Welfare Reform and Work Bill

Report (1st Day) (Continued)

5.32 pm

Clause 4: Workless households and educational attainment: reporting obligations

Amendment 3

Moved by Lord Ramsbotham

3: Clause 4, page 4, line 31, at end insert—

“Maternal nutrition: reporting obligation

A1ZA Maternal nutrition and poverty: reporting obligation

(1) The Secretary of State must publish and lay before Parliament a report containing data on—

(a) maternal nutrition in workless households in England;

(b) maternal nutrition in long-term workless households in England.

(2) The report must set out how the Secretary of State has interpreted the following terms for the purposes of the report—

(a) maternal nutrition;

(b) household;

(c) worklessness;

(d) long-term worklessness.

(3) The data contained in the report, and the provision about how the terms used in it are to be interpreted, must, so far as practicable, be derived from any relevant official statistics.

(4) The first report must be published before the end of the financial year ending with 31 March 2017.

(5) Later reports must be published before the end of each subsequent financial year.

(6) In this section “official statistics” has the meaning given by section 6(1) of the Statistics and Registration Service Act 2007.”

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Lord Ramsbotham (CB): My Lords, in moving Amendment 3 I shall speak also to Amendments 4, 5, 6, 7, 9, 10, 12, 13 and 14, which are all to Clause 4 of the Bill. Indeed, they are all amendments in effect to the Child Poverty Act 2010. They represent a repetition of amendments that I tabled in Committee about the annual reporting on health and well-being and on children aged five, as opposed to at key stage 4. For very logical reasons, the Public Bill Office has put Amendment 3 before my old amendment, which is now Amendment 5, because maternal nutrition obviously comes before children who have already been born. Therefore, I shall speak first to Amendments 5 and 6 to amplify what I said in Committee, on which I had a discussion with the Minister before Christmas following the rather inconclusive conclusion to our debate that evening, following timing problems in the House. I particularly want to talk about the link between extreme poverty and mental health, particularly of children, which was highlighted in the previous amendment.

In any situation, it is grossly inefficient to tax people who cannot pay. Local government has been quite right to draw the Government’s attention to the inability of councils in England and Wales to collect the £1 billion in three years that they were instructed to start taxing in April 2013. Of course, as has been said many times during the passage of the Bill, there is a cumulative impact on the health and well-being of residents when the benefits provided by central government for survival are being reduced in value as the rents that they have to pay rise. Therefore, in fact, we are talking about the cumulative effects of a great number of issues that are not in themselves all the responsibility of the Department of Health, or, indeed, the Department for Communities and Local Government, which have to deal with the outcomes.

The economic and social costs of mental health provision, which is the subject of this amendment, have been calculated by the Centre for Mental Health, in which I declare an interest as a vice president, as being £105 billion in 2009-10, which is reckoned to be an underestimate. That is a huge amount of money and a great deal of that is caused by the conditions that we have been discussing in this Bill. It is of interest that Dr Angela Donkin, who is a deputy director at the Institute of Health Equity, has said that the national audit in 2010 found that 82% of homeless people had at least one physical health problem, and 72% had at least one mental health problem. So there is a huge cost to all this poverty.

Some 10.4% of those in fuel poverty, living therefore in extremely cold houses, showed higher levels of respiratory conditions, cardiovascular disease and poor mental health as the result of the conditions in which they lived. You then add food poverty, which has been mentioned—and, again, the lack of proteins, iron and the correct vitamins, minerals and fatty acids leave a higher susceptibility to illness and infection and heart and lung complications. It is said that preventing low birth weight should be an absolute must for all public health officials, but all their efforts will be hampered by inefficient incomes, which mean that people cannot buy what is required to produce that high birth weight. Finally, there are many mental disorders, particularly evident in women who, in addition to handling the

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family budget, suffer from maternal depression, which is bound to impact on the children and their social development.

As I mentioned before, we have a situation here where the Chancellor is apparently directing, without ever taking evidence from such as the Barrow Cadbury Trust, whose evidence was used by the Mayor of London to calculate the London living wage—and also, I fear, there is a lack of tie-up between the Treasury, the Department of Health and the Department for Work and Pensions as well as the Department for Communities and Local Government. There is too much silo working. My amendments aim collectively to ensure that the collection of evidence by one ministry or another should be made available to all the others so that they have an aggregated picture on which to make their judgments.

Amendment 3 would introduce reporting on maternal nutrition—an addition to what I tabled in Committee. Also, it has been taken forward considerably since we debated it in December, particularly in a speech by the Prime Minister on 11 January, when he announced his life chances strategy. In addition to maternal nutrition, he also endorsed what was in my previous Amendment 4: the suggestion that reporting on children should not be left until key stage 4, at the end of schooling, but should be done at the age of five, because we would then have some chance of taking remedial action based on something that we had found early, thus increasing life chances. It is interesting that in his speech on 11 January, the Prime Minister said that,

“we must think much more radically about improving family life and the early years”.

He called that a “life cycle approach”—one that takes people from their earliest years through schooling and through adolescent and adult life.

This strategy clearly points to the importance of early child development and getting children ready for school, thus endorsing the assessment currently done of every child by the age of two, which I mentioned in Committee. Without measuring a child’s progress at the age of five, the Government cannot know how successful or otherwise any remedial treatment initiated following the health visitor assessment at two has actually been in preparing children for school.

I also mentioned in Committee that the All-Party Group on Speech and Language Difficulties, which I co-chair, in a report on the links between disadvantage and speech, language and communication needs, found that children with a low IQ from advantaged families overtook children with a higher IQ from disadvantaged families by the age of five. That is a terrible factor to consider: that overtaking will happen unless remedial action is taken. Therefore, I strongly believe that tackling child poverty and improving children’s life chances—the right reverend Prelate has just spoken about this, and we have just voted on it—is a national endeavour and responsibility. My amendment is designed to present the Government with the opportunity, through the evidence produced every year, to learn about what is actually happening to our children, and then to enable all the departments involved, not just the Department for Work and Pensions, to use the information to improve life chances, and thus to invest the nation’s money in its future—our children—more wisely.

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My other amendments—Amendments 7, 9, 10 and 12 to 14—are textual adjustments to reflect the content of Amendments 3 to 6. I beg to move.

Baroness Meacher (CB): My Lords, I strongly support the amendments tabled by my noble friend Lord Ramsbotham. The main amendments in this group are of fundamental importance if the Government are to make a success of their own DWP policy. The Government want to focus upon the life chances of children rather than upon poverty alone—but I do not believe we should lose sight of the significance of poverty, particularly when the levels of poverty will worsen so severely in the coming years. I was relieved to hear the Minister assure the House that the Government will continue monitoring poverty as before, whatever becomes of the amendment on which the House has just voted when it gets to the other place.

Of course, there is a lot more to successful parenting and the life chances of children than income alone. As we all know, sufficient income is a necessary but certainly not a sufficient condition for a successful childhood. Parents’ mental and physical health and well-being are essential to successful parenting. If a mother is malnourished, she is most unlikely to provide for her child’s mental and physical needs. If she is depressed, she may not be able to look after her child at all until her mental health improves.

As my noble friend Lord Ramsbotham reminded us, the Prime Minister himself has highlighted the early years as one of four areas in which to anchor the Government's approach to life chances. The Government’s life chances strategy can, in my view, set a course for improving school readiness for the poorest and most disadvantaged children—but only, of course, if it is introduced across the country and is adequately funded. But only by monitoring progress in improving the health and well-being of children in workless households, particularly during the early years, is there any hope that policies will be developed and adjusted over time to ensure that they help rather than hinder the life chances of those children. Any Government will need to learn from their mistakes over time—and as we all know, Governments certainly make mistakes.

5.45 pm

I was a member of the Marmot Commission on Social Determinants of Health. That commission made it clear that parenting in the early years is a key determinant of the school readiness of any child. If a child starts school at a significant disadvantage, that failure will dog them throughout their school life and throughout their entire adult life. We need to understand why a child is not school-ready on their first day at school, so all the information that the Government can gather is imperative—absolutely essential. It is concerning that only 58% of children from the most deprived communities reach a good level of development, compared with 77% in the better-off areas. That gap of nearly 20% is utterly disgraceful. Monitoring, as proposed by my noble friend Lord Ramsbotham, will enable better targeting of the most successful programmes on those who can benefit most.

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While so much is being cut back, the Government have made vital investments in the health and development of young children in recent years. I applaud their investment in expanding the health visiting programme by nearly 50% in four years, increasing the numbers by more than 4,000 health visitors. These health visitors could contribute to the monitoring of maternal nutrition and mental health. I am sure that they already do a lot of that, but an obvious thing to do would be for the Government to systematise the information and gather it nationally. Health visitors can also monitor the health and well-being of the children of workless households. We need to understand which interventions really help a child and which have little or no effect. Resources are going to be incredibly scarce in the coming years. We need them to be smartly focused.

The free early education for the most deprived two year-olds is welcome. But the Marmot Commission pointed to the importance of parents’ involvement with their child’s learning—such as reading stories at bedtime and other basic activities, which some parents may lack the confidence to do. The monitoring and reporting required in these amendments will make sure that the policies are really working. It may be that investing in two year-olds’ education will achieve little unless we go the extra mile and help parents become involved, if necessary by offering them some help with basic skills. I regard these amendments as non-political but essential for a Government of any complexion.

The Earl of Listowel (CB): I support these amendments. I too am most grateful to the Prime Minister for his recent announcements on maternal depression during and after pregnancy. I attended the launch last year of the Maternal Mental Health Alliance report on maternal depression and other mental ill-health issues. It found that the nation loses about £1 billion a year through maternal perinatal mental ill health. The main cost is incurred because the relationship between mother and child is impoverished by the mother’s mental ill health. I therefore strongly support the amendment tabled by my noble friend Lord Ramsbotham, and I look forward to the Minister’s response.

Baroness Manzoor (LD): I too support the amendments tabled by the noble Lord, Lord Ramsbotham, particularly Amendment 4. I tabled an amendment in Committee on reporting on attainment at key stage 1. I felt that was imperative, because that is the age at which early measurement of children, when they are going to school, can take place. I do not want to say any more now, because we had a very full debate in Committee; I just want to lend my support to these amendments. As an ex-health visitor—that was many years ago, I hasten to add—I recognise the importance of the health and well-being of both mothers and children. Measuring those factors in children at the age of five is imperative, rather than leaving the measurement of educational attainment, as the Bill now does, until the age of 16. We on these Benches therefore support the amendment.

Baroness Hollins (CB): My Lords, I will speak briefly to Amendments 5 and 6. I remind noble Lords that the terms of reference of the health and well-being

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boards, established through the Health and Social Care Act 2012, require them to report on local efforts in reducing health inequalities and improving the well-being of their population, so it should not be too difficult to find a way to report on health and well-being, as suggested by my noble friend. On Amendment 3, the evidence is enormous that the nutritional status of women both before and during pregnancy can have an important influence on foetal, infant and maternal health outcomes. I remind noble Lords of the enormous parliamentary and public interest in the manifesto

The 1001 Critical Days

and the work that goes on in thinking about the first two years from conception to age two, and how nutrition is such a key part of improving the life chances of children and young people.

Lord McKenzie of Luton (Lab): My Lords, this is an interesting group of amendments. If I heard correctly from each of the speakers, the thrust of it is that government should be entitled to a whole range of information that will best inform it across the piece as to how to tackle a range of issues. Specifically, the group of amendments seeks to add to the reporting requirements to Parliament: the progress of children at five in areas of cognitive, personal, social, emotional and physical development—likewise for children living in disadvantaged households; the health and well-being of children living in workless and long-term workless households; and maternal nutrition in workless and long-term workless households.

The noble Lord, Lord Ramsbotham, referred to a range of matters. In particular he spoke about the collection of disadvantage that you get: homelessness, mental health, fuel poverty and low income—it is that collection of issues which makes more difficult the life chances of individuals. A number of speakers emphasised the importance of education—the noble Baroness, Lady Manzoor, picked up again the point she made in Committee about key stage 1 for education, and the noble Baroness, Lady Hollins, spoke about the importance of health and well-being boards. I understand that the Office for National Statistics produces data on national well-being and on the well-being of children; I think it reported in 2014 and again just last year. It is interesting that a whole range of data goes into those measures. It is said with regard to children that there are something like seven domains and 30-odd measures of children’s well-being, which is a whole collection of stuff to have to handle and deal with.

At the end of the day, government ought to welcome the information that this collection of amendments seeks to be reported on, which is a range of information across the piece. The key issue that flows from it is what you do with it, or what strategies or interventions will flow from that collection of data which will make a difference to the life chances of young people—which is the thrust of this.

The noble Lord, Lord Ramsbotham, made the point that we do not have a collective figure for the consequences of all the changes in the tax and benefit system in recent times. I know that the IFS did a calculation of what had happened under the coalition Government with regard to tax and benefit changes and concluded that if you look at those changes—the

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percentage of the income of various groups of people—the lowest two percentiles bore the greatest burden. If you look at it in terms of absolute amounts, the top 10% bore the most, but if you look at it as a percentage of income, the poorest have had the worst outcome from all these changes the Government have introduced—and that is before we get into ones that are reflected in the Bill we have debated to date.

When we talk about health and well-being, we need to be clearer about our distinctions. We have the national statistics data and the background to that, which is a very broad measure. The issue around health and well-being boards’ and local authorities’ responsibility is a slightly different focus, but important nevertheless. So far as we are concerned, we can see the benefits of this range of amendments, which try to encourage the bringing-forward of data to underline just what the consequences of these policies are. I think the noble Earl, Lord Listowel, talked a moment ago about how it is all too easy for us in this Chamber to see this in perhaps rather abstract terms and not the reality. People out there have to face the reality of what these policies mean, and the collection of data of which noble Lords speak will help bring that home to government as well as to campaigners generally, so that those who bear the largest burden feel that that is understood, reflected and challenged—which is our job here.

