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Social Security Benefits Up-rating Order 2022

My Lords, I start with an apology. In my opening comments, I said the Government propose to spend an extra £6.6 million in the uprating order; it is actually £6.6 billion. Forgive me.

I thank all noble Lords who took part in today’s debate. I am not a bit surprised by the points that have been raised and completely agree with all noble Lords that we are in a difficult position. People are struggling and it is not nice to see.

The noble Baroness, Lady Lister, gave me my homework to take back to the department. I give her my word that I will take back every issue and make sure that people understand the sense of injustice that the noble Baroness and others feel. She and other noble Lords mentioned the cost of living. We have begun our recovery from the pandemic, but things have been exacerbated by the ongoing conflict in Ukraine, which is putting an additional strain on households. We are coming out of the pandemic and trying to work on that but have been further hammered by that position.

We have taken steps to ease financial pressures. The noble Baronesses, and the noble Lords, Lord Jones and Lord Shipley, will tell me that we have not done enough, but we have not done nothing. We have raised the national living wage, reduced the universal credit taper rate, increased work allowances and provided £140 million a year in discretionary housing payments and cold weather payments of £25 a week to up to 4 million people. These will have made a difference, but there is clearly more to do in the current situation.

The noble Baroness, Lady Lister, raised the point about the justification for using the September CPI figure. The Secretary of State undertakes an annual review of benefits and pensions, and the consumer prices index for the year to September is the latest figure the Secretary of State can use to allow sufficient time for the required legislative and operational changes before new rates can be introduced at the start of the next financial year. All benefit uprating since April 1987 has been based on the increase in the relevant price inflation index in the 12 months to the previous September.

As noble Lords have already said, uprating affects over 20 million customers and there are interdependencies across government. The DWP needs all benefit rates to be confirmed by the end of November, plus all the subcomponents of those benefits, so that the first IT system can be uprated in December. Any deviation will have significant implications for citizens, potentially resulting in underpayments or no payments being made. Given the volumes involved, the technical and legislative requirements and the interdependencies across government, it is not possible to undertake the uprating exercise any later than currently timetabled.