New Clause 17 - Review of application of sanctions

Welfare Reform and Work Bill – in a Public Bill Committee at 10:15 am on 20th October 2015.

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‘(1) The Secretary of State must before the financial year ending 31 March 2016 provide for a full and independent review of the sanctions regimes attached to working-age benefits, including but not limited to Jobseekers Allowance, Employment Support Allowance and Income Support, to determine whether they are effective and proportionate for meeting the Government’s objectives.

(2) The terms of reference for the review must include consideration of—

(a) the application of sanctions to lone parents with dependent children;

(b) the application of sanctions to claimants who are disabled;

(c) the effectiveness of sanctions in moving claimants into sustained work; and

(d) any other matters which the Secretary of State considers relevant.’ —(Emily Thornberry.)

To provide for a full, independent review of the operation of the sanctions regimes attached to out-of-work benefits, to determine the effectiveness of sanctions in moving claimants into sustained work as well as any adverse impacts on particular groups.

Brought up, and read the First time.

Photo of Emily Thornberry Emily Thornberry Shadow Minister (Work and Pensions)

I beg to move, That the clause be read a Second time.

The new clause is about having a review of the application of sanctions. Many shadows have fallen upon our discussions over the past few weeks. This particular shadow is whether there is a link between welfare reform and work. What happens to people who do not live up to the requirements imposed on them?

Too often in recent years the Government’s focus has been on a target-driven approach that has assumed that anyone out of work simply lacks willpower. The cornerstone of that approach has been the sanctions regime. The Committee might remember that the previous Minister for Employment, who lost her seat at the last election, took the view that

“people who get sanctions are wilfully rejecting support for no good reason”.

The evidence, however, had she or any of her colleagues cared to look, suggests otherwise.

As the Minister frequently reminds us, and as I am sure she will remind us again today, it is true that conditions have always been attached to the social safety net since unemployment benefit was first introduced in 1911. Nevertheless, the Government mislead the public when they fail to acknowledge that the sanctions regime introduced as part of the Welfare Reform Act 2012 marked a radical departure from the history of the welfare state and from the entire principle of evidence-based policy making.

The official justification of the Department for Work and Pensions for sanctions remains that

“they are there to encourage claimants to take reasonable steps to find employment or move closer to the labour market”,

but its own impact assessment for the 2012 changes acknowledged that there was insufficient evidence for the proposed approach achieving that. Since then, of course, extensive evidence has emerged that demonstrates that sanctions are deeply counterproductive if helping people into work is really the intention.

The number of people claiming jobseeker’s allowance has fallen since 2012, but that has coincided with a significant rise in the number of people whom the Office for National Statistics classes as economically inactive—not unemployed or claiming jobseeker’s allowance, but statistically almost non-people. Interestingly, many of those economically inactive people, if asked why they have become economically inactive, give their reason as being discouraged. So that is their reason—they have been discouraged and so dropped out of the labour market altogether. I would have thought it was important to do some work on what “discouraged” means and on the experiences of those discouraged people, because there might well be a clear link between cause and effect.

Research published in January by Oxford’s Professor David Stuckler found that, of those sanctioned between 2011 and 2014 who subsequently stopped claiming benefits altogether, only 20% said that it was because they had found work. According to the professor, all those people were sanctioned and 80% of them then stopped claiming benefits, but not because they had found work. So they are all off the jobseeker’s allowance statistics and are no longer unemployed. In some ways, therefore, perhaps there has been some success.

To the extent that increased sanctions have had an identifiable impact at all, it has been to increase dramatically the levels of hardship and poverty in recent years, as illustrated most starkly in the extraordinary rise in food bank use. I do not know how many Members were at the Trussell Trust breakfast this morning, but one of the stories I heard arose because the trust has started to give medical advice at some of its food banks. It was giving medical advice to a nurse who had a condition that meant she needed to take various pills. The nurse in her knew that she had to take the pills regularly, but the mother in her knew that, because their tax credits had been wrongly taken away and they were in great need, she had to give the food in the cupboard to her children. So she was taking the pills without having eaten anything and was causing herself more harm. There are hundreds of thousands of these stories and unfortunately things seem to be getting worse, not better. We understand that last year, a million people took advantage of food banks. One has to wonder what would happen if they were not available. According to the 2014 survey by the Trussell Trust, 83% of food banks said that the new sanctions regime had caused an increase in the number of people needing their help.

