Welfare Reform and Work Bill

Written evidence submitted by Taxpayers Against Poverty (WRW 02)

DRAFT AMENDMENTS

"The Child Poverty Act 2010" becomes the "Life Chances Act 2010"

Our draft amendments sets out to embed in the Bill a duty on UK governments to improve life chances of men, women and children by the introduction of policies that will;

(a) reduce the 12 year gap in the expectation of life between rich and poor

​ (b) reduce the risk of poor maternal nutrition and low birth weight in low income families. .  ​

​That would require an annual report of progress showing 

1. trends in the key indicators of health such a malnutrition, obesity, life expectancy at birth, low birthweight, infant mortality,debt, overcrowding, mental health derived from official statistics and 

2. trends in the real value of the national minimum wage and key benefit incomes as measured by the retail prices index after housing costs derived from official statistics annually for the previous ten years.  

The Department of Work and Pensions has never considered the impact of it policies on the health and well being of the poorest UK citizens and the Department of Health never considers the cost of poverty and debt related ill health in the GPs surgeries and the hospitals. ​

Other suggested amendments

Benefit levels and the minimum wage, and uprating of these,  will, at a minimum, be enough to cover the minimum cost of healthy living.

DWP will publish data annually on the number of households with children not receiving sufficient income to cover the minimum cost of healthy living.  

(More information on the minimum cost of healthy living is in the Marmot review [1] Fair society healthy lives)

DWP will  publish data on the modelled economic costs and benefits of current benefit levels in 2016 and on future changes to policies as part of consultation processes.  This modelling should include the costs and benefits to DWP and to other government departments over the life course of an individual.

 (the point here is that DWP/HMT short termism could cost other departments dearly in the long run, and future governments dearly in the long run – ie reduced benefits lead to higher health costs)

 DWP will publish a health equity assessment for all welfare and benefit changes.  This assessment will consider the impact of policies on: the ability to afford a minimum income for healthy living for households with and without children, and on the impact the policies will have on inequalities in life expectancy and healthy life expectancy.

 (this brings in a requirement to look at health, and some of the health measures suggested above – it will encourage cross departmental working)

 Life chances will be met through reductions in socio-economic inequalities in life expectancy and healthy life expectancy. Targets will be set, in collaboration with the Department of Health, to achieve this goal.

Introduction.

The test should be "A re government policies improving the life chances of men, women and children? "

i. People die on average 12 years younger in deprived Glasgow than in wealthy Kensington & Chelsea.

ii. LIFE EXPECTANCY

iii. Inequality is about incomes see "Wilkinson and Pickett ". Among the rich countries life expectancy is not related to national differences in average income, but life expectancy is related to income differences within rich societies

LOW BIRTHWEIGHT

Low birthweight is higher in deprived areas than wealthy areas

iv. The most deprived ward in Haringey had among the highest rates of low birth weight between in the UK between 2007 and 2009 ;

a. Tottenham Green      12.5%, of live births

b. St Ann’s                      9.4%  

c. Haringey                     11.62% -

d. The average for Haringey is 7.63%, England 7.53% and the OECD in 2008 6.4% with Iceland lowest at 3.8% and Turkey highest at 11%. 

e. Low birthweight in Glasgow

v. The rates of low birth weight births are highest in Pollokshields East, Arden & Carnwadric, and Govanhill, which all have rates greater than 50% above the Glasgow rate

vi. Blairdardie has the lowest rate of low birth weight births (approximately 40% of Glasgow’s rate) while Croftfoot, Cathcart & Simshill, Langside & Battlefield, and Robroyston & Millerston all have rates less than two thirds of Glasgow’s rate

vii. Professor Michael Crawford of the Institute of Brain Chemistry and Human Nutrition has said that "Low birth weight associated with foetal growth restriction is the strongest predictor of poor learning ability, school performance, behavioural disorders and crime."

Vulnerable situations are recognised by government more in the breach than in the observance.

 

1) We claim that government policies are creating unmanageable debts for citizens with the lowest incomes. The policies ignore the impact of low incomes and high housing costs on mental and physical health. The implementation of those policies has ignored the circumstances of vulnerable people.

