PARLIAMENTARY DEBATE
Universal Credit: Court of Appeal Judgment - 25 June 2020 (Commons/Commons Chamber)
Debate Detail
Contributions from Jonathan Reynolds, are highlighted with a yellow border.
Stephen Timms
East Ham
(Urgent Question): To ask the Secretary of State for Work and Pensions if she will make a statement on her Department’s response to the decision of the Court of Appeal of 22 June 2020 in the case Johnson, Woods, Barrett and Stewart v. the Secretary of State for Work and Pensions.
00:02:42
Will Quince
The Parliamentary Under-Secretary of State for Work and Pensions
I can today confirm my Department’s intention not to appeal against the judgment of the Court of Appeal of 22 June 2020 in the case of Johnson, Woods, Barrett and Stewart v. the Secretary of State for Work and Pensions. The judgment relates to an appeal made in January 2019 by the Department against the High Court decision.
As we told the court, identifying claimants is hard; it is a difficult issue. To date, we are aware of around 1,000 claimants who have disputed their earnings and fall within the relevant cohort. We are looking at how we can further identify people in this group. I stress that many people affected by two salary payments will not suffer a financial loss, as their universal credit award will increase in the following month to balance the reduction. However, we do recognise the budgeting issues that may have been caused, and we are now assessing the remedial options. That is not straightforward—it is not the simple click of a switch—particularly at a time when the Department is focused on meeting the challenges of unprecedented demand for its services.
I hope Members will appreciate that as the judgment was passed down on Monday, it would be remiss not to afford more consideration before we press on, particularly when the Court has not called for immediate action. We will now begin the process of carefully considering possible solutions, and we will keep the House updated as progress is made. There are, however, immediate actions that can be taken. We are already working closely with Her Majesty’s Revenue and Customs to work with employers on how to report their employees’ earnings correctly. HMRC has issued updated guidance for employers which, if followed correctly, will further reduce the small numbers affected.
As we told the court, identifying claimants is hard; it is a difficult issue. To date, we are aware of around 1,000 claimants who have disputed their earnings and fall within the relevant cohort. We are looking at how we can further identify people in this group. I stress that many people affected by two salary payments will not suffer a financial loss, as their universal credit award will increase in the following month to balance the reduction. However, we do recognise the budgeting issues that may have been caused, and we are now assessing the remedial options. That is not straightforward—it is not the simple click of a switch—particularly at a time when the Department is focused on meeting the challenges of unprecedented demand for its services.
I hope Members will appreciate that as the judgment was passed down on Monday, it would be remiss not to afford more consideration before we press on, particularly when the Court has not called for immediate action. We will now begin the process of carefully considering possible solutions, and we will keep the House updated as progress is made. There are, however, immediate actions that can be taken. We are already working closely with Her Majesty’s Revenue and Customs to work with employers on how to report their employees’ earnings correctly. HMRC has issued updated guidance for employers which, if followed correctly, will further reduce the small numbers affected.
00:03:56
Stephen Timms
Thank you very much, Mr Speaker, for granting this urgent question.
If a universal credit claimant is in work and is paid monthly, but those monthly payments do not align precisely with universal credit months—for example, if the claimant works for the NHS and gets paid on the last day of every month—that claimant will, from time to time, be paid twice in a single universal credit month. The universal credit computer system treats that claimant as if they had had a 100% pay rise; their benefit is cut, quite likely to zero; they have to reapply for the benefit; and their income is severely disrupted.
One of those involved in this case says that she was more financially stable out of work than in work. Another turned down an NHS job for which she was expertly qualified because she knew that universal credit would wreck her finances. Surely, nobody will dispute the view of the Appeal Court that the policy is “irrational”. I am grateful that the Minister has accepted the inevitable and is not going to be paying out for even more expensive lawyers to appeal the case. Surely the Department should have given up the fight last year, not waited until the Appeal Court reached this conclusion.
May I ask the Minister to tell us more about how many people are affected? I think the Court heard figures of around 80,000. It is a very significant problem for a lot of claimants. In his keeping the House updated—I am grateful to him for his assurance on that—will he tell us much more about the numbers who are affected, and will he fix the universal credit computer system as soon as possible?
If a universal credit claimant is in work and is paid monthly, but those monthly payments do not align precisely with universal credit months—for example, if the claimant works for the NHS and gets paid on the last day of every month—that claimant will, from time to time, be paid twice in a single universal credit month. The universal credit computer system treats that claimant as if they had had a 100% pay rise; their benefit is cut, quite likely to zero; they have to reapply for the benefit; and their income is severely disrupted.
