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Jenny Willott (Cardiff, Central) (LD):
I thank the Secretary of State for advance notice of the statement. I agree with the hon. Member for Epsom and Ewell (Chris Grayling), however, that it is disappointing that the Secretary of State held a press briefing on these measures before he came to the House, although both
that briefing and the statement are almost pointless given the extent to which the proposals were trailed in the media over the weekend.
The Government have not consulted on the proposal to push lone parents with children as young as three or four years of age from income support on to JSA, because it was not in the Green Paper, although it was trailed quite strongly at the weekend. Clearly, it was not proposed earlier because the Secretary of State knew that there would be very little support for it, least of all among his own Back Benchers, and certainly among civil society organisations, which have raised serious concerns about that proposal. It is far too soon to consider such a proposal given that the Government have only recently brought in changes to the regime for lone parents and have not even assessed the progress of those changes. It was only three weeks ago that the Government started to move 300,000 lone parents from income support on to JSA. Many organisations, including the Social Security Advisory Committee, and many Members of this House have expressed concerns about whether enough flexible working opportunities, affordable child care, and appropriate personalised support are available. It is worrying that there is not yet enough evidence to suggest whether those changes will be successful and what their impact will be on child poverty. The Government have already admitted that they cannot guarantee that lone parents will be better off as a result of the changes that have already been introduced, so why is the Secretary of State proposing to go so much further before they have even evaluated those changes?
Why is Labour attacking lone parents and demonising people who are losing their jobs during a recession? The Secretary of State said that some people say that we should be slowing down the pace of welfare reform because of the downturn. Liberal Democrats are not saying that; instead, we believe that he should take account of the downturn and not penalise people who are suffering as a result. He referred to people who are long-term unemployed as offenders, which is not only counter-productive but also illuminating. The work-for-the dole proposals treat the long-term unemployed as though they were criminals on community service. The rhetoric that is being used demonises those who are on benefits. International examples show that the work-for-the dole option is not a successit does nothing to develop skills and confidence and nothing to make people more employable. Why are the Government pushing ahead with a policy that has been shown to fail internationally?
On tailored support, the Secretary of State talks about responsibilities. We all share the view that people have responsibilities, but so do the Government. Beveridge strongly believed in helping people back into work. Why, under the JSA regime, is there no tailored support until somebody has been unemployed for a year? That is a very long time to wait when everybody agrees that early intervention is absolutely crucial in getting people back into work.
The Government are talking about making sanctions stronger. The Secretary of State says that he is implementing the Gregg review, but he seems to be overlooking the parts where Professor Gregg said that before introducing stricter sanctions, the Government had to ensure that
they introduced proper tailored support for individuals. The Government seem to be picking the bits that they like and ignoring the bits that they do not like. Could the Secretary of State confirm whether he is going to implement all the recommendations in the Gregg report or only the bits that the Tories like? At the heart of the approach that the Government are proposing is the idea that work is the best route out of poverty. Of course, everybody agrees that that should be the case, but given that more than half of children in poverty have a working parent, work does not always pay at the moment. Before the Government places sanctions on people, they need to ensure that people are better off in work. Can the Secretary of State confirm how he is going to ensure that the changes will not just move people from out-of-work poverty to in-work poverty?
These proposals highlight primarily the fact that the Tories are showing their true coloursgone seems to be compassionate conservatism. It is hard to know who is hanging on the coat tails of whom. The Tories and the Government are arguing about whose idea was whosethey almost come across as squabbling brothers. We all agree that the system needs to be overhauled, but for the Government merely to target the most vulnerable and play Are you tough enough? with the Tories is not the way forward.
James Purnell: I did not hold a press briefing, and I hope that the hon. Lady will withdraw that comment.
The hon. Lady has fundamentally misunderstood what this is all about. It is about transforming peoples lives. It is about ensuring that we provide people with help and support so that they can get back into work and help their children to have a better standard of living and high aspirations for themselves. That is exactly the right thing to be doing.
