Work and Pensions Questions

13th November 2017

David Gauke answers MPs’ questions to the Department for Work and Pensions.

Universal Credit: Advance Payments

2. Whether he has made an assessment of the potential merits of reducing the repayment rate on advance payments of universal credit. [901833]

Advances are interest free and repayable over six months for those making a new claim, or 12 months for those who were on benefits before claiming universal credit. Our objective is to strike the right balance between supporting claimants with their living expenses and ensuring they have the ability to repay the advance.

The Secretary of State knows that the guidance states that 40% of the standard allowance can be used to repay an advanced payment, and that 40% can be deducted to pay back creditors. It is not clear from the guidance whether a claimant might end up paying both, meaning that they will have more than 40% deducted from their award. Will the Secretary of State clarify the maximum amount repayable? Does he recognise that, as it stands, this is a charter for loan sharks?

The deduction from subsequent payments that take into account an advance does not apply to the 40%. We have to remember that it is an advance. An advance gives people greater flexibility to access universal credit early, so they are able to cope during the initial assessment period.

We hear a lot from Opposition Members about universal credit, but we have to remember that it is a much more effective system at getting people into work. Nationally, 113 people move into work under universal credit for every 100 under the previous system. My constituency, which was a pathfinder for universal credit, is seeing very substantial falls in the number of people claiming. Is it not a better system all together?

My hon. Friend is absolutely right. Universal credit is helping people to get into work and to progress in work. It is also clear that people on universal credit are spending more time looking for work than those on legacy benefits. It is really important that we all work to ensure the success of universal credit. We believe it will result in 250,000 more jobs—something worth achieving.

What the Secretary of State has repeated again this afternoon falls into the trap of treating everyone on universal credit as if they were out of work. Surely one big issue is the problem of applying conditionality to people who already have jobs?

The point about universal credit is that it operates when people are out of work and when they are in work. What we will not get is what happens with the legacy system: people worrying about working extra hours in case they find that their claim is closed. That holds people back from progressing. I believe that in-work conditionality has a role to play within our system to ensure that people progress. There is an issue in terms of people who are in work but are none the less receiving substantial support from the taxpayer. We want them to be able to progress to be less dependent on the state. That is what universal credit will deliver.

What steps has the Secretary of State taken to increase awareness of advance payments?

We have changed the guidance that applies in jobcentres on advanced payments and increased publicity in jobcentres. I visited a jobcentre in Bedford and saw myself how the operation of advances is working. We believe there will be an increase in take-up, which will ensure that people receive the support they need. The suggestion that people under universal credit will face weeks and weeks and weeks without any financial support whatever is, I am afraid, scaremongering. That is what is happening under the system as it is operating now.

Yesterday, the Scottish Finance Secretary, Derek Mackay, wrote to the Chancellor ahead of his Budget appealing for universal credit to be fixed, and today 114 academics published an open letter in The Daily Telegraph criticising the advanced payments system and echoing Derek Mackay’s call to reduce the first payment wait time, move to a twice-monthly payment system and reverse cuts to work allowances. Does the Secretary of State agree that the Chancellor should act?

On universal credit and early payments, of course the Scottish Government have flexibility, which they are exercising, but that means that at the end of the second assessment period people get only 50% of what they are entitled to, the rest being deferred and paid in the third assessment period, which strikes me as making the situation more difficult, not easier, for claimants, although it is for Scotland to decide how it wants to do it.

If the Secretary of State is looking for the Scottish Government to show him how it is done, he should devolve universal credit in full, and we will get on with it. Has he seen the report from the Child Poverty Action Group and the Institute for Public Policy Research saying that cuts to universal credit will leave an extra 1 million children in poverty? Is 1 million more children in poverty not evidence enough for the UK Government to reverse their cuts to work allowances and make work pay?

My point was that the Scottish Government are delivering universal credit differently and in a way that I think is worse than the situation in England and Wales. The point about universal credit is that it will help people into work. I will give one brief example: I heard of an account last week of a single mother on income support not previously able to claim for her childcare costs but now able to do so under universal credit. She is taking up a job, working eight or nine hours a week, which she could not do previously—a first step on the ladder. That is an example of what universal credit is delivering.

