Liam Byrne
MP for Birmingham Hodge Hill and Solihull North · Labour · United Kingdom
“The loss of 4,000 jobs at Jaguar Land Rover is a body blow for workers, families and communities across the west midlands, so I commend Richard Parker, the Mayor of the West Midlands, for moving quickly on Monday to put £500,000 on the table to help ensure that everybody gets back to work.”
“I wholeheartedly welcome this well-rounded statement from the Foreign Secretary, and put on record my thanks to the new Prime Minister for the hard yards that I know he has put in over recent days and weeks.”
“I am grateful to my hon. Friend for giving way, and I offer my warmest congratulations to her on her appointment to the role; she will be a brilliant Minister.”
“Let me start with a word of thanks to my hon. Friend the Member for Chester North and Neston (Samantha Dixon), who is not in her place, who said quite rightly that an awful lot has changed since the Bill was first introduced to this House. Indeed, a lot has been revealed over the course of the summer.”
“The effect of new clause 34 would be to ban off-ramping, ban new forms of digital currency transactions and ban memecoins, which are exactly the kind of measures that Ministers now need to bring forward. If we want to take the crypto system out of political finance, this is what we need to do.”
“No doubt we will learn that Mr Cottrell was in fact on the electoral register when that money was passed. No doubt we will discover that his mother, Fiona Cottrell, declared and did not disguise the fact that the money had ultimately come from her son.”
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“I thank the Minister for advance sight of his statement, although from yesterday we had a pretty good idea what he was going to say. Today brings welcome news for Britain’s pensioners. When Labour was in office we lifted 1 million pensioners out of poverty and increased pensioner incomes by 40%. Today the Minister has confirmed that pensions are set to rise, which we welcome, and we look forward to his pensions White Paper, which is now acquiring mythical status—we hope he will soon be able to prove it is a reality and not a myth. Although the news for pensioners is welcome, news for working people is a disaster. Buried in the small print of yesterday’s Budget is the brutal truth that it was a Budget for unemployment.”
“When the DWP went out to market to ask contractors to come forward and help with the task, it said, in its documents, that it could expect about 5% of people on long-term benefits to make it into work under their own steam each year. That is why it set itself a target of outperforming doing nothing by 10%—not a high bar—but somehow it managed to set a target as low as possible and miss it. It is right, therefore, that the House highlights, not just this failure, but the soaring cost of failure, which our constituents will now have to help pay down.”
“No wonder the Chancellor is tearing strips off the Secretary of State for Work and Pensions in Cabinet. All over Britain, businesses and families are busting a gut to do anything and everything to find work. Some 60% of jobs created since the election have either been part-time or self-employed, and, amidst all that strain and effort, we might have expected a little more support and a little more of a helping hand from the DWP. Yesterday, however, we discovered that it has done worse than nothing. Ministers swept into office promising the biggest-ever scheme to help people back to work, but yesterday we heard, not the hype, but the reality. It has been trying to hide these figures for more than a year, and yesterday we found out why: the Work programme has proved precisely as useful as doing absolutely nothing—in fact, worse than nothing.”
“The Chancellor has already had to revise up the cost of welfare spending for this Parliament by an eye-watering £20 billion, and now, after yesterday’s brutal exposure of the Work programme, we know a great deal more about who is to blame. We already knew that the Chancellor had done his level best to throttle the recovery. He has cut so far and so fast that we have now been landed with the longest double-dip recession since the war; and our economy is so fragile that the Governor of the Bank of England has warned that we might lapse into another recession this year; but what we did not know until yesterday was just how badly let down the Chancellor, the Cabinet and our constituents have been by the complete inability of the Department for Work and Pensions to get our country back to work.”
“I beg to move, That this House notes that only just over two in every hundred people referred to the Work Programme in its first year have gone into work; further notes that it has delivered a worse outcome than no programme at all; recognises that long term unemployment is soaring and that the welfare bill is projected to be £20 billion higher than planned; notes with concern that the Government is cutting £14 billion from tax credits and is taking £6.7 billion from disability benefits to pay for this cost of failures; and calls on the Government to implement a bank bonus tax to fund a Real Jobs Guarantee for young people and commission a cumulative impact assessment of disability benefit changes. Our debate takes place in the shadow of the Chancellor’s winter statement next week. It is clear that a winter of misery lies ahead.”
