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I am pleased to see the Minister for Employment and Welfare Reform his place, as he has been extremely helpful to me on this subject.
The Government will get support, but I am still not convinced that the cost of providing the specialist so-called niche services has yet been thoroughly thought through. I have mentioned the fact that subcontracting immediately takes a slice of money from what is the already high per capita cost of providing a good quality service. I urge the Government to consider how they can contract directly, without top-slicing a chunk of money that is wasted, with the organisations that know what they are doing and have already made a difference to the lives of adults with Asperger’s syndrome. The Government can make so much more difference if they get it right.
7.24 pm
Roger Berry (Kingswood) (Lab): It is a pleasure to follow the hon. Member for Tiverton and Honiton (Angela Browning). I congratulate her on her speech, and I am sure many other hon. Members agree with what she has said.
I shall speak only to part 1, on the employment and support allowance and related matters. I congratulate Ministers on the consultation that has taken place in getting this far—I might be slightly more critical than that in a moment, but just let me get that in first. We had about a year’s consultation before the Green Paper. We had a proper Green Paper exercise and submissions where made to the Secretary of State. We now have a Bill. It has been a long process; it has not been a rushed process, with a Bill emerging from the clear blue sky. I congratulate my colleagues on the fact that we have had plenty of time to discuss these issues before debating the Bill on Second Reading.
My hon.
Friend the Member for Regent's Park and Kensington, North (Ms Buck)
made a comment about previous debates on incapacity benefit being
toxic. My hon. Friend the Member for City of York (Hugh Bayley), who is
no longer present, referred to the Welfare Reform and Pensions Act
1999. As someone who is prone not to scratch old sores, I will not go
in that direction, but my hon. Friend the Member for Regent's Park and
Kensington, North suggested that
there appeared to be a degree of welcome consensus on where we go from
here. That is true, and it is not something that could have been said
five or six years ago.
The truth is that, because of events five or six years ago, many people in receipt of incapacity benefit and those who might receive it have become quite concerned about any new proposal and any change. They fear—dare I say it?—another cut in benefit, as under the previous Government and, sadly, as in 1999. Therefore, I start by praising the Bill, because of the clear assurance that it is not about cuts: it is about enabling disabled people and people with long-term sickness either to retain employment or to get back to work.
The problem with the number of people in receipt of incapacity benefit has never been one of fraud—it is about the most fraud-free benefit that we have—and it has never been about the benefit being generous. It is far from generous. People on incapacity benefit are usually living in deep poverty. Those two things have never been the problem. The problem is that we need to remove the barriers that prevent a very large number of people in receipt of incapacity benefit who want to get back to work from doing so. The Green Paper’s sub-title, “Empowering people to work”, is precisely what part 1 is about and precisely why we should congratulate the Government on introducing it.
We should never forget some of the basic facts that we are addressing. According to the Disability Rights Commission 48 per cent. of disabled people are out of work—virtually one in two. That increases to 79 per cent. for people with mental health problems, and it is 84 per cent. for people with learning disabilities. Those figures are shocking. They suggest that we must all address the current problems if we are serious about securing full employment for all.
The link between being out of work and being in poverty is stark and obvious, and the House does not need me to repeat the facts at length. Let me simply say that, in relation to the Government’s laudable policy and success in taking children out of poverty, 40 per cent. of children with a disabled parent today live below the poverty line. Almost one in two children of a disabled parent are in poverty. Yes, we must talk the language of the right to work; we must also talk the language of taking children and their families out of poverty. Therefore, the emphasis must be both on ensuring that people who want to work and can work receive the support to secure fulfilling employment and on ensuring that people who cannot work get a decent benefit. Those two approaches are essential if we are to make progress. The implication is that more support must be provided for disabled people in those two ways.
Let me talk
about securing employment. The Green Paper was a bit vague. The
direction was absolutely right, but it was difficult to pin down one or
two issues. The Bill is only marginally less vague than the Green
Paper. If we are honest about it, that is the truth. I am not being
critical; I am simply saying that that is the situation. The Government
have rightly promised that draft regulations will be produced as soon
as possible. To back up comments made by other Members—and
because I feel strongly about this myself—I would be grateful if
the Minister could say when draft regulations are to be made available.
I hope that that
will not be only for the first Committee sitting; a summer recess is
coming up, during which we will all be busy working, and it would be
good if we could have the draft regulations earlier rather than
later.
