big issue that we have to mention today: cladding on not just high-rise buildings, but high-risk buildings. The Government have so far put aside £400 million to take ACM cladding off social housing and £200 million for doing so in the private sector. I have to say that the social housing figure is not likely to be enough, and the private sector figure certainly will not be enough. More money will have to be found to get that cladding off and make those homes safe. The Government are now doing a review of 1,600 more properties with non-ACM cladding that may be just as dangerous. If it is as dangerous, it is going to have to come off, as the Minister for Housing has already said. If it has to come off, the Government will have to find the same money as they are doing for ACM cladding. If we add the ACM cladding budget of up to £1 billion to another £1 billion for other types of cladding, we are at over £2 billion. That does not even deal with the issue of materials that are not in those categories but are not of limited combustibility Under the changes the Government have made, they are insisting that those materials will not go on new buildings, yet they are saying that materials not safe to go on new buildings can still be left on existing buildings and that they will not help to remove them. I think there is a very big additional bill coming down the road, and when we see the estimates for the Department in one or two years’ time, they may well be very different.
It is a pleasure to follow the hon. Member for Sheffield South East (Mr Betts), and it has been a pleasure to serve on the Select Committee under his guidance for the last four years. I agree with many of the points he made, particularly the last stuff on cladding. We know that is a much bigger issue than is currently accepted, and we need to deal with it. It is interesting that he talks about local authorities not having rents capped when it is Labour party policy to cap rents in the private sector. I am not sure that is a very balanced approach I agree with many of the points the hon. Gentleman made about the spending challenges for local authorities. Clearly, there are huge spending challenges for local authorities and also for the national Government. It is my belief that we will have to address this stuff in a very different way. This is not a party political point, but Governments of all persuasions have balanced the books in this country only seven times—they have done so in only seven years—over the past 53 years. We cannot simply keep spending more than we are getting in, otherwise we end up with the £2 trillion debt, which is where we are I regret some of the spending pledges in our leadership contest at the moment, because we have got to run this country much more prudently. We have to be able to balance the books on an ongoing basis, and certainly to do so within a cycle. We have some massive challenges ahead that we will all have to accept: the cost of healthcare that we are going to provide; the cost of pensions that we are going to have to provide; and the costs of social care. As things are at the moment, all this is going to land on the taxpayer. It does not seem feasible that that situation can continue, particularly in the area of social care. We know there is a funding gap for local authorities of about £3 billion, which will rise to about £8 billion within five years, according to the LGA The Minister is doing a brilliant job in trying to get extra funds, and also in making sure that the funds are spread fairly across the country. The current funding formula is certainly not fair. My local authority has about 50% less spending power compared with some London authorities, for example. We need a fair settlement—one that is fair to everybody—but this has to be a rising tide that lifts all boats. If we do not put extra money into the system, we cannot provide a fairer funding system, as my hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown) said about school funding, and we cannot have some people losing out when everybody’s budgets are tight. We are going to have to find some more money for local authorities from somewhere if we are properly to address the fairer funding issue The biggest issues for my local authority, North Yorkshire County Council, are those involving children’s services and social care, which is what I primarily want to talk about. The difficulty with social care is that it has virtually zero correlation with the method of funding local authorities today or in the future. Moving to a system of business retention—the Minister knows I have reservations about such a system—means a finite amount of money for local authorities at a time when there is huge and rising demand for social care. There is no correlation between those two things. Local authority funding will be unsustainable. Either we find a new way of doing this, or local authorities will provide many fewer services in future The Select Committee considered social care twice. The first time, we went to Germany to look at the system there and then we conducted a joint inquiry with the Health and Social Care Committee. We settled on several recommendations, one of which constitutes the right solution, which is sustainable, scaleable and simple. It is the German system that was adopted in 1995. Before then, the German system was funded by local authorities. I am sure that they recognised that that was not sustainable, so they moved to a system of social insurance Everybody pays a small amount—just over 1% of people’s salaries, and the employer pays 1% of earnings—into a private insurance system. The insurance companies are not for profit—nobody makes any money out of the system. The levies are settled nationally, and the system also covers people with learning difficulties and disabilities. The system is simple and sustainable. Everybody pays a small amount so that nobody has to pay everything. That is the fairest part.
I am glad that my hon. Friend is talking about social insurance. I and many others have been arguing that the continental system of social insurance, particularly for funding health services, is probably the way forward. As our population ages, getting public support to pay for those services through general taxation becomes increasingly unsustainable. Personalising social insurance creates more support.
My right hon. Friend makes a good point. However, I believe that healthcare is different. Social care should be funded differently because everybody has a personal responsibility to provide for themselves in the future. Of course, people do not put money aside for many reasons. The system must be mandatory—that is the key—so that everybody puts some money aside even when times are tough. There is a threshold for people on low incomes, but the system means that people properly prepare for the future One of the biggest benefits comes when people are assessed as needing care. They can take the services of a charitable provider or the local authority, or decide to take the money. People who decide to take the money on a monthly basis can pay it to a relative or loved one to look after them. Another big benefit is therefore social cohesion. The system is about family looking after family, just as we used to do. We do not do that as much now. The system is good for society and for community. We saw that huge benefit when we went to Germany We have cross-party support for the idea. Both Select Committees—20-odd of us—reached that conclusion. It was one of the recommendations of our report, so we should work cross-party on it. There have been commissions on social care in the past, but when they report, the question is whether the recommendations are possible politically. If we put together our own parliamentary commission and reach cross-party consensus, I believe that we could deliver the recommendation The system has to be mandatory because there will not be an insurance market for it otherwise. That was the problem with the Dilnot recommendation. The scheme was not mandatory and therefore no insurance market developed on the back of it, so there was nothing available for social insurance. It is a great opportunity, which will cut the link between a potential huge future cost for local authorities, and our ageing population and the increased number of people with learning disabilities. Obviously, local authorities will have a huge part to play in directing services, but they will also be able to provide the other services that are critical for local people I am keen to work cross-party on the matter. I know that the Local Government Minister has regarded the proposal positively in the past and I am keen for the Department to give it a positive recommendation in the forthcoming Green Paper.
I would like to begin by addressing the remarks of the hon. Member for Oxford West and Abingdon (Layla Moran). I am sorry, but her party, the Liberal Democrats, were not innocent bystanders in austerity. They were active participants. She says she wants to look to the future—fine—but the effects of the decisions taken under the coalition Government are still biting today, not just in local government but across a whole host of Government policies. I am sorry, but people need to keep being reminded of that The National Audit Office and the Centre for Cities produced very robust reports on the effects of the cuts by the coalition Government and this Government to local government funding. Those cuts have been, as my hon. Friend the Member for Sheffield South East (Mr Betts) said, most severe in their effect. They have also not been very fair. For example, the most deprived areas in the north have borne the biggest share of the cuts, while areas such as Surrey and Wokingham have had few cuts that have had very little effect Durham County Council has faced massive cuts. Since 2010-11, its budget has been cut by £242 million. It has also been put at a disadvantage. As my hon. Friend the Member for Sheffield South East alluded to earlier, the Government have been moving funding from central Government to locally raised taxation. That puts authorities such as Durham at a huge disadvantage, because we have a low council tax base and a low business tax rate base. Some 50% of properties in County Durham are in council tax band A, so its ability to raise local taxation, even if it wanted to, is limited compared to others that have a larger and more diverse council tax base. If that was not bad enough, in addition to what is coming down the road with the fairer funding formula, County Durham will have to find another £39 million of cuts over the next four years. Under that strangely named fairer funding formula, County Durham loses an additional £10 million. Even though it is a deprived area, since 2011 it has already faced a higher than average core spending cut. Yet if we look at the average across the country, Durham is below average, so I do not know how that can be fair There is an idea, not just in local government funding but in education funding and everything else, that somehow every single part of the country is the same. We heard it from the hon. Member for The Cotswolds (Sir Geoffrey Clifton-Brown), who argued that the Cotswolds could somehow be compared to an inner-city borough such as Hackney. It is quite clear that deprived areas such as County Durham have a huge call on their resources from the two great drivers, adult social care and children’s care In 2018, there were 1,157 looked-after children in County Durham. Wokingham, which has not had the savage cuts that County Durham has had to face, looks after 141 children. We not comparing like with like. These are not services that councils can pick and choose from either; they fall under statutory provision. I have to say that Durham does them very well, but they create huge demands on the council budget that are not reflected in the support received from central Government. The cut in core spending has been dramatic in County Durham. Government figures show that the average core spending per dwelling is £1,908. In Durham, it is £1,727. In Surrey, which I would argue is a little bit more affluent than County Durham, it is £2,004. If we were brought up to even the England average, County Durham would get an additional £44 million This is about not only the savage effects of austerity on local government, but the pork barrel way in which the Government have distributed the money, clearly favouring areas that have supported the Conservative party and its coalition partners in the past, and punishing northern councils. In addition to the cuts that have taken place already, we have the public health funding formula, on which I led a Westminster Hall debate a few weeks ago. How can it be right that County Durham will lose £19 million a year—35% of its budget—while Surrey County Council increases its public health budget by £14 million a year Those funding decisions are clearly designed to support certain areas. [Interruption.] The right hon. Member for Gainsborough (Sir Edward Leigh) chunters from a sedentary position, but the facts are there in black and white. It has been a deliberate policy of this Government since—[Interruption.] Oh, he has got tired and gone off for a sleep. Clearly, as my hon. Friend the Member for Sheffield South East said, we need not only to look at fairer funding for local government but to ask what we need it to do. Like him, I feel that we will end up in a situation where some councils go bankrupt—some already have—and others struggle on delivering services, while being blamed by the Government for not doing so, when they have limited ability even to raise council tax locally In the 1980s, when I was first elected to local government, the Conservative party was a proud party of local government. It actively supported local government, cared about it and, as my hon. Friend said, thought it was an important part of the glue of democracy and of how we provided for communities. Alas, that seems a distant past: as I said, local government clearly will not be a priority for whoever wins the Conservative party leadership contest. This cannot go on, or we will end up in a situation where the people we were elected to serve suffer and councils throughout the country become unsustainable.
