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Benefits Simplification

It is a great pleasure for me, as a member of the Work and Pensions Committee, to contribute to this important debate, and to follow on from what our Chair said earlier. He outlined in detail the Committee's recommendations, and set the historical context for the simplification of benefits payments. The system has been growing in complexity over 30 years, not just the past two or three, and it is about time that we looked at the wider picture. I shall begin by running through some of the problems identified by the Committee. We noted that people frequently encounter problems with computer-generated letters and with long waiting times at the end of a telephone, as the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) reported. In addition, difficulties are caused by contact centre staff who follow their scripts in a rigid way that means that they do not respond flexibly to those who ring them up. Problems also arise out of the complex interaction between benefits and tax credits, and people find it hard to acquire and understand the ““better-off”” calculations. In addition, the legacy benefits system to which my hon. Friend the Member for Bradford, North (Mr. Rooney) referred is both costly and complex. I shall return to some of those matters in more detail later, but first I refer the House to the third recommendation in the Committee's report. It is important, because we want the Government to take a wider view of benefits simplification and of the system that they want to have in place, rather than adopting a piecemeal approach that merely involves dealing with individual benefits. We therefore ask whether all existing benefits are necessary, or whether some might be merged. We also urge the Government to examine the way in which the interaction between benefits and qualifying arrangements can differ, and to look at the overall purpose of the benefits system. That last question sounds easy, but the world of work and society has changed since the system was first introduced. Our approach offers a new perspective, and it is one that I hope the Minister will take into consideration. Why do we need to simplify the existing benefits system? One answer is that we need to make life easier for both claimants and staff. For instance, how many times have we, as Members of Parliament, had constituents come to us to complain about computer-generated letters? Such people may receive three letters from the same department—very often the Child Support Agency, it must be said—on one day, and another three on another day, but can they always work out what money they should get and when? No, they cannot. Computers can do wonderful things, but someone has to give them instructions. Sadly, letters that can be generated at the push of a button do not always serve the interests of human beings, and that is a problem that I hope that the Minister will look at. The point about long telephone delays has already been raised. Not only are such delays expensive for many clients, they are hugely frustrating. By the time the client speaks to the person at the end of the phone they are angry and may raise their voice, so the member of staff has to calm down a frustrated and angry client before they can talk to the client about their benefit entitlement. Furthermore, if the person at the end of the phone rigidly follows their script, they cannot deal with the complexity of people's lives, especially people who are entitled to a variety of benefits. A script can be of help to staff in contact centres, but they need to be trained to go beyond the script sometimes, so that they do not have to refer the client to many other people for an answer. How can clients be expected to understand the complex interaction between benefits and tax credits? That complexity leads to non-take-up. As we are all aware, many people do not take up benefits because they do not understand how they work. Complexity leads to both claimant error and official error. The Chairman of the Committee outlined some of the tremendously complex aspects of the benefits system: for example, there are four sets of rules about backdated benefits. The appeals system shows that the Government's intention to get things right at first contact with a client does not always work. All too often, the client appeals and their case is upheld. We need to make sure that the right decisions are made at the first contact. Our report referred to the ““better-off”” calculations. If we are to convince people to come off benefits and go into work we need to get those calculations right, because people need to know whether they will genuinely be better off in work. It is important that we look at passported benefits such as free school meals and prescriptions. If a lone parent with three or four children gets a job, she will have to take into account the fact that in future she will be paying for school meals, which add up to a substantial amount each week, and she will have to pay for prescriptions for herself. If we do not give her full and comprehensive advice she will not be able to make up her mind whether she would be better off, so the calculations must be an honest assessment of all the financial implications of moving off benefit and into work. Some complexity in the system may be not only necessary but desirable. I agree with the Chairman of the Committee that we cannot make the system so simple that there are only one or two benefits, with no add-ons. If we fail to recognise the complexity of people's lives we shall let down some vulnerable people. It was put to us that individual claimants and members of staff might have different definitions of complexity.