 

PART 1. MORE IN THE BREACH……..

 

Lord Freud.

 

2) Lord Freud, Minister for Employment gave the following assurance to Parliament during the passage of the Welfare Reform Act 2012.

We spoke about the Wednesbury principles at our seminar, and I can reassure noble Lords that the decision-making process is and will continue to be consistent with these fundamental principles of public law. The department strives to ensure that no decision is influenced by irrelevant factors and that decision-makers act in a rational and fair manner, taking into account all relevant matters before exercising a discretion. For example, the primary legislation expressly sets out that a conditionality sanction applies only if there is no good reason for the failure. In determining whether there is such good reason, decision-makers will have to consider all relevant matters raised by the claimant within a particular time period, including information about a claimant's health condition and financial circumstances.        Hansard . 25 Jan 2012: Column 1062

3) Those are principles that apply in all British courts and in all official decision making; but there is no legal process in the Jobcentres through which vulnerable situations can be identified and all relevant facts taken into account as there is in the magistrates court and all other courts. Yet the punishments imposed by the jobcentres are worse than those imposed by the magistrates.

The Financial Conduct Authority [1] .

4) In a paper published in February 2015 industry leaders gave their thoughts on consumer vulnerability.

"A vulnerable consumer is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.

Much consumer protection legislation is underpinned by the notion of the average or typical consumer, and what they might expect, understand or how they might behave. Consumers in vulnerable circumstances, however, may be significantly less able to represent their own interests, and more likely to suffer harm than the average consumer. This is an area where firms can take action and create good outcomes for the customer."

The Government Office for Science published "Mental Capital and Wellbeing" [2] in 2008.

5) "Wellbeing is also influenced by the circumstances of people’s lives, including employment, income and the physical environment. In general, being employed is beneficial for mental health, although the nature and quality of work and the workplace have a major impact on the level of wellbeing. Higher income is associated with greater levels of wellbeing, but the effect diminishes at progressively higher income levels. Recent analyses have indicated that out-of-control debts are the crucial mediating variable between low income and mental ill-health, and it may be that financial control is also a critical factor in mental wellbeing . Higher income inequality is linked to lower wellbeing as well as a higher prevalence of mental disorder. A recent UNICEF report found that children’s wellbeing scores across a range of measures were worst in the most unequal countries (UK and US). It should be noted that income inequality is at a historically high level in the UK with no evidence that this situation is changing".

The Royal College of Psychiatrists [3] website illustrates the link between debt and mental health problems.

6) Debt and mental health [4]

 

WHAT IS THE RELATIONSHIP BETWEEN DEBT AND MENTAL HEALTH PROBLEMS?

· One in four people has a mental health problem

· One in four people with a mental health problem is in debt

· One in two people in debt have a mental health problem

· Debt may be a cause   and   a consequence of mental health problems

The Ministry of Justice [4] "Taking control of goods national standards" recognises vulnerable situations and sets up a procedure for dealing with them.

7) Vulnerable situations

70. Enforcement agents/agencies and creditors must recognise that they each have a role in ensuring that the vulnerable and socially excluded are protected and that the recovery process includes procedures agreed between the agent/agency and creditor about how such situations should be dealt with. The appropriate use of discretion is essential in every case and no amount of guidance could cover every situation. Therefore the agent has a duty to contact the creditor and report the circumstances in situations where there is evidence of a potential cause for concern.

71. If necessary, the enforcement agent will advise the creditor if further action is appropriate. The exercise of appropriate discretion is needed, not only to protect the debtor, but also the enforcement agent who should avoid taking action which could lead to accusations of inappropriate behaviour.

72. Enforcement agents must withdraw from domestic premises if the only person present is, or appears to be, under the age of 16 or is deemed to be vulnerable by the enforcement agent; they can ask when the debtor will be home - if appropriate.

73. Enforcement agents must withdraw without making enquiries if the only persons present are children who appear to be under the age of 12.

74. A debtor may be considered vulnerable if, for reasons of age, health or disability they are unable to safeguard their personal welfare or the personal welfare of other members of the household. 75. The enforcement agent must be sure that the debtor or the person to whom they are entering into a controlled goods agreement understands the agreement and the consequences if the agreement is not complied with.