One of those involved in this case says that she was more financially stable out of work than in work. Another turned down an NHS job for which she was expertly qualified because she knew that universal credit would wreck her finances. Surely, nobody will dispute the view of the Appeal Court that the policy is “irrational”. I am grateful that the Minister has accepted the inevitable and is not going to be paying out for even more expensive lawyers to appeal the case. Surely the Department should have given up the fight last year, not waited until the Appeal Court reached this conclusion.
May I ask the Minister to tell us more about how many people are affected? I think the Court heard figures of around 80,000. It is a very significant problem for a lot of claimants. In his keeping the House updated—I am grateful to him for his assurance on that—will he tell us much more about the numbers who are affected, and will he fix the universal credit computer system as soon as possible?
00:01:53
Will Quince
I thank the right hon. Gentleman for his question and the constructive way in which he has put it. I will, of course, keep him updated as the Chairman of the Work and Pensions Committee as our work in this area progresses.
The case was before my time as a Minister, but several legal points were considered, and it was on only one of those points that the Department lost. We face and recognise the decision of the Court, and we recognise that some people may face budgeting difficulties. That is why we are working as quickly as we possibly can to identify the solutions and to address the matter in line with the court order.
The scope of this case is limited and we believe the cohort, as I briefly mentioned, to be in the region of 1,500, but I am looking to identify that claimant cohort very carefully. I understand that fewer than 1,000 UC claimants have notified us over the past 18 months that they may be affected by this, and it is important to keep that in the context of the 5.2 million claimants to universal credit.
The case was before my time as a Minister, but several legal points were considered, and it was on only one of those points that the Department lost. We face and recognise the decision of the Court, and we recognise that some people may face budgeting difficulties. That is why we are working as quickly as we possibly can to identify the solutions and to address the matter in line with the court order.
The scope of this case is limited and we believe the cohort, as I briefly mentioned, to be in the region of 1,500, but I am looking to identify that claimant cohort very carefully. I understand that fewer than 1,000 UC claimants have notified us over the past 18 months that they may be affected by this, and it is important to keep that in the context of the 5.2 million claimants to universal credit.
00:01:53
Mr Mark Harper
Forest of Dean
I welcome the Government’s decision to deal with this issue and not pursue a further appeal, but, having been in his position as the Commons Minister responsible for universal credit in the past, I do not underestimate how complicated it is to put in place a fix. As the Minister does so, he should reflect that we should remain clear about the central purpose of universal credit, which is ensuring that everyone is better off in work, and on the fact that it has very flexibly dealt with the huge increase of claimants as a result of covid-19 and will no doubt face challenges later this year.
My specific question is this: we only have a few weeks now until the House rises for the summer, and the Minister may not be able to solve the problem before then, but will he at least update the House before we rise, to set out what further steps he is going to take?
My specific question is this: we only have a few weeks now until the House rises for the summer, and the Minister may not be able to solve the problem before then, but will he at least update the House before we rise, to set out what further steps he is going to take?
00:02:42
Will Quince
I thank my right hon. Friend for that question. We received the judgment only on Monday, and it is a complex issue, as he rightly recognised and as I believe was recognised by the Court. The fix will not be a simple one, and we are facing unprecedented pressures on the Department at the moment. I will of course continue to keep the House and the Chair of the Select Committee updated as that work progresses.
My right hon. Friend is right absolutely about the universal credit system; it has not been easy over the course of the past six or so weeks. I must say that our people across the DWP have worked incredibly hard, but the system has also worked exactly as it should have done, with around 90% of claimants consistently paid in full and on time—more than 3.2 million people since 16 March.
My right hon. Friend is right absolutely about the universal credit system; it has not been easy over the course of the past six or so weeks. I must say that our people across the DWP have worked incredibly hard, but the system has also worked exactly as it should have done, with around 90% of claimants consistently paid in full and on time—more than 3.2 million people since 16 March.
00:03:35
Jonathan Reynolds
Stalybridge and Hyde
I add my thanks to my right hon. Friend the Member for East Ham (Stephen Timms) for securing this important question.
This Government are “irrational” and they are “unlawful”. Those are not my words, but those of Lady Justice Rose, who delivered the verdict in this week’s Court of Appeal decision against the Department of Work and Pensions. Reading that decision, there is really only one question to ask: what on earth were Ministers doing fighting this case for so many years, only to be told by the Court of Appeal something that seems to most people a matter of basic common sense?
If universal credit cannot cope with the date when people are paid and the impact of bank holidays and weekends on that payment date, the solution should always have been to change how the system works, not to persist with something that leaves thousands of people with wildly fluctuating payments from month to month. I have a constituent affected, and the first time I saw the problem in my constituency surgery in Stalybridge, I could not believe that the regulations would work the way they do.
