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Welfare Reform Bill

It is a great pleasure to follow the hon. Member for City of York (Hugh Bayley). I agree with the stress that he puts on the need for more emphasis on rehabilitation in the training of doctors and a greater sense of awareness, particularly among GPs, of the importance of work and occupational health as a route to dealing with medical conditions. The medical practice in Camden in north London where the idea of having an employment adviser within the practice has been piloted has received visits from all the Front Benchers present, and it is probably getting sick of politicians trooping through the place. The lesson to be learned is that such a measure can have a great deal of success in helping people back to work, as well as reducing medical bills. This debate has been delayed for far too long. The fact that more than 2.5 million people remain on incapacity benefit is unacceptable, and it is a disgrace that that group has been so long neglected by Governments of both parties. The Minister will be pleased to hear that we strongly agree with the principles behind this reform—principally, that society should play a much more active role in enabling the sick and disabled to take the opportunities afforded by participation in the labour market. That objective is vital not only for the individuals concerned but for society as a whole. As has been said, work is the best route out of poverty, and we all benefit, as a society, from higher levels of economic activity. While supporting the principle of welfare reform and many of the measures in the Bill, we are concerned because the Government’s proposals are short on detail, because there is a shortage of funding in some respects, and because they rely for delivery on a Department that is under massive pressure. Liberals have long believed that freedom is curtailed by poverty and disadvantage. Today, my right hon. and learned Friend the Member for North-East Fife (Sir Menzies Campbell) again made tackling poverty a top priority for Liberal Democrats. Welfare reform is central to that objective. Despite the long wait, the Bill gives every impression of being rushed in some respects. Huge chunks of important policy detail are relegated to secondary legislation, and by leaving Second Reading until just before the recess, the Minister gives himself time to work out the detail in many of those areas. The carry-over procedure, which will be the subject of a later motion, was neither designed as a general catch-all to allow Departments to delay legislation nor to apply to Bills that had not been subject to pre-legislative scrutiny. If the carry-over motion is to have all-party support—it was intended that such motions should—the Minister for Employment and Welfare Reform must provide a specific justification for using it in the case that we are considering. I hope that he will do that in his winding-up speech. I hope that the Minister can also give a clear assurance, linked to my previous point, that sufficient time will be allocated in Committee to allow full scrutiny of the Bill’s important provisions. That will require the Government to publish in draft the key statutory instruments—the Minister undertook to do that in answer to oral questions—but I hope that he will include those that deal with the level of benefit, rules of entitlement to benefit, the capability assessment and the other proposed medical assessments, conditionality, the housing benefit reform and sanctions. The Bill proposes a framework of additional responsibilities for claimants, but that can be fair only if the state and employers take their share of responsibility. As the Disability Rights Commission said:"““In return for effective opportunities and support, we believe it is reasonable to expect more people to move towards work. Without effective opportunities and support, it is not reasonable to expect greater responsibilities of claimants.””" The evaluation of pathways to work shows that the scheme has markedly improved employment outcomes. It incorporates the individually focused approach that Liberal Democrats have long advocated, and we welcome its success. However, unless the roll-out of the scheme is properly funded and coherently planned, I have grave concerns about whether it can fulfil all the expectations. The Government have allocated £360 million, as the Secretary of State said, to rolling out pathways to work. However, we still do not know exactly how much of the figure will be spent on doing that. Will the Minister give us more detail today? Will he tell us how much money will be spent on the new computer system needed to administer the new employment and support allowance benefit? Even if all the £360 million were spent on rolling out pathways to work, our calculations, based on the amounts that have been spent in the pilot areas, suggest that the figure is more than £250 million short simply for dealing with the needs of new claimants. If the objective were to support all eligible claimants, the welfare black hole would be even greater. Given the cuts at Jobcentre Plus, it is also unclear whether there will be sufficient well-trained personal advisers, let alone extra resources from the Treasury, to deliver the scheme. Although the Secretary of State did not mention the matter, the