The Minister of State, Department for Work and Pensions (Lord Freud) (Con): My Lords, these amendments on Clause 4 have been grouped together quite widely. I will start by making a general point about adding to the reporting duties that the Government have already set out. The best way of securing progress by government is to have a focused set of measures. I echo the implication of what the noble Lord, Lord McKenzie, said. The more you have, the more likely you are to have a diluted effort and distraction from the key issues, which in this case the evidence tells us are worklessness and educational attainment. Of course many factors contribute to these headline measures. For example, we know that children’s health is an important factor in their educational attainment. Tackling health at work will help ensure that more adults are able to work. Therefore delivering on worklessness and educational attainment calls for a wide set of actions. However, it is important that we focus government on its core objectives that will tackle the root causes of child poverty.

First, with regard to additional statutory reporting duties, I turn to Amendment 3. With this amendment the noble Lord, Lord Ramsbotham, seeks to introduce an additional reporting duty on the Secretary of State. The report must contain data on maternal nutrition in workless and long-term workless households in England. I have already set out that our evidence review published in 2014 makes it clear that worklessness and educational attainment are the factors that have the biggest impact on child poverty and children’s life chances. We are committed to supporting families at the earliest stage and to helping parents move into work and earn more through universal credit or investment in childcare, the national living wage and increases to the personal allowance in the tax system. This is the best way to secure children’s life chances and ensure that parents are able to care for themselves, too.

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I cannot overstate the importance of ensuring that we focus on measures that tackle the root causes of child poverty and not be distracted by others that do not do so. Of course, the issue raised by the noble Lord, Lord Ramsbotham, is important. The Government take action. They provide advice for parents on maternal and infant nutrition via NHS Choices and Start4Life. Government also operates the Healthy Start vouchers scheme, which provides low-income people with vouchers that can be spent on milk, plain fresh and frozen fruit and vegetables, and infant formula. It already publishes the results from the National Diet and Nutrition Survey, which includes results by age and gender. There are a variety of reasons why adults have poor diets, and it is important that we look at the whole picture, which gives us valuable information and helps shape interventions. I therefore cannot support this amendment.

Through Amendment 4, the noble Lord, Lord Ramsbotham, seeks to expand the duty placed on the Secretary of State to include a duty to report on the progress of children and disadvantaged children living in England at age five in their cognitive, personal, social, emotional and physical development. It is vital that all pupils thrive and develop in their early years. Monitoring children’s personal development is already a core function of every education setting. This monitoring then enables teachers to tailor their support based on how each individual is progressing. I assure your Lordships that we do not take this issue lightly. As the Prime Minister said during his speech about children’s life chances—quoted by noble Lords—we want,

“stable families and good parenting, because we know the importance of those early years in setting children up for a good life”.

There are two key issues at the heart of the life chances reforms—action on work and action on education. Lives can be transformed by focusing on these two most significant drivers of poverty. The Bill will start to realise the vision set out by the Prime Minister when he said that,

“we can rescue a generation from poverty and extend life chances right across our country”.

We all know that the end of key stage 4 is a vital juncture in a young person’s education. It represents the culmination of primary and secondary schooling and provides a consistent point at which to measure attainment across all young people. Pupils who fail to achieve at the end of key stage 4 are at high risk of not being in employment, education or training, so the Secretary of State is committed, through the life chances measures in the Bill—

6 pm

Baroness Manzoor: My Lords, I get what the Minister is trying to say but unless there is a comparator at key stage 1, by key stage 4 it will be too late—the children will be 16 years old. If the Government really are to assess the development of children from the ages of five to 16, there is a need for that assessment to start at key stage 1. If there is an issue, they can be given support much sooner so that they have much better outcomes at 16. That will not happen if we do not have information from key stage 1.

Lord Freud: As the noble Baroness knows, we have a lot of information about how pupils progress. The point is that it is necessary to have something that

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absorbs all that rather than having detailed measures at each point. The earlier processes have to be right to attain the achievements at the key target date. I have spoken in this House before about “targetitis”. If you give hospitals 220 different targets, for instance, which is what happened a decade ago, nobody knows what on earth they are looking at, whereas if you focus on the two things that really matter and not on the culmination of a lot of measures, you drive coherent behaviour through the targets that are set, and that is exactly what this strategy does.

I have already made the House aware that the measures that we have include key stages 1 and 2. Annual reporting at different stages of primary schooling already provides significant detail of the progress and attainment of disadvantaged pupils. Monitoring personal development in the way that the noble Lord suggests—

Lord Ramsbotham: My Lords, these reports include the Department for Education and the Department of Health, as well as the Department for Work and Pensions. Who is making these reports and to whom are they going?

Lord Freud: The whole point is that these reports are published. It is a forcing mechanism to make sure that the relevant Secretaries of State and the relevant departments of government work together to tackle the fundamentals that produce these outcomes.

Returning to the educational issue, if we made this change to the Bill, it would increase the burden on primary schools and send a signal to schools that Parliament does not trust them to carry out their core functions. That is why I cannot support this amendment.

Amendments 5 and 6 look to expand the reporting duty placed on the Secretary of State so that his annual report containing data on children living in workless households and long-term workless households in England must include data on the health and well-being of these children.

It goes without saying that the Government want the best for our children. We want all children to have the opportunity to have fulfilling lives and to realise their potential, and clearly their health and well-being is an integral part of that. However, we can achieve this aim, which is one that we all share, only by tackling the root causes of child poverty, and I will not parrot what I have already said on this point. Our evidence review shows clearly that worklessness and educational attainment are the two factors that have the biggest impact.

We recognise that, as the evidence review pointed out, child ill-health is also a driver of poverty. We are absolutely committed to reducing health inequalities in terms of access and outcomes, and we are working across government to ensure that ill health does not hold our children back from fulfilling their potential. The Government have already put in place a well-developed reporting framework—the public health outcomes framework—that supports health improvement and protection at all stages of life, especially in the early years. The framework includes a large number of indicators on children and young people’s health and,

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along with the NHS outcomes framework, sets a clear direction for children’s health that allows anyone to hold us to account.

We are committed to improving access to better services and to promoting early intervention to address children and young people’s mental health issues before they worsen. We are investing £1.4 billion in that over the next five years, and we have invested more than £120 million to introduce waiting time standards for mental health services—the first time that we have done that.

If we concentrate our actions and resources on the root causes of child poverty, such as worklessness and education, that will be the springboard from which everything else will follow. While the Government recognise the importance of tackling child ill-health, these amendments would ultimately distract the Government’s focus and finite resources from what is most important for our children’s future life chances. For these reasons, I cannot support the amendments of the noble Lord and the noble Baroness.

Amendment 7, tabled by the noble Lord, Lord Ramsbotham, would require separate reports for measures of worklessness and educational attainment. We are already committed to reporting on these measures and believe that it is sensible to deal with them together as they are jointly fundamental to improving life chances.

Amendments 9, 10, 12, 13 and 14 are consequential on Amendment 7 and therefore, in the Government’s view, unnecessary.

Once again, I thank noble Lords for their contributions but, on the basis of what I have said, I urge the noble Lord to withdraw his amendment.

The Earl of Listowel: Before the noble Lord sits down, will he reassure the House about the future of health visitors? Clearly, they have a very important role in the welcome things that he has just said. The Government have done a great job in recruiting and developing the workforce, but now that responsibility for health visitors has been moved to local authorities, which must fund them, there has to be a concern that in the current atmosphere for local authorities we may go backwards and health visitors will not be commissioned to do the work that is so necessary in relation to what we have just been discussing. Perhaps the noble Lord would consider writing to noble Lords who are interested in this area about the mechanisms that exist to ensure that that does not happen.

Lord Freud: I shall be happy to write.

Lord Ramsbotham: My Lords, I am very grateful to all those who have contributed to this short debate. I am particularly grateful to the noble Lord, Lord McKenzie, for summing up what people said.

I listened very carefully to what the Minister said, and I am grateful to him for repeating what he has said before about the Government’s concentration on worklessness and educational achievement as being the main causes. However, I do not think that they are unique causes. The health and well-being, not just of the children but also of the families, and particularly the mother, is something that is a huge cause of the subject that we are looking at, and it ought to be added to worklessness and educational attainment.

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It is all very well saying that we are going to do a great deal and going to improve the child mental health treatment processes in the National Health Service, but that comes at an enormous cost. The National Health Service cannot afford to do all this at present; otherwise, it would already have done it. I am very concerned that health and well-being in particular are being excluded from the terms of the Bill. They ought to be before everyone who is considering the issues of which the Bill is made up, particularly tackling the problems of worklessness and educational attainment, both of which have mental health as one reason—not the only reason—that they are there.

I am in something of a quandary. In many ways, I would like to test the opinion of the House on each of these three amendments, because I think that they are each important. However, if I may, I would like to withdraw Amendment 3 and not move 4 and test the opinion of the House on Amendments 5 and 6, which deal with health and well-being, which are, I think, the guts of all this issue.

Amendment 3 withdrawn.

Amendment 4 not moved.

Amendment 5

Moved by Lord Ramsbotham

5: Clause 4, page 4, line 36, at beginning insert “the health and wellbeing of”

Lord Ramsbotham: My Lords, I wish to test the opinion of the House.

6.10 pm

Division on Amendment 5

Contents 110; Not-Contents 184.

Amendment 5 disagreed.

Division No.  2


Aberdare, L.

Addington, L.

Adebowale, L.

Ashdown of Norton-sub-Hamdon, L.

Bakewell of Hardington Mandeville, B.

Barker, B.

Beith, L.

Benjamin, B.

Best, L.

Bew, L.

Bichard, L.

Bonham-Carter of Yarnbury, B.

Browne of Belmont, L.

Bruce of Bennachie, L.

Burnett, L.

Cameron of Dillington, L.

Chester, Bp.

Clancarty, E.

Cohen of Pimlico, B.

Colville of Culross, V.

Cotter, L.

Craigavon, V.

Dholakia, L.

Durham, Bp.

Dykes, L.

Fearn, L.

Flather, B.

Foster of Bath, L.

Fox, L.

Garden of Frognal, B.

Glasgow, E.

Goddard of Stockport, L.

Greenway, L.

Grender, B.

Grey-Thompson, B.

Griffiths of Burry Port, L.

Hamwee, B.

Hay of Ballyore, L.

Hollins, B.

Humphreys, B.

Hussain, L.

Hussein-Ece, B.

Hylton, L.

Janke, B.

Jay of Ewelme, L.

Jones of Cheltenham, L.

Kerr of Kinlochard, L.

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Kerslake, L.

Kilclooney, L.

Kinnoull, E.

Kirkwood of Kirkhope, L.

Kramer, B.

Lipsey, L.

Listowel, E.

Lisvane, L.

Loomba, L.

Low of Dalston, L.

Ludford, B.

Maddock, B.

Maginnis of Drumglass, L.

Manzoor, B.

Masham of Ilton, B.

Meacher, B. [Teller]

Newby, L.

Nicholson of Winterbourne, B.

Northbourne, L.

Northover, B.

Norwich, Bp.

Paddick, L.

Pannick, L.

Parminter, B.

Pinnock, B.

Portsmouth, Bp.

Prashar, B.

Ramsbotham, L. [Teller]

Randerson, B.

Razzall, L.

Rea, L.

Rennard, L.

Roberts of Llandudno, L.

Rodgers of Quarry Bank, L.

Rowe-Beddoe, L.

St John of Bletso, L.

Sharp of Guildford, B.

Sheehan, B.

Shipley, L.

Shutt of Greetland, L.

Smith of Newnham, B.

Somerset, D.

Steel of Aikwood, L.

Stephen, L.

Stoddart of Swindon, L.

Stoneham of Droxford, L.

Storey, L.

Stunell, L.

Taylor of Goss Moor, L.

Teverson, L.

Thomas of Gresford, L.

Thomas of Winchester, B.

Tope, L.

Turnbull, L.

Tyler, L.

Tyler of Enfield, B.

Wallace of Saltaire, L.

Wallace of Tankerness, L.

Walmsley, B.

Walpole, L.

Watkins of Tavistock, B.

Wigley, L.

Williams of Crosby, B.


Ahmad of Wimbledon, L.

Altmann, B.

Anelay of St Johns, B.

Arbuthnot of Edrom, L.

Armstrong of Ilminster, L.

Ashton of Hyde, L.

Astor of Hever, L.

Attlee, E.

Bates, L.

Bell, L.

Borwick, L.

Bottomley of Nettlestone, B.

Bourne of Aberystwyth, L.

Bowness, L.

Brabazon of Tara, L.

Brady, B.

Bridgeman, V.

Bridges of Headley, L.

Brookeborough, V.

Brougham and Vaux, L.

Byford, B.

Caithness, E.

Callanan, L.

Carrington of Fulham, L.

Cavendish of Furness, L.

Chadlington, L.

Chisholm of Owlpen, B.

Colwyn, L.

Cooper of Windrush, L.

Cope of Berkeley, L.

Cormack, L.

Courtown, E.

Crickhowell, L.

Cumberlege, B.

Curry of Kirkharle, L.

De Mauley, L.

Deech, B.

Denham, L.

Dixon-Smith, L.

Dobbs, L.

Dunlop, L.

Eaton, B.

Eccles, V.

Elton, L.

Evans of Bowes Park, B.

Fall, B.

Farmer, L.

Faulks, L.

Fink, L.

Finkelstein, L.

Finn, B.

Flight, L.

Fookes, B.

Forsyth of Drumlean, L.

Fowler, L.

Framlingham, L.

Freeman, L.

Freud, L.

Gardiner of Kimble, L. [Teller]

Gardner of Parkes, B.

Garel-Jones, L.

Geddes, L.

Gilbert of Panteg, L.

Gold, L.

Goldie, B.

Goodlad, L.

Goschen, V.

Green of Hurstpierpoint, L.

Griffiths of Fforestfach, L.

Hague of Richmond, L.

Hailsham, V.

Hamilton of Epsom, L.

Harding of Winscombe, B.

Harris of Peckham, L.

Helic, B.

Henley, L.

Heyhoe Flint, B.

Higgins, L.

Hodgson of Abinger, B.

Holmes of Richmond, L.

Hooper, B.

Horam, L.

Howell of Guildford, L.

Hunt of Wirral, L.

Inglewood, L.

25 Jan 2016 : Column 1077

James of Blackheath, L.

Jenkin of Kennington, B.