On which provisions will those drafts focus? I was talking to a specialist the other day, and she assured me that the Bill gives the Secretary of State—or all the Ministers in the Department—400 or so separate powers. [Interruption.] No, exactly. Another specialist told me the next day, “No, there are 600 powers.” I know not whether there are 400, 600 or 800 regulation-making powers in the Bill, but I know that there are a lot; there have to be a lot because the Bill is fairly vague. Can we have an assurance that these regulation-making powers will be published in draft form as soon as possible? When will that be, and which are the key areas that will be covered?
We need to know fairly soon what are the criteria for determining into which category of employment and support allowance a recipient might fall. How do we distinguish between those two groups? I cannot answer that question. We need to have some information on benefits, in order to make sure that people will be better off and not worse off. We also need to know more about how conditionality will work. Who will make the decisions? How will the appeals process work? In respect of a Bill of this kind, it is understandable that we do not have such details before us today, but I urge Ministers to make them available as quickly as possible.
On funding, the hon. Member for Tiverton and Honiton is absolutely right that in some circumstances supporting some disabled people back to work—or supporting them in retaining employment—might not be expensive but in other circumstances that can be quite expensive. If this job is to be done properly, the resources have to be found. I recall the Secretary of State saying at the time of the Green Paper that getting 1 million people back to work would save £7 billion for the Exchequer. I join the plea made by my hon. Friend the Member for City of York that a bit of recycling is a good idea. As people go back to work—
Danny Alexander: I totally agree with the hon. Gentleman’s point, but it is not just a point about recycling money. It is also a point about the overall benefit to the economy. As the Organisation for Economic Co-operation and Development has said, active labour market programmes are a good way of spending money because they release more money back to the Exchequer. So we all win.
Roger Berry: I would not suggest that there is never a net cost, but the fact is that enormous benefits come from programmes of this kind. However, as my hon. Friend the Member for City of York pointed out, the UK’s record in respect of spending on labour market programmes for disabled people is pitifully poor.The figure that I have in mind is a telling one: we spend 0.02 per cent. of national income—a fifth of the average European Union spend—on work-related programmes for disabled people. We can do better.
There is
another issue that I must again raise. I know that the Government are
now spending £62 million on access to work. That programme is
one of the best kept secrets; 75 per cent. of employers have never
heard of it, but those who have heard of it know how important
it is—and many Members know constituents who have benefited
enormously from it. When the Department for Work and Pensions writes to
me that, for every£1 million spent, the Treasury gets
back £1.7 million, it makes me ask: can I be assured that the
DWP and the Treasury have ongoing discussions to ensure that access to
work gets more money? I am deeply concerned at the announcement that
that initiative will no longer be available for Government Departments.
I know that it has already ceased to be available in the DWP. Before
the Government go ahead with that decision, I urge them to provide
evidence that it will not have a harmful effect. It is perfectly
reasonable to say that Government Departments have large
budgets—
The Parliamentary Under-Secretary of State for Work and Pensions (Mrs. Anne McGuire): I can give my hon. Friend and the House the reassurance that the Office for Disability Issues has said that it will monitor the situation, but of course all Departments are covered by a disability equality duty, which should mean that there is no detriment.
Roger Berry: I accept that, but I tabled parliamentary questions to all Departments asking how many disabled staff in each Department received support from access to work. It is interesting that some Departments simply did not know, and that others provided figures. Indeed, one Department—the Department for Education and Skills—to its credit has an earmarked fund, the reasonable adjustments fund, to deal with such requests. All I am saying is that I would like to be assured that there will not be any incentive on line-managers not to appoint somebody because they have a disability. If half a dozen people are coming for an interview for a post all of whom can do the job equally well so that the decision as to which to appoint is a marginal one, if one person will cost more money to employ because they are disabled, I would be worried, even in respect of a Government Department, that there might be an in-built bias to discriminate against that disabled person. As long as the situation is being monitored carefully, I will happily accept my hon. Friend’s assurance that I have completely misunderstood the problem and that such situations will never arise—but I will still be looking for it, just in case. Ring-fencing funds for that purpose—which is apparently what the DFES does—might be a way around that.
Where
are the 1 million jobs to come from? I have only two minutes left, but
let me make a few comments about the important role of employers. I
attended a breakfast meeting with the hon. Member for Angus
(Mr. Weir). [Interruption.] I attended a breakfast on
Thursday morning along with one or two Members—I can recall one
of them at least—with the New Beginnings coalition, whose aim is
to identify and help to dismantle the barriers faced by disabled people
in employment, and particularly to ensure that employers are engaged in
welfare reform. It is an organisation that my Front-Bench Friends will
be well aware of, and it does sterling work. A number of issues were
raised in relation to the employers’ role, and I think that it
is fair to say that there was a general feeling that most employers are
not engaged in the welfare reform
exercise very much at all. There was a comment to the effect that as
employers to some degree interface with the Department of Trade and
Industry, could we pass on the message that we know that the DWP has
the major role to play in this, but the DTI might also put in some
effort to using its good offices to persuade employers to adopt good
practice in this
regard?
