8. 8. Plaid Cymru Debate: Universal Credit

– in the Senedd on 25 October 2017.

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(Translated)

The following amendments have been selected: amendment 1 in the name of Paul Davies, and amendment 2 in the name of Jane Hutt. If amendment 1 is agreed, amendment 2 will be deselected.

Photo of Ann Jones Ann Jones Labour 5:28, 25 October 2017

We will now move on to the Plaid Cymru debate on universal credit, and I call on Bethan Jenkins to move the motion.

(Translated)

Motion NDM6549 Rhun ap Iorwerth

To propose that the National Assembly for Wales:

1. Expresses concern about the roll out of universal credit.

2. Believes that administrative control over welfare should be devolved so that the Welsh Government can alter the frequency of payments, end the culture of sanctions, and ensure payments to individuals not households.

(Translated)

Motion moved.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru 5:28, 25 October 2017

I’d like to open this debate by placing Plaid Cymru’s opinion on this policy firmly on the record from the outset. Universal credit is a pernicious and cruel policy cooked up in the out-of-touch corners of the Tory party like a gone-off Eton mess to penalise those looking for work. It’s a well-known fact that certain elements of the Conservative Party and those in UKIP who used to be Tories once upon a time have long held disdain for those in poverty or out of work. There’s been a long-term push amongst elements of the right to instil this notion of the deserving or the undeserving poor, a black-and-white simplistic response to the complex issues of poverty, deprivation and unemployment that doesn’t work in the real world.

If universal credit is meant to incentivise work, it suggests that, before universal credit, there was no incentive. Can anybody tell me with any seriousness that the regime before universal credit was generous or a giveaway for the out of work or poor? If anyone believes that, then clearly they have never been on benefits or possibly never had a proper conversation with anybody else who has even before the current universal credit roll-out. If this policy is about getting people to work and creating more responsibility and empowerment for claimants with a monthly payment, including the housing element, why the arbitrary, pointless and mean-spirited six-week payment delay? Can anybody representing the Conservative Party tell me why a new claimant in Aberavon, for example, will have to wait such a long time for a first payment if that person has unexpectedly been let off? Who will explain to someone why they may be late paying bills and go into unmanageable arrears? What rationale is there from the UK Government for this? Or is there, as I suspect, no real reason, as Angela Burns said in a leaked e-mail yesterday, and I quote:

I think this position is indefensible and if I’m challenged I will say so. For the life of me I cannot understand why a 6 or 4 week gap is deemed acceptable. It should be a seamless transition and it’s not beyond the wit of man to make it so...this cavalier attitude that the poorest can muddle through is callous at best and downright cruel at worst. I’m ashamed of my Government.’

Well, I must say that I fully agree with Angela Burns here. I’d like to focus specifically on that aspect of housing a little more, because the roll-out of universal credit, far from incentivising work and responsibility, is actually putting the roof over the heads of the unemployed at risk.

Let’s start with one damning fact. Almost half of all council tenants in the—.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

Well, you can come in if you want to make an intervention. I’m happy for you to confirm your views in that e-mail.

Photo of Ann Jones Ann Jones Labour

If Members would just carry on speaking and I’ll decide who’s going to be able to get up and speak, and if you could keep quiet to listen, as well.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru 5:31, 25 October 2017

Let’s start with one damning fact. Almost half of the council tenants in the 105 local authorities who receive the housing element of universal credit are in arrears by a month. Nearly a third are behind by two months, whereas those still on housing benefit—only 10 per cent of council tenants—are a month behind, and less than 5 per cent of that group are two months or more behind. So, tell me again how universal credit helps in this regard. When the overall benefit itself is often cut and the UK Government expects those on the credit to simply muddle through, factor in all inexplicable delays and you have a recipe for disaster—evictions, court proceedings, court costs and the spiral of debt and charges that becomes too much for many to bear. And then, of course, there’s a final slap in the face. When someone in a difficult situation needs to call to enquire about the benefit and why there is a delay or a sanction or a late payment, they get charged up to 55p per minute. Thankfully, that particular penalty on the poor and disadvantaged is now being phased out, but only because of public pressure.

The administrative charges have also been poorly managed at best. Administrative control would benefit us here in Wales and make the lives of claimants better to properly incentivise work, whilst not condemning people to poverty in the process. When it comes to universal credit, the SNP have used their limited powers to propose more frequent payments—twice monthly—allowing people to have the housing component paid directly to landlords. However, they do not have the ability to prevent the culture of sanctions, in principle. The new social security Bill also imposes duties on Scottish Ministers to give assistance, which means that they could design discretionary housing payment systems to mitigate sanctions.