“The right hon. Gentleman will be as concerned as I am about this question, because only 2.6% of people in his constituency on the Work programme got a sustainable job outcome. I will come directly to that very question, but I want to dwell first on the cost of failure. Since the Work programme has been in place, the number of people out of work full-time for more than a year has risen by an extraordinary 210,000. This spiralling cost of long-term unemployment is now costing us, in the jobseeker’s allowance bill alone, £750 million. That is an enormous cost of failure. It is the cost, in fact, of 18,000 nurses, 16,000 teachers and 14,000 police officers.”
“I know this is of great concern to my hon. Friend. There are more than six people chasing every job in his constituency. What his constituents need is a back-to-work programme that actually works, pulling out all the stops to get people into jobs, but I am afraid the story he has told from his constituency has become all too common across the country.”
“I would be happy to trade arguments about our record with the Secretary of State, because while Labour was in office, the amount of money that we spent on out-of-work benefits fell by £7.5 billion. That is why his noble Friend Lord Freud described Labour’s record in getting people back to work as remarkable. It is a shame that he could not arrive at the same judgment about this Government’s programme, which is now in place.”
“The Work programme has got only just over 2% of the people in my hon. Friend’s constituency in the programme into sustainable jobs. It is becoming clear that there is simply not enough fuel in the tank.”
“In a moment. The Government spent something like £63 million closing down the flexible new deal—a programme that was actually getting more people into sustainable jobs than the Work programme and was costing only something like 9.5% more per job outcome. The Government have, in effect, shut down a system that was working, spent an awful long time getting something back up and then overseen a programme that has dramatically failed to hit the target set for it in the first years. It is a catalogue of failure.”
“My hon. Friend is absolutely right. The Work programme has been an abject failure in her constituency. Only 1.4% of people in her constituency who went into the programme were attached to any kind of sustainable job outcome. We know from Department for Work and Pensions research last week that the future jobs fund was a roaring success, delivering more than £7,500 of wider benefit to society. It was such a tragedy that the Government closed it down. Thank heavens that Labour is in power up and down the country, including in Wales, where we are building on the lessons of the future jobs fund, making it better and stronger, and now making a difference for young people across her constituency and beyond in Wales.”
“I am afraid that prompts the question why the DWP set the target in the first place. Indeed, yesterday on the television news that I watched, the Secretary of State made great play of the fact that the Work programme was only in its first year. However, the fact that the targets were set by the DWP was somehow missing from what he said yesterday. Indeed, they were targets for the first year. The challenge only gets greater in the second year. If the hon. Gentleman looks at the tender documents that the DWP put out, he will see that in the second year the Work programme has to get 27.5% of those on jobseeker’s allowance into sustainable job outcomes. That is about 10 times what the Government have managed to deliver in the first year. So I am afraid the argument that the Work programme is just warming up simply will not do.”
“The Work programme has delivered less than that, and the benchmarks will get stiffer next year.”
“There is an element of me that feels sorry for the Secretary of State. He is operating in an economy whose recovery has been throttled by the Chancellor, while another Cabinet colleague, the Secretary of State for Communities and Local Government, is implementing the biggest cuts to those local councils where there are the fewest jobs. So yes, the Secretary of State for Work and Pensions faces a difficult challenge, but it was his Department that set out the bald statistic— [ Interruption. ] I am sorry that the hon. Member for Enfield North (Nick de Bois) cannot hear me because of the chatter from those on his Front Bench. It was the Secretary of State’s Department that said that if the Government did nothing, 5% of people on long-term benefits could flow into work.”
“My hon. Friend is absolutely right. Glasgow city council has lessons to teach all of us about what it takes to get young people back into work. Despite all the difficult decisions that the council has had to take, it has made it a priority to get young people back into work. The way in which it has built on the future jobs fund is a real lesson for everybody.”