Another very odd thing about the sanctions regime, which would be addressed if the new clause were accepted, is that different towns and villages have different numbers of people going to food banks and different levels of sanctions. There is one jobcentre where in one month, 40% of people were on sanctions. If there are such extraordinary variations happening within the system, there is clearly unfairness. If individuals within jobcentres are given powers and exercise them with a wide element of discretion, that discretion will clearly be exercised differently in different jobcentres. In some areas there will be more strain on food banks, let alone on the poorest and most vulnerable who continue to be sanctioned.

Photo of Neil Coyle Neil Coyle Labour, Bermondsey and Old Southwark

It might surprise my hon. Friend to learn that part of the strain on the resources of the food bank in Southwark, which is provided by Pecan as part of the  Trussell Trust’s network, comes from people in work. Some 10% of that food bank’s users are working, and the Government have just made that a whole lot worse with their tax credit changes.

Photo of Emily Thornberry Emily Thornberry Shadow Minister (Work and Pensions)

My hon. Friend is right. The range of people going to food banks is very alarming. It is not enough to say, “Oh well, it’s because people know that there are food banks now. They didn’t know about them in the past, but now they do, and they are going in because it’s free and taking a can of beans, but they don’t really need it.” That may be how some Government Members feel that people behave. There is another point of view, which is that to go to a food bank is completely humiliating. It is the worst.

I raise my own personal experience again. After my family got thrown out by the men with the bowler hats and went into social housing, I remember my mother used to get boxes of food from friends. It was embarrassing, but it was the way we kept things together; there were no food banks at that point. I remember that one of the food boxes always used to include Campbell’s meatballs. My mother kept them under the stairs and threatened us that if we did not eat what was on our plates, we were going to have to eat the meatballs instead. They may still be under the stairs for all I know. But at least those boxes of food were delivered to our door, instead of my mother having to go out to ask for food. That is humiliating for anybody, for heaven’s sake.

What the Government’s sanctions regime has brought us is increased hardship and suffering, with no tangible gains in the likelihood that those affected will move into work as a result. If we could be confident that all this suffering was resulting in something good, that there was meaning and that people were moving into work who would not have moved into work otherwise—can the Conservative party show us some real evidence of that?—that would take some of the edge off the terrible stories that we hear, which show that the sanctions regime is simply unfair. How on earth do people manage if they are living from hand to mouth, have no savings and have exhausted the support they can ask for from their families and friends, but then are sanctioned a third time and given nothing for three months?

Last year, under sustained pressure, the Government commissioned a review, which was carried out by Matthew Oakley, of the impact of some sanctions on some people, but it was notable more for its limits than for its findings and recommendations. To begin with, the terms of reference limited Oakley to considering only sanctions imposed on people claiming jobseeker’s allowance, and only in cases in which sanctions were imposed as part of mandatory back-to-work schemes such as the Work programme. In other words, it looked at only about a third of the sanctions imposed on people claiming a single out-of-work benefit. It did not look at the specific circumstances of disabled people, single parents or anyone sanctioned by jobcentres.

Recognising those limits, the Select Committee on Work and Pensions stepped in with a report, which was published earlier this year. The report offers the most comprehensive, fair and judicious overview we have had for some time. In the first of its 26 recommendations—after  seven months, the Government have still not responded to them—the report said the Department for Work and Pensions should

“establish a broad independent review of benefit conditionality and sanctions, to investigate whether sanctions are being applied appropriately, fairly and proportionately, in accordance with the relevant Regulations and guidance, across the Jobcentre Plus network.”

I cannot see what is wrong with that. If the Government are dragging their feet, is it possible that that is because they have something to be afraid of? If they have nothing to be afraid of, why do they not answer the Select Committee’s report for a start, and why do they not establish a broad, independent review of benefit conditionality? It is the conditionality—allowing decisions to be made under discretion—that is causing the most difficulties. Why should the Government be afraid of looking at whether sanctions have been applied appropriately, fairly and proportionately, in accordance with the guidelines, if they are so confident that everything is hunky-dory? Clearly, everything is not hunky-dory.

The Government’s inordinate delay in responding to the Select Committee’s inquiry does not inspire much confidence that its advice will be heeded. New clause 17 would take the decision out of Ministers’ hands, requiring them to submit to a full, genuinely independent review of the sanctions regime. Under the new clause, the review would need to establish what the regime was intended to achieve and whether the available evidence supported the current approach.