76. Enforcement agents should be aware that vulnerability may not be immediately obvious.

77. Some groups who might be vulnerable are listed below. However, this list is not exhaustive. Care should be taken to assess each situation on a case by case basis.

a) the elderly;

b) people with a disability;

c) the seriously ill;

d) the recently bereaved;

e) single parent families;

f) pregnant women;

g) unemployed people; and,

h) those who have obvious difficulty in understanding, speaking or reading English.

78. Wherever possible, enforcement agents should have arrangements in place for rapidly accessing interpretation services (including British Sign Language), when these are needed, and provide on request information in large print or in Braille for debtors with impaired sight.

LAW ALLOWING MAGISTRATES TO RECONSIDER FINES UNPAID DUE TO FINANCIAL HARDSHIP

8) The fines officers in the Magistrates Courts and the bailiffs enforcing fines seem not to know that Legal Advice Sentencing and Punishment of Offenders Act 2012 allows them refer cases back to the magistrates when;

i) a person was not in court when fined and has a disproportionate fine

ii) there is a change of circumstances after the Magistrates’ original decision

iii) there is financial hardship

BARONESS NORTHOVER’S ASSURANCES GIVEN TO PARLIAMENT

9) It is clear that the government amendment allows for the withdrawal of a warrant where there is a mistake in the decision to issue the warrant in the first place. The amendment covers the case where an offender is not in court when the warrant is issued, which 

 20 Mar 2012 : Column 800

results in the court not having the full information before it. This, in effect, amounts to a mistake. I hope that that also helps to reassure my noble friend Lord Thomas. If there has been a change of circumstances that, had it been known to the court, would have had an impact on the decision to issue a warrant, it is open to the debtor to argue that the warrant had been issued by mistake.

           In practice, however, when bailiffs come across hardship as defined in the guidance they should not execute the warrant and return it to the court. 

PART 2 …..IN THE OBSERVANCE

 

11) Part 2 focuses on the single adult unemployment benefit. We claim that is has been allowed to sink to a level that inevitably leads to debt and ill health before 2010; it has sunk even further since. JSA/ESA/IS are currently £57.90 a week for under 25 year olds and £73.10 aged 25 and over. In this table £73.10 is compared with selected essentials from the Joseph Rowntree Minimum Income Standards [6] . Up until April 2013 JSA/ESA/IS were paid after rent and council tax.

 

J SA/ESA/IS compared with JRF/MIS

£pw

Food

43.80

Water

5.59

Fuel

16.68

Clothing

7.25

Transport

26.68

Household costs

16.85

Total

116.85

JSA/ESA/IS

73.10

Shor t fall

43.75

Plus bedroom tax rent up to

24.00

Plus council tax up to

8.00

TOTAL POTENTIAL SHORTFALL

Since April 2013.

75.75

Fines and council tax enforcement add up to £150 or up to £125 .

court costs to the inevitable arrears , and since

April 2015 up to £1200 for fines.

Bailiffs fees can add another £420 [6]

NB currently the chaotic UK housing market is increasing rents that drive a coach and horses through all attempts to set a minimum income needed for healthy living in work or unemployment. See Fred Harrison’s submission to the committee.

 

BEFORE 2010

 

Benefit negligence

 

Letter in the Guardian May 2009

 

12) The inadequacy of the £64.30 weekly jobseeker's allowance (£50.95 for the under-25s), noted by Paul Nicolson (Letters, 11 May) is a modern phenomenon. When unemployment benefit started in 1912 it was 7 shillings a week - about 22% of average male earnings in manufacturing.

The percentage fluctuated over the succeeding decades, but by 1979 the benefit rate was still about 21% of average earnings (manual and non-manual, male and female).

By 2008, however, as a result of the policy of tying benefits to the price index while real earnings increased, the renamed jobseeker's allowance had fallen to an all-time low of 10.5% of average earnings. And while, in the past, means-tested allowances raised unemployed income to a higher minimum level, the jobseeker's allowance rates are now the same, whether means-tested or not.

Of course, average earnings have grown but so has the relative deprivation of the unemployed. This is not a policy justified by the need to maintain work incentives. It is just a dreadful record of neglect by governments since 1979.