“The hon. Gentleman should check his facts. The number of people on out-of-work benefits came down by 1 million under Labour, and the out-of-work benefit bill came down by £7.5 billion. That is in sharp contrast to this Government, who have put up welfare spending by £20 billion more than they projected. To pay down that bill, they are now having to cut tax credits from constituents such as those of the hon. Gentleman.”
“The tragedy is that the cuts are so unfocused and so unwise that Britain’s part-time workers will now be better off on benefits than they will be in work. How on earth can that be right? A couple with two children and some child care costs on £40,000 a year are set to lose £1,900—5% of their income—in benefits over the course of this Parliament, while 8,000 millionaires will gain an average of £100,000 a year from the Government’s tax rate cut in April. If that is the Prime Minister’s defence of Britain’s battlers and strivers, I would hate to see what happens when he starts attacking them.”
“The truth is that a payment-by-results system will always be cheaper if there are no results. It is the lack of results that is now costing this country a fortune. That is what is driving up the welfare bill by £20 billion more than was projected at the beginning of this Parliament. We have to ask who is going to pick up the tab. We know that it will not be Britain’s richest citizens. They have been handed a tax cut of some £3 billion. They will not be asked to pay for this failure. Instead, it will be Britain’s strivers and battlers—those whom the Prime Minister promised to defend. Well, some defence! This Government are now taking £14 billion off tax credits over the course of this Parliament. I think I am right in saying that tax credits are the only benefit that is currently frozen.”
“I am afraid the hon. Gentleman has to check his facts. The truth is that Labour delivered 1 million fewer people on out-of-work benefits and a £7.5 billion reduction in the out-of-work benefits bill. That is why his noble Friend Lord Freud described our record of getting people back to work as remarkable. If this Government had built on those lessons rather than ignoring them, they would not be presiding over the sorry state of affairs that was announced yesterday, when the Secretary of State and the Minister for unemployment—the Minister of State, Department for Work and Pensions, the hon. Member for Fareham (Mr Hoban)—were forced to come out and tell us that the only virtue they could find in yesterday’s figures was that the Work programme was cheaper than the flexible new deal.”
“Now, in this morning’s Sun , we read that a couple working full time—over a million of them will be in the system—will lose something like £1,200 a year. That is, of course, if it ever happens.”
“My hon. Friend is absolutely right: there is a bleak future for many young people in his constituency, where the Work programme has delivered something like 1.3% of people into sustainable jobs, so it is one of the worst figures in the country. When young people in my hon. Friend’s constituency face tuition fees that have trebled, the cancellation of EMA and the shutdown of the future jobs programme, he is right to call in this place for a very different course of action. Even more worrying for the future, the signs are that when universal credit is introduced, it will not get better for Britain’s strivers and battlers; it will actually get worse. We know that new rules for universal credit will mean taking in-work benefits away from anyone who has managed to squirrel away £16,000, and we know that it locks in cuts to tax credits.”
“We now know that about 6 million families are working, yet are still in poverty. There is another group of our constituents that we must worry about, too—those constituents who are disabled yet are set to lose something like £6.7 billion of help over the course of this Parliament to help pay for the failure to get Britain back to work. These benefits are being taken away, without any cumulative assessment of their combined impact, and these cuts total more than the Government are taking away from banks. That, I am afraid, is a sorry indictment of this Government’s values.”
“Let me give the hon. Gentleman some statistics. If he looked at the amount spent on benefits in 1996-97, he would find that it came to about £51 billion, excluding pensions. By the time we reach 2009-10, that had fallen to £44 billion, so I am afraid that no matter how he looks at it, the truth is that the amount spent on out-of-work benefits over the course of Labour’s period in office fell by £7.5 billion. The hon. Gentleman is a member of a party that has presided over an increase in the projected welfare spend by £20 billion, and there are something like 8,000 families in his constituency that are now seeing their tax credits either frozen or cut to pay for that cost of failure. I wonder how he is going to explain that to his constituents as we get closer to the next election. It is not simply people in work who are paying the bill.”