Jopling, L.

Keen of Elie, L.

King of Bridgwater, L.

Kirkham, L.

Knight of Collingtree, B.

Lang of Monkton, L.

Lansley, L.

Lawson of Blaby, L.

Lexden, L.

Lindsay, E.

Lingfield, L.

Liverpool, E.

Livingston of Parkhead, L.

Lothian, M.

Lucas, L.

Lupton, L.

Lyell, L.

McColl of Dulwich, L.

Macfarlane of Bearsden, L.

MacGregor of Pulham Market, L.

McGregor-Smith, B.

McIntosh of Pickering, B.

Mackay of Clashfern, L.

Mancroft, L.

Marlesford, L.

Maude of Horsham, L.

Mawhinney, L.

Mawson, L.

Mobarik, B.

Mone, B.

Moore of Lower Marsh, L.

Morris of Bolton, B.

Nash, L.

Neville-Jones, B.

Neville-Rolfe, B.

Newlove, B.

Norton of Louth, L.

O'Cathain, B.

O'Neill of Gatley, L.

Oppenheim-Barnes, B.

O'Shaughnessy, L.

Patel, L.

Patten of Barnes, L.

Perry of Southwark, B.

Pidding, B.

Polak, L.

Popat, L.

Porter of Spalding, L.

Prior of Brampton, L.

Rana, L.

Rawlings, B.

Redfern, B.

Ridley, V.

Risby, L.

Robathan, L.

Ryder of Wensum, L.

Sanderson of Bowden, L.

Sassoon, L.

Scott of Bybrook, B.

Seccombe, B.

Selborne, E.

Selkirk of Douglas, L.

Selsdon, L.

Shackleton of Belgravia, B.

Sharples, B.

Sheikh, L.

Shephard of Northwold, B.

Sherbourne of Didsbury, L.

Shields, B.

Shinkwin, L.

Shrewsbury, E.

Skelmersdale, L.

Smith of Hindhead, L.

Spicer, L.

Stedman-Scott, B.

Stowell of Beeston, B.

Strathclyde, L.

Stroud, B.

Suri, L.

Taylor of Holbeach, L. [Teller]

Trefgarne, L.

Trenchard, V.

Trimble, L.

True, L.

Truscott, L.

Tugendhat, L.

Ullswater, V.

Wakeham, L.

Warsi, B.

Wasserman, L.

Wei, L.

Wheatcroft, B.

Wilcox, B.

Willetts, L.

Williams of Trafford, B.

Young of Cookham, L.

Younger of Leckie, V.

6.22 pm

Amendments 6 and 7 not moved.

Amendment 8

Moved by Baroness Lister of Burtersett

8: Clause 4, page 4, line 41, at end insert—

“( ) children in low income households where one or both parents are in work.”

Baroness Lister of Burtersett (Lab): My Lords, in moving Amendment 8 I shall speak also to Amendment 11. Once more I have the support of my de facto noble friend Lord Kirkwood of Kirkhope. I am also grateful to the right reverend Prelate the Bishop of Durham, who expressed his support when moving his amendment. These amendments bring up the rear of his amendment but complement and cement it. We do not know what will happen to his amendment in the other place but, because it is partly based on the need to take account

25 Jan 2016 : Column 1078

of what is happening to children in working families as well as in workless families, it is important that we still debate it.

The purpose of these amendments is to balance the obligation introduced by Clause 4 to report data on children in workless households with a similar obligation in regard to children in low-income working households. As I argued in Committee, whether the primary concern is life chances, as in the Bill, or child poverty, which Ministers assure us they are still committed to eliminating, it cannot make sense to exclude from reporting obligations the two-thirds of children living in poverty in households where at least one parent is in paid work. Indeed, in the mean time the Prime Minister has repeated his welcome pledge of an “all-out assault on poverty”. Surely an all-out assault has to include this group. It is therefore appropriate that the poverty and disadvantage experienced by families with a wage earner should be included in the life chances reporting obligations.

The fundamental importance of the issue to the Government’s life chances strategy and assault on poverty is one of the reasons I return to it on Report. Its importance is underlined by the Social Mobility and Child Poverty Commission in its latest State of the Nation report. It states:

“A One Nation country would be one where work offered a guaranteed path out of poverty”,

and it documents how it fails to do so. As I said in Committee, the amendment has the support of the Equality and Human Rights Commission and End Child Poverty.

The other reason I am returning to this issue is that I was not satisfied with the Minister’s response to the arguments put in Committee. For instance, I specifically asked him to answer a question posed by my noble friend Lady Hollis of Heigham at Second Reading: how will the Government account for the poverty among children of working families? His response had been to refer to the continued publication of the HBAI statistics, which was welcome, but he did not give an explanation for the lack of any reporting obligation on this matter to ensure accountability with regard to in-work poverty. He still did not provide a satisfactory explanation under questioning in Committee.

The Minister pointed out that the current situation of the majority of children in relative poverty living in a family where at least one parent is in paid work,

“has developed over the past couple of decades due to the improved progress in tackling poverty in workless families”.—[

Official Report

, 9/12/15; col. 1586.].

That is fair enough up to a point but is no answer to the question in hand, nor is the fact that the risk of child poverty remains higher among workless households. Whatever the trend or the reasons for it, and whatever the relative risks, it does not absolve the Government of the responsibility for reporting to Parliament and the country about what is happening to children in poverty, regardless of their parents’ employment status.

If the Government are reporting only on children in workless households, they will distort the overall life chances picture and the policy responses. Given that paid work is held out as the route out of poverty and the universal credit’s objectives, surely the Government

25 Jan 2016 : Column 1079

will want to know what is happening to those who have set out on this route and to analyse any obstacles they encounter.

In Committee, we engaged in a textual analysis of the Government’s own publication An Evidence Review of the Drivers of Child Poverty worthy of an academic seminar. In the end, it all seemed to come down to whether, in its reference to “low earnings”—I note that the Minister carefully omitted reference to that part of the report yet again in his earlier responses—as a key factor, along with worklessness, that impacts on children’s life chances, “low earnings” was in brackets. The Minister seemed to suggest that, because it was in brackets, that meant low earnings “out of worklessness”. I was not sure what he meant by that. I have gone back to the original source and it is clear that the key passages contain no brackets.

To recap, the table on page 6 listing “Relative influence of factors on length of child poverty spell” is headed by “Long-term worklessness & low earnings”. The review spells out that,

“lack of sufficient income from parental employment … is not just about worklessness, but also working insufficient hours and/or low pay”.

Page 9 states:

“The key factor for child poverty now is parental worklessness and low earnings”.

Page 56 summarises the key finding:

“Long-term worklessness and low-earnings are principal drivers of child poverty and the key transfer mechanism through which the majority of other influential factors act”.

Note the “and” and the “and” and the “and”.

The significance of what we, in shorthand, call “in-work poverty” is not surprising, given the nature of the contemporary labour market. A new analysis of the Poverty and Social Exclusion survey by Professor Nick Bailey of Glasgow University shows that,

“one in three adults in paid work is in poverty, or in insecure or poor quality employment”.

Using various measures of in-work poverty, he found:

“one in six is in poverty on the low income measure, one in three on the deprivation measure”—

we spoke on a previous amendment about the measures being about deprivation as well as low income—

“and one in six on the combined PSE poverty measure”.

Professor Bailey wrote:

“It is particularly striking that a large minority of the working poor are working full time and/or live in a household with near full work intensity so that it is hard to see how more work can be the solution to their problems”.

He also notes that, for a substantial minority, what he terms “exclusionary employment” is an “enduring condition”.

Surely this is the kind of analysis the Government would want to draw on to balance and contextualise its focus on worklessness, not least given the extent to which parents on low income move in and out of paid work and worklessness in what has come to be known as the “low pay, no pay cycle”. Indeed, the fluidity of the dividing line between paid work and worklessness, which universal credit in effect recognises, makes a

25 Jan 2016 : Column 1080

nonsense of a life-chances measure that ignores one side of the disadvantaged labour market position of low-income parents.

When I withdrew my amendment in Committee and warned that I might return to it on Report, I finished by saying that perhaps by then the Minister will have come up with some more convincing arguments than he had done hitherto. However, I realise that I was being rather unfair to him, because I do not believe that there are any convincing arguments, so how could he be expected to do so? Instead, it would be refreshing and welcome if he were able now to accept this amendment—which, after all, allows the Government to define their terms—or, if he prefers, to undertake to bring forward a government amendment at Third Reading to achieve the same end. I beg to move.

6.30 pm

Lord Kirkwood of Kirkhope (LD): My Lords, I support the case that has been powerfully made by the noble Baroness, Lady Lister. We have been discussing for what seems like years what should be done to help low-income families in work, and she has made a very good case. I cannot understand why the Government do not see the force of monitoring carefully the circumstances and environment in which these children will live, admittedly in England, in low-income households.

The Minister referred—and I know the work well—to the Waddell and Burton concepts of the sustainability and well-being that derive from work. That study was done in the early 2000s, and it was a changing experience for me as well—it was new to me. He also referred to the work that he then went on to do with the Labour Government in his important report. It all suggests that low-income working families are struggling to get to the kind of rewards that Waddell and Burton were talking about in their biopsychosocial model, which was so instructive in changing the terms of the debate.

I agree with the noble Baroness, Lady Lister, that the evidence is that we are in a very precarious employment environment. It is particularly true, and becoming more so, of self-employment. Single-parent families in low-paid work suffer increased and increasing stress, and all the other well-known elements that lead to deprivation in terms of the indicators of disability, large households and some ethnic groups that have historically had challenges relating to making work not just something that pays a wage but leads to a fulfilling life. This whole area will become more, rather than less, important in future, as the precarious employment environment increases.

There are big regional differences to which, as policymakers, we are at the moment blind. There are geographical areas and differences within England—as the amendment refers only to England—that would be instructive for policymakers looking at children in low-income working families and to which we do not have access at the moment. We could so easily have it if this amendment were adopted by the Government.

Finally, the universal credit change that is coming in this direction is quite new. It requires families on universal credit under the claimant commitment not only to get themselves ready and able for work but, once within work, they are under pressure under the

25 Jan 2016 : Column 1081

new system to go for longer hours and higher-level wage contracts of employments. That is all backed by sanctions. That is something that, once universal credit eventually rolls out across 7.7 million households, we will have to watch very carefully in relation to the trends. I am not saying that there is anything wrong with trying to get people into higher-level jobs, because that is important for low-income families, but that element of universal credit is quite new, to me certainly, in relation to how the social security and social protection systems that we have in the United Kingdom work.

I would be much more comfortable if the Government were to agree to these amendments. We would be better informed and, as legislators in the future, we would be in a much better position to protect the interests of children in low-income families who struggle with poverty in this country. It is time that we tried to do something about that.

The Earl of Listowel: My Lords, I support these two amendments. In the family to which I referred earlier, Ms Lorna Sculley has three children; the oldest and youngest sons have a disability, and she is a working mother. She works 16 hours a week as a dinner lady at the First Love Foundation—the food bank—and she discussed the prospect of getting more work. She calculated that if she worked seven more hours a week, she might get only another six pounds. It just was not worth her while to progress along a work route. I welcome very much what the Government have said about introducing the new, much higher, minimum wage, but the actual effect on families’ incomes might not be as positive as we would all hope, so I hope the Minister will consider accepting this proposal.

I would like to raise another point about a further complication for Ms Sculley. She depends on housing benefit and lives in Tower Hamlets. Her benefit has not been sufficient to pay her rent, so she has to subsidise it from her other income. She says that she cannot move from where she is because of her eldest son’s disability: he is at a school that is good at meeting his needs. That is what I understood from what she said, so that is perhaps relevant to others in our discussion.

My final point in relation to Ms Sculley is that she was offered a parenting class because of her two sons’ disabilities, but it took place on a Thursday, which is when she has to work at the school. She is therefore, in a way, disadvantaged by being in work because she cannot take up the opportunity of attending the parenting class. There is a lot to be said for these two amendments, and I look forward to the Minister’s response. Before I finish, however, I would like to thank him for the time that he took last week—an hour—to speak on the needs of children as they relate to this Bill. I certainly appreciate that very much.

Baroness Hollis of Heigham (Lab): My Lords, I very much support the amendment of my noble friend Lady Lister, which was supported so ably by the noble Lord, Lord Kirkwood. I will be puzzled if the Government propose to resist the thrust of this amendment. The Government know perfectly well that, although the incidence or percentage of poverty among workless families is high, and higher than that among working

25 Jan 2016 : Column 1082

families because the number of working families is so much greater than the number of workless families, as has been mentioned already, two-thirds of children who are in poverty live in a family where an adult is in work. Part of that might be that the parent, if a lone parent, has restricted hours, but we know that, with insecure contracts and the minimum wage and so on, the key lever to get that family out of poverty is not just to get the single adult into work, but where there are two adults, to get the second adult into work as well. We know that that is a function of the age of the youngest child and the size of the family. Child poverty might well be a temporary period until the second earner—let us say, for this purpose, the mother—is able to go back into the labour market along with her husband or partner in order to amplify the family income. The need to support those children may be a temporary issue.

Given that the Minister today has put so much weight on the strain being carried by the new minimum wage and given that he will want to know, as we will all want to know, the interaction of that with the benefit bill, and the extent to which, therefore, that helps to address the levers of child poverty, above all of which is getting the second earner into part-time work, I do not understand why he would not want to track the information that my noble friend has called for. We all support the Government’s move to increase the national minimum wage. If he is right, this hopefully will have repercussions that we would all accept and support for the benefits system. But do we need to do more than that? We do not know. It may be about the size of sibling groups or the need for a second earner. We need to know what levers to pull. Unless the Government track that information, we will not know. I am sure that the Minister does want to know, so I hope that he will think very carefully about this amendment.

Baroness Manzoor: We totally support this amendment in the name of the noble Baroness, Lady Lister. I also totally agree with my noble friend Lord Kirkwood who has amply identified the arguments as to why it should be supported. The noble Baroness, Lady Hollis, rightly said that we need levers. If we do not have such levers, how are we to address the issues about people who work, those who are not in work and in-work benefits? We will talk about the universal work allowances and the implications and ramifications of that. I hope that the Minister is listening very carefully. If the amendment is called to a vote, we on these Benches will support it.