There is a range of issues to do with using the private and voluntary sector in pathways to work. I have said for quite some time that, sadly or otherwise, I have often found that there are private and voluntary sector organisations that are far better placed to give support than many of our Jobcentre Plus offices; that is the truth. There are some very good voluntary sector organisations, but they need to have good contractual arrangements. In an advertisement that I saw in SocietyGuardian last Wednesday—if I can mention The Guardian without the Whips getting too irate—for the new pathways to work contracts, the key contractors were offered contracts of three years-plus, but if there are subcontractors, I hope that they get more than mere one-year contracts under this system. Organisations that provide such support must be able to work in decent conditions, not least because the good ones employ lots of disabled people, which is why they are very good at providing the service.
7.38 pm
Mr. Greg Hands (Hammersmith and Fulham)(Con): It is a great pleasure to follow the hon. Memberfor Kingswood (Roger Berry), who made a characteristically passionate and well-informed speech. I want to make a few brief remarks about cancer patients, and others facing long-term illness, before moving on to consider the housing benefit proposals in some detail and the proposal to introduce the new local housing allowance.
On cancer patients and their families, carers and supporters, I have in my constituency both Macmillan Cancer Support and CLIC Sargent, with which I do quite a lot of work on ways to reduce the non-medical costs of cancer and long-term care. There are some depressing statistics. In respect of those aged 55 or less, seven out of 10 households with a member suffering from cancer suffer a loss of income, with the average income fall being in the region of 50 per cent. I applaud the campaigns to reduce those costs, which are very expensive, especially in London, and include parking fees and congestion charging, as well as other medical expenses. We need to look closely at lightening the load on cancer patients and those close to them.
I turn to housing benefit and the new local housing allowance. Housing benefit is an important benefit and it is vital to scrutinise it and the proposed changes properly. It is currently paid to 4 million households in the UK——mainly low-income tenants but also people of working age and pensioners. Only 20 per cent. of those 4 million live in privately rented properties—the primary sector under consideration in this Bill—and a key test for the future of these regulations will be when and if they are applied to social housing.
The gist of
the new local housing allowance scheme is that it pays a flat rate that
varies only according to the size of the family and the area in which
the tenant or household live. That contrasts with the current
system, under which housing benefit is related to the total rent of a
house or flat. Under the new LHA system, tenants have a chance to shop
around for cheaper property and pocket the difference, or to trade up
and make up the extra rent themselves. As I understand it, that scheme
will be introduced only for future tenants and that existing ones will,
in effect, be “grandfathered”, at least for the time
being.
The Bill also allows benefit reduction for those who commit antisocial behaviour and who refuse help in order to reform their behaviour. I shall not dwell on the idea for too long, but it has potential. As currently expressed, the scheme will kick in only after eviction and put the onus merely on going on a rehabilitation course. We could explore that idea further. In my constituency, too many tenants and residents have suffered for too long from the effects of antisocial behaviour, and they have seen little action from the outgoing Labour council in the past 20 years to combat the problems. The new Conservative council in Hammersmith and Fulham is certainly taking such problems very seriously.
In general, I greatly support initiatives to help those who are less well off in what are otherwise prosperous areas—a typical situation in large parts of inner London, including Regent’s Park and Kensington, North, to which reference was made earlier. For example, I took part in the launch of the new Hammersmith and Fulham credit union a couple of months ago, which is a scheme designed precisely to help the less well-off in an area that is otherwise superficially very prosperous. However, a constituency such as mine contains many very successful people, as well as many who are struggling. In my view, otherwise wealthy areas that contain a large number of poor people have suffered badly under this Government through, for example, the changes to the index of local deprivation, the capping of council tax benefit at band E over a six-year period, the fixing of funding formulae against London, and so on.
As a former councillor, I have a lot of experience in dealing with housing benefit cases in my own constituency; in fact, I used to represent tenants at housing benefit tribunals. The “HB regs”, as they used to be known, have evolved somewhat since the mid-1990s and have been updated many times, so I had to do a little updating myself before taking part in this debate. But I know from experience that changes to housing benefit need to be properly thought through and carefully piloted, and I certainly welcome the piloting approach that has been taken. Housing benefit has been particularly subject to fraud and poor administration over the years, as witnessed, for example, by problems in London councils during the late 1990s. We need to approach reform with caution, but reform is much needed.