On lone parents and the Gregg review, we are not saying that we are going to bring in those changes before the lone parent changes that are currently being introduced. This is about the next stage of welfare reform. It is right that lone parents should have to look for work when their child reaches the lower age of seven years, but Paul Gregg was not saying that parents of younger children should be made to work, or to look for work, but that they should prepare for work. We have fantastic help for people who need to get out of debt or to address serious issues such as mental health or drug problems. We also have help in relation to child care, confidence issues and training. It is right that people should go in and develop an action plan so that they can prepare for work, but then also, at the right time, be expected to take it up. It is all about ensuring that we end child poverty in this countrysomething that the Liberal Democrats have said is an unnecessary distraction. They are neither prepared to put in the support for people nor to address their high expectations to ensure that they get back into work to help themselves out of poverty.
This is the right approach that builds on the best approaches around the world, which involve full-time activity among other things. The hon. Lady is wrong to say that international evidence shows that that does not work. It does not work if that activity is of low quality, has no job search and does not help people to develop skills. It does work, however, if it involves full-time activity that teaches people skills, such as turning up on
time and being presentable, and it ensures that people are looking for work. That approach is followed in countries such as the Netherlands and Denmark, and we will follow that approach because it is right for people.
The hon. Lady says that we should not deal with people who are repeatedly failing to live up to their obligations. I completely disagree. If people are taking money and playing the system without trying to get back into work, that is an abuse of the system. It is wrong for people to do that, and requiring those who do it to undertake full-time activity in return for benefits is the right approach because it is not fair on everyone else if they abuse the system in that way.
Finally, the hon. Lady asked what we will do to make work pay. We have transformed the situation: a lone parent working for a full week is more than £100 better off than in 1999, and that is even more than they would have had before 1997 thanks to the introduction of the minimum wage, which her party opposed. On top of that, we pay a £40 premium per week for people when they go into work. We are also piloting a £25 better-off guarantee. That is the right approach: more support and higher expectations. I am sorry that she does not support it.
Roger Berry (Kingswood) (Lab): I thank my right hon. Friend for his continuing efforts to support more disabled people and others getting into work. Does he agree that some media reports about the threat of sanctions against benefit recipients have caused anxiety among many people, not least those with mental health conditions? Such reports can be incredibly counter-productive in relation to what the Government seek to do. Moreover, they may discourage those entitled to benefits from claiming them. Can my right hon. Friend say how he intends to address those concerns?
James Purnell: I entirely agree with my hon. Friend, and I want to pay tribute to him for all the work that he does in championing the rights of disabled people in this House. It is right that we should give power to disabled people because society still discriminates against them and we need to ensure that they have the support and power to get themselves back into work and to achieve their aspirations, just the same as anybody else. No one should ever demonise or discriminate against disabled people, and we will ensure that that does not happen.
Mr. Iain Duncan Smith (Chingford and Woodford Green) (Con): I start by welcoming the statement. As the Secretary of State knows, a year ago, the Centre for Social Justice published a series of reforms, many of which went alongside Freud, but some went slightly further. What the Secretary of State is saying is along those lines, so I welcome what he says. As he knows, the Centre for Social Justice and I have worked with the hon. Member for Nottingham, North (Mr. Allen) on early-years intervention, and on the idea that empathy and bonding between the age of one and two is vital. I suspect that that idea, which I recommend, is reflected by his rejection of any talk of forcing people into work at that stage of a childs life.
I would, however, like to raise one issue. The Secretary of State talked about a lot of ways of getting lone parents back into work, and we know how difficult that is. When he refers to 32 hours work a week actually
paying he is right, but one of the biggest problems is that many of the lone parents that we saw who worked between 16 and 32 hours complained hugely about the massive withdrawal rates that they suffered. I know that the issue is a difficult one, but the benefit block means that some of them take back only 10p in the pound for each of the hours that they work. That is a major issue and a disincentive for many of them. Losing housing benefit after falling out of employment and then finding it can take months to get it back is a major disincentive. Will he consider those matters in the next few months and bring some suggestions forward?
James Purnell: I welcome what the right hon. Gentleman says. Just to clarify, we are not rejecting a proposal that lone parents of children aged between one and seven should be made to work because no such proposal was made. Paul Gregg did not make such a proposal; he thinks that they should be preparing for work and that they should do that at a pace that is right for them.