Despite years of pressure, Ministers have repeatedly resisted efforts to have a full inquiry. In new clause 17, we offer them an opportunity to reconsider; in fact, we offer them an opportunity to provide for an inquiry in law so that they can no longer duck and dive, trying to avoid collecting evidence on this fierce and unfair regime. We urge the Government to support the new clause. If they will not, we would ask them simply: “What are you afraid of?”

Photo of Debbie Abrahams Debbie Abrahams Shadow Minister (Work and Pensions) 10:30 am, 20th October 2015

I am very pleased to support the new clause, and I congratulate my hon. Friend on her excellent speech.

I have been campaigning on this issue for more than two years. I started when a constituent came to me and told me that he had been going through the work capability assessment process when the nurse conducting it said, “I think you’re having a heart attack. You need to go to hospital.” Off he trotted, and he was okay, but, two weeks later, he got a letter through the post saying that he had not completed the assessment so he was going to be sanctioned. That was how this all started for me. I thought, “Possibly this is just a one-off,” but then I heard more and more cases not only from constituents but from people right across the country. That corresponded with the introduction of the new sanctions regime at the end of 2012 as part of the Welfare Reform Act 2012.

People on not only employment and support allowance but JSA were being sanctioned. Sometimes that was for being a few minutes late. I have heard other examples of increasingly unreasonable reasons, such as people being sanctioned for attending their mother’s funeral or, absurdly, for going to a job interview. That is the ridiculous state the sanctions policy is in.

I have also heard of another worrying category of reasons, which can only be described as fabricated. I still have an email from a constituent saying that he had  been sanctioned because he had not attended an interview with his adviser. He came to my office and showed me the evidence that he had not seen that specific adviser but he had seen another. He asked how he could possibly be sanctioned.

I wondered what on earth was going on, but it all fell into place when another constituent came to see me. He had been an adviser in various Greater Manchester jobcentres for more than 20 years. He was so appalled with what was going on that he had to tell me. He said that there were targets for sanctions that are part of the performance monitoring for jobcentres. The aim is to get people off flow, and sanctions were the way to achieve that.

My hon. Friend mentioned the recent inquiry, but before that the Work and Pensions Committee undertook an inquiry into the role of Jobcentre Plus in the reformed welfare system. When the then Minister came to the Committee I asked whether she would undertake a more detailed, independent inquiry. The Select Committee thought that she had agreed to that. Paragraph 100 of its report states:

“We strongly believe that a further review is necessary and welcome the Minister’s commitment to launch a second and separate review into the broader operation of the sanctioning process.”

As we know, there has been a bit of backtracking on that. The report concluded:

“Our evidence suggests that many claimants have been referred for a sanction inappropriately or in circumstances in which common sense would suggest that discretion should have been applied by JCP staff. DWP should launch a second, broader, independent review of conditionality and sanctions, to include investigation of whether the process is being applied appropriately, fairly, proportionately and in accordance with the rules, across the Jobcentre network.”

That was an all-party report indicating that the situation was very worrying.

In addition to those very serious ethical issues, there were and still are concerns about the numbers of people affected, and in particular the meteoric rise in the use of sanctions for employment and support allowance claimants. Between December 2012 and 2015 jobseeker’s allowance sanctions were 3.6 million, including 1.7 million adverse decisions. In the case of ESA sanctions—remember, those affect people who have been found not fit for work—from November 2012 to March 2015 there were 245,679 sanctions, including 68,400 adverse. That compares with the June 2010 to October 2012 period, when there were 60,363, including only 27,919 adverse. That is more than a doubling in ESA sanctions.

As my hon. Friend said, the regime is particularly punitive. A sanction is for a minimum of four weeks and can be for up to three years. The Government have said that it is very unlikely that people will be sanctioned for three years, but I am afraid it has happened. It particularly affects young and disabled people and lone parents.

During 2013-14 it became clear that although no other benefits, for example housing benefit, were meant to be affected, they were. As soon as someone was sanctioned, they were automatically having housing benefit and other benefits stopped. That exacerbates the position of people already on incredibly low incomes.

Photo of Emily Thornberry Emily Thornberry Shadow Minister (Work and Pensions)

Might I take advantage of this moment to point out that, when my local law centre takes up appeals on sanctions, it has a 100% success rate?

