Westminster Hall Debate – Effect of Social Security Changes on Equality

DA social inequalityYesterday, I spoke during a Westminster Hall Debate on effects of social security changes on equality in which I called on the Government to respond to my concerns after a damning dispatches programme on PIP.

You can watch my speech here or read it in full below:

 I sincerely congratulate my hon. Friend the Member for City of Chester (Christian Matheson) on securing the debate and his excellent contribution, and all Members on their contributions on such an important topic.

The hon. Member for Ross, Skye and Lochaber (Ian Blackford) mentioned the Resolution Foundation paper that was published yesterday. I used to work on inequality and there are a variety of ways of measuring it. He was probably talking about the Gini coefficient, which has been relatively flat over the past decade or so, but other data, such as those on the extremes of wealth in the top 1% compared with the bottom 1%, vary considerably. I will look at those data in a moment, but they show inequalities that hark back to the Victorian age. In fact, the IMF has said that income inequality is

“the defining challenge of our time.”

In the UK, 40 years ago, 5% of income went to the highest 1% of earners; today, 15% does. But this issue is about not just income but wealth. If we think back a few weeks to when the Panama papers were published, they revealed the shocking extent to which the assets of the richest are kept in offshore tax havens, where tax is avoided and evaded. According to the Equality Trust, another good source of data, in the past year alone the wealth of the richest 1,000 households in the UK increased by more than £28.5 billion. Today, their combined wealth is more than that of 40% of the population, which is equivalent to 10.3 million families—so, the wealth of 1,000 families is equivalent to that of 10.3 million families. While the wealth of the richest 1% has increased by 21%, the poorest half of society saw their wealth increase by less than a third of that. I could go on, but I have set the context.

Looking over the past six years at the regressive Budgets of this Government and the previous coalition Government, we should not be surprised. As the Institute for Fiscal Studies has shown, last month’s Budget left people on low and middle incomes proportionately worse off as a result of tax and social security changes, which is what we are discussing today. Regressive economic policies that mean that the total tax burden falls predominantly on the poorest, combined with low levels of public spending, especially on social security, are key to establishing and perpetuating inequalities. In particular, those on low incomes, the sick and the disabled have been hammered by this Government.

Since the Welfare Reform Act 2012, according to analysis by Demos and Scope, 3.7 million sick and disabled people have had approximately £28 billion in social security support cut. That does not include the cuts that we have seen to social care, access to transport and support for disabled children in schools—right across the piece, disabled people have been hammered. The Welfare Reform and Work Act 2016, which has only just been given Royal Assent, will compound the effects of those cuts. The cut of £1,500 a year for people on ESA WRAG—the work-related activity group—and the UC equivalent who have not been found fit for work is an anathema.

There is clear evidence from the Extra Costs Commission, as we have heard, that sick and disabled people face additional costs—estimated at £500 a month—because of their condition. The effect of further cuts in support will be to plunge even more sick and disabled people into poverty. We know that 5 million sick and disabled people are already living in poverty; what we do not know is how many more will be pushed into poverty as a result of those measures, because the Government have not assessed that. It is shameful that the Government have not done so, or even looked at the implications for people’s condition.

I am sure that the Minister will respond by saying that the Act is about incentivising sick and disabled people into work, but again we have contradictory evidence from various reports. In connection with the disability employment gap, which remains stubbornly high, only 124 employers signed up to the Disability Confident campaign.

That is the latest figure from the website. Also, last year, fewer than 37,000 disabled people received support from Access to Work, out of the 1.3 million disabled people who are fit and able to work. Much, much more needs to be done. It does not stop there. Other cuts have included the bedroom tax, cuts to supported housing through the local housing allowance and the 1% cut in housing benefit—there has only been a reprieve for the next 12 months. I could also mention other cuts and policies such as sanctions. Those are all having and will continue to have an adverse effect on the sick and disabled.

This is the first time that the Minister and I have debated since the recent change in leadership at the Department. The new Secretary of State made sympathetic overtures in his statement to the House, and I welcome the Government’s U-turn on the cut to the personal independence payment proposed in last month’s Budget, but as the Channel 4 “Dispatches” programme a couple of weeks ago showed, the PIP assessment process is clearly not fit for purpose. According to a number of my constituents—if I have time, I would like to mention a couple of them.

I would be grateful if the Minister could respond to the details I have sent him in writing regarding an inquiry to investigate the qualifications, training and behaviour of assessors; just how widespread the appalling behaviour we witnessed on that Channel 4 programme is; the validity and efficacy of the assessment tools—the Royal College of Psychiatrists was dismayed at the inappropriate standards and tools being used—particularly for people with chronic, fluctuating and mental health conditions; and the performance monitoring of contracts, not only in terms of activity levels but to ensure ethical standards of practice.

I have met many sick and disabled people since I was elected in 2011. Some are barely surviving and are hanging on by their fingertips. I genuinely fear for them. Of course, we know that many have not survived and have taken their own lives or just faded away.

Governing is about choices. The revenue lost to the Exchequer every year as a result of tax fraud is equivalent to what we spend on disabled people through DLA and PIP—£16 billion. If the Government truly believe in fairness and in addressing the real inequalities in this country, they need to reflect that in their policies. They need to clamp down on tax fraud and ensure that our most vulnerable in society are looked after properly, not plunged into poverty or worse. The Government should not just talk the talk, but walk the walk.

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