Baroness Sherlock (Lab): My Lords, I thank my noble friend Lady Lister for tabling this amendment and for introducing it so well. In Committee, she made a very compelling case and I share her view that the Minister’s response was more than usually unpersuasive. In fact, she may have identified the reason for that and may be on to something. It is not as though we lack evidence. We have heard that two-thirds of children in poor households have a parent in work. I think we all accept that the risk of poverty is lower in families where parents are working and that the risk rises as the hours worked do not. But that does not change the fact that today large numbers of children are in poverty even though their parents are in work.

25 Jan 2016 : Column 1083

My noble friend Lady Lister and I clearly had the same weekend reading. How sad am I? I, too, dug out the State of the Nation 2015 report from the Social Mobility and Child Poverty Commission and the original evidence command paper from 2014. The commission put it really clearly. It states that,

“today 1.5 million children are in poverty because their working parents do not earn enough to secure a basic standard of living and the risk of absolute poverty for working families after housing costs has increased over the last decade”.

We clearly have a problem. In their command paper, from which my noble friend Lady Lister quoted, the Government analysed what drove how long a child stayed in poverty. They state:

“The main factor is lack of sufficient income from parental employment … this is not just about worklessness, but also about working insufficient hours and/or low pay”.

They did not mention something which was picked up by the noble Lord, Lord Kirkwood— namely, that another crucial determinant is the nature and level of in-work benefits and the way in which they apply. But the Social Mobility and Child Poverty Commission did raise that. In its 2015 report, it commented:

“Many families will find it very difficult to increase their earnings enough to make good the cuts in state support even if they benefit from the welcome introduction of the National Living Wage … we recommend that the Government should, as the public finances improve, revitalise employment incentives in Universal Credit”.

However, as we know, things are going in the opposite direction. The Government have done real damage to work incentives—the very thing that UC was designed to tackle—by cutting work allowances. In this Bill, they are cutting the value of the main in-work benefits through the benefits freeze. They are abolishing the family premium in universal credit for all families and significantly cutting child tax credit for families with more than two children, both of which will hit working families with kids. On Saturday, the Times reported that cost-cutting means that 240,000 families will be denied the free childcare promised to them in the Conservative manifesto.

In Committee, the noble Lord, Lord Freud, argued strongly against targets on relative poverty because he believes that they drive government decisions on allocation of resources and he does not like the way they do it. He got his way on that, if not on measurement. But the information should at least be recorded. The risk of failing to measure and to discuss the trends in in-work poverty is that the Government will not do anything about it because it somehow legitimises the idea that poverty is not about money but about worklessness, as though, by definition, children with working parents could not be poor. If we do not focus on that, it could distort policy-making too.

If the Government are focused only on worklessness, they could end up pursuing policies that just move children from being poor in households where they see their parents a lot to being poor in households where they do not see their parents very often because they are out working unsocial hours in order to be able to make ends meet. With all the consequent damage to family life that that does, that is not the answer. I live in hope that the Minister will accept this amendment, having been persuaded by the brilliant arguments of my noble friend Lady Lister, but just in case,

25 Jan 2016 : Column 1084

unaccountably, he is not going to do that, will he tell the House one very specific thing? Does he accept that it is possible to be poor if your parents are in work and you are a kid? If so, what are the Government going to do about it?

6.45 pm

Lord Freud: My Lords, let me go straight to that question while it is fresh in my mind. It is, of course, possible to be poor while both parents are in work, particularly under the present legacy system. That is why we are bringing in universal credit—to make that much harder. We are not arguing about the level of poverty; it is about what is likely to happen to the life chances of that child compared to both parents being at that level of income and out of work and in work. That is the argument I have been trying to make all afternoon, with, I think, some resistance.

Under Amendments 8 and 11, noble Lords seek to expand the reporting duty placed on the Secretary of State so that his annual report to Parliament must include data on children living in low-income families where one or both parents are in work. Their amendments would add the terms “low income” and “in work” to the list of terms to be defined in the annual report.

I have already gone on enough about the centrality of worklessness and educational attainment. Alongside these statutory measures, the Prime Minister has announced that we are committed to publishing a life chances strategy in the spring, which will set out a comprehensive plan to fight disadvantage and extend opportunity, including a wider set of non-statutory measures on the root causes of child poverty such as family breakdown, problem debt, and drug and alcohol addiction.

I have said before that work is the best route out of poverty but I want to restate our arguments about the centrality of tackling worklessness. The risk of a child being poor is dramatically reduced if at least one parent works. According to the latest statistics, the risk of being in relative poverty for a child in a working family is 13%, compared to 37% for a child in a workless family. So a child in a workless family is almost three times as likely to be in poverty as a child living in a family where at least one adult works. Perhaps those are the figures for which the noble Baroness, Lady Sherlock, was asking.

Last year, we published an analysis on the transitions into and out of poverty. What we found was staggering, although some might say that it was obvious. Of the children who are in poor workless families, 74% will leave poverty altogether if their parents move into full employment. The analysis also made clear that the more work parents do, the more likely they are to leave poverty, with 75% of children from poor families in part-time employment leaving poverty if their parents enter full-time employment. I remind noble Lords that we have a package of reforms to encourage people to work. These policies include the national living wage and changes to the personal tax allowance, which will allow people to keep more of what they earn. Furthermore, over 30 million individuals will see a tax cut as a result of the changes we will make in this Parliament. Some 570,000 individuals will be lifted out of income tax altogether by 2016-17 and, as a

25 Jan 2016 : Column 1085

result of the introduction of universal credit, more people will enter work due to improved financial incentives. We have a vibrant and growing economy, and last year real pay grew by 2.1%.

On the question from the noble Baroness, Lady Hollis, on support for women, we are supporting families through the national living wage, which is expected to have a stronger positive impact on the female workforce, boosting the wages of three in 10 female employees by 2020. Our childcare reforms will provide support to women who want to find employment, helping them to increase their income.

We have discussed before that two-thirds of children in relative poverty are from working families, but let me go over my argument. I am not convinced that it will convince the noble Baroness, Lady Lister, but I must try. It is correct that the latest figures published in the HBAI show that 64% of children in relative poverty are from a family where at least one adult is in work. This proportion has grown over the last couple of decades due to the improved progress in tackling poverty in workless families. In 1996-97—the earliest period for which data are available—around 60% of children in relative poverty were from workless families, which is around 2 million children, and around 40% of them were in working families, which is around 1.5 million children. During the 2000s, there was progress in reducing the number in poverty in workless families by focusing spending on tax credits, but this had the unintended consequence of weakening work incentives that resulted in hardly any change in the number of children in in-work poverty, which stood at 1.3 million in 2009-10.

Baroness Hollis of Heigham: My Lords, if the Minister will allow me to say this, he is misrepresenting the statistics. It may be a statement about children in poverty, but in particular the number of lone parents in that period who were in work went up from barely 50% to some 65%. Therefore, tax credits made work pay for them.

Lord Freud: It may have made work pay for some people, but it had the effect that, while it was possible, through income transfers, to drive down the out-of-work poverty of children, which is what they were designed to do, it had virtually no impact on in-work poverty. That brought that policy to a reductio ad absurdum: you could not do it without undermining your work incentives because you were raising the level of the benefit structure and it was beginning to knock up the income scale. That was the problem; that is what the data show.

In-work poverty, combined with falling levels of children in poverty from workless families, led to a greater proportion of children in poverty being from those workless families. This meant that, from 1996-97 until the end of the last decade, the proportion of children in poverty from working families actually went up from four in 10 to six in 10. That is the reality of the situation today. I can see that there is some ideological difference to be found over that analysis.

The evidence review, raised by the noble Baroness, Lady Lister, highlighted the importance of low earnings, but emphasised the impact of working a lower number

25 Jan 2016 : Column 1086

of hours, rather than the impact of low-paid work. On the question of how we will know about the levels of poverty—in work and out of work—I reassure her, as I already have, that we will have that data in the HBAI. It will continue to be available. Indeed, those in-work poverty figures in the HBAI can always be broken down by whether the family is in full-time or part-time employment.

I described why having two separate systems worked so poorly. We are introducing universal credit exactly to address those disincentives. I can tell noble Lords that I have spent the most enormous amount of personal time trying to get this structure so that we do not have these odd disincentives, which are really undermining for society. Universal credit is the best way to give people the incentive to enter work: it reduces poverty by making work pay and making sure that people do not lose out as they start to earn more, which is the terrible discontinuity in the legacy system. It provides an effective route out of poverty, while supporting the most vulnerable households. We already see the evidence under universal credit that people are working more and are better off in work.

As with Amendment 2, which we discussed earlier, these amendments would reintroduce an income-based relative poverty measure, which, as I have tried my best to explain—perhaps not as successfully as I might—do not tackle the root causes of child poverty. The Government are concerned with focusing our efforts and attention on those areas that will make a real difference to children’s lives, and concentrating on those root causes.

Resources are finite. It is crucial that we prioritise our actions to make the biggest difference for children. Statutory income measures cause the Government to focus their action and resources on direct and incremental increases to family income, but that does not necessarily drive any real change and is detrimental to the things that we think are vital—noble Lords know what I think they are.

Let us focus on the things that matter and drive the actions that will give our children the future they deserve. Let us not be distracted by measures that detract from that aim. As I said, we will continue to publish the HBAI figures so that we will know exactly what is happening. I therefore urge the noble Baroness to withdraw the amendment.

Baroness Lister of Burtersett: My Lords, I am grateful to all noble Lords who spoke in support of the amendment. I am grateful to the Minister, who at least went into more detail. As he expected, I was not convinced by his arguments, because I still have not really heard a convincing explanation of why there should be no accountability for what is happening. He said that we must focus on the things that matter, but surely what is happening to, for instance, the lady referred to by the noble Earl, Lord Listowel, matters? My noble friend Lady Sherlock talked about those who work such long hours that they do not see their children. We know from research at Bath University that children care about that. It talked about children and lone mothers in particular: they are glad when their mother gets paid work, but it affects them. They hardly see their mother. That time squeeze on such families is important. These things matter as well.

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I do not necessarily think that this is ideological, as the Minister said. At the beginning he said that it is not the level of poverty that matters, but what is likely to happen to the life chances of children—as if these were totally separate things. The whole point, as the Social Mobility and Child Poverty Commission and the driver analysis said, is that life chances are affected by income poverty. Therefore, we need to know what is happening to the life chances of children, regardless of the employment status of their parents. I will not go into the detail of the trends; it is pretty much what the Minister said in Committee. I do not think that that is the point; the point is that there should be government accountability about what is happening to those who, as the Minister likes to say, are “doing the right thing”—although I am not so sure it is always doing the right thing—and who are in paid work.

I am disappointed. What the Minister said at the end suggests, if we are focusing on what matters and we do not focus on the poverty of those whose parents are in paid work, that that therefore does not matter. That says volumes. I do not suppose that low-paid parents are sitting at home watching this debate—they are probably out there working—but if they read about it or hear about it, they would say, “Don’t we matter? Don’t the hours I am putting in for little pay matter? Don’t the Government want to report on what is happening to people like me? Doesn’t it matter?”. I think that it matters enormously. However, I will not push our luck and test the opinion of the House, so, regretfully, I beg leave to withdraw the amendment.

Amendment 8 withdrawn.

Amendments 9 to 14 not moved.

7 pm

Clause 5: Social Mobility Commission

Amendment 15

Moved by Baroness Lister of Burtersett

15: Clause 5, page 5, line 23, leave out “Social Mobility” and insert “Life Chances”

Baroness Lister of Burtersett: My Lords, I wish to speak to Amendments 15 to 23. I am very grateful to the right reverend Prelate the Bishop of Durham for adding his name to them.

The amendments would rename the Social Mobility and Child Poverty Commission the Life Chances Commission, rather than the Social Mobility Commission, as in the Bill, so as to align the commission’s remit with the new focus on life chances introduced in the Bill and about which the Minister has spoken a lot this evening. I still think that the removal of the words “child poverty” from the commission’s title—after all, it was originally named just the Child Poverty Commission—is sending a message that the Government no longer care about child poverty, which is surely not their intention given that they assure us of their continued commitment to the elimination of child poverty. However, in the spirit of compromise, I realise that the inclusion of the “CP” words might be sensitive, so I have not included them. I return to this amendment because, as

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I put it in Committee, I was “desperately disappointed” by the Minister’s response, or rather lack of response, to the case we had made.

To recap that case: the amendment would, in my view, better capture the spirit of the new focus on life chances enshrined in the Bill. Thus I was, and remain, genuinely puzzled about why the Government did not use this opportunity to rename the commission the Life Chances Commission. As I said in Committee:

“At Second Reading the Minister underlined that the Government’s new approach is the life chances one, focused on transforming lives through tackling the root causes of child poverty, and he referred to the new statutory measures as key life chances measures”.—[Official Report, 9/12/15; cols. 1592-3.]

This stance was reinforced by the Prime Minister’s recent speech in which he sketched out the principles underlying the Government’s planned life chances strategy, to which the noble Lord, Lord Ramsbotham, referred earlier, as did the Minister. The strategy that the Prime Minister sketched emphasises, as he put it, “a more social approach” that moves “beyond the economics” and develops “a richer picture”. In other words, it seems to me that the Prime Minister understands that a life chances agenda is less economistic and is richer than a social mobility agenda. Indeed, I suggest that social mobility is an example of the 20th century thinking—that is, old thinking—that he argues we need to move beyond.

Therefore, I welcome the Government’s introduction of the concept of life chances, even if I argue that they should pay more attention to the importance of material resources, as the current commission recognises. As I explained in Committee, I believe that it is richer than the narrower, meritocratic notion of social mobility. I drew on the work of the Fabian Commission on Life Chances and Child Poverty—chaired by the noble Lord, Lord Adebowale, who is no longer in his place—of which I was a member. As a good academic, I will define my terms. The commission defined “life chances” simply as referring to the likelihood of a child achieving a range of important outcomes which occur at successive stages of the life course. Again, the Prime Minister talked about a life-cycle approach.