Photo of Debbie Abrahams Debbie Abrahams Shadow Minister (Work and Pensions)

My hon. Friend is absolutely right. Cases are often overturned on appeal, but for someone on ESA—that means they are not well—going through that process is traumatic and can exacerbate the condition. I will come to that in a moment.

My hon. Friend mentioned the Oakley review, which reported in July 2014. It looked specifically at the JSA sanctioning. It was an important step, but there were still many unanswered questions, which is why the Select Committee wanted to look at it in more detail.

I am aware of the dreadful circumstances of food bank use to which my hon. Friend has alluded—in my area, 60% of food bank use is attributed to sanctions. More shockingly, I am aware of the reports of accidental deaths following sanctions. Those have been included in coroners’ reports, so I do not mention them lightly. David Clapson was one particular case. He was a former soldier who gave up his job with BT to care for his mum, who had dementia. When she died, he wanted to get back to work and signed on at the jobcentre. He missed an appointment with his job adviser and was sanctioned. He was diabetic. Without the £71.70 a week from his jobseeker’s allowance, he could not afford to eat or put credit on his electricity card to keep the fridge where he kept his insulin working. Three weeks later, David died from diabetic ketoacidosis caused by a severe lack of insulin. He was 59. A pile of CVs was found next to his body. The coroner said that, when he died, he had no food in his stomach. His sister, Gill Thompson, has campaigned tirelessly to get an independent review into sanctions. The petition she started has more than 211,000 signatures to date.

David is not the only person to have died following sanctions. There have been 49 peer reviews following the death of a claimant, but the DWP is still not prepared to release the details of whether sanctioning was involved. I hope Ministers reconsider that.

The Work and Pensions Select Committee inquiry reported in March. If anything, the Opposition’s concerns from the previous inquiry worsened. The negative impacts on poverty, including child poverty, debt, physical and mental health, were reported. The Committee was given the example of a woman who had discharged herself when she was in hospital because she was frightened of being sanctioned.

There is evidence that the sanctions targets were driven by targets to get claimants off-flow, distorting the JSA figures. As my hon. Friend the Member for Islington South and Finsbury has mentioned, the team from Oxford analysed data from 376 local authority areas and found that 43% of JSA claimants who were sanctioned left JSA. As my hon. Friend said, 80% did so without having a job.

The main recommendation from the Select Committee was for a more detailed independent inquiry. Matthew Oakley said that he expected that to happen. I am at a loss as to why the Government are dragging their feet. Surely that is the very least we should do for the people who have lost their lives following sanctions and for their relatives. I hope the Committee will do the right thing and support the new clause.

Photo of Hannah Bardell Hannah Bardell Shadow SNP Westminster Group Leader (Business, Innovation and Skills) 10:45 am, 20th October 2015

My colleagues have spoken very passionately on the new clause and the Scottish National party absolutely supports it. It might be interesting for the Committee if I shared some of Michael Adler’s report on benefit sanctions and the rule of law. In his concluding remarks, he says:

“We now come to the question of whether benefit sanctions are compatible with the rule of law. My conclusions, and I must stress that these are my personal conclusions and that other people may wish to take issue with them, is that they are not.”

The SNP has, for a very long time, in Committee, on the Floor of the House and publicly, opposed the sanctions regime and called for a root-and-branch review. Much of that is highlighted in Mr Adler’s report. He notes how

“the House of Commons Work and Pensions Committee (2015) reiterated its previous call for a comprehensive, independent review of sanctions and for a serious attempt to resolve the conflicting demands on claimants made by DWP staff to enable them to take a common-sense view on good reasons for non-compliance. The Committee concluded that there was no evidence to support the longer sanction periods introduced in October 2012 and recommended the piloting of pre-sanction written warnings and non-financial sanctions. Sadly, these recommendations seem to have fallen on deaf ears and to date there has been no response from the DWP to the Report.”

I encourage DWP to give us its thoughts on that and why it cannot take that on board.

Mr Adler also says in his report:

“Vulnerable claimants are most likely to be sanctioned and, despite the availability of hardship payments, many of those who are sanctioned experience enormous hardship. Anecdotal evidence suggests that many of them end up becoming homeless, using food banks and resorting to crime.”

As DWP has said, sanctions are supposed to be part of a benefits system that gets people back into work and helps people. How can that be the case when someone of that credibility suggests that they are damaging society so badly?