A recent report by the Resolution Foundation using new data based on bank transactions shows that 58%—the majority—of new claimants moving on to universal credit as a result of leaving employment in the last year were paid either fortnightly or weekly in their previous job, which is a far higher percentage than in the economy on average, where about one in four of all jobs is paid fortnightly or weekly. The Government should ensure that no claimant has to wait more than 10 days, so will they end the six-week wait and ensure that universal credit mirrors the world of work for those who claim it?

Universal credit is replacing tax credits, and under tax credits 57% of claimants are paid monthly and 12% four-weekly—nearly 70%—so if we are to have a system that works for everybody, it has to be a monthly system.

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Contracted-out Health Assessments

3. What recent assessment he has made of the (a) accuracy and (b) efficiency of contracted-out health assessments for employment and support allowance and personal independence payments. [901834]

We are committed to ensuring that claimants receive high-quality, fair and accurate assessments. The DWP monitors assessment quality closely through independent audit. Assessment reports deemed unacceptable are returned for reworking. A range of measures, including provider improvement plans, address performance falling below expected standards. The DWP continually looks to improve the assessment process.

My constituency office is inundated with people dissatisfied and distressed after their personal independence payment assessment. In the light of statistics showing an almost ninefold increase in complaints to the Department, what analysis has been made of the assessment process?

We are of course constantly striving to improve the assessment process. It is worth pointing out that the total number of complaints is about 1% of the total number of PIP assessments, but we continue to work closely with the assessors to ensure that this can be delivered as effectively as possible.

The vast majority of successful appeals are successful because of late additional evidence. What further consideration has been given to sharing data between the two different assessments and to providing for automatic access to health records—where the claimant is willing—in advance of an assessment?

My hon. Friend raises an important point and is absolutely right about the reason for the majority of overturned decisions. We continually look at how to increase co-ordination between the PIP and employment and support allowance assessment processes, and that is certainly something we are considering.

My constituent has a life-limiting illness, and her medical consultant has confirmed that it affects even the most basic daily activities. Without a transplant, she has approximately two to three years left to live. She has just been turned down for a personal independence payment. Will the Secretary of State please undertake to look into the position as a matter of urgency? Will he also confirm that compassionate Conservatism is officially dead?

My answer to the hon. Lady’s first question is that I will, of course, happily look into that case if she will provide me with the details.

For our constituents a health assessment is an incredibly important moment, and it can be very distressing. I have been calling for routine recording of assessments, to provide evidence if they go wrong and also because recording in itself should sometimes change behaviour for the better. Will my right hon. Friend give me an update on the recording pilots?

We are indeed looking into that. My hon. Friend has made an important point about the need for independent auditing of assessments to ensure that the advice provided by the decision-makers is of suitable quality, fully explained and justified, and recording is one of various options that we are considering to bring about those improvements.

Let me start by welcoming the Minister for Disabled People, Health and Work, the hon. Member for Truro and Falmouth (Sarah Newton), to her place.

There has been a 900% increase in the number of complaints about personal independence payment assessments. Statistics from HM Courts & Tribunals Service show that both the number of appeals lodged and the proportion of DWP decisions overturned have increased. There was a 67% increase in the number of appeals in the first quarter of 2017 in comparison with the same period last year. Just last week, Britain’s most senior tribunal judge said that most of the benefit cases that reach the courts are based on bad decisions when the DWP has no case at all. The quality of evidence—

Order. We need a question mark very soon. Forgive me, but the hon. Lady’s text does seem extensive. I know that she is new to the Front Bench, and I am listening to her with interest and respect, but we must proceed speedily, because otherwise Back Benchers lose out. I know that she is coming to a question in her next sentence.

I certainly am, Mr Speaker. What action is the Secretary of State taking to improve the PIP assessment framework, the accuracy of decision-making and the standards of mandatory reconsiderations, and will he stop wasting taxpayers’ money on unnecessary and lengthy tribunal appeals?

Let me put the position in context. Since personal independence payments were introduced in 2013, the DWP has carried out more than 2.6 million assessments. As I said earlier, the total number of complaints received equates to fewer than 1% of all assessments. Our latest research shows that 76% of PIP claimants are satisfied with their overall experience. Of those 2.6 million decisions, 8% have been appealed against, 4% successfully. Of course, we constantly strive to improve the PIP system, but, as I have said, it should be seen in context.

Last week I was able to spend a day at the Alloa jobcentre in my constituency and observe what is going well and what is going not so well with some of our welfare reforms, including universal credit and PIP. One issue that arose was the length of time that people are waiting for health and work capability assessments. What penalties are being levied against some of the third-party companies that are involved in the assessments, and what could be done to close the gap for our constituents?