It is a pleasure to follow the right hon. Member for North Durham (Mr Jones). I normally agree with him on so many things, but since he touched on the Conservative party leadership contest, let me say that there is a hustings for Conservative councillors taking place at this very moment at the Local Government Association conference. Of course, they are at the forefront of public service and our local communities, and they are proud Conservatives in the role they play in local government. I had better declare an interest: I am married to a Conservative councillor, so I will double down and reiterate that point I think all Members would agree that local government stands at the forefront of the delivery of so many services across our country, and that so many of our constituents depend on those services. I think it is fair to say, on the basis of the comments we have heard, that we all know there are challenges with that across our constituencies. It is appropriate that we should debate local government and the MHCLG estimates on the day that the Local Government Association holds its conference in Bournemouth, because councils are responsible for the delivery of so many vital services in our communities. I want to touch on a number of them, including housing, adult social care and supporting children with special needs, with reference to the challenges of growing demand Much of this has been mentioned already, but I would like to give some examples from Essex, where we also have funding pressures. It is not a policy of discrimination, if I may say so in reply to the points made by the right hon. Member for North Durham. Despite facing a tight squeeze on the funds they receive from central Government—a squeeze that started before 2010—local authorities have worked hard, and we should pay tribute to all councils, whatever their composition, because they have all worked hard to balance their books We know that efficiencies have been made. We know that local authorities have been innovative: services have been shared, procurement strategies changed, and some services reduced or changed. But rising demand has put councils at a tipping point where they now need some increases in resource from central Government, certainty about medium-term settlements and more flexibility over the powers they have and the ways they can generate income In the amazing and incredible county of Essex, the county council has delivered £311 million of savings over the last four years, a significant sum, and it is working to make a further £176 million of savings by 2021-22. The reason for those savings is to ensure that resources are naturally focused on investing in adult social care and the council’s outstanding children’s services. It received an outstanding Ofsted score, and I am very proud of the council for its sheer determination and the work it has done to receive that score. But the savings target is a stretch, because there is little left to cut. There is little more that the council can slice off because demand on services is growing at a startling rate. For adult services, we see a growing number of service users who use services for longer and have more complex needs. Over the next decade, the number of residents in Essex aged over 80 will rise by 60% and the number of those aged over 90 will double. There are also growing numbers of adults with learning disabilities who we want to support as much as possible. That is the right and compassionate thing to do, and we want to provide fairness and opportunities in doing so We must see the Government do more to give councils such as Essex the resources to meet these needs. We also need to see the Government recognise that our councils need more resources to support children’s services and those with special needs and disabilities. The hon. Member for Oxford West and Abingdon (Layla Moran) also mentioned that in her opening remarks, and that touches on education, health and care plans too. While councils’ budgets have been squeezed, they have had to provide for more services and new responsibilities, and it is right that we all recognise that The introduction and roll-out of education, health and care plans has caused a 35% increase across the county in the number of pupils covered by EHCPs in the four years between 2013-14 and 2017-18. It is right that we recognise the impact that is having on budgets for supporting children with special educational needs, because it has not been met by the high needs funding block Councils now face the challenge of carrying deficits and they do not know what the Government will do to address that. In Essex, the deficit is now £15 million and it is set to double. Across the country, it could hit £1.6 billion by 2020-21. That challenge needs to be addressed. We have all heard about funding reforms and we have all participated in many debates and presented the issues to Ministers, stressing that those matters will have to be addressed through the comprehensive funding review and fair funding review, when they come. Those reviews must deliver genuine reform. We cannot tinker around the edges any more The process must include addressing the regional inequalities that other hon. Members have mentioned in funding for councils such as Essex. Despite the growing levels of demand on services, Essex is underfunded compared to many other areas. In Essex, the funding level is £271 per person per year for services, whereas the figure elsewhere is much higher, doubling to £563 per person in parts of London. As a result of those pressures, the council is looking at making very difficult decisions just to close the £176 million finding gap At the moment, the council is consulting on proposals to change library services, which could lead to seven of the eight libraries in the Witham constituency closing if community management proposals do not come forward. I should add that that is not the sole answer when it comes to addressing library services. The total budget for libraries is about £13 million, and, while there may be some merit in looking at ways in which to bring more community management and involvement into our libraries and modernise services, the potential impact on our communities is significant. I do not think anyone in the House can dispute that, especially given that reductions in the libraries budget will make barely a dent in the £176 million savings target No one will be surprised to learn that I have met many residents throughout my constituency who are campaigning passionately to save our libraries, including those in Wickham Bishops, Kelvedon and Coggeshall. They want those vital services and facilities to remain open. I hope that the Government will reflect on what they can do in the long term to continue to safeguard the community lifelines about which so many of us feel so strongly The issue of planning and development is highly controversial in many parts of the country, but it is incredibly controversial from an Essex perspective. We want to see communities, not housing estates, being built. In Essex, and especially in my part of Essex, we know that the building of new homes is absolutely right because it gives families more security, including financial security, but we are aware of the challenges that local authorities face in respect of the five-year land supply My communities are open-minded about development, but they are frustrated by a lack of infrastructure and a lack of support. We must be radical in our use of, for instance, the new homes bonus to support more infrastructure, and change the way in which we support local government funding across the country.
It is an honour to follow the right hon. Member for Witham (Priti Patel). Being married to a councillor, she will appreciate most acutely the tough decisions that councillors must make. Let me begin my speech by thanking councillors of all political parties for their work. Looking around the Chamber this afternoon, I see many Members who I know have served as councillors, in senior leadership roles or as back-benchers. I believe that one of them is still serving as a local authority member today. No councillor stands for election to deal with a five-year budget forecast. They do so for good reason, to help the local communities. We should always remember that, regardless of the decisions that they are forced to make That leads me neatly to the main points that I want to make. The hon. Member for Oxford West and Abingdon (Layla Moran) began by talking about the overall global figures that are affecting local government finances. The speeches that we have heard from Members on both sides of the House today have shown that every Member, everywhere, has a series of problems that can be attributed to the way in which the local authority is either run or funded. I agree with the hon. Member for Thirsk and Malton (Kevin Hollinrake) that when this is fixed, a rising tide will lift all those problems. Sadly, however, that rising tide will simply drown some of them, either because they cannot keep pace or because they are already enmeshed in problems that no amount of additional funding will solve What we need to think about—and I offer this as a radical suggestion which I hope the Government will consider—is moving away from the idea that we fund councils, fund the police service and fund clinical commissioning groups, and adopt a place-based approach to the way in which money goes into a community. One of the things that we do very well on the Public Accounts Committee is following the taxpayer pound. We have noticed continually that consequential impacts of a decision by a clinical commissioning group will drive up the costs of a service in a local authority. The decision by a police commissioner to close a police station—as is happening in Stoke-on-Trent—pushes up the incidence of antisocial behaviour. It will then be said that it is the council’s responsibility. Littering because of the lack of a recycling service will become detritus, with bricks left on streets. It becomes vandalism So many things happen not because of local authority funding, but because of the way in which we fund our entire public service. If the Government and, I hope, our own Front-Benchers—who I can see are listening—would seriously consider that place-based funding, we could eradicate some of the problems without necessarily having to throw lots of money at them. I know that that will not be easy, but if we are serious about a sustainable long-term public sector, we are going to have be honest about it The same goes for our social care funding arrangements. The National Audit Office report shows that 80% of social care budgets are overspent. I am pretty sure that if the Ministers at the Dispatch Box were to design a system today for funding adult social care, they would not say, “Let’s take the value of a property from the 1970s and its total value across an entire geographical area determined by a review in the 1970s and say that incremental increases of 2% every year is the best way to fund adult social care.” It is the way that we do it, but it is not the way we would design. If we are genuinely serious about tackling the funding issues in local government, we are going to have to look at the way in which we fund these things long-term and not simply tinker at the edges hoping to massage the figures so that marginal constituencies in one part of the country are better off at the expense of safer constituencies for Opposition parties elsewhere, which is what we talk about in fair funding formulas if we are being brutally honest.
My hon. Friend is making an interesting point about Total Place and how we should approach things, and we had some evidence on that in our recent Select Committee inquiry into local government funding. Does he accept however, that in order to hold that all together we need some local accountability, so we ought to be looking at how we devolve some of those powers to local government, and with it a better system of funding, as my hon. Friend has rightly said?
I thank my hon. Friend for that and for presciently leading on to my next point, which is about how devolution settlements work and the myriad different settlements that we have, across England predominantly, with city deals, local enterprise partnership arrangements or mayoral combined authorities. That means there are lots of arrangements we can look at to find best practice and then share it. There are examples of mayoral authorities dealing with their housing crisis in clever ways which traditional two-tier local authority areas have neither the capacity in their staff base to do, to be candid, nor perhaps the demand in their local areas for If we are to have that accountability structure, there needs to be a greater role for the Department, whatever it might be called. Civil servants from the Ministry of Housing, Communities and Local Government were asked a very simple question at a recent appearance before the Public Accounts Committee: “You say local authority funding is sustainable; what is the matrix by which you make that assessment?” The civil servants were very good at answering some questions, but were unable to give us an exact demonstration of how they make that decision. The NAO disagreed with them on a fact-based, evidence-based assessment, yet when that question was put by numerous members of the Committee, some more vociferously than others, they were unable to give us a clear explanation of how they make those sorts of determinations. If we are going to be serious about the way in which local government is funded, there has to be strong overview and oversight by Departments, but we also need to trust local government Local government has been given a series of new responsibilities. I was a councillor and I know that local authorities welcome new responsibilities because it allows them to flex their muscles and do things in an imaginative and innovative way. However, they are restricted in how they are able to deliver them—they find themselves straitjacketed—and they suddenly find themselves carrying unnecessary burdens in order to deliver something that they know they could do better if they were allowed to. They do not make a hash of it but they end up not reaching their full potential.
My hon. Friend is making some good points, but does he also agree that one of the Government’s mistakes in terms of devolution is holding to the idea that that can be done only if there is a mayor? That has led to some very strange situations. For example, in the north-east we have a hotch-potch of different responsibilities in different areas.
I entirely agree, and the same goes for LEP boundaries. If we are going to do this, there has to be a way forward that means that it fits local area needs According to the NAO, £6 billion is currently tied up between section 106 agreements and the community infrastructure levy. That is a huge amount of money, but the CIL aspect of that cannot be spent on building new affordable housing because it is for low-level infrastructure. I urge the Minister to review that. It is a pot of money that exists in local authorities that could be unlocked to readily transform the way in which our local authorities work At its best local government is flexible, lean and hungry to do things, but that agility is fast becoming fragility, and I fear that if there is one more knock to the system everything will shatter.
Thank you for this opportunity to speak in the debate, Mr Deputy Speaker, and it is a pleasure to follow my fellow Public Accounts Committee member, the hon. Member for Stoke-on-Trent Central (Gareth Snell). We debate many of these things on a regular basis. I congratulate the hon. Member for Oxford West and Abingdon (Layla Moran), who is also a member of the Committee, on having organised this debate and ensuring that it occurred. I want to talk about a couple of points, primarily about policy perspectives relating to housing and planning, which my right hon. Friend the Member for Witham (Priti Patel) also mentioned Before I do that, I should like to refer gently to the points raised by the right hon. Member for North Durham (Mr Jones). I do not want to get too political, but the problem with baselining everything at 2010 is that we all know in our heart of hearts that that is not the right place to start. I know that from the perspective of local government, because I was a councillor for four years before 2010 and I can recall the amount of money that was sloshing around in the system. Quite frankly, there was too much money in the system because some councils did not know how to spend it and were certainly not spending it effectively. We have to be careful when we go back to those kinds of baselines, not least because that arrangement was unsustainable on a national level and inopportune in many areas at local level Moving on to the policy points, I have a couple of suggestions for my hon. Friends on the Treasury Bench. One is about an issue that deserves greater attention in housing policy. The other about is fracking, which is a favourite interest of mine and which many Members are already bored by. On housing, I know from debates such as these, from discussions in the Select Committee and from watching what is happening across the midlands and the north of England that the national planning policy framework—useful though it is in many areas—is becoming a somewhat blunt tool in other parts, particularly around housing. We see the emphasis on house building, particularly in the midlands and the north, which I welcome. I welcome the 217,000 houses that were built last year and the 35,000 housing starts in the first quarter. We can also see the huge pipeline of planning permissions that has built up to an average of 350,000 a year over the past few years The policies are obviously working, but we have to ask ourselves whether they are becoming a slightly blunt tool. Areas in the midlands and the north are being asked to take large swathes of housing, but if we look at the best proxy for housing, which is house prices over the past 10 years or so, we see that there has been either no increase in house prices or a real-terms house price drop. I would like us to consider moving the national planning policy framework towards a more regional approach. We obviously have a problem in the south-east and around London, and it is absolutely appropriate that we should address that, but in other areas we might need to think again I shall move on to fracking, as I do on a semi-regular basis in this place. The reason that I bring it up regularly is that I do not think everyone in this place really understands the consequences of our fracking policy and where it might end up. If we do not understand it now, we run the risk of facing some very large bills in the future, along with the significant impact on many communities including mine, where we have a fracking application in Marsh Lane at the top of my constituency. No one in Government has ever been clear on what the purpose of fracking is.