Jonathan Bradshaw
University of York
Tony Lynes
London

AFTER 2010

13) In February 2015 there were 3. 7 million claimants of main unemployment benefits and 4.8 claimants of housing benefit in the UK [8] . Currently the unemployed all start on either £57.90 a week or £73.10 a week. The family premium of £17.45 a week and £66.90 is added for the first child and then £66.90 for every subsequent child. They have been hit by perfect storm of cuts.

a) Increases were frozen at 1%

b) Council tax was imposed by 250 councils

c) Housing benefit was cut three times [9] each of them leaving rent to be paid out £73.10 a week of unemployment benefit; it was paid after rent and council tax up to April 2013

d) The social fund was abolished.

e) The cuts in benefit incomes, that were already inadequate, has inevitably created debt. There are reports from the advice sector that they are overwhelmed. Debt creates mental and physical health problems. They also create enforcement and its costs.

f) The pressure to buy food for growing children, cook it and keep warm, to buy clothes and shoes not only creates stress but also pushes decent mothers to miss the TV licence payment, get behind with the rent and council tax.

g) worn out clothes leads to children being identified as poor in the school playground which leads to truancy.

h) Young people avoid fares and get caught.

That all leads to the courts and a clash between a sanction imposed by the job centre and a fine or council tax enforced by the magistrates.

When a sanction is imposed the offender cannot pay the fine. See case history below.

To the Magistrates, Highbury Corner - Magistrates Court

John Smith, Tottenham – the Highbury Corner Magistrates remitted the £135 unpaid balance of the Fine.

14) Statement to the Magistrates.

We are asking you for a statutory declaration or the remission of £135 fine in full on the following grounds that.

The fine should never have been imposed, he is a vulnerable person as described by the Ministry of Justice; he also cannot afford to pay.

Mr John Smith has no record of ever being fined.

The first he heard of the fine was when the Bailiffs called to tell him he had been fined for TV licence evasion demanding £445 down at 7.30 in the morning.

He protested that was impossible because the TV licence authority representative had frequently told him he was not liable because his TV set is only used for games and DVDs. He does not require a TV licence. He has no TV or broadband account. Two men from the TV licencing authority have inspected his flat and agreed with him.

He called PN at 8am the same morning who informed Marston about Mr John Brown’s circumstances and they agreed to suspend the bailiff action.

Mr Brown has a long history of anxiety and depression and has been treated in the NHS psychological services. Please see attached letter.

On the 1st January 2014 he was sanctioned for three months for attending an interview on the wrong day. His housing and council tax benefits were stopped. He is still paying off rent arears at £10 every two weeks out of his £72.40 a week adult unemployment benefit (ESA).

It was after the sanction that NHS psychological services referred him for 12 fifty minute sessions of therapy.

He received a letter from Haringey Council this week giving notice of intended demolition of the block of flats where he lives.

His means statement is attached. The court’s attention is drawn to Joseph Rowntree minimum food standard for a healthy diet of £43 a week and the impossibility of buying such a diet and all other necessities on £72.40 a week which will be raised by 1% on April 1st to £73.10. http://www.jrf.org.uk/publications/minimum-income-standard-2014

Mr Brown’s mental health is not improved by debt. The court’s attention is drawn to the link between debt and mental health problems, which has been reported on by the Government Office for Science and the Royal College of Psychiatrists. https://mail.google.com/mail/u/1/#search/royal+college+of+psychiatrists+debtors

WHAT IS THE RELATIONSHIP BETWEEN DEBT AND MENTAL HEALTH PROBLEMS?