newspapers report that the Government have tacitly admitted that the funds are inadequate by suggesting that the support through pathways to work should be targeted at those with children. Will the Minister confirm whether that is the Government’s intention? The Government have made it clear that they want to target pathways resources in other ways. For example, the city strategy is a welcome attempt to tackle concentrations of incapacity benefit claims by joining up resources in specific cities. However, there is a worrying neglect of the challenging issue of helping claimants in rural and remote areas back to work, not to mention the pockets of deprivation found in rural towns and villages. I hope that the Minister can deal with that point, which was also made in an earlier intervention. It is worth pointing out that the success of pathways to work has not been even for all groups. The Department-funded evaluation, which the Institute for Fiscal Studies carried out, found no statistically significant improvement for people with mental ill health as the primary reason for their claim. Age Concern said that the scheme had been much less successful for the over-50s. Better support for both groups is vital if welfare reform is to be a success. The voluntary and private sectors can be highly successful in getting people back to work. In some ways and some places, they have been more successful than Jobcentre Plus. I highlight the work of the SHIRLIE project in Inverness, in my constituency. It helps especially those with learning disabilities back to work. The working neighbourhoods project in Parkhead in Glasgow has received several visits from politicians, but has also been successful in targeting not only those on incapacity benefit but a range of disadvantaged groups, through one joined-up project. However, it is important to ask how the experience of the voluntary sector will be used throughout the country. The current plan is a bit of a dog’s breakfast, with Jobcentre Plus delivering 40 per cent. of provision and the voluntary and private sectors being used for the remaining 60 per cent. If the voluntary sector is as effective as the Government say it is—we agree about that—why will their expertise not be on offer throughout the country? Work-related activity must reflect the nature of a person’s impairment. Specialist as well as more local providers should therefore be contracted to help specific client groups. There should not simply be big contracts with big providers. In dealing with the needs of people with mental health problems, we need to ensure that there are enough trained therapists throughout the UK, as Lord Layard, for example, proposed. Given the five-year training for many of those roles, what plans have the Government to train people to fill the roles that will be needed if welfare-to-work support is to be properly available for people whose first reason for claiming benefit is mental ill health? In proposing the new employment and support allowance, the Government have missed an opportunity to simplify our enormously complex benefits system. They have also missed an opportunity to tackle the poverty and low income traps that remain far too prevalent in the benefit system, not least in the tapers for housing benefit, council tax benefit and income disregards. There is an opportunity to unify the system. The income disregard is currently a great deal smaller than that for incapacity benefit. That means that although the income disregard for incapacity benefit may encourage people to try out work for a few hours a week, they then get caught in the housing benefit trap, which leads to their losing benefit and acts as a strong disincentive to taking work. Will those who receive the income-related employment and support allowance, who would previously probably have been entitled to income support, also be entitled to passported benefits—for example, free NHS prescriptions and dental treatment, free school meals, funeral expenses and so on? That is important for many claimants. Unless the Minister can clarify the matter, there may cases of the new benefit leaving people worse off. Will the Minister also explain why employment and support allowance, once decided, is not to be backdated to the start of the claim? Not doing that will cause serious problems for some people, especially those who leave work or statutory sick pay, or younger claimants who will be penalised through the reduced rate that applies in the early phase of the benefit. I want to consider the proposed medical assessment process. The incapacity benefit medical assessment desperately needs reform. It is subject to persistent concerns about unfairness and poor decision making, especially about mental health. Some 50 per cent. of appeals are granted. A working group is considering improving the assessment, and I welcome the Secretary of State’s commitment to ensuring that more detail is available before the Committee discusses the matter. It is vital for the Government to get it right. The Royal College of Psychiatrists want rigorous testing and evaluation of the new assessment system for those with mental health conditions. In a written answer, the Minister suggested that some sort of testing, but not a formal piloting process, will take place. Will he explain exactly how the new assessment will be tested?