Autumn Statement Distributional Analysis, Universal Credit and ESA — House of Commons, 2016-11-16
Topic: Social Welfare
David John Barrington Burrowes (Conservative, Centre-right): I am pleased to be able to take part in the debate. The shadow Chancellor talked about econometrics; I want, like the Prime Minister, to focus on human metrics. At the outset of her premiership, she rightly said that this would be a Government who wanted to "stand up for the weak" and reach out to the "just managing" Today’s debate, like the debate that we shall have tomorrow, is about seeking to fulfil those aims I intend to concentrate on cuts in the universal credit work allowance today and delay most of my comments about the ESA WRAG payments until tomorrow, although I will say now that I approve of the Green Paper’s direction of travel. Its vision of integrated and personalised employment and health support is overdue, but welcome. However, we need to look out for the disabled people—some 500,000, according to a House of Commons Library estimate—who worked in April as new WRAG claimants. They will still be affected. The flexible support fund—about which I look forward to hearing from my hon. Friend the Minister for Disabled People, Health and Work—is crucial. Along with other discretionary relief, it needs to meet the wider costs of job seeking for disabled people by April. We cannot deny that those wider costs exist, and we must ensure that we meet them. My support for the Government’s admirable reform agenda for disability depends on that Let me now say something about low-income families, who are the main subject of the debate and, in particular, about the first few lines of the Government amendment, which "notes the role of universal credit in ensuring that work pays" That is what we want to happen. It is the very basis of our welfare reforms. We must commend the Government, and previous Governments, for the fact that some 764,000 children will not wake up in workless households today because of the opportunities for work that have been provided. That is extraordinarily important. Work is obviously a primary route out of poverty, and the income tax cuts, the national living wage and the 30 hours of free childcare are all extremely welcome What will drive all this through, however, is universal credit that does what it was designed to do, and makes work pay. In Enfield, which rolled the scheme out early, it has been a success. Work coaches have reached out to previously unreached individuals, helping them to find work. More people are working, obtaining work more quickly, staying in work longer, and earning more. The first nine months have been very successful. Universal credit claimants are now 13% more likely than jobseeker’s allowance claimants to be employed, work 12 days more, and are more than twice as likely to try to work for more hours That is all extremely welcome. However, there is a risk that the cuts in the universal credit work allowances will unpick the good work of the universal credit: the work coaches, the incentives, the living wage and the free childcare. It will be like a travellator in an airport. We want the travellator to help people—especially those on low incomes—to travel into work. It will now be switched in another direction; actually, it will be going in the opposite direction, which will mean that 2.7 million working families will on average be £1,500 worse off without the benefit of work allowances. It matters greatly to these families. It also does not make sense that these families who are claiming universal credit will be worse off than families protected under legacy tax credits payments living in the same town, the same neighbourhood or even the same street. That is not fair. There is cross-party concern about this, and a shared concern among campaign groups, which are not always on the same wavelength. Gingerbread, focusing its concerns on single parents as well as couples with children, makes the point that working single parents in the poorest fifth of households are set to lose nearly 7% of their income. A home-owning single parent working full time will be over £3,000 a year worse off without the work allowances, and if a second earner enters work he or she will lose 65p in every pound earned. CARE also made this point in relation to recognising our support for marriage in the tax system, which it says could be undermined. In particular, single-earner married couples on median incomes with two children will lose significantly without the work allowances.