Jobseekers (Back to Work Schemes) Bill — Second Reading

Part of the debate – in the House of Lords at 4:20 pm on 21st March 2013.

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Photo of Baroness Hollis of Heigham Baroness Hollis of Heigham Labour 4:20 pm, 21st March 2013

My Lords, like others in this House and like my noble friend Lord McKenzie, I have been in the Minister's shoes. Let us be clear, therefore, that I, like him I am sure, support work programmes that skill claimants. I remember when one lone parent told me, "I have a future now". I support them as long as DWP accepts good cause or good reason when the programmes are not appropriate. I therefore also support sanctions for people who can and should seek work but who knowingly refuse to do so without good cause, because without such sanctions the programmes become merely voluntary. I support these sanctions becoming increasingly tough so that the person knowingly refusing to comply becomes aware of the increasingly severe consequences of their actions. However, because I want to change behaviour and encourage good behaviour, I support the lifting of sanctions when the individual complies and comes into the Work Programme. While those sanctions last, I support a level of hardship payments so that vulnerable people-for example, children-have some degree of protection.

Such a simple, clear approach requires simple, clear communication with all claimants. I would hope that that is common ground around this House today. However, I say to the Minister that with this Bill the Government are not simply remedying some minor technical slip-up by the department, as Ministers would want us to believe. This Bill trespasses quite improperly on to new ground in four ways. Two of these have been well argued, by the noble Lord, Lord Pannick, in particular. It uses emergency legislation, normally reserved for national security issues. Why? It does so because the Government are not willing to trust the British justice system, presumably because they feel that they would lose in the Supreme Court. That is profoundly disrespectful to claimants. Therefore, we cannot scrutinise the Bill as we should, we cannot take it through the proper stages as we should, and, as the noble Lord, Lord Pannick, said, it is an abuse of Parliament. Worse, the Government make the Bill retrospective. Unlike the noble Lord, Lord German, I do not recall any retrospective social security Bill. It means, as the noble Lord, Lord Pannick, has said, that we are punishing people for actions which the courts have ruled were legal at the time they were committed.

My third objection is that the Government knew of the problem. The Social Security Advisory Committee, whose job it is to scrutinise regulations, warned that they were flaky, and the Government, as is their wont, ignored it. The Government, therefore, knowingly disregarded the very body set up to amber or red-light their regulations.

My final objection is that these so-called technical mistakes were far from technical. I ask your Lordships to remember that sanctions are not there to cut the benefit bill. They are there to change behaviour and bring people into the Work Programme. To change behaviour, you need to understand your client base and communicate effectively. That client base, at risk of sanction, is not for the most part made up of schemers, skivers or fraudsters, because that requires ingenuity, alertness and a certain competence. No; the sanctions pool includes the chaotic, the incompetent-unlike, of course, the DWP-the confused, often those with poor mental health, learning difficulties, weak organisational skills, and the functionally illiterate. It includes lone parents, the depressed, the poorly educated, and those with needy ADHD children. It includes young men, thrown out of their mother's home by a new stepfather and now sofa surfing and living hand to mouth without any routine.

How did the Government handle this client group before the court intervened? First, they told clients that their sanctions from the Work Programme could last up to 26 weeks, but the department failed to mention that the first offence would require a sanction of only two weeks, the second of only of only four weeks, and only subsequent offences of six months. Secondly, and more importantly-and this is certainly not technical-they failed to tell claimants that they could end their sanctions by doing what the Government and all of us want them to do, which is to comply with the Work Programme. Thirdly, the Government in their letters failed to draw attention to the underpinning of a hardship regime which protects vulnerable people and children from, frankly, going hungry.

Not to tell people about this step approach to sanctions, not to tell them how they can end the sanctions and not to tell them that they could access a minimal hardship payment is not merely a technical failure but a travesty of our responsibility to claimants, many of whom, I repeat, have chaotic lives, poor mental and physical health, limited literacy and are highly confused and vulnerable.

The Minister assumes, as always, economic rationality, yet he knows as well as I do that most people sanctioned did not know that they could be sanctioned or what they were sanctioned for. The DWP's own research, report 523 in 2008 and report 767 in 2011, revealed that between a half and two-thirds of those sanctioned did not know that this could happen and that, when it did, they did not know why. In some cases, because they were already having their benefits stopped to repay crisis loans, they were not even aware that they were being sanctioned at all. Benefit cuts therefore appeared to be something just arbitrarily happening to people like them to make them poorer. As the research concluded, not surprisingly the benefit sanction had little impact on their job-seeking behaviour because of the lack of clarity of communication. That is the Minister's client base. Just think about it.

We are trying to change behaviour, rightly. We may be trying to instil sensible habits, organisation and reliability, rightly. How will that happen if the sanctioned person does not know he is being sanctioned, why he is being sanctioned, what he can do appropriately to end the sanction, or what, if he is in hardship, he and his children can do to survive in the meanwhile? He has been made, so to speak, a financial outlaw without knowing why and what the law is that he is sanctioned for breaking.

I do not challenge at all the right to sanction people who should but knowingly refuse to participate in the Work Programme. The word is "knowingly". Those letters sent out by DWP did not tell claimants what they could and should expect if they did not comply-claimants who, above all, needed simple, clear information. The Appeal Court held that it should have done and it did not. That is not merely technical-it really is not-it is key to the moral as well as the legal validity of the entire sanctions process.

The noble Lord, Lord Freud, suggests that the Government should not have to pay out the £110 million to £130 million or so to rectify their mistakes to people who should have behaved differently and that the money would therefore have to be found elsewhere. I ask noble Lords on the coalition Benches mentally to replay this miserable tale, but this time substitute HMRC for DWP and taxpayer for claimant. If the Court of Appeal found that HMRC had acted illegally in fining-that is, sanctioning-taxpayers for, say, late submission because HMRC had failed to make taxpayers properly and fully aware of the fining/sanctioning regime, and that as a result the court argued that the fines collected were deemed to be illegal, what would the coalition Back Benchers be arguing? Would they support emergency retrospective legislation to make legal what the courts found was illegal in order to avoid repaying those improperly collected fines? Somehow, I think not. Noble Lords on the Benches opposite might even be outraged that the Government were seeking to make legal what had been ruled by the courts to be illegal. They might even think that HMRC was trying to put itself above the law because it had the power to change the law by rushing a retrospective Bill through Parliament. They might think that and they would be right.

The DWP got it wrong; it is deeply regrettable, but it happens. What it must not do is rush through retrospective legislation in indecent haste to insulate itself from the consequences of its own mistakes and seek to make legal what was illegal. If any claimant tried that line, they would be sanctioned. Perhaps the department might regard our amendment as such a sanction.