Therefore, the emphasis is on a range of outcomes, including health and well-being, as well as those associated with social mobility. Children must be given the chance to enjoy a happy, flourishing childhood, and to continue to thrive as they grow up. Thus, as I explained, it is about caring about children as beings as well as “becomings”, both of which can be damaged by child poverty. I suggest that, again, this chimes with the Prime Minister’s speech, which for instance emphasised factors such as mental health and character and talked about cultural disenfranchisement.

The commission preferred the concept of life chances over the narrower one of social mobility because the latter reflects the kind of economistic thinking rejected by the Prime Minister and does not embrace the idea of ensuring that everyone has the chance to live a full and flourishing life. Moreover, it ignores what happens to those who are not able, or may not want, to climb the education and career ladder. In Committee, I gave the example of someone who devotes their life to caring for others—undervalued, be it on a paid or

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unpaid basis. As I asked, do we want to say to children that it is an ignoble ambition to care for others instead of climbing the economic ladder? To these arguments the right reverend Prelate the Bishop of Durham added a perhaps even stronger one—that the notion of life chances resonates with children themselves in a way that social mobility never would. I hope that he will expand on that in a moment.

In his response, the Minister maintained that the reformed commission would be able to focus more single-mindedly on social mobility, and that its remit on social mobility would be expanded. However, its overall remit is, of course, being narrowed in a way that I argue is out of line with the much broader life chances approach outlined by the Prime Minister. It also apparently excludes child poverty, which, as the current commission makes clear, undermines social mobility and restricts life chances. I believe that this will diminish the commission’s role and the value of its work. What the Minister did not do was explain why the Government believe that it is better to focus the commission’s remit on social mobility when the whole thrust of the Government’s thinking, as otherwise enshrined in the Bill, is life chances. Therefore, I was left even more puzzled at the end of our debate than at the beginning.

I know that the Minister takes our debates seriously and goes away and thinks about what has been said. Therefore, I end on a note perhaps more of hope than expectation, but I am hoping that he has done so with regard to this amendment and realised that what I am proposing is helpful to the Government’s cause and, indeed, would be welcomed by people in the field, including many who are otherwise critical of what the Government are doing in the Bill, and, indeed, as the right reverend Prelate indicated, perhaps by children themselves. I beg to move.

The Lord Bishop of Durham: My Lords, I support this amendment. Yesterday, I spent a delightful evening with a small number of academics after preaching at Evensong in an Oxford college—Worcester College. It was a very pleasant evening. However, as I sat there, I kept coming back in my mind to today’s debate because I was reminded of the extraordinary privilege of being in an Oxford college and the elite nature of it. This is not to criticise it or put it down; I had the privilege of studying in a private hall in Oxford when I trained for my ordination. However, I found myself thinking about the vast number of children and young people I meet in schools and colleges around the north-east, and have met in other parts of the country over the years, for whom such privilege is not their aim. Most of those I meet do not talk or think about being socially mobile. They do talk, however, about wanting a decent home and growing up and finding a good job on a decent wage. They also talk about having a stable, loving family through their childhood and wanting to create stable, loving families in the future. Those are the hopes and dreams of most of them. I believe that we have a lot more work to do on aspiration levels. I would love more of them to dream that one day they could go to Oxford or Cambridge, and that they can be significant players in their own communities and

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transform them, because that is where most will do it. Of course, we all know people who make huge impacts on their local community because they believe in it.

Social mobility is simply too narrow a focus. I absolutely support the move to the term “life chances” as a better expression of a broader base on which to think about these matters. I am not a great sociologist, but I went back to Max Weber, who was the first person I could find who talked about life chances and who introduced the concept of social mobility. In that, he talks quite clearly about social mobility being only one of the factors. He also talks about social stability, social cohesion and social integration. These are at least as significant and, for large numbers of people, they matter as much as, if not more than, social mobility.

Life chances around worklessness, educational attainment and, indeed, income are a broader-based way of assessing poverty. They will tell us more about the health of society than simple social mobility. Changing the name of the commission will absolutely reflect more closely the intention of the Government and offer a way of monitoring progress and feeding into it through the commission’s work. It matters and it would be nice to have a commission with a title that children themselves recognise, understand and could talk about and debate in their schools. How much they would, I do not know, but the idea of a title that they relate to is very valuable. This is intended to be helpful. To call the commission the Life Chances Commission fits absolutely with what the Government are aiming at and will help serve that aim better than the simple, narrow focus of social mobility.

The Earl of Listowel: In listening to this debate, I find myself sympathetic to the notion of social mobility but I also think of the play “Macbeth” and of Macbeth and his wife. There is a risk, I suppose, if one puts too much weight on social mobility, of a society which is red in tooth and claw. The addition of the words “Life Chances” balances that. Your Lordships may also remember the series “Seven Up!”, which I think started in the 1970s and followed 10 children through their lives into adulthood. To my mind, the happiest life in the group was that of a young black boy who grew up in foster care and then went on to become a butcher, marry and have a family. He seemed the most contented of the lot. To be able to achieve a stable and loving family is also important to society, so it would also be helpful to measure that.

Lord McKenzie of Luton: My Lords, this amendment has been moved very comprehensively by my noble friend Lady Lister and spoken to by the right reverend Prelate the Bishop of Durham, to whom I should say that the closest I got to Oxford on Sunday night was watching “Endeavour” on television. This is a re-run of an amendment moved in Committee as part of a wider group covering life-chances strategies. The Minister’s response then, as reported in col. 1598 of Hansard on 9 December 2015, was clear on a commitment to publish a life-chances strategy, as well as the annual report as set out in the Clause 4 obligations, but there was no commitment to make this a statutory obligation. As my noble friend Lady Lister has argued, the concern

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which has been expressed about the commission is that, for the future, it has no obligation explicitly to promote the tackling of child poverty. Although there is a commitment to report on life-chances data, and a statement on the record that there will be a life-chances strategy, the role of the Social Mobility Commission seems somewhat removed from this.

As my noble friend Lady Lister pointed out in Committee, promoting social mobility is a narrower ambition than tackling poverty and promoting life chances: it is not a substitute. It is, of course, a not unreasonable ambition, but a commission focused on life chances would naturally encompass the prospects of social mobility. The reverse is not the case. We therefore support my noble friend’s amendment. It seems odd that the Government are keen to have a commission reporting on progress on improving social mobility but not on life chances.

7.15 pm

Lord Freud: These amendments seek to rename the reformed commission as the Life Chances Commission, rather than the Social Mobility Commission, and to amend the duties placed on the commission to promote and improve life chances instead of social mobility. The two concepts—social mobility and life chances—are different although there are, of course, areas of overlap between the two. The Prime Minister’s speech earlier this month demonstrated the importance this Government places on improving children’s life chances. The statutory measures of worklessness and educational attainment and the Government’s life-chances strategy will drive action that will make the biggest difference to children’s life chances. Together, they will provide transparency and enable anyone to hold the Government to account.

The Government also place great importance on improving social mobility and providing equality of opportunity for all citizens. Our proposals for the reformed commission will enable it to have a single-minded focus on social mobility and play a crucial role in its scrutiny and advancement. That is about ensuring that everyone has the opportunity to realise their potential in life, regardless of their background. Perhaps those in Oxford do not need quite as much looking after as others. The commission will also have a new duty to promote social mobility in England, enabling it to engage with a wide range of partners, including government, business and the third sector. This will be crucial to tackling the institutional biases and cultures that prevent individuals fulfilling their potential. Through our new statutory life-chances measures and strategies and the reformed Social Mobility Commission, the Government will drive action and enable scrutiny on these two vital issues. I therefore urge noble the noble Baroness to withdraw the amendment.

Baroness Lister of Burtersett: My Lords, I am very grateful to the noble Lords who have spoken. I feel slightly embarrassed; I am supposed to be the sociologist but it was the right reverend Prelate who quoted Max Weber. I had better go back and read my old sociology textbooks. I still do not feel that the Minister has given a true explanation. He seems to be making a distinction: the way he and the Prime Minister see it, life chances are about children’s life chances, while social mobility

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is about everyone—children and adults. However, children become adults and I see life chances as being about the whole life course, from cradle to grave. If that is the case, and the distinction lies in the commission’s focus being more on what is happening to adults, that worries me even more. Let us remember that this started life as a child poverty commission. In the Welfare Reform Act 2012, it became the Social Mobility and Child Poverty Commission and some of us were a bit worried about that at the time. Were we not right to be worried? Now it is not just child poverty that has been dropped, but children, too. Apparently it is not now supposed to be interested in children at all. I am not so much puzzled now as quite worried about what this means for the commission, because the Social Mobility and Child Poverty Commission has produced very valuable reports about what is happening to children in this country. The Government no longer have a statutory obligation to report on children in poverty, other than in relation to worklessness and educational attainment. We do not know what will happen to the Child Poverty Unit. It is as though children—and children in poverty—are just disappearing.

I am less puzzled than really upset about what has happened here. The complete shift of focus away from children in this commission is disgraceful. I am not going to push it now, for obvious reasons, but I hope there may be some other way that we can come back to this, though I do not know at what point this can happen or what scope there will be for the commission to try and expand its remit. I find what the Minister is saying quite extraordinary. As he himself has said, we want to focus on what matters: he is saying that children do not matter. I leave it there and beg leave to withdraw the amendment.

Amendment 15 withdrawn.

Amendments 16 to 23 not moved.

Clause 7: Benefit cap

Amendment 24

Moved by Baroness Pitkeathley

24: Clause 7, page 9, leave out lines 5 and 6

Baroness Pitkeathley (Lab): My Lords, the purpose of this amendment is to remove carer’s allowance from the list of qualifying benefits for the benefit cap. It would also remove an injustice.

While an exemption for households including a disability living allowance or personal independence payment claimant exists, this does not protect all families affected by disability or all carers from the cap. This is due to the way that a household is defined by the benefit system, as your Lordships will know. For the purposes of that system, a household is considered to be an adult, their partner, if they have one, and the children that they have who are under 18. If any other adult relatives—for example, older parents, brothers and sisters or even adult children—live in the same house, they are considered to be part of a different benefits household or unit, even though they live

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together. This means that while carers looking after disabled partners and disabled children under 18 are exempt from the cap, those caring for adult disabled children, siblings or elderly parents are subject to it. Currently, about 1,400 households containing carers are affected by the benefit cap—please remember that figure, as it is a relatively small number.

The Government’s stated objective for the cap is to encourage more households to move into work. A new lower-tiered cap has been designed to strengthen the work incentives for those on benefits. That is a perfectly respectable aim but if it is designed to be fair to individuals who are working hard and contributing to society, it cannot be right that it is applied to carers. There are two main reasons.

First, carers contribute an enormous amount to society; your Lordships will be familiar with this. The value of unpaid carers’ support to the economy is £132 billion every year—the cost of a second health service. Indeed without the support from carers, health and social care systems would simply collapse. There is no doubt that carers are a major contributor to society. Secondly, carers cannot mitigate the impact of the cap in the way that the Government suggest. In Committee in the Commons, the Minister, Priti Patel, said:

“We all acknowledge the important role that carers provide, but we do not accept that carers are unable to work. Although seeking work is not a condition for receiving carer’s allowance, many carers are nevertheless able to and combine work with caring responsibilities”.—[Official Report, Commons, Welfare Reform and Work Bill Public Committee, 17/9/15; col. 237.]

The Minister is quite right but your Lordships should remember that to receive carer’s allowance, carers must be caring for a minimum of 35 hours a week, the equivalent of a full working week.

While it is true that some carers combine work and care, for the majority the intensity of their caring role means that this is simply not possible. For those who combine heavy caring with significant work, the prospect of reaching breaking point, where carers suffer exhaustion and physical and mental breakdown, is greatly increased. The latest survey from Carers UK about carers at breaking point shows that six in 10 people caring for an older, disabled or seriously-ill loved one have reached that breaking point at some time.

The cap is applied unequally to carers. While the exemption for households in receipt of PIP or DLA is very welcome it means that carers who are considered not in the same household are penalised, although they may be living in the same house as the person they care for. This means that of two carers who are caring for exactly the same amount of time with the same income, one would be subjected to the cap and one would not. Surely subjecting those who provide unpaid care to the benefit cap is unfair, counterproductive and inconsistent with the Government’s stated aims for their policy.

Hearing me say those things, your Lordships may think, “Well, she would say that, wouldn’t she?”, but they are very much reinforced by the recent High Court decision. On 26 November, the High Court ruled—

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Lord Freud: It might be worth my intervening on the noble Baroness, I think, in the interests of not hearing too much more vituperation—there is only a certain amount that I can take.

Noble Lords: Oh!

Lord Freud: Amendment 24 seeks to remove carer’s allowance from the list of benefits that are included within the benefit cap. As written, the effect is that recipients of carer’s allowance with a benefit income above cap levels would still be included in the cap but their carer’s allowance payment would be disregarded from the cap. That is the way that this amendment works.

I emphasise to the noble Baroness, and to your Lordships, that this Government value the contribution which carers make to society, and shall outline the further steps that we are taking to support carers. As I indicated earlier in the process, the Government have been carefully considering the position of carers and the people who they care for in relation to the benefit cap. I am grateful for the patience which noble Lords have shown while we completed this consideration. I know that your Lordships have been keen to hear where we would come out but it is necessary to look at these things in detail and take the right time to do so. We keep all these policies under review and have been looking at support for carers with particular attention—that is, across the piece and not just here. In relation to the benefit cap, the position of carers cannot be considered in isolation from wider policy aims. Our strategy is to support and invest in carers. We have therefore looked at the evidence and considered the best way to continue to support carers in the context of wider government strategy.

We do not consider that the disregard which this amendment would create is the right approach. We want to go further; we will be exempting all recipients of carer’s allowance from the benefit cap, whether they are single or part of a couple. This approach fits within the wider government strategy to support and invest in carers. Many carers wish to enter paid employment and many have done so while sustaining the role. We recognise that in some cases, it is beneficial for both the cared-for person and the social care system if people are cared for at home. It continues to be the case that some paid employment, alongside caring, will be right for many carers. But our strategy to support carers through the Care Act and through wider investment strategies provides new, targeted opportunities for help and encouragement, where appropriate, to remain close to paid employment.