This issue goes to the heart of the problems with universal credit. Time and again, we are told by Ministers that universal credit is more flexible, that it is more agile and that it can be adapted to meet new requirements and respond to problems that are identified. Yet when it comes to making seemingly simple changes such as these, claimants are faced with a rigid, unbending, uncaring response.
The Government always seem unwilling to listen to the experiences of the people who actually use the system. I ask the Minister, first, how much public money has the Department has wasted fighting the case? Secondly, I welcome the Minister’s statement that the Government now accept this decision, so how, and how quickly, will the universal credit regulations be changed to accommodate the ruling? Thirdly, do the Government accept that four single mums should not have to go to the Court of Appeal to be listened to by their own Government? Will the Department acknowledge that there is an overwhelming need to recognise the lived experiences of people who are actually in receipt of universal credit and review a whole range of policies, including the five-week wait, the frequency of payments and how the initial assessment period works, so that we can then get a social security system that is fair and effective and works the way that it should?
This Government are “irrational” and they are “unlawful”. Those are not my words, but those of Lady Justice Rose, who delivered the verdict in this week’s Court of Appeal decision against the Department of Work and Pensions. Reading that decision, there is really only one question to ask: what on earth were Ministers doing fighting this case for so many years, only to be told by the Court of Appeal something that seems to most people a matter of basic common sense?
If universal credit cannot cope with the date when people are paid and the impact of bank holidays and weekends on that payment date, the solution should always have been to change how the system works, not to persist with something that leaves thousands of people with wildly fluctuating payments from month to month. I have a constituent affected, and the first time I saw the problem in my constituency surgery in Stalybridge, I could not believe that the regulations would work the way they do.
This issue goes to the heart of the problems with universal credit. Time and again, we are told by Ministers that universal credit is more flexible, that it is more agile and that it can be adapted to meet new requirements and respond to problems that are identified. Yet when it comes to making seemingly simple changes such as these, claimants are faced with a rigid, unbending, uncaring response.
The Government always seem unwilling to listen to the experiences of the people who actually use the system. I ask the Minister, first, how much public money has the Department has wasted fighting the case? Secondly, I welcome the Minister’s statement that the Government now accept this decision, so how, and how quickly, will the universal credit regulations be changed to accommodate the ruling? Thirdly, do the Government accept that four single mums should not have to go to the Court of Appeal to be listened to by their own Government? Will the Department acknowledge that there is an overwhelming need to recognise the lived experiences of people who are actually in receipt of universal credit and review a whole range of policies, including the five-week wait, the frequency of payments and how the initial assessment period works, so that we can then get a social security system that is fair and effective and works the way that it should?
00:00:00
Will Quince
I thank the hon. Gentleman for his question. Each and every judicial review has its own grounds for being brought and is looked at on a case-by-case basis, and with each JR, the Secretary of State, Ministers and officials look closely at the grounds and respond accordingly. I gently point out to him that the Court of Appeal accepted our interpretation of the UC regulations. However, the point that some people may face budgeting issues is why we are acting.
I am disappointed, if not surprised, that the hon. Gentleman has taken the opportunity to launch yet another attack—a baseless, unwarranted and unfounded attack—on universal credit. We all know, and he knows, the truth: the system has worked incredibly well and Labour’s broken legacy benefits system simply would not have coped with the unprecedented demand that we have seen during covid-19. Universal credit has passed that test with flying colours. There have been over 3 million claims, and I am so proud of our DWP employees and the universal credit system. It is time that Labour got behind this Government and universal credit and worked with us to make the system even better.
I am disappointed, if not surprised, that the hon. Gentleman has taken the opportunity to launch yet another attack—a baseless, unwarranted and unfounded attack—on universal credit. We all know, and he knows, the truth: the system has worked incredibly well and Labour’s broken legacy benefits system simply would not have coped with the unprecedented demand that we have seen during covid-19. Universal credit has passed that test with flying colours. There have been over 3 million claims, and I am so proud of our DWP employees and the universal credit system. It is time that Labour got behind this Government and universal credit and worked with us to make the system even better.
00:00:00
Mr Richard Holden
North West Durham
I echo the words of my right hon. Friend the Member for Forest of Dean (Mr Harper) and welcome the decision by the Government not to appeal this judgment, because this has also affected constituents in North West Durham. I also welcome the fact that the Government have invested an extra £7 billion into the welfare system to support people during the coronavirus pandemic, which has clearly strengthened the safety net for a large number of my constituents. Will the Minister confirm how many families across the country have benefited from this extra support through the universal credit system at this difficult time?