The right hon. Gentleman raises an important point. In any welfare system that uses a taper, the taper can either apply to lots of people, who end up being means-tested across a wide-range of incomes, or it can be very sharp, and money is withdrawn very quickly. There is no perfect solution. We think that we have improved the situation substantially with the working tax credit and the minimum wage. The next issue to consider is housing benefit, and the White Paper announces that we will consult next year on reforms to the housing benefit system, looking at working incentives to ensure that there is fairness with regard to those who are working and those who are not, so that people on benefits do not end up getting subsidies for rents that those who work could never afford.
Mrs. Joan Humble (Blackpool, North and Fleetwood) (Lab): My right hon. Friend will be aware that there has been a huge increase in the number of child care places available through the Governments national child care strategy, but many of those places are available during regular working hours. Will he do all that he can to ensure that more child care is available at weekends and in the evenings so that the lone parents who I meet in Blackpool can take advantage of jobs in retail, the hospitality trade, pubs, clubs and the tourist industry? At the moment, they cannot.
James Purnell: My hon. Friend makes an important point, and she gives me the opportunity to make it clear that this is not about targeting lone parents. In fact, the people who have the least obligations in the system at the moment are couples who are parents and are out of work. We want to ensure that we expect the same of them as we do of lone parents. That is the right thing to do. She is also right about the centrality of child care. We have made it clear in our reforms to the regime for lone parents and the jobseekers allowance that if there is no appropriate child care, parents should not be expected to take up work, because that child care should be the first priority. We need to continue to expand child care. We have doubled investment. As she knows, from 2010, all secondary schools will be expected to have wrap-around child care in the evenings and before school, and we need to ensure that people have that support in the holidaysthat is very important for people.
David Simpson (Upper Bann) (DUP): I broadly welcome the reforms that the Secretary of State has introduced, but with some concerns. I am sure that all hon. Members would agree that there are those on benefits who genuinely want to get back into work to give themselves some pride, and to make a contribution to society. The Secretary of State hit on one vital point. All hon. Members will agree that a hardcore percentage of individuals have spent their lives creaming benefits off the state. Can the Secretary of State assure us that his proposals will deal with that?
James Purnell: Our proposals will ensure that there are clear expectations of people, and if people repeatedly fail to live up to their obligations, they will face clear sanctions. They will either lose their benefit, or be required to do full-time work in return for their benefit. That is the right thing to do, but it will apply to a tiny proportion of people. The vast majority of people are never sanctioned. Of those who are sanctioned, the vast majority are only sanctioned once, and half of them think it was the right thing to do in the first place.
Mark Durkan (Foyle) (SDLP): I thank the Secretary of State for his statement. Some of us, however, are unsure of some of his proposals because of our constituency experience. Can he colour in for us how the right to control will be meaningful for disabled people, and whether it will apply to people with all recognised long-term conditions? On invest to save, and the proposal that the private and voluntary sectors should compete to win commission-driven contracts, how will he ensure that the process works in a fair way, and allows the voluntary sector to compete credibly What scale of investment will it need to muster, and will the process disadvantage areas where there are recognised concentrations of high, long-term unemployment, where such contracts will be less attractive? If conditionality and sanctions are to be the order of the day for lone parents and other people on modest benefits, when will the Government extend that principle to the banks?
James Purnell: I think that the Leader of the Opposition said that we had too much conditionality with regard to the banks.
My hon. Friend is right to point to the need for the DEL-AME mechanism in areas with higher levels of inactivity, which is exactly what we are providing. That mechanism will be more attractive in areas where there are more people who need help to get back into work, and therefore the areas that he mentioned would be particularly helped. We want to consult people on how the right to control will work; it will be a fundamental reform to the way in which support for disabled people works in practice. We want to consult people on which funding streams should be included. People would clearly not want defence or refuse collection to be included in a right to control, where they could take control of those matters in an individual budget, but if support is given to help disabled people, we want them to have control of it. If they are happy with what they are getting from local authorities and others, they can continue with it, but if they are not, they have the power to say, No, I want to take this money and spend it in the way that I think fit. That gives power to disabled people, and it will lead to a real transformation.