“My hon. Friend is right. The Work programme has delivered only about 1% of his constituents into sustainable work. What we will publish this afternoon is an analysis showing that the per capita cuts in councils across the country are biggest where jobs are fewest. Where there is something like £200 a head in cuts, it means two or three times the national average of people chasing every single job. It is not surprising that the Work programme, flawed as it is, is finding it hard work because the Chancellor has throttled the economy and the Secretary of State for Communities and Local Government is cutting back where jobs are fewest.”
“The Chancellor knows that it is going wrong, and No. 10 knows that it is going wrong. Only the Secretary of State thinks that it is all okay. There he was yesterday, running from studio to studio, saying to anyone and everyone who would listen that it was all fine—that it would be all right on the night—although, quite obviously, it is all wrong. I am now sure that the Secretary of State is competing for Channel 4’s Comical Ali award for those who ignore all the evidence around them. It is not delusions of grandeur from which he suffers; it is delusions of adequacy, and the tragedy is that there is an alternative.”
“My hon. Friend has been a consistent champion of Stoke, and has consistently drawn attention to the need for greater economic development there. The Work programme is not helping, the cuts in council funds are not helping, and the Chancellor’s wider economic strategy is not helping. My hon. Friend is right: we must redouble our efforts, particularly in those poorer parts of the country, to get people back into work. There is very little sign that that is happening at present. Once upon a time we were promised a welfare revolution, and I think that we are right to ask this afternoon what on earth has happened to it. Universal credit is descending into universal chaos, punishing the strivers and battlers whom it was supposed to help. A climate of fear is being created for disabled people, and the Work programme quite simply is not working.”
“My hon. Friend is exactly right. Many of our communities throughout Britain are being hit from all sides, and the Government simply do not seem to understand the combined impact of what is happening. We can only hope that next week’s autumn statement will contain a proper plan to get us back to growth and to get our country back to work.”
“I am grateful to my hon. Friend for bringing that report to the House’s attention. I have not seen it, but yesterday’s announcement made clear that for the groups who need extra help, the Work programme is failing particularly badly. I was extremely disappointed to learn, for example, that those receiving employment and support allowance were getting the toughest deal. Fewer than 1% of them were being helped into sustainable jobs. That is not a record of which any Member in the House can be proud.”
“They need help when they are disabled. Millions today pay in and get nothing back. They are short-changed Britain, when what we want is something-for-something Britain. Those of us who want to modernise the system know we need to remember the most important lesson Beveridge taught us: social security is built on full employment. So let us get on with getting Britain back to work, and we should start with the young people, whom we will ask to pay for all of our futures—our young people who are hungry for work, yet are being let down by this shambolic Government. I commend the motion to the House.”
“That is one of the highest levels in any western country, and it is a badge of shame. Now, all over the country Labour councils are leading the charge to get young people back into jobs. In Leeds, Sheffield, Liverpool, Wales, Cardiff, Glasgow and Birmingham, it is now Labour councils that are rolling up their sleeves and leading the drive to get young people into jobs. We should help them, so let us put in place a bank bonus tax to create a fund that would help us get young people back into work. This Saturday is the 70th anniversary of the Beveridge report. That report offered the blueprint for post-war social security. The truth is that 70 years later, working people in this country need new things from the welfare state. They need retraining when they lose their job. They need child care. They need better social care.”
“The hon. Gentleman is right. That is just one more element of the wider picture that we are presenting this afternoon. At a time when there is a huge combined impact on communities throughout the country, we do not have a plan to get Britain back to work. What we have is a welfare bill that is rising, and when it comes to paying that down, it is Britain’s working people—those in receipt of tax credits—who are bearing the brunt. The Government are taking £14 billion out of tax credits over the course of the present Parliament. We are arguing for a different approach, and we hope that we will see it next week. We believe that that different approach starts with getting our young people back into work. They currently constitute some 40% of those who are out of work.”