One of the problems that I have considered when thinking about fracking is that if we do it at scale, the impact on the environment and the countryside will be huge, but if we do not do it at scale, the benefit will be so relatively small as to make it not worth pursuing.
rose—
Order. I do not want us to get into too much of a debate on fracking. I recognise that it has an impact, but the danger is that we will end up with Members on both sides just discussing fracking.
I will absolutely take your steer on this, Mr Deputy Speaker The key point that I was coming to, without getting too generic about it, is that we do not yet know the outcome of the consultation that the Ministry of Housing, Communities and Local Government ran last year on loosening the planning rules around permitted development and the national significant infrastructure project. I would be very keen to see that outcome. We can discuss my wider concerns about fracking at another time, but I really hope that we can determine that this will not go ahead, because in communities such as mine, it is not wanted.
I do not want to upset Mr Deputy Speaker, but this is a very relevant issue, because fracking is part of local planning policy. Can I invite both my hon. Friend the Member for North East Derbyshire (Lee Rowley) and my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake)—
Can I help by saying that I still make the decisions? I do not want this to descend into a debate purely about fracking. It can be referred to in passing, of course, and I recognise the planning implications, but I do not want to get into a full-blown debate on fracking. I will still make the decisions.
I certainly do not want to debate the matter with you, Mr Deputy Speaker, because you are obviously in the right, but I would just like to invite my hon. Friends to my constituency. I do not believe that fracking will industrialise the countryside. Some 90% of my constituency is covered by petroleum exploration and development licences, and fracking is perfectly compatible with current gas exploration in my constituency. Please come and see it.
I thank my hon. Friend for his intervention, and I will move on from this subject quickly having made my points. I hope that those on the Treasury Bench will consider my points about fracking, decommissioning costs and the NPPF There is an awful lot of discussion about the distribution of money, and I recognise that Derbyshire County Council, which is ably led by Barry Lewis, and North East Derbyshire District Council, which is now Conservative-led for the first time in 40 years, are now having to grapple with many of the issues talked about in this debate. I accept that there is a real debate about distribution, but there is also a debate about the overall funding envelope for local government As a member of the Public Accounts Committee—there are many esteemed colleagues in the Chamber who are or have been members of the Committee—I know that it is charged with looking at value for money in the public sector, and we regularly see millions or billions of pounds not being spent effectively or efficiently or not securing the correct outcomes. If we lose that from the debates around topics such as this, we lose a key part of what we should be doing as Members of Parliament. We should be discussing not only how much we spend, but what we spend, where we spend it and what the outcomes are. That focus on outcomes has been lost in political discourse since at least 2017, if not before, and I hope it returns not just to this debate, but to wider British politics as a whole.
It is a pleasure to speak in this debate, and I want to focus my remarks on housing. However, before getting on to that topic, I want to make a few other points, starting with the financing of local government as a whole, which my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) described so well. We need to take a serious look at how we fund local authorities and at the demands we place on them. We know that the business rate system is broken, which harms businesses and means that we are not getting the local economic growth that we need to see business thrive. We are also seeing more and more online businesses, which also has serious consequences as well. We must review the business rates and council tax systems and seek a much fairer system of funding local authorities We also need to determine what local authorities are there to do. Over my short time in this place, more and more of that determination is being done at Westminster, but then powers have been taken away and councils have not been given the necessary resources. In effect, we have seen risk shifted on to local authorities, but they have not been given the resources to address their needs. That cannot be the right way forward, so we need a review ahead of the comprehensive spending review, because how can we have a spending review if we do not know what we are spending or how are we going to fund it? Time is short, and I say to the Minister we need to get a move on because local authorities are struggling. We can see that in how services are being cut in our areas, and we have heard about the severe impacts on local communities from right across the Chamber today I also urge the Minister to look at youth services. We do not have a statutory youth service, and that is having a massive knock-on impact on all sorts of other services. A place-based approach is important so that we can understand how to move prevention up local authority agendas. I urge the Minister to examine how we can fund a youth service, because we know that prevention makes such a difference and, ultimately, is cheaper than having to address the effects of when things go wrong I also urge the Minister to look at the high needs education budget within a wider scope, as we need to get this right. Local authorities are having to provide that resource, but my local authority is in deficit as a result—£760,000 last year, and a predicted £1.3 million this year and £1.9 million next year. This is about funding services for the most vulnerable people in our communities, our young people, to ensure they have the best chances in life. I therefore urge the Minister to ensure it is properly funded come the comprehensive spending review I am sure all hon. Members are frustrated that the Government have promised us so many times that they will address social care. After Dilnot in 2011, we were promised a Bill in 2012, but it never emerged. Seemingly on an annual cycle, we are promised Green Papers, White Papers and all sorts. We have to remember these are just discussion documents, not action plans, yet nothing has emerged. We have a real social care crisis I disagree with the hon. Member for Thirsk and Malton (Kevin Hollinrake) on how we should approach social care, because I believe we need a much more therapeutic approach. The relationship with the health service is therefore important, and funding social care and providing security, particularly for older and vulnerable people, needs to be a priority for this Administration. We cannot wait I asked a question the other day, and we now know we will not have the Green Paper before the summer, which means we are just kicking the can further down the road. Of course, older people are struggling to fund their social care needs at the most vulnerable time in their life. That just cannot be right, so I urge the Minister to ensure social care is properly funded. Personally, I would prefer to see a more universal approach to social care, and I believe that joining it up with the national health service would be the best way to deliver it I return to housing through the prism of what is happening in York Central. It is fair enough that the Government have an ambition to build 300,000 housing units, not that it will be easy to deliver, but frankly their target is of no use whatsoever if those units will be second homes and assets for investors, not homes in which people can afford to live. It is a shame that the Minister is not listening, because this is crucial to the development and growth of our city The reality is that the housing being built at York Central will not be affordable to the residents of York. We have a housing crisis in our city because, over the years, successive councils have not built the houses our city needs. As a result, people who are desperate for a home are constantly coming to my surgery, and all I ever get back from the council—a Lib Dem administration—is a letter saying, “We do not have enough houses.” Yet, time and time again, the council passes planning applications to build luxury apartments worth £300,000 to £500,000, which nobody in my city can afford as it is 11 to 19 times the average wage We will therefore see all these housing units being ticked off on a chart, which the Government can quote and say, “Look at how many houses we have built.” But they are not homes in which people can afford to live, so they will move into the private rented sector or they will be assets or weekend homes. They are not the homes we need The imbalances we have in York are having a massive impact on our care sector, because care workers and people working in the NHS cannot afford to live in our city. We have more than 500 vacancies, which is skewing the whole economy in the private sector and the public sector. It is simply a broken system, and it has to be addressed The local authority has paid £10 million up front into the York Central site, with potentially another £35 million of borrowing—money the council will not see, but from which developers will benefit. This will therefore have a massive negative impact on people living in York. I understand the housing infrastructure fund was important for unlocking the site, because it is a rail-locked site, but what are we unlocking it for? The reality is that the plans were predicated on the local authority being able to generate resource from the enterprise zone, which is fair enough in itself, but when the size of the enterprise zone is reduced by a third, it is not going to be able to get its revenue from business rates, which was predicted at £133 million. Therefore, the income will be reduced, which means that the return to the local authority will be reduced and the maths simply does not work for anyone but the developers, who are clearly laughing at the Government’s decision to press ahead with this Ultimately, local authority money has been put into this site and will not be seen again by the people of our city. That cannot be right, so we have to look at how local authority money works together with other revenue streams to bring benefit to local people. Putting local needs at the heart of this is really important. Why is it so important for our city? I have already mentioned that this housing is unaffordable, but the impact of this is a reduction in the opportunity for the local authority to grow the economic base of our city. As a result, less revenue will come into our city, which will be seriously detrimental in the long term. We have a once-in-a-lifetime opportunity to build York as a city for the future, so I urge the Minister to look at these funding streams once again.