Danny Alexander: Does the hon. Gentleman share my concern about how the areas in which the local housing allowance is being set are being decided? In a constituency such as his, which has well-off and not so well-off areas, the LHA could be set too high or too low for the people living there.
Mr. Hands: I thank the hon. Gentleman for his intervention. He is right and he makes the point well; indeed, I shall come to that in a moment.
I strongly support the general principles referred to in the Green Paper and agree that we need to get tenants to take more responsibility for their own financial affairs. That said, I shall now outline a few difficulties that I can foresee with the new LHA. Much depends on what constitutes a region or an area and, although it is obvious what is meant from the pathfinder studies in the nine local authorities, it is otherwise by no means clear. There are particular problems in London in setting the level of benefit. What constitutes a decent, normal market or median rent in London, given the huge discrepancies in rent levels in different boroughs across the capital? For example, rents in Barking and Dagenham or Havering are far lower than in Westminster, Kensington and Chelsea or Hammersmith and Fulham. Even within a very small local authority area such as my own, the difference in rent levels between Fulham—around the Hurlingham club—and in Shepherd’s Bush can be huge, so it is very important that we define such areas well. I should be grateful for guidance from the Minister on this issue.
If such areas are made too big, the natural reaction may well be for people to move from expensive boroughs to cheaper ones, or from more expensive areas within a given borough to cheaper ones. Some might view that as desirable and say that it is merely tenants following market forces, but I am not so sure. If the different parts of London are to remain sustainable and solid communities, we need a range of people living in each. Pricing the poor out of the centre of London, or out of places such as Fulham, could have consequences that we need to consider carefully before going down that route.
Justine Greening: My hon. Friend is making a very good point. As recently as last Friday, I met the head teacher of my local school—the Elliot school—and one of the things that she is very passionate about is the fact that the children whom she teaches constitute a very diverse group. My hon. Friend is right to highlight the danger associated with this legislation. We need to be careful to ensure that we understand its impact.
Mr. Hands: I thank my hon. Friend. It is important to be careful both in setting the areas and in defining exactly how we are going to arrive at the median rent level. Of course, a big range will create much more potential for people moving out of expensive areas and into cheaper ones. I urge the Government—in London, at least—to make the regional considerations as small as possible and to make the areas as small as can reasonably be assessed. Indeed, the same should perhaps be done in other parts of the country.
In the Green Paper, the Government state:
“tenants are able to compare how much support is available towards their housing costs in different areas and for different property sizes.”
That is probably a great thing—we do want tenants to start looking around and assessing the economics of particular properties—but we do not want to encourage too much mobility out of the better-off areas.
Mr.
Khan: Does the hon. Gentleman think that, if tenants are
thinking about the price that they have to
pay for accommodation, it will make them more responsible and lead them
away from receiving allowances and toward paying rent
themselves?
Mr. Hands: I agree entirely and in principle that this is a very good reform. I am simply saying that in constituencies such as ours, exactly how we define the median rent level and the area concerned needs to be approached with care.
We should also consider the potential for arrears. Although the Green Paper highlights the expectation that tenants set up standing orders to pay rent, thereis clearly no compulsion to do so. Moreover, no consideration has been given to how councils might play a part in setting up such arrangements, or to the costs that might be involved to councils in offering services in this area if people get into trouble. In creating individual responsibility, councils might need to have resources to help such people get through the transitional period. I welcome the commitment given at the start of this debate to extending throughout the country the support being made available in the pathfinder projects to help tenants in more difficult and challenging circumstances to make that transition.
I want to talk about an issue that has not reallybeen touched on this debate—the potential for overcrowding. There is a real risk, which has not been totally borne out by the pathfinder projects, that many tenants will trade down their accommodation, move into smaller premises, take the higher level of local housing allowance, save money on the local allowance by paying less rent than they really should, pocket the difference and use it for something else. Some might say that that is fantastic and that it encourages more responsibility on behalf of that tenant, but if it leads to more overcrowding in places such as inner-city London and my constituency, that could be an unfortunate consequence. I would be grateful for the Minister’s views on what sort of protection can be put in place against people who are, in effect, moving to a much smaller property than they should be.
One of the most interesting aspects of this debate is the potential for extending the provisions to the 80 per cent. of housing benefit recipients who are in social housing. I have two practical concerns. I know that this aspect is not in the Bill, but there is the potential to introduce it. Having spoken to my council, I know that it believes that the local housing allowance would cost more to administer than current arrangements for its council tenants. It also thinks that arrears would probably increase in the social housing sector and that probably some transitional help would be needed for councils.