00:00:00
Will Quince
I thank my hon. Friend, who is a firm champion of his constituents in this place. He is absolutely right that we have introduced a series of changes during the covid-19 pandemic, targeted at those facing the most financial disruption, that could be operationalised as quickly as possible, ensuring that people get the support that they need. He is right that that is close to £7 billion in the welfare system alone and it will benefit approximately 10 million families.
00:03:10
Neil Gray
Airdrie and Shotts
I pay tribute to the four women who brought this case and all those who supported them, including the Child Poverty Action Group, and I thank the Work and Pensions Committee Chair, the right hon. Member for East Ham (Stephen Timms), for securing this question. This really is damning for the Government and successive Secretaries of State, who have belligerently fought this in the courts. Why should women and disabled people have to go to court to get basic fairness? I am sorry that the Secretary of State is not here to respond.
The issue of people getting paid salaries on irregular but predictable days of the month is something that the Scottish National party has been raising as an issue with UC for years, and the Court of Appeal has ruled that it was irrational for the Work and Pensions Secretary not to act to resolve the problem. Why should claimants lose UC support simply because of the day of the month that they are paid? That question has not been answered. As part of the process of accepting this ruling, will the Minister at the very least ensure that the predicted 85,000 people thought to be directly impacted have their situations resolved? Will the Minister work with the Chancellor to finally add flexibility to the monthly assessment period to resolve this issue and the five-week wait, which is also impoverishing people?
The issue of people getting paid salaries on irregular but predictable days of the month is something that the Scottish National party has been raising as an issue with UC for years, and the Court of Appeal has ruled that it was irrational for the Work and Pensions Secretary not to act to resolve the problem. Why should claimants lose UC support simply because of the day of the month that they are paid? That question has not been answered. As part of the process of accepting this ruling, will the Minister at the very least ensure that the predicted 85,000 people thought to be directly impacted have their situations resolved? Will the Minister work with the Chancellor to finally add flexibility to the monthly assessment period to resolve this issue and the five-week wait, which is also impoverishing people?
00:00:00
Will Quince
I thank the hon. Gentleman for his question. I stress that we received the judgment only on Monday and it is a hugely complex issue. That is recognised by the court—it is not a simple fix, as the hon. Gentleman points out. He knows that we are facing unprecedented demand, because he has raised this question with me before. I said that I will keep the House and the right hon. Member for East Ham (Stephen Timms), the Chair of the Work and Pensions Committee, updated as we progress.
On the hon. Gentleman’s points relating to assessment periods, there are some aspects of the universal credit system that are fundamental to its design and are deliberately designed to achieve its original objectives—to mirror the world of work. This includes the mechanism of a monthly assessment period and, of course, the initial assessment period at the beginning of a claim. It is important to stress that over 75% of people in this country are paid monthly and the majority of countries in the European Union also have systems that operate on a monthly basis.
On the hon. Gentleman’s points relating to assessment periods, there are some aspects of the universal credit system that are fundamental to its design and are deliberately designed to achieve its original objectives—to mirror the world of work. This includes the mechanism of a monthly assessment period and, of course, the initial assessment period at the beginning of a claim. It is important to stress that over 75% of people in this country are paid monthly and the majority of countries in the European Union also have systems that operate on a monthly basis.
Jerome Mayhew
Broadland
In March alone, about 1.24 million new applicants relied on the universal credit system to be able to process their claims and pay them within days vitally important sums of money to help them live. While the case has properly highlighted about 1,500 outlier cases, does my hon. Friend agree that it was the Government’s decision to invest in an automated digital system that does not require manual intervention by DWP officers to carry out individual calculations of the amount of an award that has allowed this to happen?
Will Quince
My hon. Friend is absolutely right. It was this Conservative Government who introduced our modern, dynamic, agile new benefits system, tailored for the claimant’s personal circumstances. The fact it is online means we have been able to process the claims of more than 3 million people, getting them the support they desperately need as quickly as possible. Just imagine for a moment, Mr Speaker, the chaos that would have ensued had we been relying on Labour’s broken legacy benefits system alone. Thank heavens for universal credit.
Jim Shannon
Strangford
I have had many similar cases over the years, so I am really pleased first to see the court decision, but secondly to see the Government and the Minister in particular responding in a very positive fashion. The judge referred to common sense; it is about not just common sense, but the practical effects on families at a time of financial stringency over Christmas and the new year. Can the Minister confirm whether he will retrospectively correct the mistake, which quite simply boggles the mind and common sense? He referred to solutions, and I can give him one very quickly. Will those who have had to take out loans to cover the month where they lost full payment receive help to pay the interest on those loans? Some took out loans with tremendously large interest rates. It is important that people have help right now.