I welcome the opportunity to contribute to this debate; we are discussing integral parts of policy for the key regeneration of towns such as Fenton and Longton in my constituency. Both towns have high streets and markets that rely on increased footfall to secure their future. That means unlocking derelict brownfield sites around our towns for more housing that residents need, attracting new businesses into empty units, and improving facilities and the sense of destination for visitors Retail sales have been falling and high street stores have been closing. First, from out-of-town retail parks, and now from online retailing, our town centre are increasingly feeling the squeeze. Online now makes up just under 20% of retail sales, according to the latest figures from the Office for National Statistics. That percentage will likely continue to increase, and the high street needs to adapt if we are not to lose these important centres. It must be helped to adapt by the policies of the Ministry of Housing, Communities and Local Government Last week The Daily Telegraph reported that one in three shops that close in the current market will not reopen as shops in the future. It is clear that our town centres can no longer be so dependent on retail to survive as they once were. It is essential that we attract new and innovative uses; we need to see more people living in our town centres and a range of different businesses moving in to fill empty spaces. It would be fantastic to see these properties, many of which make up the rich and historic fabric of our towns, brought back to life. There is a high demand for small and medium-sized business units, and there is no reason why these properties could not be converted, especially for new start-up businesses and footloose digital businesses. We must incentivise property owners to convert their premises to alternative uses, and remove the barriers and restrictions that currently exist. Our use-based planning system needs to be aware of these trends and be flexible in response, not getting too bogged down in restrictive use categories that threaten the future of our high streets. Why should we not relax class uses on all our empty town centre properties? The perfect plan cannot be the enemy of the demanded good. That also includes flexibility for temporary and pop-up ventures We also must see the investment that is so vital for the future of our town centres. In a property market such as that of Stoke-on-Trent, with many Victorian town centre properties in a poor state of repair, owners may find themselves investing more in converting and renovating than the property is actually worth. This is where it is essential that our bid to the future high streets fund for Longton is successful. Prior to the announcement of this fund, I lobbied Ministers in Her Majesty’s Treasury to create just such a fund, directed at our town centres. Our bid for Longton must receive some of this funding, and I urge Ministers to throw their weight behind it. Without future high streets funding, many properties in the town centre are likely to continue to remain derelict and the town centre will continue to decline It is also extremely important that we see stronger towns funding directed at towns such as Longton and Fenton and across my constituency. These are parts of the country and communities that have previously felt left behind but that have huge potential to blossom, with the right support. These towns must be given the chance to thrive again, and to be the beating hearts they once were. Perhaps they will no longer be the bastions of retail they once were, but there are so many other exciting possibilities. That might mean more pop-up art installations or performances, fringe festivals, or have-a-go activity weekends. For example, this weekend the iconic Gladstone Pottery Museum in my constituency will host the ninth annual Longton beer festival, which is certainly an event that I look forward to participating in Longton’s visitor economy used to be sufficiently robust to support three hotels in the town centre, but unfortunately that is no longer the case. So much is still unique and different about our town centres, and if that was lost it would leave our communities much worse off and damaged. That is why the Longton heritage action zone is so important, to preserve what is historically unique and to make best use for the future. Increasing the footfall in our town centres and recharging our tourism economy is a key aim of the heritage action zone that Stoke-on-Trent City Council is taking forward with Historic England. The council is refurbishing the old town hall as a local service centre, and the fantastic Victorian market hall is also receiving investment, including new public toilet facilities We also see private investment coming into Longton, with a number of new retailers having set up recently, and the Exchange shopping precinct has invested in the refurbishment of the main retail complex, which will help to bring much-needed increased footfall into the town centre. We must continue to build on such successes The old town hall in Fenton is being brought back into use, thanks to the owner, Justin Meath Baker. A whole range of new businesses are moving in, and the local centre is due to relocate there soon. In addition, planning permission has recently been granted for a £17 million mixed community housing development right in the centre of the town, alongside the £8 million new build scheme that is already under construction for sheltered housing. Like many cities, Stoke-on-Trent is attractive to people who increasingly value town-centre urban living, and we have, of course, six historic market towns to choose from Although period properties are attractive for residential use and create a real sense of place by saving historic architecture, the upfront cost of converting historical buildings to residential use, or of modernising much of the Victorian terrace stock, has often unfortunately proven too costly. In low-value markets, sales for more than the property value can often be realised. The wider context of a high-supply, low-demand Victorian terrace market has previously undermined confidence in the market for building specific types of new housing more suited to the 21st century. There can be an imbalance: we see high demand for certain types of housing locally that currently is not being met by the local market. For example, Stoke-on-Trent is probably the only city in the UK of its size that does not really have a strong, functional private rented sector apartment market. We need more developers to take the risk, because we do have the demand for flexible styles of living, what with two universities and one of the largest hospitals in the country The council has been doing some excellent work to disrupt the market, to tempt new types of housing development into the city and get brownfield sites developed. When developers do progress sites, those sites now under development have seen high rates of sale, with properties on new build sites throughout the city selling much quicker than was initially expected. We must do more to help to meet the growing demands, and especially to see the redevelopment of the brownfield sites in and around our towns that suffer from the additional costs of previous industrial use. There is no justification for demand to be suppressed. We must give the market the confidence to invest in housing products such as PRS and executive homes, which investors would not always be willing to do in markets such as Stoke-on-Trent In 2015, Stoke-on-Trent City Council secured housing zone status, making it one of 20 pioneering authorities outside London. As a result, the council has worked with developers to activate schemes on stalled sites to deliver new homes. Not only is this enhancing the local housing offer, but it is boosting confidence by testing and proving the market for such homes. I would like to see much more dedicated funding available for a broader range of developers who are dedicated to bringing empty retail space into residential use. That could really help to meet local housing needs. There has been an unwillingness for the private sector to take the risks needed where the market is untested and of lower value, so market-making measures are needed to help to de-risk development. I very much welcome the engaging approach that the Department has taken to confronting such challenges, and hope that we see that approach continue The Ministry of Housing, Communities and Local Government is a key ministry not only because of its funding but because of what its policies can enable and facilitate forward-looking local authority leaders—like our fantastic new council leader in Stoke-on-Trent, Councillor Abi Brown—to achieve locally. The work we have done in Stoke-on-Trent has seen Conservatives top the poll in the local elections for the first time ever, doubling the number of Conservatives on the council. I congratulate every single one of our new and re-elected Conservative councillors in Stoke-on-Trent. We need to continue to develop our proposals and to improve our communities, so that we see the city move forward.
It is a pleasure to follow the hon. Member for Stoke-on-Trent South (Jack Brereton). I appreciate some of the points that he made, particularly on social housing and on how Stoke is taking on the same challenges that face so many of us. I thank the hon. Member for Oxford West and Abingdon (Layla Moran), who is currently not in her place, for securing such an important debate. I am obviously delighted to support her as I, too, put in to speak in the debate Clearly, local government faces huge challenges. As my hon. Friend the Member for Sheffield South East (Mr Betts) said, the cuts faced by MHCLG have been far greater than those faced by any other Department. It is our local authorities that have borne the brunt of austerity as, of course, have our communities with the cuts to so many of their services—whether it be the hostels provided for those coming out of prison or the Army or those who are victims of domestic abuse. Certainly, we have seen significant cuts in Warwickshire. We have seen cuts to children’s services; closure of children’s centres; cuts to waste and recycling; cuts to fire and rescue services; cuts to our libraries—and the list goes on I want to concentrate the rest of my remarks on social housing. As chair of the Parliamentary Campaign for Council Housing, I have been pressing for more social rented housing since I arrived in Parliament. It is well understood that we are facing a housing emergency: 277,000 people are homeless; 1.1 million households are on waiting lists; and young families spend three times more on housing costs than they did 50 years ago. Just 6,000 social rented homes were built last year. Warwick District Council, which more or less overlaps my constituency, has built just eight social rented properties in the past four years, despite the fact that 2,000 people were on the waiting list I have been making my case ever since I arrived in this place, and I regard housing as the No. 1 priority for all of us in this House. We must fix this housing crisis. Shelter reports that 3.1 million homes need to be built in the next 20 years to meet the demand of those at the sharp end of housing need, particularly the younger trapped renters and the older renters, too. Back in the 1950s, in response to Churchill’s challenge, Macmillan, as Housing Minister, built 200,000 council homes. Meeting the housing need will happen only with significant investment in social rented council housing It is social housing that is desperately needed. Since 1980, house building in this country has been distorted by various policies, which have resulted in an average of just 25,000 social homes being built a year, compared with 125,000 during the post-war period. That is a loss of 100,000 units per year—4 million in total. The question that I want to put to the Minister is simple: how best can we use that £8.5 billion allocated to housing and planning? That is a significant sum and accounts for 80% of the total MHCLG budget This year, the Ministry of Housing, Communities and Local Government estimates that it will spend £3.9 billion on affordable homes—although that is often a misnomer. As well as home ownership options such as part-buy, there will also be social rented housing. To put this into context, back in 1953, in one year alone, the then Conservative Government invested £11.35 billion at today’s prices. Clearly, we are not doing enough. From speaking to Members across the House, I have learned that there is widespread support for increasing the budget. Where we differ is the proportion that should be spent on social housing, and there is real clear blue water between us on how that should be funded This call for a massive increase in social rented housing is echoed by Shelter. In its report produced by the Social Housing Commission, it concluded that there was a need for 3.1 million homes over a 20-year period, equating to 155,000 homes a year, of which I believe 100,000 at least should be council houses. I proposed that to the House on 13 June, and it was supported. This number is not pie in the sky; it was supported by my right hon. Friend the Member for Doncaster North (Edward Miliband) and, indeed, by Baroness Warsi. The only way councils will hit these kinds of numbers is through grant funding direct to councils, ring-fenced for building social rented housing. London Economics estimates that £10.7 billion is needed per year—less in real terms than the figure that was being spent in 1953 It would be easy to think that the lifting of the local authority borrowing cap will be sufficient to provide the funding needed, but it will not. Don’t get me wrong—the lifting of the cap is very welcome, although long overdue. However, it is estimated to result in only £3.4 billion of investment in building council homes over the next four years. What is fundamentally wrong with the provision of housing is that too much money is being spent on the wrong schemes. The Help to Buy scheme falls within the remit of MHCLG. In my view, this scheme is totally the wrong priority and is simply being used to maintain inflated house prices and the bloated profits of house builders and developers This year, the Help to Buy scheme will once more account for the largest share of housing spend at £4.1 billion. The National Audit Office reports that two thirds of this—£2.7 billion—is in effect being used to subsidise homebuyers who could have bought a home without it, and one in 25 of those homebuyers had household incomes of over £100,000. Surely it would be better to use the £4.1 billion to build 40,000 social rented homes instead. Beyond MHCLG, there is of course the massive £21 billion being used on housing benefit annually. Again, surely this budget would be better utilised building social rented housing and realising those assets, rather than fuelling the private rental sector at the taxpayers’ expense.
I have quite a lot of sympathy with my hon. Friend’s point about the Help to Buy scheme, particularly with regard to the NAO report. Does he agree that, whatever different views there might be, the Government should at least do an evaluation of the Help to Buy scheme before they embark on a further phase of it?
My hon. Friend always makes an important point, and his knowledge of the sector is unsurpassed. He is absolutely right that we should suspend the scheme and think about how the budget should be used urgently to kick-start a social rented programme I say all this because of the pressing and urgent crisis of homelessness and rough sleeping. My hon. Friend the Member for York Central (Rachael Maskell) gave us an example of what this crisis looks like across our communities, as our housing markets are distorted by developers. Lord Porter put it very well when he said that a good home provides a good chance of good health, good education and good lives. The reality is that, without good homes, we are seeing a huge increase in social and health-related issues, all of which add to the already great burdens faced by our local services and thus our local authorities Local government faces huge challenges indeed: the rising costs and numbers related to children’s services; the crisis that is the unsustainable pressure brought by adult social care; the closure of hostels; the cuts to welfare services; and the closure of children’s centres, libraries and fire stations. But I would assert that the desperate need for social rented housing is at the core of so many of the problems we face. To that end, I urge the Minister to reconsider the allocation of budgets, to slash the support for and suspend Help to Buy, to lay claim to the housing benefit budget and to use that money to kick-start the industrial-scale social housing that our society desperately needs.