As I say, we will be exempting recipients of carer’s allowance from the benefit cap. This is of course complex and we will need to get it right. But with my assurance that to support this exemption we will bring forward an amendment at Third Reading, and then appropriate regulations in due course, I therefore ask the noble Baroness, if she has finished moving her amendment, to withdraw it.

Baroness Pitkeathley: I am always happy to spare the Minister more vituperation, as he pleaded for. I am of course delighted with what he said, with the

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recognition that the Government have given to the contribution which carers make and to their inability to mitigate the effect of the cap in other ways. Certainly, some carers combine paid work with caring but, as I have said, for many their caring responsibilities are too heavy for them to do that without enormous stress. I am very glad that the Minister has taken account of that, and that the Government have taken account of the very strong wording of the High Court judgment. The wording was extremely well put but extremely firm. It would have been very difficult to understand if the Government had not heeded the very strong words of that High Court judgment. At the time, it seemed that there was neither logic nor justice in the Government’s position. I beg leave to withdraw the amendment.

Amendment 24 withdrawn.

Consideration on Report adjourned until not before 8.30 pm.

Education (Student Support) (Amendment) Regulations 2015

Motion to Regret

7.30 pm

Moved by Lord Stevenson of Balmacara

That this House regrets that the Education (Student Support) (Amendment) Regulations 2015, which change the existing student support arrangements so that new students starting full-time courses after 1 September 2016 will no longer qualify for a means-tested maintenance grant, will result in a significant decrease in participation in higher education by those in low-income groups, older students, female students, and students from ethnic minorities (SI 2015/1951).

Relevant document:18th Report from the Secondary Legislation Scrutiny Committee

Lord Stevenson of Balmacara (Lab): My Lords, I start by declaring an interest; I have two children currently enrolled in British universities. I think both attend, although I am not absolutely sure about the second one—but I want to make sure that that is on the record. I am also very grateful for the excellent work of the Secondary Legislation Scrutiny Committee, which alerted your Lordships’ House to the regulations that we are discussing in its 18th report.

The Government are proposing, under these regulations, to take grants away from around 500,000 of this country’s most disadvantaged students and replace them with maintenance loans, to be paid back when their earnings exceed £21,000 a year. The Government estimate that this will save £2.3 billion by 2020-21. My first point is that a change of this magnitude, which could affect more than 500,000 people, ought to have been made by primary legislation. According to the House of Commons Library, there were 395,000 students on full grant and 135,000 on partial grant in 2014-15. This SI affects a very significant number of people.

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I checked with our Library over the weekend, and the last higher education Bill to go through your Lordships’ House was in the summer of 2004. Here we have Ministers trying to shut down parliamentary scrutiny by introducing major changes to the negative procedure, when we all know that SIs cannot be amended and that no formal approval is required in either House. It is not a proportionate way of proceeding, even if the powers are in the substantive legislation.

My second point is that this measure was not included in the Conservative Party manifesto. This U-turn comes just four years after grants for students from disadvantaged backgrounds were hailed by the Government as an essential element in their higher education strategy. Could the Minister explain the thinking behind this change of approach, given that the previous higher education Minister, the noble Lord, Lord Willetts, who unfortunately is not in his place, said that ever since tuition fees were raised in 2012, the Government had acknowledged that maintenance grants were central to ensuring that higher education was still accessible for poorer students? The noble Lord said that tuition fee rises were,

“progressive, because they help to encourage people from poorer backgrounds to go to university, because of the higher education maintenance grant”.—[

Official Report

, Commons, 3/11/10; col. 940.]

This is not of course an isolated proposal but part of a pattern. It mirrors, for example, changes that removed NHS bursaries for nurses and other staff. It has been foreshadowed by changes that the Government have made in the support for further education over the past three or four years.

We put down this regret Motion today to hold the Government to account over what I see as a major policy change. It seems to many observers that the Government have been on the defensive all the way through this process. There was very little detail to be had when the Chancellor first mooted this change in the summer Budget, and not much more in the Autumn Statement. It was only when the National Union of Students raised the alarm about the impact of the policy and threatened a judicial review over the lack of consultation and the failure to publish the equality assessment that we began to see what was going on.

The generation of students entering further and higher education from September 2016 are going to be saddled with even greater debts—or “income-contingent tax liabilities” as the Government like to call them—than they were already likely to be from their course fee loans of £9,000 per annum going up. The IFS said in a press release summarising its briefing note on the summer Budget 2015:

“Students from households with pre-tax incomes of up to £25,000 (those currently eligible for a full maintenance grant) will have a little more ‘cash in pocket’ … But they will also graduate with around £12,500 more debt, on average, from a three-year course. This means that students from the poorest backgrounds are now likely to leave university owing substantially more to the government than their better-off peers”.

The IFS also states:

“The poorest 40% of students going to university in England will now graduate with debts of up to £53,000 from a three-year course”.

Note the use of “debt” rather than “income-contingent tax liabilities”—the IFS certainly calls a spade a spade. All this is backed up by the Sutton Trust, which says:

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“Shifting grants to loans may move them off the balance sheet, but it could also put off many low and middle income students and tip the balance against their going to university”.

In a recent publication, million+ says that research from the NUS published last week by Populus shows that parents are concerned that the Government’s plans to scrap the maintenance grant will discourage their children from applying to university. The change could also have a serious impact on postgraduate enrolment, since it is clear that the abolition of grants will increase individual student debt significantly. Indeed, the range of groups affected by these changes is daunting. The equality analysis published last November concedes that black and minority-ethnic students in particular will be disproportionately worse off. As for older learners, it says:

“Mature students will be disproportionately impacted by the policy proposals”.

The Government have also conceded that disabled people will be badly affected by this decision as well as by the decision to delegate responsibility for much of the disabled student allowances schemes to institutions.

The equality analysis also raised the question of discrimination because of concerns among some Muslim students about taking out interest-bearing loans. Can the Minister update us on the discussions which took place during the last Government on the introduction of sharia-compliant loans? Finally, it also states that female students will be particularly affected given their “significant overrepresentation”, as it is described, in populations currently receiving grants.

These damning details from the Government’s own equality analysis should surely give Ministers pause for thought. Does the Minister have anything to offer which might ameliorate these shocking findings? These issues need to be addressed urgently, otherwise any progress towards making higher education more diverse, particularly at postgraduate level, will be jeopardised.

Finally, it is also important to note that this policy does not exist in isolation. The cumulative impact of the rise in tuition fees, the scrapping of maintenance grants and the freezing of the repayment threshold all point towards a more hostile environment for those thinking about higher education. What is driving these panic measures from the Government? Is it a belated recognition that the whole set of financial assumptions about the repayments that underpin the trebling of student fees in 2012 is, as we predicted, producing a black hole for them and for future taxpayers?

Removing maintenance grants makes no economic sense. The IFS conclusion is that this change will not improve government finances in the long term. It states:

“The replacement of maintenance grants … will raise debt for the poorest students, but do little to improve government finances in the long run”.

The IFS points out that the rationale behind this is clearly political. The Government will gain in the short term because current spending on grants counts towards current borrowing—clearly bad—while current spending on loans does not impact on borrowing until the debt is written of at the end of the 30-year repayment period, which is good for current Treasury Ministers.

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The change helps the Chancellor to balance the books in this Parliament even though it will be at the cost of higher borrowing three decades or so into the future.

On 11 January this year, the Prime Minister gave a speech on life chances, referred to in the previous debate, explaining how the Government intend to transform the lives of the poorest in Britain. He said that his Government’s mission was to,

“look each … child in the eye and say, ‘Your dreams are our dreams. We’ll support you with everything we’ve got’”.

It is a good line and I sincerely wish it were true. But the reality is that there is a growing disconnect between the rhetoric and the action. Scrapping maintenance grants sends out a message that runs counter to any prospect of increased social mobility. This policy will impact heavily on women, the disabled, black and ethnic-minority students and older learners. To cap it all, it will end up being more expensive than the current grants system.

The Government should bring forward a higher education Bill. If we had it here today, we could have been discussing how to realise the wider benefits of having more people educated to degree level in our country and how best to fund that investment in our future prosperity and to properly support every young person in the country to develop themselves to the best of their ability. I challenge the Minister to convince us tonight that these regulations are the right thing to do and that her Government are supporting our young people with everything we have. I beg to move.

Baroness Garden of Frognal (LD): My Lords, I welcome the noble Lord, Lord Stevenson, securing a debate on these regulations and join with him in his regrets.

There has been widespread concern at actions the Government are taking which place additional burdens on those least able to accommodate them. The Liberal Democrats will feel particularly outraged at these regulations. As the junior coalition partner, we were notoriously unable to implement our policy of no tuition fees, but we were able to use our influence in government to fend off some of the harsher proposals of our coalition partners, to produce a fairer system for students from lower-income backgrounds and to give incentives and support to those who might be deterred from further learning.

I was Government Whip in the coalition Government, working for the noble Lord, Lord Willetts, as Universities Minister, as the noble Lord, Lord Stevenson, has already quoted. He understood fairness and we were delighted when he said that the proposals would,

“encourage people from poorer backgrounds to go to university, because of the higher education maintenance grant”.—[

Official Report

, Commons, 3/11/10; col. 940.]

The way in which these changes are being brought in—through the back door, as it were—seems to indicate that the Government are rather ashamed of them, and hoped to sneak them through without having to face the music of their impact. They are, indeed, a backward step.

Of course any additional support in the form of loans is welcome, but that really is not relevant to this argument. Maintenance grants have the great advantage

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of being non-repayable. The sums, of up to £3,387 a year, certainly do not allow students to live the life of Riley, but they can make all the difference to a student struggling to pay for the necessities of life and study—rent, food, other bills and the items they need for their learning. They have enabled some of the most disadvantaged to participate in higher education, many the first in their families to do so, without the burden of additional debt.

Changing grants to loans is a very significant move for those who will see their university debts soar. I, too, was startled at the Institute for Fiscal Studies warning that,

“The poorest 40% of students going to university in England will now graduate with debts of up to £53,000 from a three-year course, rather than … £40,500”,

which is already an eye-watering amount to this cohort.

Those who will be most deterred by additional debt include those the Government most need to engage in education. Women, for example, tend to be more debt averse than men as well as being a large proportion of this population. Disabled students have the additional deterrent of changes to the disabled students’ allowance, which we were debating only last week. Adult learners and black and minority ethnic learners are more aware of the burden of loans, which they are unlikely ever to be able to repay.

What benefit will this bring to government finances? It will be disproportionately little in comparison with the damage it will do to encouraging social mobility and building an inclusive graduate population. Many of these loans will never be repaid anyway, but for the students they will be there as a reminder of a debt instead of a grant that can be long forgotten.

The Government should be facing up to skills shortages in the population and tackling the increasing divisions between rich and poor. We need to encourage learners to improve their skills and knowledge, to be ambitious, to fulfil their potential and thus to make a greater contribution to the economy and to the well-being of themselves and the country.

These regulations will do nothing to encourage those from less advantaged parts of society to work hard and achieve. The Government did not need to do this. It was not a manifesto commitment. As the National Union of Students rightly said, the decision is “undemocratic and ill-considered”. There has been no effort at thorough consultation with those people and organisations most affected by the changes.

Would the Minister please clarify for the House the justification for saddling the poorest students with the greatest debt? In coalition, my party argued consistently for measures to encourage—not deter—women, adult learners, ethnic minorities and disabled people. What are this Government doing to encourage these learners? What consultation will be put in place before such a damaging change is inflicted on those learners we most wish to be helped to fulfil their potential?

I urge the Government to think again about these mean-spirited and harmful changes.

Baroness Deech (CB): My Lords, most speakers tonight will focus on cost and the increased debt that will accrue to students if these grants are converted to loans. I want to explore an effect that, in my view, is

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far more serious and damaging to the Government’s aspirations for higher education. The effect of ending grants designed for food and rent costs, is that more students will have to stay at home for their studies. I will explain briefly that this will eventuate in a decrease in social and academic mobility and a ghettoisation of universities.

It is already the case that teenagers from better-off families are more likely to attend top universities than those from low-income backgrounds, even though more students from less well-off backgrounds are attending university. Some 5% of poor students went to Russell Group universities according to the latest statistics, compared with 12% from more affluent homes. It is very likely that this is simply because the teenager from a comfortable home can afford to go to any university of his or her choice throughout the country, knowing that they are able to pay the rent and all the added costs of living away from home, while the less well-off student is increasingly forced to attend whatever university is close to home. Average rents for students living away from home are around £400 a month and over £500 in London. Therefore, of course the less well-off London student will live at home, even though academically and socially his or her choice might be Oxford or Cambridge.

7.45 pm

Much though those top universities have done to make themselves affordable by way of bursaries, the prospect of adding to one’s debt will be off-putting for the student from a modest background. Government Ministers of all parties are frequently heard to complain that disproportionately few poor and ethnic minority students attend Oxford and Cambridge. These proposals will make that situation far worse, and undermine all the imaginative and extensive efforts made by top universities to reach out to underprivileged students all over the country.

It is also the case that students from ethnic minority backgrounds are already more likely to study close to home, maybe in part because their parents are fearful of letting them go too far away. To take away from them the maintenance grant, the one factor that could help them place their foot on the ladder of opportunity and independence, is short-sighted and will retard, if not block, the integration of youth of all backgrounds into a better educated society—an aim allegedly close to the heart of the Government, and indeed to all of us.

More than 20% of students live at home, and the number is already rising. The better-off ones are more likely to live away from home. Of course, many students freely choose to live at home; I am concerned with those from whom choice will be taken. What is wrong with living at home and studying at your local university because you cannot afford any longer freely to choose to move away? There is the time and expense of commuting, especially in London; exclusion from the networks formed by those who live in halls or shared accommodation; and the evening social life. If university becomes a 9 to 5 existence, they are missing some of the university experience, are less likely to make friends and will feel less involved in campus activities.

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Without maintenance grants, students are more likely to take jobs, which might cause their academic work to suffer, whereas the better-off ones can still rely on their parents’ support. The student who lives at home delays that important moment of learning to be self-reliant, living on a budget, cooking and mixing with all sorts.