Will Quince
I am happy to meet the hon. Gentleman to discuss those cases in more detail. As I said, I am absolutely committed to finding a fix. The court has not mandated any specific fix or action, but I am committing us to finding a solution, and I will do all I can to do so. The court dismissed the appeal on the grounds of discrimination. He mentioned families. The Department is absolutely clear in its firm support for all claimants. We continue to support families with things such as childcare costs, and I stress that childcare support under universal credit is far more generous than the old legacy benefits system, with the ability to claim back 85%, as compared with 70%. I would be very happy to meet the hon. Gentleman to discuss those concerns in further detail.
James Sunderland
Bracknell
Many of my constituents in Bracknell work in the creative arts sector. We heard earlier about the millions of families who benefited from universal credit during the pandemic, but will the Minister please assure me that the minimum income floor will be maintained for this important area of the economy for the foreseeable future?
Will Quince
I thank my hon. Friend for that question, and he is right to raise the issue, because I know that those who work in the creative arts are particularly exercised and concerned by it. The issue is covered by the Minister for Employment, my hon. Friend the Member for Mid Sussex (Mims Davies). The minimum income floor rules are suspended at the moment. I will put the Minister for Employment in touch with my hon. Friend and ensure that his concerns are raised, but he has rightly put them on record.
Marco Longhi
Dudley North
The universal credit system has come under unprecedented pressures for obvious reasons during the past few weeks. Having interrogated my office systems, I have encountered only 10 inquiries relating to universal credit, which were largely inquiries wanting more information. That is out of thousands of other cases that my office has received. Does my hon. Friend agree that that is in fact indicative of a system that is both resilient and working very well?
Will Quince
My hon. Friend is absolutely right: universal credit is standing up to the challenge during this unprecedented time. The digital approach of universal credit, as he rightly points out, has allowed us to get support to more than 3 million people over the past three months, which simply would not have happened under Labour’s legacy benefits system.
Dr Ben Spencer
Runnymede and Weybridge
I thank the Minister for his answers today. It is important to reflect on the fact that the computer system has been able to deal with an unprecedented crisis in terms of people claiming UC, which the legacy benefits system just would not have been able to cope with, but with automation comes inflexibility. Could he say whether this is a case of “computer says no” or “computer says not yet”?
00:02:06
Will Quince
I thank my hon. Friend for that helpful question. My universal credit programme colleagues may well have their heads in their hands as we speak, depending on what I now commit them to, but I am absolutely determined to find a fix to this issue.
Yes, a number of items are in the pipeline, ready to be changed on universal credit. Despite criticism from Opposition Members, we have made significant changes to universal credit, and much more is to come, such as the roll-on of legacy benefits next month, which will benefit people to the tune of £200. Those are all in the pipeline to be done, and this will be added to that. I will try to expedite it as much as I possibly can.
Yes, a number of items are in the pipeline, ready to be changed on universal credit. Despite criticism from Opposition Members, we have made significant changes to universal credit, and much more is to come, such as the roll-on of legacy benefits next month, which will benefit people to the tune of £200. Those are all in the pipeline to be done, and this will be added to that. I will try to expedite it as much as I possibly can.
00:01:13
Margaret Greenwood
Wirral West
Many people on low incomes have suffered real hardship as a result of the Government’s failure to address this fundamental flaw in universal credit. I pay tribute to the women who took the Government to court to seek justice on this matter, but they should not have had to do so. A number of my constituents have been affected. One is a single working mother who has fallen into arrears with her rent, has seen an increase in her anxiety and depression, and has had to turn to food banks and local welfare assistance as a result. I wrote to the Secretary of State and Ministers several times about this last year, so will the Government now look at the cases of my constituents and all those affected as a matter of urgency, and pay them the money that they should have received?
00:01:37
Will Quince
I am certainly happy to look at the cases raised by the hon. Lady. I have said clearly that I am determined to find a fix. That will involve looking at numerous solutions, identifying the cohort of people and the fix and putting it into action. That may take a little time, but as I say, I am determined to find that solution. I am happy to meet her when we are able to do so to look at those individual cases she raises in more detail.
00:02:12
Selaine Saxby
North Devon
Three million people have claimed universal credit since the beginning of the coronavirus pandemic, which is a huge success. I thank the Department for Work and Pensions team who enabled that. Indeed, the robustness of the computer system behind universal credit has facilitated rapid and easy access to welfare support for so many additional claimants. However, does the Minister agree that, on occasion, human intervention when the computer does indeed say no might help prevent cases like those falling through the cracks?