It is a great opportunity to speak in this important debate, and a pleasure to follow the hon. Member for Warwick and Leamington (Matt Western) Local government is at the heart of what we all do as constituency MPs. We are all put on these Benches to stand up for our local communities, and that has certainly been at the centrepiece of all my campaigns and everything I have done since I have been lucky enough to represent the wonderful new town of Redditch The context of this debate has been articulated clearly by many Members: spending had to be constrained, for all sorts of reasons, by an incoming Government in 2010. That seems like a long time ago, but in financial terms it is really a very short period. Difficult decisions had to be made. Local and county councils have been at the frontline of some of those decisions with the priorities that had to be set. Some of them have done an extremely good job under very difficult circumstances. My hon. Friend the Member for North East Derbyshire (Lee Rowley) pointed out that we must always think about efficiency and how we are spending hard-working taxpayers’ money. I pay tribute to the work that has been done in Redditch to that end. I will therefore focus on the needs of Redditch and what we are doing in the local area, and then touch on adult social care I have been proud to work, together with my colleagues, on a campaign that we call Unlock Redditch, which is about releasing the potential of our town. It is a new town that faces challenges similar to those in other communities up and down the country. I very much thank our local council officers and the wonderful team of colleagues led by Councillor Matt Dormer, who has been successful in bucking the national trend in election results for the last three elections in a row. We have made gains on our local district council, which is doing an absolutely immense job in championing the needs of our area. In recent times, plans have been put forward to build over 600 new council homes, mostly bungalows. This is the first council house building programme in Redditch since 1998. Account has been taken of the needs of some of the most vulnerable groups in society. A new policy has been brought in to exempt care leavers from council tax. We are working very hard on our future high streets fund bid. We are also bidding for heritage action zones funding. I see the Minister is taking notes. We really want this bid to be successful Although we are a new town, we are built around a historic core. We have a beautiful church in our town centre surrounded by a lovely green. It is an attractive place for people to come to, but, like most areas, it needs just a little bit of TLC. That would really boost our town’s chances of being at the forefront as a tourism destination for leisure and shopping, helping to lure people away from the charms of inner-city Birmingham and Solihull—because, after all, who wants to go there when they could go to the Kingfisher shopping centre in Redditch? Of course, you are very welcome yourself, Mr Deputy Speaker. I know you have many friends in Redditch, and they would be pleased to see you there. We have also been successful in implementing grants from the LEP. We want to see our train station redeveloped and the line dualled so that we can much more easily travel into Birmingham for leisure and for work I want to say a little bit about adult social care. It is common knowledge that the pressures on adult social care are causing immense difficulties, and it is no different in Worcestershire. Our county council is spending some £187.7 million on the social care budget generally, a large proportion of which is on adult social care. When I came into this role—I have been an MP for only two years—I remember having my first meetings with Worcestershire County Council and being told that the county used to have so-called £1 million families who, due to a combination of needs, needed £1 million-worth of support. There were a few of those families, and of course that placed pressure on services. Now we are seeing more so-called £10 million families. Need is always rising, and these families are the most vulnerable. They have a complex picture of needs, taken together, whether to do with housing, multiple disability or education and schooling. Such a family must have the support that we all want them to have, but it becomes much more difficult to meet the ever rising level of demand We have often attempted as politicians to answer the conundrum of doing more on social care. Frankly, that was an absolute disaster in the 2017 election—I think we can all be honest about that. We tried to come up with policies to tackle the issue, as we needed to do, but the heat and light of an election was absolutely the wrong time to do it. It became a political football and a toxic issue. It was utterly the wrong way to do it. We must get together across the Benches—I think there is an appetite for that—to look at things such as the German model, advocated by my hon. Friend the Member for Ayr, Carrick and Cumnock (Bill Grant). I have learned a lot from my hon. Friend. We have to think about how to harness the wealth locked up in people’s homes and how we contribute as a society to making this the best country in the world at taking care of elderly people I am sure that our two leadership candidates are watching this debate—they have nothing better to do. I absolutely believe that both of them will focus on adult social care. They, like all of us, will have constituents with such issues in their surgeries and affected family members. I have spoken about my mother’s dementia—a catastrophic illness, and the care costs can escalate. Our next Prime Minister has to have adult social care on the agenda. Whoever makes that a priority will receive my full support.
I deliberately left it late to put in for this debate, Mr Deputy Speaker; I thought that if we were voting, I might get a good audience. I hoped that that audience might include my right hon. Friends the Members for South West Surrey (Mr Hunt) and for Uxbridge and South Ruislip (Boris Johnson) so that I could take one of two opportunities. Option A was that I could try out for any ministerial posts available in the next couple of weeks; option B, if I was not that lucky, was maybe to lobby about some of the things I have been particularly interested in I am sure you will be aware, Mr Deputy Speaker, that on 26 June last year, the all-party parliamentary group on excellence in the built environment, which I chair, recommended that there should be a new homes ombudsman—better redress for home buyers. Someone buying a new house for a couple of hundred thousand pounds who finds there are problems with it has fewer rights than if they had bought an electric kettle. My all-party group recommended that and, quick as anything—12 months later, almost exactly to the day—the Government launched a consultation on that very topic. I could have saved them the trouble; they could simply read the APPG’s excellent report and we could just get on with it. If all goes really badly for me in future, maybe I can apply for the ombudsman job instead It is important for us to think about safety. There is a lot of talk post-Grenfell about ACM materials, but the excellent Nathaniel Barker from Inside Housing did a report recently highlighting that in March last year 44 councils had fire doors that were non-compliant or possibly non-compliant. Twelve months later, half those councils have not changed a single door. How often do we walk in and out of buildings and see that compartmentalisation has been affected because somebody has put through central heating or wiring and affected the integrity of the building? Fire doors might be propped open or their intumescent strip is faulty in some way. Let us not just focus on ACM materials, but also on the relatively simple stuff that we all see every day. Let us make sure that all fire doors in all buildings are compliant. That was an excellent report from Nathaniel The Government could also do something a little more simple on improving safety: they could endorse my private Member’s Bill that suggests that there should be carbon monoxide detectors in all new builds and privately or socially rented homes, so that we can protect people However, I wanted to spend most of my speech haggling with the hon. Member for Warwick and Leamington (Matt Western). I agree that Help to Buy is not as effective as it could be, but I disagree about the natural heir to the scheme. In my humble opinion, shared ownership is the future. If we replaced Help to Buy, an extra 15,000 houses could be generated in demand for shared ownership. If someone wants to buy a £230,000 property unaided, they need to be earning about £47,000 a year. If they are buying it through Help to Buy, they need to be earning about £38,000 a year. However, if they buy it through 25% of shared ownership, they could be earning as little as £21,000 a year. For people in my constituency, where the average income is about £27,000 a year and the average property price is £127,000, shared ownership is the future. It is a great way of getting people on to the property ladder. They can access it with relatively low incomes and a relatively low deposit, and it is the best way to establish a home-owning democracy That was a whistle-stop tour, Mr Deputy Speaker, but thank you for your time.
We have had a thorough and full debate, and I think quite a thoughtful debate from those on both sides of the House. I add my thanks to the Backbench Business Committee for choosing the topic of Housing, Communities and Local Government for this estimates day debate I thank the hon. Member for Oxford West and Abingdon (Layla Moran) for the way in which she opened the debate. She set out a very real concern that is felt across all parties in this House about the impact of a decade of constraints on local government and the effect that that is now having on our public services. However, it would be remiss of me not to say that she and the Liberal Democrats displayed a little bit of collective amnesia, because they were in government between 2010 and 2015. It does seem that “Sorry” is the hardest word. In her defence, she said that she campaigned against these cuts as a candidate, but her Ministers slashed and burned many of the services she referred to. The crisis in local government today, the crisis in adult social care today and the crisis in children’s services today have their roots in the coalition years, and the Minister for local government was a Liberal Democrat—he is now Lord Stunell of Hazel Grove—although he occasionally got locked in the Opposition Lobby in votes, which is perhaps why he was very quickly moved I want to pay tribute to the other contributions: from my hon. Friend the Member for Sheffield South East (Mr Betts), who is the Chair of the Select Committee and brings so much knowledge to these debates; from my right hon. Friend the Member for North Durham (Mr Jones) and my hon. Friends the Members for Stoke-on-Trent Central (Gareth Snell), for York Central (Rachael Maskell) and for Warwick and Leamington (Matt Western); and from the Conservatives, the hon. Members for The Cotswolds (Sir Geoffrey Clifton-Brown) and for Thirsk and Malton (Kevin Hollinrake), the right hon. Member for Witham (Priti Patel), and the hon. Members for North East Derbyshire (Lee Rowley), for Stoke-on-Trent South (Jack Brereton), for Redditch (Rachel Maclean) and for Walsall North (Eddie Hughes) I want to echo the right hon. Member for Witham, who mentioned that she is married to a councillor. It would be really remiss of me not to mention that I, too, am married to a councillor—Councillor Allison Gwynne—on Tameside Metropolitan Borough Council. I am incredibly proud that both my councils have, since May, had a female leader. The councils are very ably led by two incredible Labour women. Councillor Brenda Warrington, the leader of Tameside, has been joined by Councillor Elise Wilson, the new leader of Stockport Metropolitan Borough Council. They are both doing great work. I also want to thank all our dedicated council staff and councillors of all political persuasions and none for the incredible work that they do in making sure our communities are looked after. While they have continued to work hard and to lobby for the resources they need to do their job, they know—and we know actually—just how hard that job has become over the last few years. The debate has put out the message in various ways, but it is the same on both sides of the House: increasing concern about the growing crisis in local government funding and the huge cost pressures, particularly in children and adult services The consequence of the cost pressures in those people-based services is that the place-based services—the neighbourhood services—are squeezed. The conundrum for local councillors is that most people think that their council is there to deliver the place-based services. They are the things that they see: bins being emptied, streets being swept, parks being maintained, libraries being open and youth centres existing. Those services are squeezed to pay for the pressures in children and adult services I will rattle off a few figures: 763 youth centres and more than 700 libraries have closed, and Sure Start has been cut in half, since 2010. Yet local government is the beating heart of our communities. Our councils keep our streets cleaner and safer, protect the most vulnerable in society and maintain our green spaces. When we inevitably grow older, we hope that our councils will be there to provide the services to give us dignity in old age As my hon. Friend the Member for Stoke-on-Trent Central said, we should work towards Total Place. The previous Labour Government were keen on developing the notion that all public bodies, across the public sector, should work towards the same strategy and outcomes, and ensure that there are proper joined-up, people-based services. Our councils are the lynchpin of providing cohesive, joined-up public services, whether housing, police and crime prevention, leisure services, youth services or public health, which widens into the national health service.
I understand that the hon. Gentleman’s preference was not for making cuts to local authorities over the past few years, and he makes a good case for that. However, faced with the challenge in 2010 of balancing the books against a backdrop of £153 billion annual deficit, where would he have made the cuts?
The hon. Gentleman should realise that we are almost a decade into austerity and local government has taken the biggest hit of any Department. There is a reason for that. It is easy to pass the blame from Whitehall to town and county halls throughout the country. The Conservative Government have hung the hon. Gentleman’s councillors as much as Labour councillors out to dry.