We must have the control of benefits devolved to Wales, so solutions designed for our country can be put into practice as they are being done in other parts of the UK. If Labour was serious about altering the current benefits and housing assistance regime, they would be supporting the devolution of benefit spending and policy, including universal credit. I fear, however, as we’ve witnessed with the bedroom tax and zero-hours contracts in the past, that they would prefer to make warm speeches, as you may hear today, condemning the Conservatives on a UK level, but not making or demanding the powers here in Wales so that we can be the masters of our own destiny. We’ve had similar issues on similar cases where we have the decisions, we have the powers within our control to be able to lead on this agenda.

I hope that the Welsh Government will now support the full devolution of benefits, which our people so clearly need, and I would hope that the Welsh Conservatives can follow the lead of some of their colleagues here in telling the UK Government to make changes, or abolish this harsh, arbitrary and pernicious regime. If we agree, as parties—or other AMs may agree—that this is a policy that is harming those who are in poverty, then we should be using every power that we have, even if that’s principled and moral power, to say to the UK Government that they should abolish this particular universal credit regime.

Photo of Ann Jones Ann Jones Labour 5:34, 25 October 2017

Thank you very much. I have selected the two amendments to the motion. If amendment 1 is agreed, amendment 2 is deselected. I call on Mark Isherwood to move amendment 1, tabled in the name of Paul Davies.

(Translated)

Amendment 1—Paul Davies

Delete all and replace with:

To propose that the National Assembly for Wales:

1. Acknowledges concern about the roll-out of universal credit.

2. Welcomes the principles behind universal credit, which are to give people a helping hand into work, and notes that when the Centre for Social Justice envisaged universal credit it found that most people claiming benefits wanted to work but were held back by a system that did not incentivise employment.

(Translated)

Amendment 1 moved.

Photo of Mark Isherwood Mark Isherwood Conservative 5:34, 25 October 2017

Diolch. I move our amended motion. As it states, the National Assembly for Wales acknowledges concern about the roll-out of universal credit. Two weeks ago, I wrote to the UK Secretary for Work and Pensions regarding universal credit helpline charges, imploring him to immediately explore and consider alternative options in a situation in which some people have been charged up to 55p a minute to discuss their individual claim in English, creating further barriers and much distress, whereas the Welsh language helpline is free. We were therefore pleased to hear last week’s announcement that this charge would be scrapped. We also welcome reports that UK Ministers could reduce the waiting time for universal credit payments from six weeks. As the MP for Stevenage said on Saturday, on that particular issue I think we are very, very close to getting a resolution.’

It is, in fact, great to see backbenchers in the Government party doing their democratic job and their Government listening, and a shame that we haven’t seen the same here from Labour backbenchers on issues ranging from warnings over a decade ago that Labour’s massive social housing cuts would create a housing supply crisis, to their failure to speak up publicly now in support of disabled campaigners fighting Welsh Government plans to scrap the Welsh independent living grant.

Our amended motion also welcomes the principles behind universal credit. As the communities Secretary said here himself last week, the principle of the universal credit programme wasn’t wrong’.

When the Centre for Social Justice, which has two Labour Members on the board, envisaged universal credit, they found that most people claiming benefits wanted to work but were held back by a system that did not incentivise employment. They found that, despite a massive redistribution programme, worklessness was becoming ingrained in many parts of the UK. Research, however, found that universal credit claimants in the initial roll-out were 13 per cent more likely to have been in work than those on jobseeker’s allowance and earning more money than those on jobseeker’s allowance.

Evidence today shows people are moving into work faster and staying longer in their job as a result of universal credit. Claimants will no longer need to go through the bureaucracy of changing their benefit claim when they enter work, as universal credit stays with them. Advances are available for anyone who needs them, and around half of people take this up. For those who can’t wait until their first full payment, interest-free benefit payment advances are available within five working days, and if someone needs it urgently, this can be made on the same day. Over 50 per cent of new claimants have made use of these payments.

At the beginning of this year, 55 per cent of people on universal credit weren’t getting their first payment on time, but now over 80 per cent get the right amount on time the first time, with the remaining 20 per cent having missing information. The most recent expansion phase will only take the proportion of the forecast universal credit claimant population from 8 per cent currently to 10 per cent by the end of January, with time to address issues as they arise built into the roll-out schedule. Over three quarters of tenants were already in rent arrears before they started claiming universal credit, but, after four months on universal credit, this had fallen by a third.