“May I draw the Secretary of State’s attention back to the invitation to tender, which presumably he signed off? Under the heading of “Key Performance Measure”, which is in bold type and is the thing that we are interested in and debating, it says: “Performance will be measured by comparing job outcomes…in the previous 12 months to referrals in the same period.” The target for performance in the previous 12 months was 5%, and the Work programme statistics delivered yesterday showed that that target had been missed comprehensively.”
“I am grateful to the Secretary of State, who is being characteristically generous in giving way. Broadly speaking, about 800,000 people were referred to the Work programme in the 14 months to which he extended the reporting period to flatter the figures, and 5% of 800,000 is 40,000. According to his figures, only just over 30,000 got into sustained jobs, so 10,000 more people would have got into jobs if the Government had done nothing. That cannot be a record of which he is proud; surely, he can admit that to the House.”
“That is the problem that we have to fix, and that is why the Chancellor is so cross.”
“This is an important point for us to debate. I do not know whether the Secretary of State has seen the analysis that was published yesterday by Inclusion, but it is pretty clear on this question. The proportion of people flowing into sustained jobs from the flexible new deal was 5%, which is much higher than the figures for the Work programme. The flexible new deal was more expensive. Inclusion calculates that the cost per job outcome under the Work programme is £14,000. The flexible new deal was 9.5% more expensive, but the Secretary of State is failing to be level with the House about the fact that doing nothing costs his Department less, but it costs the country more, because the welfare bill goes up. A payment-by-results programme is cheaper if there are no results.”
“The hon. Gentleman is generous in giving way. Our point is that there is not enough fuel in the tank. I am sure he is as worried as I am that on current performance, the Work programme may not hit its second-year target to get 27.5% of those on the programme into a long-term job. The Opposition motion says that we should start putting more fuel in the tank by providing extra resources for young people.”
“May I first associate everyone on the Opposition Benches with the words of commemoration for our much treasured colleague, Malcolm Wicks, who is sorely missed? Will the Secretary of State confirm that the introduction of universal credit is proceeding according to its original timetable?”
“That is curious, because last year the Secretary of State told us that every new claim for out-of-work support would be treated as a claim for universal credit from next October, but the Minister of State, the hon. Member for Fareham (Mr Hoban), told Parliament on 26 October that the rules for universal credit from 2013 onward are still “under development.” What on earth is going on? On Atos, on caps on pension charges and now on universal credit, it does not appear that the Secretary of State has got a grip.”
““No.” This morning, an unnamed Minister weighed in to support the Secretary of State in his own way with a ringing endorsement, saying that universal credit “is another car crash waiting to happen”. The Secretary of State is no stranger to friendly fire. Indeed, back in 2002, he described himself as the “quiet man” who was about to “turn up the volume”. Today, we are not asking the Secretary of State to turn up the volume. We are asking him to dial down the chaos and dial up the competence in his Department. The Secretary of State and I share a faith. He, like me, believes that confession is good for the soul, and today is confession time. We need answers to a host of questions about universal credit and we cannot help to get this vital project back on track unless he comes clean about exactly what is going on.”
“At the heart of the debate is a very simple principle, which is that anyone in this country should be better off in work than they are on benefits. That is a principle in which we in the Opposition passionately believe. We are a party that was founded by and for working people and that is why we want universal credit to succeed. It is now, however, an open secret in Whitehall that universal credit is a flagship that is sinking fast. The Treasury, says Mr Nick Robinson of the BBC, “have long had deep anxieties that” the Secretary of State “might not be able to control spending” on universal credit. Last week, the Minister for the Cabinet Office and Paymaster General, who is an old friend of the Secretary of State, was asked how universal credit was going. He said: “Are we there yet? Am I absolutely confident we are there yet?” His answer?”
“I beg to move, That this House notes that the Universal Credit is late and over budget; recognises that there is widespread unease surrounding the implementation of the £2 billion scheme’s IT system; further notes that the project is so badly designed that it is set to reduce work incentives for over two million people and hurt small businesses and the self-employed; believes that Ministers have failed to properly account for numerous basic details of how the scheme will work, such as its interaction with free school meals or what is to be done with 20,000 Housing Benefit staff; further believes that the project is poorly thought through and is now at risk of descending into chaos; and calls on the Government to publish the business case, so that the House can see a detailed plan of implementation, and urgently to set out a plan to address these deep flaws before it is too late.”