Mr. Peter Lilley (Hitchin and Harpenden) (Con): It is for you to decide, Mr. Speaker, whether the Secretary of States claim that he did not brief the press despite issuing a press release requires an apology to this House. None the less, I wholeheartedly welcome the statement, now he has brought it to the House, just as I have welcomed innumerable statements of similar rhetoric from his predecessor. Can he assure me that attributing more substance to his statement than to all those previous statements made during the past 10 years is not a triumph of hope over experience? Can he explain, given his rhetoric and Freuds arithmetic, both of which I support and which suggest that the savings from getting people back to work should exceed the costs of doing so, why he requires more than a temporary increase in his budget to bring this about? More specifically, can he tell us what safeguards he proposes, so that fully disregarding child maintenance when working out income-related benefits will not create a direct incentive for couples to split up? When they are together, couples get no allowance for the income earned typically by the father in helping to bring up the children, and it is important to consider that. I hope that he has found a way of overcoming that, but if he has not, he should be aware of the problem.
James Purnell: The problem that we inherited from the right hon. Gentlemanhe was one of my predecessorsis that the money was not put in to help people back into work. The Conservative Government cut benefits, not unemployment queues, and the number of those claiming incapacity benefit increased from 700,000 to 2.6 million. We now have a million fewer people on benefits precisely because we have been prepared to do what he never did: invest money in getting people back into work, rather than just paying the cost of the failure to do so.
The right hon. Gentleman is right to say that we want to put money into getting people back into work precisely to reduce the costs of their not working. That is exactly the right thing to do. In relation to child maintenance, we are trying to solve the problem of the way in which the Child Support Agency was created, which meant that benefits were going straight to the Treasury, not to parents. There was no proper incentive for people to give money to their ex-partner, because they thought it would go to the taxpayer rather than to the parent. This measure means that money will go to the children. It has been widely welcomed and it is absolutely the right thing to do.
Mr. Peter Hain (Neath) (Lab):
I represent a coalfield community where, under the Conservatives failed policies, thousands of people were thrown on to incapacity benefit and were more likely to die on it than ever to work again, so I very much welcome these reforms. However, may I press the Secretary of State specifically for clarification that lone parents will not be required to take a job unless affordable child care is available? I would also like a better-off calculation to be done for them, so that they are better off and their children can be rescued from poverty. The matter of couples should also be looked at carefully, particularly the way the tax credit system works, because it is often not worth their while to get into work and off benefit. Finally, the revolving door syndrome, whereby people get a job but then come back out of employment and cannot immediately
claim benefit or pay their mortgage, could become a problem that needs to be addressed. Dealing with those matters would help to ensure that the attempt to get genuinely full employment was successful.
James Purnell: On the first three assurances that my right hon. Friend asks for, I can say yes, yes and yes. On the fourth, I can say that that is absolutely the case, because of the work he did. He started the process of making sure that we assess tax credits, housing benefit and other benefits from the Department for Work and Pensions together in one office. We will now be able to roll that out across the country. We want to look at both how people can have stability when they go back into work and how housing benefit reforms can help to ensure that people have certainty that, when they go back into work, they will continue to get that level of funding. That is one of the fundamental points that we want to consider in the housing benefit reforms.
We are taking forward the radical reforms that my right hon. Friend put in place, particularly in relation to lone parents, and he is absolutely right to say that this is about helping the thousands of people
James Purnell: I gave the answer on couplesthat was one of the three yeses. My right hon. Friend is right to say that thousands of people in all our constituencies were affected by that failure to put support in place. We will not repeat that mistake.
Sir George Young (North-West Hampshire) (Con): At the end of the Secretary of States statement, he said that he would legislate to give disabled people the right to have choice in and control over services and support received from the state. I welcome that. He will know that local authority social services departments are introducing personally directed support over the next three years. Will the legislation cover the support that disabled people get from the national health service?
James Purnell: It will not cover things such as accident and emergency care, because that would not be the right approach. The NHS is running individual budget pilot schemes and we do not want to confuse the picture. It is right for the NHS to have such pilot schemes, for example, in relation to chronic care, because we are trying to build on previous individual budget pilots, which worked well, but had two problems: first, people sometimes did not have the powers to have individual budgets in practice and, secondly, although those pilots were good within particular funding streams, they were less good for allowing people to pull different funding streams into one budget. That is what this right will create for disabled people. We will have eight trailblazer authorities to see exactly how the measure will work in practice, and introduce legislation to roll it out if that is successful.
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