rose—
I will not give way just now In the past decade, local government in England has lost 60p out of every pound that the previous Labour Government invested in our communities, in local services, in the glue that binds our communities together. The estimates debated today will sadly offer no relief to local government. The only major change from last year in the funds for local government is for business rates relief. Although it is welcome that the Government are compensating local government for that policy, it is necessary only because the Government have refused to undertake a fundamental review of business rates for which many have called. I am proud to say that the next Labour Government will conduct such a review Although the Minister can speak today about increases in local authorities’ spending power in this year’s settlement, it is all smoke and mirrors. Any increases are possible only if all councils increase their council tax by the maximum possible, which would mean eye-watering, inflation-busting tax increases for ordinary households. Council tax now equates to 7% of the income of a low-income family, compared to just 1% for a high-income family. That is not only unfair, but economically incoherent. The poorest areas, those that need the most resources to cope with the growing demands on children’s services and adult services, will never be able to raise the money they need. My right hon. Friend the Member for North Durham made the point that far less is possible in those areas than in the more well-off areas of the country I do not make that point to argue that we should be robbing some areas to fund others, but the fact is that all councils are now struggling and I would guess that that is not lost on the Minister. I hope that he will now be interested in solutions to the problem, because there is a growing chorus of concern from those on the Government Benches behind him. We are seeing a reverse redistribution of funding: a shift away from spending on local services that is based on need and deprivation Let me just remind the Minister that, while the Tories have in some cases actually seen spending increases, nine out of the 10 areas that have seen the largest cuts are Labour controlled: Hackney, £1,406 less per household in spending power between 2010-11 and 2019-20; Newham, £1,301; Tower Hamlets, £1,264; Knowsley, £1,057; and Southwark £1,014. Those are eye-watering numbers. Then we look at the other end of the scale: Maidstone, a £678 drop; Tewkesbury, £5.31; Vale of White Horse, £4.12; Tonbridge and Malling, a £4.18 increase; Stratford-on-Avon, a £7.45 per household increase; Uttlesford, a £7.66 increase; Horsham, a £15.68 increase; Wokingham, a £39.31 increase; and the Isles of Scilly, a £336.78 increase. That just is not fair. Not one council that has seen an increase in spending power from 2010-11 to 2019-20 is a Labour council What was in this year’s funding settlement? Unfortunately, I am not able to speak today about what the funding situation will look like next year because nobody knows—no one on the Opposition Benches, no one in local government, not even the Minister. Councils would normally have started their budget setting planning process, but they remain completely in the dark about how much funding they will have next year. The Government’s intention was to implement a fair funding review and to increase the percentage of business rates retained locally from April 2020, but the Tory leadership contest has thrown that plan up in the air. As the Chief Secretary to the Treasury told the Lords Economic Affairs Committee earlier this month: “The plan was to launch the spending review just before the summer recess…I would suggest that’s unlikely given the current timetable of the Conservative leadership election.” If that is not the case, I recommend that the Minister use this opportunity to set the record straight. I know that everyone in local government would welcome clarity. We need that certainty. Is there going to be a spending review? Is it going to be for four years? Is it going to be for one year? The Minister needs to give clarity What we do know from a survey published today by the Local Government Association is that one in three councils is worried that it will be unable to provide the statutory services by the end of this Parliament. That would include services such as: preventing homelessness; ensuring that vulnerable children are safe; ensuring quality of life for all adults; and dignity in old age. We know from the same survey that year-on-year cuts and an unprecedented rise in demand for these services have resulted in one in five councils being concerned that it will not be able to balance the books this year In closing, I would like to repeat the words of the Conservative Lord Porter, who said earlier this month: “If the Government think the policy going forward is to spend all your reserves, and then we will find some new money…after you have spent all your reserves,” the Secretary of State is going to have to “explain to the public why those people died because the money was not available… It is always about understanding the cost of everything and the value of nothing.” Never has a truer word been said. That is the reality, and I genuinely hope that the Minister, whom I respect greatly, will get a grip on his two leadership want-to-bes and insist that they start to fix the decade of neglect and cuts that our communities and local government have endured.
It is a great pleasure to conclude this debate, which I agree with the hon. Member for Denton and Reddish (Andrew Gwynne) has been very thoughtful. I congratulate the hon. Member for Oxford West and Abingdon (Layla Moran) on opening it and thank the Backbench Business Committee for securing time for us to discuss a subject that is close to my heart. She can rest assured that the latest report of the Public Accounts Committee on local government sustainability is bedtime reading for me; I have it with me at all times. I thank all hon. Members who contributed to the debate We are all here because we value and recognise the invaluable work conducted by councils up and down the country. I join all hon. Members on both sides of the House in paying tribute to our hard-working councillors, and I thank them for everything they do for our local communities. Let me also take this opportunity, on the first day of the Local Government Association conference, to thank the noble Lord Porter for his tenure as chairman of the LGA. He is a genuine giant in the world of local government, he has been a strong champion for the sector, he is respected across the spectrum, and I know he will be sorely missed Shortly after I became local government Minister, Lord Porter’s successor, Councillor Jamieson—whom I wish every success too—handed me a document that contained an incredible statistic. He had calculated that councils provide an amazing 800 different services. They really do touch every aspect of our lives as citizens. We heard about a range of those services today I will try my best to answer as many of the queries that were raised as possible. Many of them relate to areas that are not my direct responsibility but that of our fantastic Housing Minister. I am pleased to say that he has been here for most of the debate and has heard and absorbed all those queries. With his tagline “more, better, faster”, I know he is relentlessly committed to ensuring that everyone has a safe, decent and affordable home to call their own As I reflected on those 800 different services from where I stood, I came to see that there were three major, overarching areas for which councils have responsibility: driving economic growth; helping the most vulnerable in our society; and building strong communities that we are all proud to call home. I am pleased to say that this Government are supporting councils to do all three Before addressing the various points that were made in the debate through the prism of those three areas, I want to acknowledge that, of course, local government has been through a challenging period financially. I do not disagree with that; it would be wrong to do so. I agree that the balance of spending has shifted from non-statutory services to statutory services, and it is right that that is addressed in the upcoming spending review. Members can rest assured that, working with Departments such as the Department for Education and the Department of Health and Social Care, we are providing an evidence-based and robust account to the Treasury to inform those spending review conversations It is important to note why local government was put in that position. As my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) pointed out excellently, it is incumbent on all Governments to balance the books. The task this Government inherited was significant. As my hon. Friend the Member for Redditch (Rachel Maclean) pointed out, local government had a difficult set of circumstances to deal with. It made some difficult decisions and did extremely well. I join my right hon. Friend the Member for Witham (Priti Patel) in saluting not just her husband but the entrepreneurship of all local councillors up and down the country in responding to that climate. They truly have done us proud I agree with the hon. Member for Oxford West and Abingdon that at this point we should look forward, and I am pleased to say that the tide is turning. This year, local councils will have access to over £46 billion in core spending power. That represents not a cut or a fall, but a 3% cash increase on the funds available last year, and a real-terms increase in money available to councils to spend on services We heard from Opposition Members about the burden of council tax. The Government and this side of the House will always be on the side of hard-pressed taxpayers, and determined to keep council tax as low as possible. Since the coalition Government came into power in 2010, council tax has risen at an average of just over 2% per annum. We can all remember that under the last Labour Government council tax doubled, going up at a rate of more than 6% every year. Our residents need to know one thing: if they are focused on low council tax and better services, it is a Conservative Government that will deliver them. A recurring theme in the debate—it was raised by my hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown), the hon. Member for Oxford West and Abingdon, and the Chair of the Select Committee—was governance. They were right to raise that issue. Like me, the hon. Lady was not here during the coalition Government, but they decided to abolish the Audit Commission and replace it with a more decentralised framework for oversight and accountability. The Secretary of State confirmed at the LGA today that the Department plans to enhance its role in oversight and leadership of the local authority governance system. His aim is to be able to spot problems more easily and sooner, to support councils and to protect our residents. The Secretary of State is committed to outlining to the Public Accounts Committee by the end of the year the specific steps that he will take in that regard. I know that that is something that many hon. Members have raised today and I hope they will be reassured by that. In conjunction with that work, the Secretary of State has committed to a review of the local audit framework. Again, he will report soon to the Public Accounts Committee on how that should be achieved My first theme is economic growth. The money that funds our public services has to come from somewhere, and the only sustainable way to generate those funds is to drive economic growth. Councils play a critical role in that, incentivised and supported by central Government. Our business rates retention scheme means that every authority in England stands to reap the rewards of increased growth in business rates income and will be able to use those rewards to invest in their local economy and community. Through business rates retention, councils now have access to nearly £2.5 billion in additional funds, on top of their core spending power, to fund local services Our successful 75% business rates retention pilots were incredibly popular, and 14 pilots are now in operation, benefiting over 100 different local authorities. My hon. Friend the Member for North East Derbyshire (Lee Rowley) reminded us of the importance of all councillors embarking on a journey of efficiency to ensure that their taxpayers’ money is spent incredibly well. Where we can find those efficiencies, we absolutely should The Government are championing authorities that are putting digital innovation at the heart of their service delivery and transformation and efficiency programmes. That has the potential to be hugely significant, which is why our new digital declaration is so important, and that ambition is backed by a £7.5 million local digital innovation fund. That is funding projects that have the potential to save money and transform services on the ground. The programme is also providing digital leadership training for hundreds of senior councillors and officers up and down the country, building the local government leaders of tomorrow I turn next to councils’ crucial role in helping the most vulnerable in society, and again the Government’s record is strong. We fully back councils that are on the frontline in helping those in need, supporting children, the disabled and the elderly.
My hon. Friend has referred to the role of councils in protecting the vulnerable. Does he also recognise that since health-visiting services were passed to them, the number of health visitors has fallen by more than 2,000 nationally—which is not helping young people to get a good start in life—and addiction services have been massively reduced, which means that deaths from alcohol and morbidity from alcohol-related diseases are on the rise? Will he please undertake to review the basis of the commissioning of those services and consider returning them to the NHS, where they belong?
I am not sure I agree with my hon. Friend that it would be right for public health responsibility to be returned to the NHS. Local government does not believe that it is right, and since local government has taken on ownership of public health, all the outcomes that I have seen have improved and been delivered more effectively. The Secretary of State recently commented on that. I appreciate the hon. Gentleman’s broader point, and of course it is important for delivery to be carried out well, but I think that the track record is in local government’s favour thus far.
I take a different point of view. When public health was the responsibility of the NHS, the money was kept within the NHS budget, and increased each year in line with NHS funding. Since the transfer to local government, the funds have been cut substantially in real terms. Let us return public health funding to a level at which local government will really deliver.
I think we are talking about two different issues. One is the issue of who is responsible for delivering public health, and I am strongly in favour of local government’s continuing responsibility. As for the budget, the Chairman of the Select Committee will know that it is ring-fenced. As that is rolled into business rates retention, it is of course right for there to be a proper governance and assurance mechanism The most recent Budget provided £650 million in new funding to help councils respond to pressure on both children’s and adults’ social care, and we have heard much about that today. It comes on top of the billions of pounds of extra funding in previous Budgets for adult social care, and it is starting to make an enormous difference on the ground. The number of delayed transfers of care has fallen by 50% since the peak, and 93% of councils agree that joined-up working with the NHS through the Better Care Fund is improving outcomes The hon. Member for Stoke-on-Trent Central (Gareth Snell) set a good challenge for Governments to follow when he spoke of place-based funding. The improved Better Care fund is just one aspect, but we should clearly aim to do more in that direction, pooling budgets locally among different agencies when it makes sense. Manchester is the most evolved model in that regard, and I have enjoyed getting to know the team there and seeing the results that its work is having My hon. Friends the Members for Thirsk and Malton (Kevin Hollinrake) and for Redditch (Rachel Maclean) talked about the importance of a long-term solution. That is not my remit, but I hope that the Secretary of State is giving good consideration to the joint work of the two Select Committees on a social insurance model. The hon. Member for York Central (Rachael Maskell) reminded us that prevention is better than cure, and I fully agree with her I am very proud of the work that our Department has done in leading the highly successful troubled families programme, which has supported more than 400,000 families through an innovative early intervention model utilising a key worker and a whole-family approach. The results have been excellent. Children have been saved from going into care, people are coming off benefits and going into work, and crime and antisocial behaviour have been reduced. Ultimately, families are becoming stronger. It is a privilege to meet the people who are executing the programme on the ground, and those visits are some of the most humbling that I make. I know that that programme, and those workers, are making an enormous difference to the lives of some of our most vulnerable citizens Finally, let me touch on the work of councils in supporting strong communities. I agree with my hon. Friend the Member for Redditch about that. The Government see it as a critical task, and we are helping councils to build cohesive, safe and local communities up and down the country—places that we are proud to call home. We have provided additional funds to enable councils to build cohesion in areas on which migration has had a particular impact We have worked with my hon. Friends the Members for Redditch and for Stoke-on-Trent South (Jack Brereton) to come up with various support schemes for the high streets, which are now worth more than £1.5 billion. We have helped councils to make improvements to local roads—the essential arteries of our community life—with a £420 million fund to deal with potholes. We have provided new money for parks and green spaces, which has brought about the creation of more than 200 “pocket parks”. Those little havens of greenery make all the difference to the community, especially in the more deprived areas Just those few examples demonstrate the breadth and depth of our commitment to helping local government to build vibrant and cohesive communities in the places that they serve. Whether they are driving economic growth, caring for the most vulnerable in society or building stronger communities, local councils across the country do an amazing job. That is what makes it such a privilege for me to have this role, and to champion local government in Whitehall and in Westminster. Local government deserves our backing, local government is getting our backing, and I commend the estimates to the House Question deferred (Standing Order No. 54)
I remind the House that I have certified that the regulations apply exclusively to England. The motion could have been subject to double majority voting: the whole House and those representing constituencies in England Motion made, and Question put forthwith (Standing Order No. 118(6)). Community Infrastructure Levy That the draft Community Infrastructure Levy (Amendment) (England) (No. 2) Regulations 2019, which were laid before this House on 4 June, be approved.—(Mike Freer.) Question agreed to.