The timing of both ESA or PIP assessments has improved in recent months: the waiting time has been reduced. I welcome that, but we continue to work closely with the providers of the assessments to ensure that their performance is adequate.

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Universal Credit: Food Poverty

5. If he will make an assessment of the effect of the length of waiting time to receive universal credit on levels of food poverty. [901836]

The availability of advances at the start of a universal credit claim ensures that those who need money immediately can access it. Our data shows that around half of claimants are receiving advances, and we have recently undertaken an exercise to improve awareness and access to this support.

The manager of a food bank in Lincoln has said that there is evidence of a clear correlation locally between the introduction of universal credit—in Lincoln, we have only had it partially so far; we are getting full roll-out in March—and an increase in the use of food banks. I ask for your comments on that, and do Government Members, including yourself, think it is acceptable that people in Lincoln and across this country are starving but for food banks because of waiting for universal credit payments.

I would not presume to say what is acceptable for the people of Lincoln—that is way above my pay grade—but the Secretary of State might wish to proffer an opinion on the matter, and we look forward to it with interest and anticipation.

This is why I repeatedly make the point that nobody needs to wait a long period of time for cash support under the universal credit system, and to suggest otherwise is causing unnecessary anxiety for those who are not on universal credit—and I think we should all discuss this in a slightly more responsible manner.

When I visited Newark’s jobcentre a week or so ago, I found that 80% of the jobs on offer were paid either four-weekly or monthly. Does the Secretary of State agree that we have to be careful not to patronise working people and not to prevent them from entering the workplace with as much ease as possible? The vast majority of jobs in my constituency are paid monthly.

My hon. Friend is absolutely right. Part of the purpose of universal credit is to close the gap between being out of work and being in work. Most jobs are paid monthly, and getting people used to that monthly system is a sensible approach. I also very much welcome the fact that my hon. Friend has visited a jobcentre, and I recommend that other hon. Members do so, to hear how universal credit is operating on the ground. I know that many hon. Members have found the experience to be extremely positive.

I will not ask Government Front Benchers for a fifth time whether I should believe the Secretary of State’s statement that the roll-out of universal credit in Birkenhead will be hunky-dory, or the opinion of the food bank, which says that it will need an extra 10 tonnes of food to prevent people from going hungry—if he cannot abide the word “starving”. We will have a debate on this on Thursday, which Members across the House have signed up to. This will be the first time that Conservative Members will have an opportunity to vote on whether they want to reform universal credit. Will the Secretary of State open that debate, hear it and take the message directly back to Cabinet, please?

The position that we have made clear for a long time is that we want to ensure that universal credit works. This is a test-and-learn system, and we are always looking at ways in which we can improve it, particularly for that first period. I would say to the right hon. Gentleman and to the House as a whole that universal credit is helping us to address the best way to deal with poverty, which is to ensure that people can get into work. That is the argument that I and my right hon. and hon. Friends will continue to make.

I, too, have visited jobcentres, and I know that work coaches are an integral part of the universal credit system. Will my right hon. Friend tell me how the new work coaches will assist jobseekers in my constituency in their eager quest to find employment?

My hon. Friend is absolutely right. This is why we are recruiting work coaches up and down the United Kingdom to provide the personalised support that people need to help them get into work. I come back to my experience of meeting work coaches in jobcentres up and down the country. They believe that they have a system in place that is helping them to do more to transform lives, and that is hugely important.

One of the original objectives of universal credit was to reduce child poverty. In 2010, the Government said that UC would reduce child poverty by 350,000. That figure was revised to 150,000 in 2013, but last year, Ministers failed to produce a figure in answer to a question from my hon. Friend the Member for West Ham (Lyn Brown). What is the Government’s current estimate of how many children will be lifted out of poverty as a result of universal credit?

Universal credit gives people a better opportunity to work, and it gives parents, including single parents, greater support with childcare. I come back to the example I gave the House a moment ago. Someone who had previously been on income support and unable to get help with childcare can now get that help and get on to the employment ladder, thanks to universal credit. That is what universal credit is delivering.