I would be interested to see
some of the results for the nine pathfinder authorities. Regrettably,
we have not yet got the final report from those authorities—I do
not think that it is due till the end of the year—to enable us
to assess the situation properly. There are some mixed experiences if
one compares, say, Lewisham with Conwy, which I suppose is not that
surprising when one considers the mix of housing stock and tenants in
the two areas. Apparently, in the pathfinder areas, 56 per cent. of
landlords said that the
new local housing allowance scheme would make them less likely to let to
housing benefit tenants due to fear or experience of arrears.
In answer to the hon. Member for Tooting (Mr. Khan), I think that we need to start giving people responsibility for their financial futures. Undoubtedly, some tenants will struggle with an incoming payment and outgoing payment when previously the cash flow was effectively hidden from them and managed on their behalf. But surely, as my right hon. Friend the Leader of the Opposition says repeatedly, we need to start trusting people and getting them less dependent on the state to do everything for them. Let us be bold and back the new local housing allowance.
In conclusion, we need to support this scheme, but we need to look at perhaps three or four areas where there are concerns. I would like the Minister to address them in his summing up. The first is the potential for mobility, both within an area of inner London and out of inner London into outer London. Secondly, thereis the potential for the overcrowding of tenants tosave money. Thirdly, there is the potential for greater arrears. Finally, there is the potential for greater administration costs, especially if the two schemes are going to be run in tandem, which I think is what the proposal states. Effectively there will be a lot of historic existing tenants on the existing housing benefit system, plus a large group on the new local housing allowance. I hope that the Minister will address those points.
We should welcome the new local housing allowance. We need to move ahead with caution. The current system is too susceptible to fraud, too complex and destroys individual aspiration. It is time for something better, but we still need a little caution.
7.52 pm
Mrs. Janet Dean (Burton) (Lab): I thank Ministers and officials for the intensive consultation that has taken place over recent weeks. As a member of a number of all-party groups and the chairman of the all-party group on lupus, as well as the all-party autism group, I know how much effort has been put into discussing the proposed reforms with MPs and patient groups. There is widespread support for the proposals in the Bill, which bring a real opportunity to change the way in which we look at disability and work. Although pathways to work has begun to change the culture of the system, employers need to be encouraged to retain and accommodate staff who may become ill or suffer an injury. The system needs to enable people to play as active a part in work as possible. Individuals need to have faith that the process is working for them.
I agree with the charity Rethink when it refers to people needing
“support and encouragement rather than negativity and discrimination”.
I
believe that the new system will be judged on its ability to focus on
individuals’ needs. In order to do that, there will need to be
increased training for Jobcentre Plus staff and for doctors carrying
out capabilities assessments. Although I recognise that, as now, people
will be assessed according to how the illness or disability affects
them, rather than which condition they have, there is a need for those
who interview or examine individuals to have some
knowledge of different conditions. They will need to recognise that
those who have a learning disability or who are autistic do not need
rehabilitation, but, as others have said, may need long-term support in
employment or when there are changes in that employment.
Employees at Jobcentre Plus and personal advisers will need to recognise that many people, especially those with a mental health problem, may have their condition worsened if they are placed under too much pressure. Advisers will need to know that long-term conditions, some of which, such as lupus, are notwell known, will vary between individuals. Indeed, conditions such as lupus do not just affect individuals differently; those who have the condition may feel quite well one day and be confined to their home the next. Some people with lupus have depression, or they may have memory or cognitive problems because of the cerebral involvement of their illness. Those who are assessing and working with those individuals will need to be aware of the varying nature of such conditions. The issue of training is not covered in the Bill and I would be grateful for reassurance that there will be such training in specific impairments, such as autistic spectrum disorders.
Alison Seabeck (Plymouth, Devonport) (Lab): My hon. Friend is talking about the range of different effects that illnesses can have on different people, particularly people with lupus. Does she agree that, as part of the assessment, there is some importance in interviewing not only the person with the illness, but the carers of that person, who are often better able to describe what is going with that individual?
Mrs. Dean: I certainly agree. Indeed, sometimes the person with a particular condition underestimates the problems that they have with it, so having a partner or a carer with them can be of great help.
Understanding of autism is still lacking among professionals. If the employment and support allowance is to work for people with an autistic spectrum disorder, more training for personal advisers, jobcentre staff and health professionals is essential. A tiered system of training could be developed to ensure that all personal advisers had a basic level of knowledge and could call on people at a regional level for more in-depth knowledge. Any organisations that are in receipt of contracts to work with individuals should also have adequate understanding of the needs of people with different impairments.
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