On a point of order, Mr Speaker. I am intrigued by the double majority that was required on a voice vote. I wonder whether your ears are so skilfully attuned now that you can distinguish the Ayes and Noes between Members representing seats north and south of the border.
I did not think that an abnormal level of skill was required. It was evident to me that the motion had been agreed to. The question of whether an abnormal level of skill would have been available to me is hypothetical and it would be immodest of me to answer the question in the affirmative. As I treat of the matter as hypothetical and am not required to answer, and as I note from the beaming countenance of the hon. Gentleman that he is teasing me, I take it in the spirit in which he has done so and proceed to the petition in the name of Mr John Howell.
I present a petition that has been signed by 406 residents of the village of Woodcote in my constituency and by surrounding villages that feed into the school of Langtree. The purpose of the petition is to try to remove once and for all issues over school funding. This is a similar petition to the one that I submitted in connection with Henley itself a little while ago The petition states that the petition of the residents of Woodcote, Oxfordshire, of friends of Langtree School and of those from surrounding villages declares that a funding review is needed in relation to Langtree school; further that this school funding review should address how funding increases will be made in relation to schools in the Henley constituency in real terms beyond the amounts already being spent on schools and how to eliminate the gap between the best and lowest funded schools in the constituency; further that there must be a review of areas of inflationary pressures and situations where schools provide additional services such as social care, or deal with criminal behaviour to examine the real costs of providing education; further that there must be an assessment into the extent and access to capital funding; further that the Basic Entitlement must form an appropriate percentage of the National Funding Formula used locally; further that the Department and Treasury must ensure that small primary schools in the constituency remain integral to their communities Following is the full text of the petition: [ The petition of residents of Woodcote and friends of Langtree School, Declares that a funding review is needed in relation to schools in the Henley constituency; further that this school funding review should address how funding increases will be made in relation to schools in the Henley constituency in real terms beyond the amounts already being spent on schools and how to eliminate the gap between the best and lowest funded schools in the constituency; further that there must be a review of areas of inflationary pressures and situations where schools provide additional services such as social care, or deal with criminal behaviour to examine the real costs of providing education; further that there must be an assessment into the extent and access to capital funding; further that the Basic Entitlement must form an appropriate percentage of the National Funding Formula used locally; further that the Department and Treasury must ensure that small primary schools in the constituency remain integral to their communities. The petitioners therefore request the House of Commons to ask the Department of Education and the Treasury to conduct a review of school funding in Henley that addresses the issues stated above, in advance of the Comprehensive Spending Review; and further requests that the findings of this review are communicated to the House of Commons. And the petitioners remain, etc.] [P002483]
I thank the National Autistic Society and the local group Autism Take 5 for their help in preparing for this debate Of those who have been fortunate enough to have received a diagnosis, there are 540,000 people with autism spectrum conditions. Some 433,000 are aged 18-plus, and 107,000 children are currently diagnosed with ASCs UK-wide. Research by the Centre for the Economics of Mental Health sheds light on the impact on the UK economy through lost productivity. This Government emphasise the need for people to move into paid employment and for higher rates of economic activity, but the autistic population is standing out as they are experiencing social and employment exclusion more than any other group. The cost of this is £27.5 billion spent annually supporting people with ASCs, and a 36% loss in employment in that group The World Health Organisation reports a substantial increase in people being diagnosed with autism spectrum conditions. Therefore, we must consider the large number of teenagers now approaching working age. This is significant because people with ASCs experience symptoms that are considered barriers to employment.
I thank the hon. Lady for bringing this subject to the House for consideration. Every one of us in this House and those outside are concerned about it. Does the hon. Lady agree that support and understanding are the key to employment of people with autism, and that the option of free training—something different, and something proactive and positive for people with autism and their employers—should be available to private employers who wish to learn how to get the best from their staff, and ensure that their working environment is safe and secure for all workers?
I feel privileged that the hon. Gentleman has intervened in my Adjournment debate, and I could not agree with him more. I will come to his point later in my speech Following a survey commissioned by the National Autistic Society, the London School of Economics advises that only 16% of adults with ASCs are in full-time employment, despite 77% of them wanting to work. These figures have remained static since 2007 and are considerably lower than the employment figure for people belonging to other disability categories, which currently sits at 47%. Therefore, those with autism spectrum conditions are disproportionally unemployed We know that employment contributes to our identity and quality of life. Equally, we are only too aware that unemployment has significant individual and societal costs. As a result of these barriers, most people with ASCs who are fortunate enough to gain employment will experience mal-employment, and will most likely be placed in jobs that are a poor job fit for their skillset. This is commonly because the job does not align with individual interests, talents, specific skills or intelligence levels. It is common sense that the better the job fit, the more likely people are to succeed. By not addressing this, individuals with ASCs will experience high levels of job turnover, resulting in disjointed employment histories that limit their potential for continuous employment; we know that when applying for jobs, our work history can either facilitate or block our access to being invited for an interview Every adult—with or without a disability—has the right to enjoy employment, and should be able to choose their career without restriction, to work in positive conditions and to be protected against unemployment.
Does my hon. Friend agree that one of the major concerns for many people relates to workplace assessments and their effectiveness, or ineffectiveness, whether for those with autism or other disabilities? Does she agree that the Department really should consider how it measures the effectiveness of workplace assessments—say, for those with autism—in enabling them to stay in a job for a longer period?
I thank my hon. Friend for that intervention. He raises a very important point It is recognised that jobcentre staff will encourage an individual to apply for and accept any vacancy. For someone with a fragmented employment history, this quickly becomes accepted as the only route to employment.
My hon. Friend is making an excellent speech. Does she agree that we should ask the Government to follow the advice and example of the Scottish Government in creating an autism implementation team to improve outcomes, including in accessing work, for people with autism so that they are supported as they make their way in the world?
I thank my hon. Friend for her intervention. I do agree. In fact, there are many occasions when this Government could follow the excellent example of the Scottish Government, but in this case it could prove especially fruitful Not all jobs are suitable for individuals with autism spectrum conditions, as a result of their own individual barriers. These are common symptoms of ASCs. It is accepted that ASCs will result in individuals experiencing strong resistance to change and poor social communication and interpersonal skills. They will struggle in acclimatising to new routines and procedures. However, this should not prevent them from accessing employment: it means that we need to change our approach within the workplace.
I congratulate my hon. Friend on securing this debate and on the way in which she is presenting her case. As well as the barriers of access to employment that she is speaking about, there are barriers of access for people with autism going about their daily lives in general. Does she agree that Hope for Autism, which is based in Airdrie but serves the entirety of North Lanarkshire, is an example of a specialist local organisation doing fantastic work to help young people with autism, and their families, not just in accessing work but in being able to cope with the barriers that they face?
I thank my hon. Friend. Yes, he is absolutely right. There are so many organisations UK-wide that support and help people with autism, but we need to really concentrate on getting people on the spectrum into employment We need workplaces to become accessible for those with ASCs. I would argue that we need a more holistic approach and acceptance of an individual’s personal preferences and abilities. We must recognise the barriers that some will face when attempting to gain employment. In the first instance, job application forms can be too complex and without clear instructions. Most individuals with autistic spectrum conditions will struggle with deciding whether they should declare that they have an ASC. Again, this is a result of the neurotypical stereotyping that continues to exist today. In other words, people with ASCs are perceived as being very different, and there is no real understanding of the challenges and range of autistic spectrum conditions that exist When someone with an ASC is fortunate enough to be invited for an interview, a variety of factors may impact negatively on their performance, as it might be called, in relation to a neurotypical candidate. It is important to recognise that they will be sensitive to sensory stimuli—bright lighting and so on—that will result in increasing their anxiety before they have even begun the interview. We use the neurotypical as a normative benchmark for interview success, but this needs to change. Interviews measure candidates demonstrating their social skills and having the confidence to maintain a flowing conversation. An interviewer will expect the interviewee to respond to questions quickly However, the language used in questions can be misunderstood. Not everyone interviewing applicants is experienced or trained in interviewing techniques and can all too often ask one question that contains other questions, causing confusion for an individual with an ASC. One common question in interviews is, “Tell me about yourself.” Someone with an ASC will have difficulty in determining what exactly the interviewer wishes to know: it is too open-ended a question. Questions need to be concise and designed to avoid misinterpretation. They will struggle to read between the lines or understand the tone of voice. Many interviews use questions that require hypothetical scenarios and hypothetical answers. People with ASCs are factual thinkers and will find that line of questioning challenging. We also know that someone with an ASC will have problems understanding facial expressions and recognising social cues. It is widely accepted that people with ASCs experience difficulty in adapting to new routines and procedures. They will also struggle with adopting a flexible approach in unexpected situations, so not all jobs will be appropriate environments for them. I have not given an exhaustive list The Government argue that disability support is in place, such as the local supported employment and intensive personalised employment support programmes, but those are generic disability employment programmes, not designed for autism spectrum conditions. We need specialised support that will prove more successful in assisting people with ASCs into employment and maintaining employment. That role should be taken up by Jobcentre Plus. With proper training, jobcentres would be able to support employers who take on those with ASCs. Being employed offers structure and routine, which enhance an individual’s life. If employers need to change their approach to hiring staff and allow a time period for those with ASCs to settle into their roles and environment, that should be done. However, there is very little or no evidence to prove that the Government are taking steps to regulate the situation, in spite of their past commitment to do so What is not being recognised are the attributes that people with ASCs have and can bring to the workforce. About half of those in this population will have higher education, with some educated to PhD level, yet they remain under-represented in senior organisational roles. So many people with ASCs are extremely skilled in maths, physics, computing sciences and engineering, yet they remain discriminated against, with their talents and intelligence being cast aside—all because the Government will not put into practice the recommendations provided by various autism charities The Government are refusing to take the bull by the horns and activate their own strategy and the Equalities Act 2010 to its fullest extent; they would rather tiptoe around autism and claim that they recognise that changes need to be made. Where is the headway on this? People with ASCs are still being excluded and discriminated against. Given their abilities, they have exceptional characteristics as employees, such as honesty, efficiency, precision, consistency, low absenteeism, disinterest in office politics and attention to detail. However, as the hon. Member for Strangford (Jim Shannon) mentioned, the lack of appropriate training and support for employers means that they generally do not see these characteristics—only autism. More often than not, that means that people in the group are forced into entry-level jobs that will not last long, due to their intelligence levels We cannot continue to repeat this vicious cycle with the new generation of workforce. When someone is excluded from the workforce despite their credentials, despite their abilities, despite their intelligence, what are the implications of their being unemployed? They are depression, isolation, anxiety and low self-esteem. The system is not fit for purpose What are the Government planning to do to rectify the situation? They continuously categorise autism spectrum conditions as a “learning disability”. I suggest that being able to achieve a PhD, complete higher education and have expert level skills is not reflective of having such a disability. Not all people with autism spectrum conditions have learning disabilities, and we need the Government to recognise that. We need to stop regarding the autistic and neurotypical ways of thinking as polar and conflicting opposites; they are merely different, with no wrong or right side at play The Autism Alliance has done amazing work in providing the confident autism and neurodiversity toolkit, but it is not being used enough. The difficulties many people with autistic spectrum conditions have may mean that, when they cannot get a job, they have to apply for benefits. Most of my casework is in relation to people requesting mandatory reconsiderations or people being forced to attend tribunals. It is all too obvious that the application forms for benefits such as the personal independence payment and employment and support allowance—
Will my hon. Friend give way?