That was a really disappointing answer. As we have already heard, the Child Poverty Action Group published data last week predicting that 1 million more children will be pushed into poverty as a result of universal credit cuts, 300,000 of whom will be under the age of five. Another objective of universal credit was always to make work pay. Given that four out of 10 people on UC are in work and will be on average £2,600 a year worse off, when will the Government admit that UC is not fit for purpose or fit to meet the challenges of a new labour market and stop its roll-out?

May I just point out that child poverty is down since 2010? I think the hon. Lady has rather given the game away: she does not want to pause and fix universal credit; she wants to scrap it. She wants to rewind to a system under which claimants faced marginal deduction rates of over 90% and had to cope with a multitude of benefits. We had a benefits system that was not an aid but an impediment to working people and that trapped people in poverty and dependency. That is what universal credit will bring an end to.

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Universal Credit

10. What steps his Department has taken to ensure that people do not face financial difficulties while waiting for their first universal credit payment. [901844]

Advances are available at the start of a universal credit claim to ensure that those who need it have money to tide them over until their first payment. Our data shows that around half of claimants are receiving advances, and we have recently undertaken an exercise to improve awareness and access to this support.

I thank the Secretary of State for his very reassuring answer. In Banbury, we are fortunate to have very low unemployment rates. Can he tell me what will be the likely impact on jobs of universal credit roll-out in my constituency

In total, it is estimated that universal credit will help around 250,000 more people into employment. On average, that works out at around 400 extra people in work in each parliamentary constituency, but universal credit will, of course, have larger impacts in areas with a higher proportion of benefit claimants or a higher prevalence of single-parent and out-of-work families.

The Trussell Trust says that food bank use has increased in areas where universal credit has been rolled out. Universal credit has not been rolled out yet in my constituency, but this weekend the Heywood food bank ran out of food. What safeguards will the Secretary of State put in place to ensure that universal credit claimants do not have to rely on the charity of their neighbours, a system that sometimes fails?

We are improving the advances system, and we are improving awareness of it. Importantly, support is available, and that is a message that we can all take to our constituents. Nobody needs to wait six weeks because advances are available within jobcentres, and they are being taken up. The majority of new claimants are taking up those advances.

Last week, I heard from one of my constituents who was having difficulty getting an advance payment and who had to resort to a food bank. When the error was corrected and he got his advance payment, he took the food back to the food bank. First, does that not show that, when mistakes are made, every effort is made to correct them? Secondly, does it not show the basic human decency of those claiming universal credit?

I entirely agree with the point my hon. Friend makes. It is worth pointing out that, in the normal course of events, someone’s advance takes about three days to go through the banking system and for the money to be paid, but that, if need be, people can get support on the same day.

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Job Creation

13. What estimate he has made of the number of jobs created since 2010. [901848]

Since 2010, more than 3 million more people have found employment. The employment rate is close to the record high, while the unemployment rate is the lowest it has been since 1975.

In addition to those almost record employment levels, 11% of people in Cheadle are self-employed. My constituent Alexandra Singer is a self-employed wheelchair user who finds that valuable opportunities to attend networking events are lost because they are not always accessible for disabled people. Does the Minister agree that to unlock the talent and energy of disabled entrepreneurs, organisers must make provision for successful businessmen and women, such as Alexandra Singer, to attend their events?

I agree with my hon. Friend on that. It is right that service providers have a duty to anticipate these things and provide adjustments, where reasonable, for disabled people. In the case of her constituent, this may include arranging events at an accessible venue. It is also worth pointing out that one in five of those taking up the new enterprise allowance, which is designed to help people set up businesses, are disabled people.

Every new job is welcome, but we have a country where 55% of people new into work are in receipt of benefits and living in poverty and where the better-off are now disgustingly well-paid. What are the Government really going to do about this?

Of course the highest earning 1% pay a bigger proportion of income tax than they ever have done before. I am also pleased to say that our Government have substantially increased the personal allowance; we have introduced the national living wage; and the support that universal credit is going to provide will help more and more people progress in work.

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David holds regular surgeries at various places in the constituency, including Rickmansworth, South Oxhey, Berkhamsted and Tring. 
Forthcoming dates:


22nd June, South Oxhey
6th July, Berkhamsted
20th July, Rickmansworth
2nd August, Tring
13th August, South Oxhey
31st August, Berkhamsted
14th September, Rickmansworth
28th September, Tring
19th October, South Oxhey
26th October, Berkhamsted
9th November, Rickmansworth

Call 01923 771781 to make an appointment.

Record of surgeries

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