It is absolutely vital that students of different backgrounds get to mix with those who have the same academic and career aspirations as they do. This is the key to integration and to a healthy, undivided society. A student who has grown up in a part of the country heavily populated by one ethnic group stands to gain enormously—as does the whole of society—by going off to a university in another region, meeting others and learning to live and study with them.

Academic studies have shown that there is very marked ethnic segregation in our school system. Far too many children are attending schools where their own ethnic minority within the UK context is actually a majority. They are segregated in school education by faith and by ethnicity. They do not learn how the other half lives, how to challenge the prevailing culture, how to share experiences, how to appreciate multicultural living, how to criticise and how to aspire to a life different from that of their parents. The most segregated areas for very young pupils include Bradford, Birmingham and Bolton, among others.

If we extend this analogy into student life, it must be wrong that a student who, as a school pupil, spent their time in one community only continues to do so by studying at the local university and living at home. Moreover, they are being deprived of academic choice. If, because they have no maintenance grant, they cannot afford to leave home, then they cannot study the course that is right for them and is academically the most suitable, because it is not offered at their local university.

In sum, what the Government are doing by removing maintenance grants is not merely saving money but reinforcing segregation. Poor and ethnic minority students will have taken from them that golden opportunity at a critical age to widen their horizons and leave home for another part of the country. Academic choice will suffer. Racial and social integration will be put back. Better-off students will continue to surge ahead in educational opportunities, and universities will become as segregated in their make-up as some schools in some parts of the country already are.

If the Government believe what they say about every pupil fulfilling their potential, about all young people living in harmony in a society open to all and equally accessible to all, they must restore maintenance grants. Can they explain how to avoid real social and academic harm resulting from this penny-pinching measure?

Baroness Shephard of Northwold (Con): My Lords, I have just three points to make. I shall be very brief, because many other noble Lords want to participate in this important debate.

First, many here will well remember the anxiety that many of us felt about the possible effects on student participation rates in higher education in 1998,

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when students became responsible for paying upfront tuition fees, and more recently—there have been many changes since then, but to take just one example of other changes—when tuition fees were raised to £9,000. Many believed at the time that those measures would have a particularly adverse effect on the higher education participation rates of young people from poorer families, thereby affecting not only their life chances but, longer term, the national economic effort.

In fact, according to UCAS, the proportion of young people in higher education eligible for free school meals has increased by a percentage point a year since 2012, and the number of young people from places in England with the lowest HE participation—I come from one of those areas—has increased year-on-year from about 19,000 in 2012 to about 22,500 in 2015. As Universities UK pointed out in its report of June last year:

“There is no evidence that the funding reforms of 2012 have deterred young, full-time students from applying to university. Numbers of applications from all socioeconomic groups have been increasing steadily”.

My second point is that in the past—this may be an explanation for that steady increase in participation rates of children from poorer families—increases and changes in student fees have been accompanied by grants, loans and bursaries and, in 2012, a 10% rise in the maintenance grant for poorer students. It is therefore welcome that, as part of this proposed switch from grants to loans, the maximum available finance for poorer students will rise by about £500 a year to more than £8,000. This has been welcomed by, among others, Sir Les Ebdon of OFFA.

However—my noble friend will be aware that a “however” usually comes in at this stage when I am making points about education, and I pay tribute to the extremely valuable and passionate points made the noble Baroness, Lady Deech—the Department for Business itself acknowledges that the prospect of increased debt may deter some low-income households from undertaking higher education. It is for this reason that I strongly urge my noble friend to ensure that the effect of these changes is closely monitored. I ask this in the name of social mobility. The Government’s 2015 higher education Green Paper commits them to doubling the proportion of students from areas where participation is low by 2020. This is an admirable objective in line with many other policy areas where the Government’s pursuit of greater social mobility is succeeding. It would be regrettable if that progress in social mobility were to be checked at this stage for the sake of an omission of careful monitoring of the effects of these measures on precisely the groups already referred to by the noble Baroness—and those that I suspect will be mentioned by other noble Lords who will contribute to the debate. I know that my noble friend will undertake to keep a more than close eye on the way that this develops.

Baroness Kennedy of The Shaws (Lab): My Lords, I thank my noble friend Lord Stevenson for bringing the Motion of Regret to the House. I feel more than regret; I feel alarm and despondency. I share the word used by the noble Baroness, Lady Garden: I feel a sense of shame that we have embarked on this step

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without proper legislation. I have to say to the noble Baroness, Lady Shephard, that monitoring itself will be too late. The consequences will be very obvious for the groups about whom I am going to speak.

The removal of the maintenance grant from the poorest and most disadvantaged is something with which I am very familiar. The reason is that back in the mid-1990s, the noble Baroness, Lady Shephard, appointed me to lead a small commission to look at some of the problems that had arisen over the funding of further education at the time. One thing that became very apparent was that for the poorest in society, the route to higher education is often via further education. It became clear in the report that eventually came from the work I was deputed to do by the noble Baroness, who was a most remarkable and fine Secretary of State in those years, that many people who had been failed by the system—young women who had got pregnant in their teens, boys who had become disaffected and sometimes got into trouble and people whose families went through problems when they were at a crucial point in their schooling—missed out on the golden ladder, so familiar to people in this House either for themselves or for their children, of going through school and proceeding into university. For many, the route back into education was through further education, and further education is the ladder into higher education.

I still see such people regularly because, at the end of the reporting I was commissioned to do, the further education world put together a little foundation which bears my name, for which I continue to raise funds and to which I contribute, to create bursaries for students of the category I described: those who try to use further education to better themselves, the very people I so often hear described as those who should be given opportunities. This Government claim to be totally committed to aspiration. I know, because of that little foundation, the Kennedy Foundation, that those people are often hardest hit by the current funding system. It is a hard business, taking out loans when you are the mother of young children, when you are from a really disadvantaged family and have no safety net or back-up from other members of your family. We contribute a bursary to them. It is not a significant sum of money, but if they did not also get the maintenance grant, they would not go to higher education at all.

This will be a deprivation; I have no doubt about that. We do not have to use more than our imagination to know that there will be a great cohort of young people—people in their 20s and early 30s—who will not go back into education because the idea that they will not get such support will be too much of a disincentive. That should be a source of shame to all of us, but certainly to the Government.

I have listened to what others have said. I was very moved by the comments of the noble Baroness, Lady Deech. It is true: those who are poorest do not want to do the business of going off to university. Even in my youth—I was brought up in Glasgow in a family where no one had gone on to higher education—almost everyone who went to the schools that I went to went to the local university because they just could not afford to go somewhere else. I flew the coop and it changed my life, and I want that for other people from

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my background. I urge the Government to think about this again, because I think that not enough thought went into it. The cost to the lives of people is too great. The numbers are not huge, the money is not that huge, and I think we will pay a terrible price. I would ask the Government to think again.

8 pm

Lord OShaughnessy (Con): My Lords, I wish to speak in support of the Government’s higher education policy and against the content of the Motion—and, in particular, the contention that these changes will result in a,

“significant decrease in participation in higher education by those in low-income groups, older students, female students, and students from ethnic minorities”.

We have been here before. The doom-mongers have been making these claims about the changes to the higher education system for about 20 years. This is not a party-political point; those doom-mongers were in the Conservative Party in the late 1990s, they were in the Liberal Democrat Party in the early part of the 2000s, and now they are in the Labour Party. At each point they have been proved wrong. I had a small responsibility for working on the policy that brought about the current system, working with my noble friend Lord Willetts.

It is worth remembering what the purposes of these reforms are. The first is to share more fairly the burden of cost between the taxpayer and those who go to university and benefit hugely over their lifetime in terms of income. Therefore, it is only right that they should share some of the cost. It is also designed to set higher education institutions free. Finally, specifically, it is designed to get more disadvantaged students into higher education. It was on that basis that the Liberal Democrats went through an incredible amount of political pain to support the reforms of the coalition Government; it is exactly the same reason why the Labour Government introduced the reforms that they did in the late 1990s and early 2000s, introducing whatever you want to call it—an income-contingent tax liability, or a loan system. What it amounts to is a time-limited graduate tax, which is, I think, all the rage at the moment on the other Benches.

It is important to remember the remarkable benefits that these changes have brought about. We have a record number of students—a 3.1% increase in the number of people entering UK higher education in 2015—and more students from disadvantaged backgrounds. The proportion of English students from disadvantaged backgrounds is up from 13.6% in 2009 to 18.5% in 2015. Part-time students studying for their first degree also get student loans now, and graduate contributions have become more affordable. By sharing out the burden more broadly, graduates now have to earn £21,000 before they start to pay back.

It is also worth thinking that we have the opportunity to compare what would happen if we went back to the old system, because it is running in Scotland. In Scotland there are no fees, yet the poorest fifth of Scots are three and a half times less likely to go to university than the best-off, and that figure is two and a half times in England—it has improved. There is also less financial support available in Scotland, precisely

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because the taxpayer has to share the entire burden. So the opportunity for the poorest young people has increased, and would restricted by plans to scrap fees. Specifically, these reforms have had a benefit for disadvantaged pupils. The maintenance loan has risen, as my noble friend Lady Shephard, said; there is much more support than was there before. Also, under the access agreements that universities now have, they are planning to spend £719 million in 2015-16, up from £407 million in 2011-12. So, overall, the amount of support for disadvantaged students and the number of students who are studying is increasing.

The final point to bear in mind here, which is critical, is that, as a result of sharing the burden more broadly, we have more students going to university, which is an ambition shared by everybody, throughout the House. An estimated 60,000 more young people are going to university every year because of these reforms. It is important to see these reforms in the round; if you do so, it is difficult to argue that they have done anything other than increase participation and, in particular, increase participation for disadvantaged young people.

Baroness Sharp of Guildford (LD): I join others in thanking the noble Lord, Lord Stevenson, for bringing this Motion of Regret before the House—and I join others in supporting it. I do so because it is very clear from the analysis by the Institute for Fiscal Studies and others that this move will impact more heavily on students from poorer families who, up till now, have received substantial maintenance grants to help off-set the considerable debts that they incur from the cumulative effect on tuition fees over three years. As my noble friend Lady Garden said, that amounts to something like £43,000 at the moment. The result of this would be to raise that debt by some £17,000, up towards £60,000.

The numbers involved in this are not trivial. In 2014-15, 42% of students in this country got a full grant, while 14% got partial grants. More than 50% of students currently benefit from the maintenance grant in one form or another; that is approximately 500,000 students—very considerable numbers. As BIS’s own impact assessment makes clear, and as others have mentioned, it will disproportionately affect those such as black and ethnic minority students and women.

Lord Winston (Lab): I am grateful to the noble Baroness for giving way. Could she clarify a point that is puzzling us on these Benches? It has been stated that students undertaking part-time studies can get their grant in full; that is the impression that has been given. Is that correct? I know that she has spent a lot of time discussing part-time students and their remuneration.

Baroness Sharp of Guildford: The answer, I believe, is that until now part-time students have had no maintenance grants. One of the beneficial effects of this—I was going to mention it later—is that it has enabled the Government to extend maintenance grants to part-time students. That is one group of people who will be better off. But is it is noticeable that among the students who will be affected are, as the noble Baroness,

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Lady Kennedy, said, mature students—those who come to university late. They have shown already, by the way they have reacted to the introduction of high tuition fees, that they are much more risk-averse than younger students.

Perhaps I should declare an interest as a member of the all-party Higher Education Commission, which a couple of years ago published a study of the financing of higher education. The evidence that we took included a short survey of quite a number of students and their reactions to this. An interesting fact that emerged from the survey was that the 18 year-olds knew very little about the financial effects of the debts they were taking on. As far as they were concerned, it was all a long way in the future. They felt, as I remember I felt when I was 21 and people were talking to me about pensions, something along the lines of, “I couldn’t care less”. Later on one realises how important these things are.

It became clear that older students, on the other hand, are worried about taking on further debt. Many of them already have mortgages and children, and are trying to manage their costs. They are much more worried about taking on debt than younger people are. That was one reason why, among mature students, who are disproportionately also part-time students, there has been an enormous drop in numbers. There has been a 45% drop in the number of part-time students since the introduction of tuition fees.

I feel strongly about all these issues. I accept that under the present repayment terms the actual amount repaid will remain at 9% on all income over £21,000 each year. The only difference is that those from lower-income households will have bigger debts, which for many of them will remain for 30 years. The Institute for Fiscal Studies reckoned that under the old system, before the introduction of these new measures, 73% of student loans would never be fully repaid. The measures before us will mean that more students from lower-paid households—these are the students who tend to go into lower-paid jobs—will have bigger debts, and that proportion can only increase.

As the noble Lord, Lord Stevenson, pointed out, there is a certain amount of creative accounting which enables the Government to take some £2 billion off the books today, with the idea that it will be picked up 30 years hence, in never-never land. There are only two good things about this. First, it has enabled the Government not to cut the adult education budget in money terms. I was very pleased about that. Secondly, it has enabled them to put some funding into maintenance grants for part-time students.

But I am particularly sorry to see this measure involving maintenance loans, because the previous system, along with the national student scholarship scheme and all the fair access measures taken in 2012, was part of the compact between the coalition partners on the introduction of full-cost tuition fees. My former leader in the other place, the right honourable Nick Clegg, went to considerable trouble to ensure that the introduction of fees would not impact more toughly on students from lower-income backgrounds. This measure seems to me to be yet another cynical unwinding of the coalition agreements.

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What were very carefully balanced measures to promote equity are now being cast aside with remarkably little thought.

Lord Berkeley of Knighton (CB): My Lords, may I make a point, not as an expert on the figures—we have heard from them in various parts of the House—but to suggest that the Government might be walking into a false economy here? I say this as someone who, as a broadcaster, has talked to artists, musicians, novelists and other people who have made the creative economy glow—a glow in which the Government frequently feel able to bask. Many of those people who came from very impoverished backgrounds feel that they owe their success, their chance in life, to the support they got at a moment when they needed a maintenance grant.