00:02:52
Will Quince
I thank my hon. Friend for her helpful question. The system is largely automated, and that brings huge benefits—that is why we have been able to deal with those claims—but, inevitably, that also means that issues come up that we need to address. This is one of those issues and, yes, in some cases, they require a manual intervention. My first instinct is to look at whether we can find an automated fix, but we will of course look at manual fixes, if that is necessary. I know that my hon. Friend is on the Select Committee, and if she has any particular ideas in that regard, I am happy to meet her to discuss them.
00:03:16
Jessica Morden
Newport East
The Court of Appeal ruling rightly draws attention to one of the problems with the universal credit system, but will the Minister also address why under-25-year-old single parents receive less on universal credit than they would have done under legacy benefits? I have lobbied Ministers with the Newport GoGirls group on that—it is unfair and it needs to change.
00:03:44
Will Quince
I did not entirely catch the question, but I think the hon. Lady is referring to the disparity between universal credit and legacy benefits. I would say that this Department acted at incredible pace to operationalise and bring in measures as quickly as possible to help those who have been most financially disadvantaged as a result of covid-19. That is why we did it through the vehicle of universal credit. Legacy benefits will be reviewed and uprated ahead of April 2021 as per usual.
00:04:03
Nigel Mills
Amber Valley
Is there any merit in having another look at the timing of assessment periods, such as having them generally fixed to the end of the month to remove some of the issues that seem to keep arising?
00:04:10
Will Quince
It is something I am exploring as I look at our different options. My hon. Friend is an experienced member of the Select Committee, and I am happy to work with him and to hear his ideas. It is important to stress that for the majority of the circa 5 million claimants, the date of their assessment period works well. Changing assessment periods to align with pay dates is problematic. Nevertheless, everything is on the table, and I am looking at all options. The court judgment was very recent—only on Monday—so I hope that the House will give me the time and space to look at this in the granularity of detail that it requires.
Ronnie Cowan
Inverclyde
This is, in truth, just the latest failing in a pernicious and punitive welfare system. When Beveridge wrote his famous report in 1943, he said:
“A revolutionary moment in the world’s history is a time for revolutions, not for patching.”
As we attempt to enter a post covid-19 world, will the UK Government give their support to the Scottish Government and ensure collaboration from HMRC and DWP as we seek to run basic income pilots in Scotland?
“A revolutionary moment in the world’s history is a time for revolutions, not for patching.”
As we attempt to enter a post covid-19 world, will the UK Government give their support to the Scottish Government and ensure collaboration from HMRC and DWP as we seek to run basic income pilots in Scotland?
Will Quince
At the heart of this problem is an interaction between employers and HMRC. If more employers followed the very clear and beefed-up guidance from HMRC, there would be far fewer people affected. That is why we are beefing up our work with HMRC colleagues and counterparts, to ensure that the guidance is absolutely clear. If employers follow it and report the correct dates, this issue simply will not occur.
Andrew Griffith
Arundel and South Downs
One key test of a benefits system must be the dignity that it confers on the recipient. Does the Minister agree that there is great dignity in an automated solution that is modern, simple and straightforward and that there is potentially a role for employers to align their dates with a system that is in the best interests of their employees?
Will Quince
I thank my hon. Friend for that question. He is right. The universal credit system and tens of thousands of dedicated DWP staff have processed an unprecedented 3 million claims since mid-March. As I have said before and will keep repeating, Labour’s legacy benefit system, based on paper forms and a lot of face-to-face interaction and meetings, simply would not have coped with the pressures of covid-19. It has not been easy, and our people have had to work incredibly hard, but the important thing is that the system has held up, and people have been able to make their claims online, in their own time and in their homes. We have not seen the queues outside jobcentres that there have been in other countries, because we have universal credit, and this Government invested in it.
Mary Kelly Foy
City of Durham
I would like to congratulate these four women on their victory for social justice. It is shameful that the Government have pursued this case to the Court of Appeal. These were working women who were paid a regular monthly salary. Welfare rights experts described them as perfect candidates for universal credit. Does the Minister agree that a system that does not work for people like them does not work at all?
Will Quince
I thank the hon. Lady for her question, but I do not recognise the picture she paints. As I said earlier, judicial reviews are brought for all sorts of reason. Like her, I pay tribute to the ladies involved in bringing this case, but I point out gently to her that the Court of Appeal accepted our interpretation of the UC regulations. Nevertheless, we accept and note that some people may face budgeting difficulties. That is why I have committed to take this action.
