Extract from PMQs: Universal Credit - Sep 12

The National Farmers Union, the Federation of Small Businesses, the National Audit Office, the National Housing Federation, Gingerbread and the Royal Society of Arts—does the Prime Minister know what these organisations have in common?

Yes, I can tell the right hon. Gentleman that what those organisations all have in common is that, across a variety of areas of activity, they give excellent service, they promote the interests of those whom they represent and they are bodies with which this Government interact and to which this Government listen.

I am truly grateful to the Prime Minister for that answer, the first part of which I wholly agree with. What they also have—[Interruption.] It’s all right. What they also have in common is that they are telling this Government that their flagship benefits policy, universal credit, is flawed and failing hundreds of thousands of people both in work and out of work. In 2010, the Government declared that universal credit would lift 350,000 children out of poverty. Does the Prime Minister stand by that figure?

We introduced universal credit because we needed a system of welfare in this country that encouraged rather than discouraged people into work, that made sure that work always pays and that was a simpler system than the legacy system that we were left by the Labour party—remember the legacy system of the Labour party. It meant that we had individuals being paid £100,000 a year on benefits—all paid for by hard-working taxpayers earning a fraction of that sum.

The Child Poverty Action Group says that, far from taking children out of poverty, universal credit will now increase the number of children in poverty. Since 2010, half a million more children have gone into poverty relative to that time. The Government know that this policy is flawed and failing. Their own survey on universal credit found that many were in debt, a third were in arrears with their rent and half had fallen behind with their bills. Does the Prime Minister dispute her own Government’s survey, or dispute the experience of the claimants?

Let us look at the experience of some of the claimants. Roberta said, “My work coach helped turn my life around. He tailored his support to my situation and thanks to him I have found my dream job.” Ryan said, “I am happy with the new universal credit. My work coach has been great—I didn’t expect to have a job so soon.” Nayim said, “Universal credit gave me the flexibility to take on additional hours without the stress of thinking that this might stop my benefits straight away.” We have gone from a situation under the Labour party where 1.4 million people spent most of a decade trapped on benefits. We are helping get people into work, which is why, earlier this week, we saw unemployment yet again at a record low.

We are all constituency MPs, and I think that most of us are well aware of the pain that universal credit is causing when people come into our advice bureaux. Some 60% of families facing cuts owing to the two-child policy are in work. Universal credit is not making work pay; it is taking money away from families and putting more children into poverty. The National Audit Office report found that universal credit is creating hardship, forcing people to use food banks and could end up costing the system even more. Does the Prime Minister dispute the National Audit Office findings?

The right hon. Gentleman talked about constituency cases. I remember—[Interruption.]

Order. We are at a very early stage of the proceedings. We have got a long way to go, but questions must be heard and the answers must be heard, and as usual I want to get through the Order Paper.

The right hon. Gentleman started his question by talking about constituency cases. I remember the single mother who came to see me as her Member of Parliament when Labour was in government who told me that she wanted to get into the workplace and provide a good example to her child, but the jobcentre had told her that she would be better off on benefits. That is the legacy of the Labour party.

My question was about the National Audit Office. The Trussell Trust backs the NAO. It says that food bank usage in areas where universal credit has been rolled out is four times higher than in areas where it has not been introduced. But, without resolving any of those failings in the next year, the Government propose to inflict this on another 2 million people. As part of that transfer, hundreds of thousands of people with disabilities and on employment and support allowance, jobseeker’s allowance and tax credits will receive a letter telling them that their support will be stopped. They will have to make an application for universal credit. Does the Prime Minister think it is the responsibility of the Government who are changing the system to ensure that people retain the support that they need, or is it down to the individual, many of whom are very vulnerable people who need help and support?

What the Government are doing is delivering a system that does give support to vulnerable people, but encourages people to get into the workplace, because we know that work is the best route out of poverty. However, if the right hon. Gentleman believes that universal credit needed some change, why, when we made changes such as reducing the waiting days for payment and bringing in a housing benefit overlap to help people, did Labour vote against those changes?

It is Labour that has been speaking up for the poorest in this country. It is Labour that has been challenging this Government. It is Labour that wants a decency within our society that this Government are incapable of delivering. [Interruption.]

Order. Mr Spencer, I always thought you were a good natured, laid-back farmer. You seem to be a very over-excitable denizen of the House today. Calm yourself, man.

The mental health charity Mind says that there is a real possibility 

“that many people with mental health problems could see their benefits stopped entirely”.

It is outrageous that vulnerable people risk losing out because of these botched changes. 

The Government’s Brexit negotiations are an abject failure. I can see that by the sullen faces behind the Prime Minister—and that is not just the European Research Group; it is the whole lot of them. But everywhere you look, Mr Speaker, this Government are failing—1 million families using food banks; 1 million workers on zero-hours contracts; 4 million children in poverty; wages lower today than 10 years ago; and on top of that there is the flawed and failing universal credit. Disabled people at risk of losing their homes and vital support; children forced to use food banks—and the Prime Minister wants to put 2 million more people on to this. The Prime Minister is not challenging the burning injustices in our society. She is pouring petrol on the crisis. When will she stop inflicting misery on the people of this country?

The right hon. Gentleman talks about challenging the burning injustices. That is about setting up the race disparity audit, which says what public services do and how people from different communities in our country are treated by them.

It means saying that nobody in this country should be stopped and searched on our streets because of the colour of their skin—that was me as Home Secretary, never the Labour party. We are seeing 3.3 million more people in jobs as a result of our balanced approach to the economy. 

And what have we seen from Labour over the past few days? Iranian state TV broadcasting no-confidence votes against Labour Members of Parliament; police investigating anonymous and threatening letters about the deselection of Labour MPs sent to Labour offices; and, most shamefully of all, the hon. Member for Streatham (Chuka Umunna) saying that the Labour party is now an institutionally racist party. That is what the Leader of the Opposition has done to Labour—just think what he would do to this country.