I will not bore your Lordships with lots of names, but I could reel off pop stars, painters, novelists—you name it—who, had it not been for this support, might not have been able to make the contribution to our creative economy that they have. We should tread very carefully in cutting off funds to that section of our community.

Lord Winston: My Lords, I declare an interest as a paid employee of Imperial College London, which is a Russell Group university, and as chairman of the Royal College of Music and chancellor of Sheffield Hallam University in Yorkshire. I am sure that the noble Baroness understands that these are very different higher educational institutions and that they will all be seriously worried about this measure. One issue is that this seems to have been slipped under the wire without proper discussion in the House of Commons and has now come to be debated only as a result of my noble friend’s excellent Motion of regret. A key issue here is the debate on higher education altogether. I fervently hope that the Minister will do something to ensure that there is a proper debate about the Green Paper that is currently being processed, because a number of measures in there are very serious.

I will not detain the House for long, because I have not prepared a speech, and I do not intend to prepare speeches. But I must tell the Minister that I remember vividly a graduation ceremony at Sheffield Hallam University when a 55 year-old, rather ageing-looking man came up to me with tears running down his cheeks and told me, “This university has completely changed my life”. This is not just an isolated example; it happens every day in Sheffield.

8.15 pm

Since I started as chancellor 12 years ago, Sheffield’s economy has been transformed in a remarkable way by people who would never have gone to university, from families who had no idea about university, who desperately need every bit of support they can get to get there. This has made a massive difference to the economy of Sheffield. The moment you get off the train at Sheffield station and walk up towards the university, you can see what has happened in that city, which was deeply depressed after the loss of steel, coal, cutlery, and much of the engineering that went on in that city.

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That transformation has been very much a result of Sheffield Hallam University and its relationship with that community.

But the fact of the matter is that these measures will affect “rich” Imperial College as well. To live in South Kensington will cost those less well-off students a great sum of money. As a result we will undoubtedly lose students, who will decide not to apply even though they are good enough to do engineering at one of the best universities in the world; bear in mind that so many of our universities are in the top 10 in the world. We must do everything we can to nurture them. As regards the Royal College of Music, there is no question that many of our musicians will always be desperately underpaid, rather poor, and will often come from underprivileged families, and it is very important that that get every bit of support that they can.

I regret that we have to discuss this now. I have to say to the noble Baroness, Lady Shephard, who was rightly regarded as an outstanding Secretary of State, that that change in the applications to many universities is happening now. Indeed, at Sheffield Hallam we are beginning to see that fewer students are applying. This is not unusual in many of the newer universities, and it may of course apply certainly to home students in some of our universities such as those in the Russell Group. So I urge the Government to think again and press them to have a proper debate on the future of higher education in the near future.

Lord Howarth of Newport (Lab): My Lords, this policy of removing maintenance grants and replacing them with loans, whichever way you look at it, is reckless. It is reckless fiscally. In the early 1990s, I was Higher Education Minister when the Government of that time introduced the original system of maintenance loans for students in higher education, but we did so on a very carefully circumscribed basis. Looking across the Atlantic to the United States of America, where there was a very extensive system of student loans, we saw how unhappy were the consequences, both financially and in human terms. That approach, taken by that Conservative Government, was reasonable and responsible and is in strong contrast to the approach now being taken by this Conservative Government. The Institute for Fiscal Studies has explained to us how the policy we are now debating is a device to enable the Chancellor to achieve a modest additional reduction in his deficit by 2020—political window-dressing for him, but the price that will be paid is a much more significant increase in national indebtedness in years after that.

It is reckless financially: the Government are quite deliberately proposing to create bad loans. It would appear that their business model is that of the purveyors of sub-prime mortgages; the fact that they admit it does not make it any better. They intend to dump a poor-quality loan book on the financial system in the future. That is cynical. We expect a Government to act with prudence and integrity in such matters.

It is reckless in terms of the life chances of people who come from disadvantaged communities, in contradiction to the Prime Minister’s professions. This policy will be socially regressive: Ministers are setting out to tempt with additional cash in hand people who come from lower-income households, knowing

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very well that such people will leave university with larger debts than their peers from better-off households.

As the Minister who also introduced the disabled students’ allowance, I feel particularly strongly about the accompanying policy to freeze that allowance. In their equality impact assessment, the Government admit that this policy will bear disproportionately on disabled people, although they say that it will not do them that much harm. However, if you are disabled, a little goes a long way, and I would add that such a policy is surely discriminatory. The whole purpose of the disabled students’ allowance was to enable disabled people to experience higher education on a basis equal with non-disabled people, so it cannot be right to freeze the allowance for disabled students, who are increasingly disadvantaged.

Those who resist the cash bait will probably do so because they are deterred by the prospect of taking on a substantial additional personal debt. That is extraordinarily retrograde when we know that our economy urgently needs a higher level of skills across wider sections of the population so that we stand a chance of improving our national productivity and competitiveness. The noble Baroness, Lady Deech, made an important point about the retrogressive effect of confining to studying close to home students from poorer households who do not want the debt, thus making them unable, unlike their counterparts from better-off households, to avail themselves of the full range of opportunity in higher education.

The policy is contrary to the whole ethos and principle of the welfare state, which is to redistribute resources and opportunity across the lifespan, so that people contribute when they are able to do so but, when they need support, they get it in health, social security and education—precisely the support that this measure is going to reduce. That is part of the principle of fairness. That principle of the welfare state is what binds us together as a society and, as my noble friend Lady Kennedy said, it is shaming that the Government neglect such a principle.

The policy is reckless in terms of intergenerational fairness. The Government are intending to ask our children and our grandchildren to pick up the tab for it. They should not behave like that—it is a betrayal of the generations to come.

The policy is reckless, too, in terms of truth. The Conservative Party did not tell voters in its manifesto at the election last year that it intended to introduce this change. That was cowardly. In this measure the Conservatives are reneging on the commitments made by David Willetts, now the noble Lord, Lord Willetts, to Parliament in 2012—in good faith, I am absolutely certain. He assured Parliament that any financial hardships that might be created by the trebling of tuition fees would be mitigated by the continuing availability of maintenance grants. However, the Government are dishonouring that commitment and, in doing so, they are acting to the detriment of trust in government and respect for politicians.

The policy is also reckless constitutionally. Here they go again, introducing major change affecting a large number of people, with major expenditure

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implications, by way of a statutory instrument. That is in defiance of the conventions of Parliament. It is an abuse. The noble Lord, Lord Strathclyde, in the report of his review urged the Government not to leave too much in legislation to be provided for by way of statutory instruments. We know that the negative resolution procedure makes accountability of the Executive to Parliament almost non-existent, and we know—the noble Lord, Lord Strathclyde, has said this too—that the whole system of parliamentary scrutiny of statutory instruments needs to be overhauled.

Your Lordships’ House is, in one of its most important functions, a guardian of the constitution. We have not voted down this particular statutory instrument but I believe that, had we done so, we would have been well within our rights, because it is for us, again and again, to prevent as well as we can abuse of power by the Executive. The House of Commons, dominated by the Executive, will never do that reliably; we, at least, have to accept that that is part of our responsibility. The noble Baroness, when she seeks to defend this policy at the Dispatch Box, should blush.

Baroness Evans of Bowes Park (Con): My Lords, I thank all noble Lords for their contributions to this debate. Let me briefly address the points raised about the parliamentary process for scrutinising statutory instruments before I come on to the substance of the debate.

The regulations were laid before both Houses on 2 December 2015 and were made under powers granted by the Teaching and Higher Education Act 1998. The instrument was prayed against in the other place and a debate took place in committee on 14 January, which was followed by a full opposition day debate on 19 January. So this SI has followed the procedure agreed by Parliament. But of course, as ever, we have had a further extremely valuable debate in your Lordships’ House today.

Let me start by placing this instrument in the context of the Government’s higher education policy. As noble Lords have said, we have a higher education system to be proud of and a worldwide reputation for excellence, with three universities in the world’s top 10 and the most productive research base in the G7. We have lifted the cap on student numbers, putting into practice Lord Robbins’s famous principle that university places,

“should be available for all those who are qualified by ability and attainment”.

We have seen record numbers entering higher education, including record numbers of students from disadvantaged backgrounds, as my noble friends Lady Shephard and Lord O’Shaughnessy highlighted. The OECD has said that England is,

“one of the few countries to have figured out a sustainable approach to higher education finance”.

When Lord Robbins set out his principle in the early 1960s, participation in higher education was around 5%. That figure is now approaching 50%, something that we should be proud of. However, in this context of rapidly growing student numbers, funding universities sustainably can be achieved only by asking students to meet a greater part of the cost of their education, paid not upfront but out of their future

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earnings. This reflects the principle that, if you benefit from higher education and secure higher lifetime earnings than taxpayers who do not go to university, you should contribute to the cost of your education. It is vital to the continuing success of the sector that the cost of higher education is sustainable for government and the taxpayer, so that more young people can undertake the transformational experience of going to university. In short, we cannot have social mobility without sustainability.

Offering increased loans for living costs instead of grants allows the Government to make significant progress against their fiscal mandate but offers more upfront support to students for their living costs: up to 10.3%, or £766, more additional support in 2016-17 for eligible students—money that they will then have to spend during their time at university on, for instance, rent and all the other things your Lordships have mentioned.

Noble Lords have referred to the equality analysis that the Government have published, and a number of issues it covers have been raised in the debate, in particular in relation to the potential impact on disadvantaged groups and those with protected characteristics. The Government carefully considered these before laying this instrument. That is why, alongside the potential risks that the equality analysis identified, a number of mitigating factors were also outlined, including, as I mentioned, the increase in living cost support in 2016-17 for students from some of the most disadvantaged backgrounds, the fact that graduates do not have to pay anything back until they earn over £21,000 and, of course, the fact that graduates earn considerably more over their lifetime.

This is far from all that the Government are doing to ensure the widest possible access to higher education. The Prime Minister has set out his ambition of doubling the proportion of people from disadvantaged backgrounds entering higher education and increasing the number of BME students at university by 20% by 2020. The sector is our partner in achieving these goals. In response to a request from the Government, Universities UK has set up a social mobility advisory group to report to the Universities Minister. It will provide advice and action to widen access to higher education, including on meeting the Prime Minister’s ambitions. I have absolutely no doubt that it will keep a very close eye on the broad effects of government policy in this area. To back this up, in 2016-17 universities expect to spend £745 million on measures to support the success of disadvantaged students. That is up significantly from £444 million in 2011-12.

Any higher education provider who wishes to charge above £6,000 for a full-time course must agree an access agreement with the Director of Fair Access and as part of this agreement the institution must devote a proportion of the fee income above £6,000—typically around 25%—on measures to support widening access and support for disadvantaged students.

8.30 pm

We certainly do not want to see the kind of academic segregation about which the noble Baroness, Lady Deech, expressed concern, and that is why we and universities are focusing on a variety of measures,

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particularly outreach into schools. For instance, students of Northumbria University and Newcastle University are working in school programmes in which undergraduates work as tutors in schools, raising aspiration and attainment among the students they engage with. The University of Nottingham devotes access money to mature students, offering them mentors in order to improve their chances of completing their courses.

The noble Lord, Lord Stevenson, asked about changes to NHS bursaries. The current system for funding health students was not working. Last year, the cap on applications meant that we had to reject 37,000 applications from people who wanted to study nursing. By introducing loans, we can scrap that cap and train up to 10,000 more nurses as well as increasing the up-front support these students receive.

On the question of sharia finance, the noble Lord rightly said that the coalition Government was the first to seriously explore a sharia-compliant student finance product. The Government have consulted and, upon reviewing the consultation responses, the Government supported the introduction of sharia-compliant “takaful” alternative finance product available to everyone. Our commitment was reaffirmed in the Green Paper, but we need primary legislation and we are actively looking at an appropriate vehicle through which to bring this forward.

I will also deal with the questions on the value of savings of this proposal which a number of noble Lords have mentioned, including the noble Lord, Lord Stevenson, and the noble Baronesses, Lady Garden and Lady Sharp, among others. The switch from maintenance grants to loans will save £2.5 billion per year from the fiscal deficit. This is a substantial contribution towards delivering on the Government’s fiscal mandate. However, of course, I acknowledge that a proportion of the loan outlay may not be repaid by students. Therefore, we forecast that the long-term annual economic savings will be around £800 million a year.

A number of noble Lords mentioned the Institute for Fiscal Studies research, which last summer estimated the long-term annual savings to be around £270 million. At that time the IFS was working on the information it had available, but the Treasury’s estimate of the Government’s cost of borrowing has fallen since then, which is why we now estimate that these savings will be more like £800 million a year.

This Government offer young people more than one high-quality route to a successful future. Higher education can be a life-changing experience but so, too, can an apprenticeship. That is why the Government are committed to seeing 3 million apprenticeship starts in England by 2020.

We are also committed to enabling access to higher learning by other routes. For instance, we have announced for the first time—to make this clear to the noble Lord, Lord Winston—that we will be introducing maintenance loans for part-time students, and the recent changes allowing access to government support for part-time study towards a second degree in some STEM subjects will be extended further. It has also been confirmed that from September this year students aged up to 60 undertaking postgraduate masters would be able to access government loans for the first time.

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The Government are able to make these changes because they are ensuring that higher education is funded sustainably. That is what this instrument helps to achieve. I hope I have addressed all the points raised by noble Lords in the debate and that the noble Lord, Lord Stevenson, will be sufficiently reassured to withdraw the Motion.

8.33 pm

Lord Stevenson of Balmacara: I can answer that—no—but I would like to take a little longer.

I apologise to the noble Lord, Lord Willetts, for not spotting him in his place when I started my speech. He must have slipped in. Two brains are obviously much easier to hide than one. I am sorry that he was not there. We have had Hamlet without the prince. Where is the speech? Surely the architect of this wonderful policy, as we have heard it described, should have been there shouting from the rafters. Can I encourage him to rise? No.

We have had a good debate and I thank all those who have contributed. It could allow us to look forward to further discussions on higher education and, if it does so, allow us to probe some of the assertions of the noble Lord, Lord O’Shaughnessy, that somehow the garden is blooming, roses are flowering everywhere and higher education is in a good state. It certainly is not. It is time that we got some real discussion and debate going on this.