“It is unclear how I might respond to that. I hope I will be able to set out for the hon. Gentleman this afternoon what I think will be a shared set of concerns about how to get this vital project back on track. I hope we have a degree of clarity, honesty and openness from those on the Treasury Bench.”
“Friend the Member for Stockport (Ann Coffey), that a couple with kids working part time—and goodness me, there are more people working part time these days—will now be more than £700 better off on benefits than in work. How on earth can that send the right signal?”
“Then there is the question of how universal credit will interact with increases in personal allowances, which were introduced with such a great fanfare over the past year or two. Last week, Gingerbread said that because universal credit is calculated on post-tax income, the lowest paid would see most of the increase in personal allowances wiped out. In fact, when universal credit is introduced, the low paid will lose two thirds of the increase in personal allowances. Somehow the Chancellor of the Exchequer forgot to tell us that when he unveiled the proposal in his last Budget. Then there is the question of how universal credit will lock in the cuts to tax credits that hit so many of our constituents this April. Those cuts now mean, according to answers given to my hon.”
“What is going to happen to that budget? Then there is the question of council tax benefit, which is worth £5 billion for 6 million households in Britain. As it turns out, we are going to get not a national scheme but a local scheme, because the Secretary of State lost his battle with the Secretary of State for Communities and Local Government. He was sat on by the right hon. Member for Brentwood and Ongar (Mr Pickles), which is a fate we would not wish on anyone. The result is that whether someone is better off in work or on benefits will depend on where they live. The Institute for Fiscal Studies says that universal credit “severely undermines” the simplification.”
“That was the figure that the Department for Work and Pensions gave to the Office for Budget Responsibility in July last year. Yesterday, however, the Secretary of State told the House that he had agreed to a Treasury target of £2.5 billion, wiping £600 million off tax credits by so-called policy designs. Where on earth is that money going to come from? It is, I am afraid, a mystery. It is a mystery shrouded in further questions about whether people will be better off in work when universal credit is introduced. What on earth is going to happen to free school meals, which are worth £410 million a year to families in many of our constituencies and are a vital lifeline every week? The Children’s Society says that if universal credit integrates free school meals in the wrong way, that will wipe out incentives to work for 120,000 families.”
“Let me start with precisely that risk. We were told when universal credit was first proposed that the IT costs would be in the order of £2 billion. Some £200 million was taken off for subsidies for another problem with child care created by the Secretary of State’s friend, the Chancellor. The former Minister responsible for unemployment, the right hon. Member for Epsom and Ewell (Chris Grayling), before he departed for the Ministry of Justice, said that the cost had spiralled to £2.1 billion. Already, two years in, the project is £100 million over budget and we learned yesterday that universal credit, when it is introduced and fully rolled out in 2017, will demand an extra £3.1 billion in welfare payments each year.”
“That is very much the point of bringing the debate here today. We need from the Government transparency about the business case, which is being kept secret. Until we get to the heart of how the policy will be rolled out, until we get some answers to these basic questions, it is difficult for us to offer some constructive advice—advice we would offer for free.”
“We have problems with free school meals and with council tax benefit, a short-changed personal allowance, the lock-in of cuts to tax credits and a worse incentive to work. That raises fundamental questions about a system that is about to go live in 150 days. That is why in this debate we want some answers on how these problems will be solved.”
“It absolutely does. Our chief concern is that that open and fair system of assessment will not fall into place for universal credit, with enormous consequences for our constituents. The final point about the basic principle of whether people will be better off in work or on benefit is the evidence published by the Secretary of State’s own Department in the impact assessment that he signed earlier in the Parliament. The evidence shows that the marginal deduction rates will not go down for many people but will go up—2.1 million people will see their marginal deduction rates go up when universal credit is introduced. The incentive for them to work does not increase with universal credit; it goes into reverse.”