Robert Halfon
Harlow
Will my hon. Friend congratulate and thank the staff at Harlow jobcentre on all the work they have been doing on jobs and universal credit at this difficult time? I have had communication with a single parent in my constituency who says that if she puts her child into childcare, she may end up earning more, but then universal credit will cut £400, so it is better to be with her child. In essence, she is saying that she is worse off if she goes to work under universal credit. Will my hon. Friend look again at helping single parents, to ensure that it is better for them financially to work than stay at home?
Will Quince
I thank my right hon. Friend for his question. He is a firm champion of universal credit and the benefits of it, and I certainly join him in paying tribute to all the staff at Harlow jobcentre who have done incredible work during this most difficult and unprecedented time. He raises an important point about childcare. One of the fundamental principles of universal credit is that work should always pay. That is why, under universal credit, childcare is at a higher rate of 85% as opposed to 70%. I will look at the case that he raises in detail and meet him at our earliest possible convenience.
Neale Hanvey
Kirkcaldy and Cowdenbeath
While I welcome the Government’s decision not to draw this matter out further, it seems that it is always someone else’s fault. This week in the Court of Appeal, the Department could not offer a single reason for its flawed and, in the words of Lady Justice Rose, “irrational” approach to universal credit’s monthly assessment period. This is not the first time that this Government have been found wanting, only to be dragged through the courts to do the right thing. If they will not tell the courts, the Minister must advise the House: what exactly was their alleged defence this time?
Will Quince
I gently suggest—[Interruption.]—as my right hon. Friend the Member for Forest of Dean (Mr Harper) says from a sedentary position, that the hon. Gentleman reads the judgment, because the Court of Appeal accepted our interpretation of the universal credit regulations. Nevertheless, we accept that there may be people who face budgeting pressures, and that is why we are committing to take this action.
Debbie Abrahams
Oldham East and Saddleworth
Women and disabled people have had to resort to law to get the Government to listen to the unfairness and the hardship that universal credit creates. Danielle, a dinner lady, was losing about £500 a year as a result of being paid on the last day of the month. She has ended up in debt and behind with her rent, and she does not know how she will recover. If the computer system is as agile as it is meant to be, why has this, and so many other issues, occurred? Why is there a difference in the 1,000 people that the Government say have been affected, as opposed to the 85,000 people whom the court has identified?
00:09:25
Will Quince
I will certainly look at the individual case that the hon. Lady raises, but I would gently say that it is such a shame that the Labour party—and she is no exception to this—is constantly so negative about universal credit. It is a modern, flexible, personalised benefit, which reflects the rapidly changing world of work. Let us remind ourselves of Labour’s position, which is to scrap universal credit with no plan whatever with which to replace it. That seems pretty foolish to me, but do not take my word for it; the Institute for Fiscal Studies has slammed Labour’s pledge as uncosted and
“unwise…expensive, disruptive and unnecessary.”
I could not have put that better myself.
“unwise…expensive, disruptive and unnecessary.”
I could not have put that better myself.
Alexander Stafford
Rother Valley
More than 1 million people have claimed universal credit since the beginning of the coronavirus pandemic and have been able to access an advance first payment, giving them access to support in just a few days. Does my hon. Friend agree that this has been vital for dealing with hardship during this difficult period in my constituency of Rother Valley and across the whole of Yorkshire?
Will Quince
I thank my hon. Friend for that question. He is right. We have had more than 3 million claims to universal credit since the middle of March and more than 1 million applications for advances, getting support to people who need it quickly, often within just a couple of days. That support is important, but I would stress that, for the cohort coming on to universal credit at the moment, the take-up of advances is lower, which often reflects personal circumstances. Therefore, taking an advance is not for everybody. It is interest-free and repayable over 12 months—as of next year, that goes up to 24 months. We are making the changes, but I agree with him that we are supporting people who need it the most in a timely manner.
Meg Hillier
Hackney South and Shoreditch
Understandably, the Minister wants to talk a lot about the people who have had to claim universal credit in recent months. I, too, pay tribute to the staff at Hackney jobcentre, who have worked very hard to make sure that people in need get it, but there is nothing wrong with being critical of this big failure by the Department. He said that 1,000 people have complained about mistreatment, but the court identifies 85,000 people who could be affected. Can he assure us that work is going on to identify them—perhaps through an algorithm with a human element added if something unusual is thrown up—so that people are treated fairly and do not have to complain, and the Department acknowledges its mistake and seeks them out?
Will Quince
I thank the hon. Lady for her question and join her in paying tribute to the staff at Hackney jobcentre who have done an incredible job under the most difficult of circumstances. We will, of course, be doing a deep-dive exercise into the cohort that is affected. I do not recognise the 85,000 figure. If I am honest, I think that that may be a figure that came from the Opposition, but I will look at that in detail. I gently point out to her that we now spend more than £100 billion a year on benefits for working-age people—that is more than £100,000 million pounds. We will continue to reform our welfare system to ensure that work always pays, and universal credit is at the heart of that.