One in four people has a mental health problem

One in four people with a mental health problem is in debt

One in two people in debt have a mental health problem

Debt may be a cause and a consequence of mental health problems

Royal College of Psychiatrists

http://www.rcpsych.ac.uk/workinpsychiatry/qualityimprovement/research/debtandmentalhealth.aspx

We also draw the attention of the court to the Taking Control of Goods;

i) National Standards published by the Ministry of Justice in April 2014. It states;

ii) "Enforcement agents/agencies and creditors must recognise that they each have a role in ensuring that the vulnerable and socially excluded are protected and that the recovery process includes procedures agreed between the agent/agency and creditor about how such situations should be dealt with"

iii) https://www.gov.uk/government/publications/bailiffs-and-enforcement-agents-national-standards

10) SINCE THAT CASEE THE MINISTRY OF JUSTICE HAS INTRODUCED OF THE MAGISTRATES COURT SURCHARGE IN APRIL 2015. THE CLASH BETWEEN JOBCENTRES AND MAGISTRATES COURTS IS NOW UNMANAGEBLE BY THE STATE OR ITS CITIZENS

11) The mandatory in the Magistrates Courts in April 2015 of up to £1200 was introduced without any consultation just before the election.

12) It devastates the poorest citizens who cannot pay for a TV licence, a bus or a train ticket, or whose children are persistent truants; they are prosecuted as criminals.

13) Simultaneously the jobcentres are stopping people's incomes with a sanction from one month to three years. Sanctions are draconian punishments by the jobcentres without a fair trial.

14) If the magistrates are to take into account that loss of means and any vulnerable circumstances in setting a proportionate fine there has to be a trial. But the guilty and not guilty sanctioned persons are unlikely to go to court and risk the new surcharges.

15) They will therefore be fined £200 plus £150 costs in their absence, which they cannot pay. The enforcement process then leads to the bailiffs on the doorstep demanding immediate payment of the fine plus costs of £350 plus their fees of £265.

Table 11: Main out of work benefits1 2 

 

Great Britain and abroad (thousands), not seasonally adjusted

Total

GB
Claimant
Count3

Employment & Support Allowance and other incapacity benefits4

Lone Parent5

Other Income related6

Level

Level

Level

Level

Level

 

 

2011-May

4799.1

1446.3

2570.2

595.4

187.2

2011 Aug

4872.6

1515.0

2582.2

595.3

180.1

2011-Nov

4,831.5

1,499.4

2,575.6

581.6

174.9

2012-Feb

4,934.2

1,623.2

2,557.7

584.2

169.1

2012-May

4,799.2

1,529.0

2,528.1

577.1

165.0

2012-Aug

4,727.3

1,505.2

2,517.0

545.2

159.9

2012-Nov

4,637.7

1,471.7

2,500.0

510.0

156.0

2013-Feb

4,679.5

1,547.6

2,475.7

504.9

151.3

2013-May

4,536.6

1,432.6

2,456.5

499.7

147.8

2013-Aug

4,409.9

1,327.2

2,440.8

497.5

144.4

2013-Nov

4,249.9

1,166.3

2,456.4

485.0

142.2

2014-Feb

4,265.9

1,187.8

2,459.3

480.1

138.7

2014-May

4,118.3

1,039.4

2,470.2

474.7

134.0

2014-Aug

4,021.0

915.7

2,508.1

470.8

126.4

2014-Nov

3,911.6

812.8

2,520.3

455.5

123.0

2015-Feb

3,936.2

838.3

2,533.2

448.1

116.6

September 2015


[1] http://www.instituteofhealthequity.org/projects/fair-society-healthy-lives-the-marmot-review

[1] http://www.fca.org.uk/news/occasional-paper-no-8

[2] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/292450/mental-capital-wellbeing-report.pdf

[3] http://www.rcpsych.ac.uk/workinpsychiatry/qualityimprovement/research/debtandmentalhealth.aspx

[4] http://www.rcpsych.ac.uk/workinpsychiatry/qualityimprovement/research/debtandmentalhealth.aspx

[4] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/353396/taking-control-of-goods-national-standards.pdf

[6] http://www.jrf.org.uk/sites/files/jrf/MIS-2015-full.pdf

[6] https://www.citizensadvice.org.uk/debt-and-money/action-your-creditor-can-take/bailiffs/bailiffs-fees-and-charges/fees-bailiffs-can-charge/

[8] https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/452513/statistical-summary-august-2015.pdf

[9] The so called bedroom tax, the £500 housing benefit cap and the local housing allowance all cut housing benefit leaving rent to be paid out of unemployment benefits that were paid after rent and council tax up to April 2013.

Prepared 11th September 2015