Universal Credit Roll-out — House of Commons, 2017-10-24
Topic: Social Welfare
Deborah Angela Elspeth Marie Abrahams (Labour, Centre-left): No. I am sorry, but I am not going to take any more interventions Other design problems I mentioned last week include: the fact that payment is made to one member of the household—predominantly men—and that the second earners, who are predominantly women, face much reduced work incentives; the fact that severe disability premium payments were not incorporated into universal credit; the fact that rent is paid to the claimant rather than the landlord; the fact that self-employed people are subject to the punitive minimum income floor, which fails to reflect the reality of the peaks and troughs in their working hours; and the fact that in-work conditionality is coming down the track, meaning that 1 million working people will have to visit jobcentres while much of the Jobcentre Plus estate is being closed, and will face financial sanctions if they fail to work the hours their job coach deems they must work. On top of that, there are the real-time information flaws, which have been mentioned by my right hon. Friend the Member for East Ham (Stephen Timms), and the fact that there is no time limit on disputes, which will lead to more delays in payments. There is also, of course, the fact that the child element of universal credit has been reduced from 20 to 19 years I turn to the cuts made to the programme since its introduction. Universal credit was meant to simplify the system, but it was also meant to make work pay. We have always supported those principles, and we still do, but unfortunately the 2015 summer Budget slashed the work allowances, and the rate at which support is withdrawn was dramatically increased. As the Institute for Fiscal Studies said in its response to the Budget, that meant the promise that work would always pay was lost. The cuts reduced the work allowances from £222 a month to £192 a month for a couple with two children claiming housing costs. It is estimated that that will result in an additional 340,000 people in poverty by 2020. Some families have been left as much as £2,600 a year worse off Families with three children face even greater difficulty, as the Government have decided that the state should play no role in supporting the life chances of the third child. A whole generation of children will be born without the support that was offered to their siblings, which is a break from the historical principle that the state should not punish children for the circumstances of their parents. Single parents have been hit particularly badly. In real terms, a single parent with two children who is working full time as a teacher will be £3,700 a year worse off. That is even before we reach the Government’s freeze on social security rates, which the Joseph Rowntree Foundation predicts will push 500,000 more people over the poverty line. Its analysis shows that the freeze will mean that a family of four receiving universal credit will be over £800 a year worse off in 2020, and that is on top of the other cuts I have outlined. Will the Minister confirm that the Government will continue the freeze on social security payments, including universal credit, given that it was introduced when inflation was 0.3% but the rate is now 3% As I revealed last week, the Child Poverty Action Group’s forthcoming report estimates that these cuts will push 1 million more children into poverty, 300,000 of whom are under five. What does it say about this Government when their policies knowingly push children into poverty? The Secretary of State, the Minister for Employment and many other Conservative Members have tried to suggest that data apparently showing a 3% increase in employment outcomes under universal credit compared with the situation under the previous system is evidence that universal credit works to get people into work. However, they fail to add that the data is from 2015—before the cuts were implemented. Will the Minister now commit to updating the figures, and will he retract these particular statistics, which he has used numerous times It is worth pointing out that the most recent figures show an underspend—I repeat, an underspend—on tax credits of as much as 2.4% compared with the projections of the Office for Budget Responsibility. Will the Government provide an exact figure for the savings that that has created? Could not some of the underspend be put towards sorting out the problems that we are now encountering under the new programme? I will return to that point in a minute.