Welfare Reform Bill — Second Reading

Part of the debate – in the House of Lords at 6:06 pm on 13 September 2011.

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Photo of Baroness Meacher Baroness Meacher Crossbench 6:06, 13 September 2011

My Lords, I congratulate the noble Lord, Lord Feldman of Elstree, on his very pertinent maiden speech. With a legal background as a commercial barrister, the noble Lord's contributions to the House will surely be incisive and hard hitting. As the former managing director and chief executive of his family's textile manufacturing business, he brings invaluable commercial expertise, and as the organiser of the operations and fundraising for David Cameron's leadership campaign, he is clearly someone who expects, and achieves, success. Noble Lords, particularly Cross-Benchers, will I am sure gain great confidence if they find him on their side of an argument. Again, I congratulate the noble Lord, Lord Feldman of Elstree, and welcome him to the House of Lords.

I begin my remarks on the Welfare Reform Bill by applauding the Government and, most particularly, the Minister for some of the valuable reforms in this Bill, which include: the serious attempt to simplify the system-anyone who knows about welfare benefits knows the importance of that objective; the integration of the universal credit and Inland Revenue databases enabling truly automatic benefit adjustment-what could be more important?-in response to earnings changes; and the two-year window for automatic reinstatement of benefits if a job does not work out. All three are vital changes to reduce the risk of taking a job for people, in particular those with mental health and other fluctuating disorders. I will focus my attention on those groups because I believe that they are the most difficult to help. I say clearly that I have serious and considerable concerns about the Bill, albeit that I recognise its strengths.

As other noble Lords have pointed out, one of our great difficulties in debating this Bill is in distinguishing between the impact of the cuts and the impact of the structural changes. I believe that it is a combination of both that will threaten the stability of the lives of vulnerable individuals and the very fabric of communities. The housing benefit changes are among the most threatening. Many other noble Lords will address those issues and, therefore, I will not do so.

The new personal independence payment presents very severe risks for people with mental health problems. The Minister has been clear in emphasising that benefits will be focused on those in greatest need. Who can disagree with that? But we know that assessing people with mental health problems is far harder than assessing those with physical disabilities-in part, because mental health problems fluctuate from day to day and from week to week, as everyone knows. ATOS and jobcentre staff have all been confounded by these problems. I understand from the Minister that the assessments for PIP will be based on, but different from, the assessments for ESA. This gives me some assurance but I remain most concerned about this issue. How many mentally ill people will be wrongly deprived of their benefits, with disastrous consequences? That is something we need to address in discussing the Bill.

I have been involved in a small way with the excellent work of Professor Harrington and a group of mental health charities to improve the descriptors used in the assessments. I am also aware of the planned improvements in the assessment process for ESA, using a report from the claimant's preferred clinician and having the final decision on ESA entitlement made by Jobcentre Plus staff rather than ATOS. Perhaps the Minister can confirm that these elements of the assessment process for ESA will apply also to personal independence payments. I think and hope that they will.

In the end, the validity of the decisions about whether a claimant with bipolar disorder or agoraphobia should be entitled to PIP will depend considerably on intelligent decision-making by well trained and highly skilled Jobcentre Plus staff. My biggest fear is that, under financial pressure, the DWP will have underpaid, underskilled and overworked staff making these key decisions affecting people's lives.

In a discussion with carers of severely mentally ill people in east London last week, they talked about their recent reassessments for benefit and described being "terrified"-their word not mine-because the interviewers had no idea or understanding about the conditions with which they were dealing. One carer referred to a report following an assessment that completely misunderstood the mental disorder of her son. Can the Minister give some assurance about staff training and pay? You cannot get decent staff unless you pay them.

My next point concerns conditionality and sanctions. The Bill significantly increases the use of conditions and sanctions for claimants of employment and support allowance. We all know that there are individuals and families for whom a life on benefits has become the norm and for whom a strong conditions and sanctions regime is essential in their own interest to try to re-establish them in an independent life. However, such a system presents huge risks for people whose minds are not clear. A severely depressed claimant may not do what a severely physically disabled claimant would take for granted: open letters, read them, understand them, realise the need to respond and so on. For someone lying in bed wanting their life to end, none of these conditionality requirements will be met-and what then?

Certainly for people using secondary mental health services, most undoubtedly benefit from undertaking work-related activities, so much of this Bill is common sense and we all agree with the principles. The trouble is, when you look at the application the panic starts. Inappropriate conditionality and sanctions can easily be counterproductive and fairly disastrous. For this very substantial group of ESA claimants, the regime must be supportive, skilled but not frightening.

On a different issue, for this group of claimants the option of having the rental element of universal credit paid direct to the landlord is vital. I understand the principle of encouraging independence and getting people to pay for their own rent, but we have to find a way forward for this group and maybe others that noble Lords may highlight. Failure to find a resolution to this problem for this group will lead to more homelessness and hospital admissions. How many more psychiatric hospital beds can we afford?

The plan to limit contributory ESA to 12 months for people in the work-related activity group is a further matter of concern. The issue is perhaps assessment for the support group. If employers are not going to take people on, they will not get a job within 12 months. That needs to be part of the thinking in assessment for the support group.

I am running out of time. For claimants with mild to moderate anxiety or depression, the availability of good quality CBT is going to be essential if the Government are to reduce radically the numbers of that group on ESA in a caring way. For people addicted to drugs or alcohol, special benefit conditions need to be established. Regular interviews and job applications simply will not work. I applaud the Minister for removing the provisions in the previous Welfare Reform Act, but we need to do more work on that group.

In conclusion, I hope we can agree solutions to these problems, without resorting to votes, through discussion and greater understanding. I look forward to working with noble Lords to improve the Bill and ameliorate the hardship which will, without any question, result if the Bill goes through as it stands.