I have not yet been in office for six months, but at least 25% of the workload coming through my constituency surgery and office is down to people who have been sanctioned. One of those is someone who suffers from Parkinson’s and who was treated appallingly by a representative of DWP. I am fighting that case and I have taken it up on the Floor of the House. I urge DWP and Ministers to look again at the sanctions regime and how it is treating vulnerable people in our society. It is not encouraging them back into work and it is not helping their families. We must have a root-and-branch review and listen to the Committees of the House on which Members across the political divide sit so that we can have a sensible approach to treating the most vulnerable.

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions)

Let me start by saying that the Government keep the operation of the sanctions system under constant review to ensure that it continues to function effectively and fairly. Where we identify an issue, we will act to put it right. It is therefore unnecessary to embed the implementation of a review in the Bill. The Government have made a number of improvements to the JSA and ESA sanction systems following recommendations made by the independent review led by Matthew Oakley only last year. That improvement work is continuing to ensure that the Oakley recommendations are acted on  in the right way where possible. In addition, we are taking the opportunity to ensure that the ongoing improvements in the review are built into the design and delivery of universal credit.

We have not only responded promptly and positively to the recommendations, but have gone further. We have improved the clarity of the JSA and ESA hardship application process, and made improvements to the payment process to ensure that payments are made within three days. We have carried out a review to check that our systems are operating effectively in respect of housing benefit, and that housing benefit is not impacted when a sanction is applied. We have introduced an improved claimant commitment for JSA jobseekers on the Work programme. We have also revised guidance to encourage jobseekers to share that claimant commitment with their provider. That will ensure that jobseekers understand what is required of them—their responsibilities both to Jobcentre Plus work coaches and Work programme providers—and that providers are clear on any previously agreed restrictions for the jobseeker, helping them to design tailored support.

We have made significant improvements to the decision-making process to ensure that doubts about actively seeking work are resolved quickly. The vast majority of decisions are now made within 48 hours, including consideration of good reasons. Our systems are ensuring that, when decisions are made in the jobseeker’s favour, their benefit payments are transferred to them using faster electronic payment systems to ensure that payment reaches their account on the same day.

I would like to touch on a couple of the points hon. Members have made. Sanctions were discussed in Committees in the previous Parliament, and there have been many debates about sanctions in the Commons Chamber and in Committees. Each month, more than 99% of ESA claimants comply with the requirements that are asked of them with regard to sanctions, and the individuals are asked only to meet the requirements that they agree with their advisers. That includes consideration of any health conditions, disabilities or health impairments.

Photo of Neil Coyle Neil Coyle Labour, Bermondsey and Old Southwark

There are individual examples. A man with a visual impairment and who has a guide dog was sanctioned for non-compliance. He did not know what the agreement said, because he was never sent it in an accessible format—he never had a Braille copy of the agreement. That was raised with the Royal National Institute of Blind People. A case was raised with Mencap of someone with a significant learning disability who never understood what the agreement meant, could not comply with the proposals that he had supposedly agreed to, and ended up being sanctioned. Does the Minister agree that those examples do not reflect a system that she has described as effective and fair? Where is the Department’s review of accessible formats provision?

Photo of Priti Patel Priti Patel Minister of State (Department for Work and Pensions)

The hon. Gentleman is right to give those examples. What happened is not right. He mentions accessible formats. I will go away and report back to him on that, but what happened in that case is simply not right—that should not have happened to someone with a visual impairment.

The Department is considering the contents of the Work and Pensions Committee report and looks forward to working with it not just on that, but on future reports.

I come back to my point that, with all our policies, we will keep the operation of the sanctions system under review. We are focusing our efforts on continuing to improve the process on JSA and ESA to ensure that the agreed recommendations can continue to be delivered in the existing universal credit live service and embedded into the design and build of the emerging universal credit digital service. On the basis that we have a system of continually reviewing the sanctions system and are looking at it with regard to the universal credit live and digital services, I urge the hon. Member for Islington South and Finsbury to withdraw the new clause.

Question put, That the clause be read a Second time.

The Committee divided: Ayes 8, Noes 10.

Division number 57 Decision Time — New Clause 17 - Review of application of sanctions

Aye: 8 MPs

No: 10 MPs

Ayes: A-Z by last name

Nos: A-Z by last name

Question accordingly negatived.