Yes, certainly.
In relation to PIP and reconsiderations, does my hon. Friend recognise that, as I said to the Minister yesterday, 85% of all considerations were overturned in April 2019? Rather than that type of bureaucracy, we should be investing in the frontline, as my hon. Friend is saying.
Yes, I completely agree As I have said, most of my casework is in relation to people coming to me as they cannot navigate the benefits system. They find it increasingly difficult, and many in fact just give up altogether. As a caring society, we should not allow that. Applications for PIP and ESA are designed in such a way that they eliminate the neuro-diverse mindset. They are designed by a Government who would have us believe they are using all the toolkits, training, expertise and guidance from the various charities. It is clear that if this were true, more adults would have accessed employment since 2007, and fewer adults would be struggling to navigate the discriminating benefit process in operation. As MPs, we cannot know the number of individuals who have tried to apply for these benefits and not got beyond an application. People may now be homeless, have mental health issues or worse because of how this Government are failing the autistic population of this country I should like the Minister to address these questions. What steps will this Government take to close the autism employment gap? Will the Government commit to ensuring all Jobcentre Plus staff have proper autism understanding training? Will the Government commit to recording autism in the labour force survey so that we can measure progress in the employment of those with autism spectrum conditions Finally, will the Government commit to raising awareness of the autism friendly employer award? This would help many more ASCs into employment. There are other awards that MPs could work towards, too. I am proud to be the first parliamentarian to receive the autism friendly award. It is not hard to make a difference for ASCs, but by raising awareness we, together, can perhaps raise employment levels for this under-represented group of society and harness their undoubted talents for the good of society and of the economy as a whole.
It is a pleasure to respond to the hon. Member for Motherwell and Wishaw (Marion Fellows). She made a very well-thought-through, constructive and challenging contribution, with which—apart from perhaps the odd comment about the Government’s record—I wholeheartedly agree. I am not surprised at the quality of her speech, because I and the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Colchester (Will Quince), were just commenting on how the hon. Lady is probably the most prolific Member on parliamentary questions in our Department and keeps us very active when we arrive at the office every day There were four asks—I will cover all four—and it is a yes across all four. First, as a Government we are proud that there have been an additional 950,000 more disabled people in work in the last five years alone, and we hope to see a further 1 million by 2027. The hon. Lady is right that we do not currently record statistics on people with autism in the labour force survey. The National Autistic Society has done its own survey, and it has estimated that 16% of the 700,000 adults with autism are in work. We are now working with the Office for National Statistics so that we can make that part of the labour force survey. I would welcome that, as the Minister for Disabled People, and we are very much on that Parliament often rallies round to raise the profile of cross-Government improvements that are needed to support people with autism. The all-party parliamentary group on autism has more than 200 cross-party members, and the Westminster Commission on Autism brings together senior parliamentarians and leading members of the autism community. There are also several national and local autism-supporting organisations, which are key stakeholders that support various Departments.
I thank the Minister for giving way and for a very constructive response to my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows). Does he agree that it is extremely important that parliamentarians undertake the autism awareness training that the all-party parliamentary group has provided? I believe that more than 100 MPs have already done so. I was very pleased to do it. Does he also agree that MPs should undertake the Disability Confident training to ensure that they are Disability Confident employers?
The chair of the all-party parliamentary group on disability has highlighted two incredibly important asks of all Parliaments and parliamentarians, and I wholeheartedly agree that they should all have that training, and that they should all sign up to Disability Confident. Many parliamentarians have done so and many enthusiastically support both those campaigns, but it does no harm to remind people that, even with busy diaries, that is incredibly important The majority of the speech of the hon. Member for Motherwell and Wishaw focused on employment opportunities, so that is where I will start. In the jobcentres, we are grateful for the work of the Autism Alliance, which helped develop the disability toolkit, providing comprehensive information on autism and hidden impairments. We also now have the bite-sized autism awareness learning that jobcentres are looking at. From that, many examples of good practice have developed locally, which we are sharing across the jobcentre network. They include calm and quiet sessions for claimants We also have the disability passport, “About Me”, which encourages disabled claimants to disclose their disability and health conditions at an earlier stage. That improves communication, ensures reasonable adjustments in advance and allows individual challenges to be explained only once. That issue was clearly highlighted in the hon. Lady’s speech. We have done more intense training on autism and hidden impairments for 1,000 of our frontline staff to ensure that there is a high level of understanding in every jobcentre. We will continue to do that, and that was one of the hon. Lady’s asks. I would like to invite her to meet me and my team to look at that particular area so we can have confidence that we are doing everything we reasonably can in all jobcentres. As part of our support for people who could be classed as being further away from the workplace, we have: universal credit personalised support, which could simply be signposting following the first conversation; moving on to the Work and Health programme; the personalised support package, which now includes 800 disability employment advisers and leaders; or the intensive personalised employment programme, which will be launched at the end of the year. The latter is highly personalised and tailored to the individual’s needs. That is important, because every autistic person experiences autism differently and many have complex needs or other conditions, such as a learning disability or a mental health condition, so the programme has to be tailored and personalised One of the best levers that we have as a Government is the Access to Work programme. Again, while we celebrate the fact that 33,800 people—a record number, up 13%—benefited from Access to Work last year, as with the labour force statistics, we cannot record autism. However, once that comes in to the labour force statistics, we will also have it within Access to Work. I know that it is not an exact comparison, but last year, there was an increase of 22% in claimants with a learning disability where there was a crossover. There was also a 28% increase in young claimants who benefit from the Access to Work scheme. That is important because Access to Work has only recently broadened out from simply supporting people with a physical disability or sensory impairments, and we have now stepped up significantly support for mental health, learning disability and autism However, it is a journey and we have a real commitment to go much further. We are working with organisations such as the Autism Alliance and Exceptional Individuals to ensure that our staff have specialist knowledge, so that when they talk to employers and the potential or existing employee about how we can provide support, we have the best knowledge of the available technology and the way in which support workers can help, particularly in the interview process. Probably the most powerful part of the hon. Lady’s speech was about interviews and adapting the interview process. I have employed disabled people. I understand that interviews are a strange old process, because they bear little relation to what happens next and generally everybody just claims to be very active at sport. The real question is how they will fit those roles. We talk to employers who are struggling to fill skills gaps about being a little bit smarter. Also, through the Access to Work programme, we can look at travel, which is important, particularly if people are anxious and would find public transport difficult. We will be doing far more We are looking to build evidence in this area. We are working with a supported business alliance—57 supported businesses across the country—to provide a greater level of additional support. In return, we can gather the evidence to see how we can break down the barriers and provide long-term sustainable opportunities with career progression.
As had been said, I appreciate the constructive way in which the Minister is responding to the debate. Alongside the barriers that people with ASCs have to the workplace, they are also, sadly, more likely to be exploited. One of my constituents was affected by unpaid work trials in B&M Stores. In light of this debate, I wonder whether the Minister might consider the Government’s position to oppose the 10-minute rule Bill from my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald) to ban exploitative unpaid work trials, so that people with autism and Asperger’s, such as my constituent, are not exploited in such a way again.
I am conscious of time, so I will have to look into the details. It is right that we absolutely have to do more to enlighten businesses of all sizes about the opportunities. Small changes and good practice can benefit not just individuals with autism, but the organisations that take them on This is my second time as Minister for Disabled People and I am very proud that, in the final few weeks last time, I was able to push through the opening up of disability apprenticeships, removing the need to get a grade C in GCSE maths and English for people who would qualify under the disability apprenticeship. That is an important way that we, as a Government, are trying to remove barriers, but we must look at providing additional support within the workplace to go beyond the interview, so that people have an opportunity to demonstrate their skills Through our Disability Confident campaign, which now has more than 12,000 businesses of all sizes signed up, we are looking to share best practice. I think we can go further than that, not just by recruiting more organisations to the Disability Confident campaign, but by looking at organisations such as the Health and Safety Executive. To a certain extent, that will help support the point made by the hon. Member for Airdrie and Shotts (Neil Gray). It is very proactive in engaging with businesses on safety, so it is a given that the workplaces will have a safe environment. We are world-leading on this—other countries look to our expertise—but we need to do the same on health. That includes empowering small and medium-sized businesses in particular that do not have personnel or HR departments, so that they can have the skills and the confidence to make small, reasonable adjustments. That would be a win-win for all I had the pleasure on Friday, as part of Employability Day, of meeting employers and individuals who had overcome those barriers. That was transformational for those individuals who were enjoying the opportunity to contribute, and to the employers who had struggled to fill gaps and were now benefiting as an organisation.
I was just sitting here thinking about the best way of doing this. The hon. Member for Motherwell and Wishaw (Marion Fellows) has made some suggestions. When it comes to organising training for the potential employer and the young person with autism, would the Minister consider using the influence of parents and families to enable the training process to be easier for the person who has autism as well as for the potential employer?
I agree. In all parts of accessing services and applying for jobs, having supportive individuals is a reasonable adjustment that a good employer, a good organisation and a good Government should take into account and should encourage. In the final moments, I wish to pay tribute to the hon. Member for Motherwell and Wishaw. It is fantastic to see so many Members supporting an Adjournment debate. I think that is a recognition of the quality of the speech that was delivered on a really important topic. I think there is much agreement across the House and I would be very happy to meet further to discuss what more we can do. The Government are determined to make a real difference in this area. I am absolutely thrilled to see that there is cross-party support for that. Together, we will do everything we can to unlock every individual’s talent, so that everybody can benefit from the growing economy Question put and agreed to.