Mr Speaker
Ground control to first officer Bob Blackman.
00:02:06
Bob Blackman
Harrow East
If you knew the broadband experience in north London, Mr Speaker, you would know why I need to wear this headset.
One advantage of the universal credit system is that it takes input from claimants that would otherwise have to be re-input several times, resulting in the correct level of benefit, but one problem is that it does not deal with the exceptions. Will my hon. Friend consider a system whereby, when people suddenly see huge increases in their pay and therefore a reduction in benefits, an alert is triggered to allow someone to look at what is going on and correct the position?
One advantage of the universal credit system is that it takes input from claimants that would otherwise have to be re-input several times, resulting in the correct level of benefit, but one problem is that it does not deal with the exceptions. Will my hon. Friend consider a system whereby, when people suddenly see huge increases in their pay and therefore a reduction in benefits, an alert is triggered to allow someone to look at what is going on and correct the position?
Will Quince
I thank my hon. Friend. That is a helpful suggestion and certainly one that I will be exploring. He is right to extol the virtues of real-time earnings information. Among many other reasons, it is what makes universal credit much superior to the legacy benefits system, because we are able to ensure that as people’s income fluctuates their support can fluctuate, too. His suggestion is a good one, and it is one that I will be looking at along with a suite of numerous other measures no doubt. I would be very happy to meet him to discuss it in further detail.
Hywel Williams
Arfon
I am glad of the Court’s sensible judgment and the Minister’s response, but this case highlights the flaws in UC, the need to adapt it to particular circumstances and the difficulties in doing so. With one third of Welsh households to receive UC by 2023, will he take this opportunity to respond to the Senedd’s Equality, Local Government and Communities Committee’s recommendations and look to devolve aspects of social security administration to Wales?
Will Quince
That is probably a letter that has gone to the Secretary of State, as opposed to me, and is well above my pay grade. I gently suggest to the hon. Gentleman that UC is good news for the whole UK, including, of course, Wales. I remind him that, once fully rolled out, it will be £2 billion more generous a year than the legacy benefits system it replaces. About 1 million disabled households will be £100 per calendar month better off, and claimants will have access to about £2.4 billion in benefits that previously went unclaimed under the confusing and clunky Labour legacy benefits system.
Steve McCabe
Birmingham, Selly Oak
The Minister is right to say that this judgment did not rely on an interpretation of regulation 54, as did the earlier one, but will his solution necessitate an interpretation based on the real income that people earn, as opposed to the false one that the Department has been assuming because of the technical judgment it has made about the assessment period and earned income?
Will Quince
The assessment period is fundamental to the design. [Interruption.] It is not fundamentally flawed. A small number of people do have fluctuations, which is why we are looking to take action in this area. We recognise that there is an issue, but it is important that it is kept in the context of 5.2 million UC claimants. I would hazard a guess, because this is certainly the case for my inbox, that despite there being more than 3.2 million new UC claimants, Members’ postbags are not full of complaints about UC. That is because the system is working very well.
Chris Stephens
Glasgow South West
The Department’s assessment period has resulted in one of my constituents earning £846 a month with a double calculation. As a consequence, they have now received a council bill that has increased from £36 a month to more than £200 a month. Will the Minister also have discussions with local government to ensure that claimants do not have bills that they simply cannot afford due to the Department’s errors?
Will Quince
I thank the hon. Gentleman for that question and I am happy to look at that case in detail. He is right to raise the point about passported benefits, and I would be happy to meet him to discuss it in further detail.
Chi Onwurah
Newcastle upon Tyne Central
Newcastle was a pathfinder for UC, but the Minister seems to have learnt nothing from the experiences of my constituents. Having dealt with their experiences over years on these issues, I know not only the financial impact, which is devastating enough, but the impact on claimants’ trust in government, in our welfare system and in technology itself. I find his lack of contrition astounding. Will he not apologise and learn the lessons of this mistake?
Will Quince
UC is working and it is working well. The point I make to the hon. Lady is that we constantly and consistently listen to Members from across the House, stakeholders and members of the public who raise issues associated with UC. It is a new system and we have made significant changes. We have pumped additional billions of pounds into this system to improve it. Instead of scaremongering on UC, which the Opposition continue to do and which is the biggest thing that damages public trust in our system, I suggest they work with this Government to improve a system that is already working well, in order to make it even better.
Mr Speaker
In order to allow the safe exit of hon. Members participating in this item of business and the safe arrival of those participating in the next, I am suspending the House for three minutes.
Sitting suspended.
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