Photo of Mr Simon Thomas Mr Simon Thomas Plaid Cymru

I heard what he just said about how the roll-out will allow these issues to be ironed out, going forward. Can he understand, therefore, why we have it trialled in Torfaen and Flintshire here in Wales, and today, in fact, in the last 10 minutes, the Welsh Local Government Association has said, on the basis of those trials, it should be paused in Wales for reflection?

Photo of Mark Isherwood Mark Isherwood Conservative 5:38, 25 October 2017

Seeing the signatory, I suspect there was something of a political motive there, coinciding with this debate.

However, as I said, arrears have fallen for those on universal credit by a third after four months. However, it has always been recognised that although most people on low incomes manage their money and want to, some will need extra support, which is why the UK Government issued the universal credit local support services framework in February 2013, developed between the Department for Work and Pensions and partners, including the Welsh Local Government Association.

This ensures that claimants who are not yet ready to budget for themselves on a monthly basis or are unable to use the internet are protected and assisted onto the new system. But, claimants who have debt problems or other vulnerabilities, such as poor numeracy skills, substance abuse or mental health issues, are given practical support at the onset of their claim through a network of local services, and alternative payment arrangements will be available to help claimants who need additional support, paying housing costs directly to landlords, making more frequent than monthly payments to help with budgeting, and splitting payments between partners where there is financial abuse. That is what the public sector in Wales has been signed up to, supposedly for four and a half years, and this now comes under the banner of universal support.

As I highlighted in this Chamber four years ago, DWP officials have been working with all the devolved administrations since March 2012 on plans for universal credit roll-out, alongside the framework with local government, including the WLGA, and we must therefore ask the Welsh Government why universal support isn’t operating better in Wales.

Photo of Ann Jones Ann Jones Labour 5:40, 25 October 2017

Thank you very much. I call on the Cabinet Secretary for Communities and Children to formally move amendment 2, tabled in the name of Jane Hutt.

(Translated)

Amendment 2—Jane Hutt

Delete point 2 and insert new points:

Notes the devastating impact on vulnerable families of anxiety, debt, homelessness and mental ill-health caused by the roll-out of universal credit which is putting significant pressure on devolved public services.

Believes that it is an important founding principle of the welfare state that risks should be shared equitably across society and that control over welfare costs, payments and administration should therefore be undertaken at a UK level.

Calls on the UK Government to reverse its damaging cuts to welfare, to pause the universal credit roll-out and address the fundamental concerns being raised.

(Translated)

Amendment 2 moved.

Photo of Ann Jones Ann Jones Labour

Thank you. Leanne Wood.

Photo of Leanne Wood Leanne Wood Plaid Cymru

Diolch, Llywydd. Today’s Plaid Cymru debate addresses one of the main social issues of our time. It’s now beyond doubt that the roll-out of universal credit is causing increased hardship, and the fact that universal credit has been accompanied by drastic welfare cuts has made the inherent problems in the scheme even worse. Citizens Advice has established that universal credit recipients are more likely to be in arrears on rent, council tax and water bills. Debt, evictions and food bank usage have all increased for some recipients in the pilot schemes. We know that homelessness is up already, yet, down the line, this will mean greater risk of homelessness again, as well as increased costs for the NHS, local government and social services.

Now, the greatest lie behind universal credit, and the greatest injustice, is the idea that this is somehow all about incentivising work. Using the social security system to get people into work is a laudable aim that very few people would disagree with. But the way to achieve this is by making work pay more than the benefits, not by penalising people and forcing them into low-paid or insecure jobs, or by using sanctions. In fact, the DWP’s own impact assessment of universal credit suggests that 2.1 million recipients will see their deduction rates increase. This means it’s not true to say that universal credit makes work pay; quite the opposite for 2.1 million hard-working people.

This means that the new system is, in fact, removing financial work incentives that existed under the previous system for a significant number of people. To add insult to injury, universal credit embeds the culture of sanctions and extends that culture to part-time workers, as if part-time workers are now what the Tories would call scroungers.

The rate of sanctions is higher than the previous system and can be applied to people who are in paid work. If the UK Government insists on pressing ahead with universal credit, there is a model already existing within the UK for Wales to be able to modify and mitigate its worst effects. Devolving administrative control of welfare would allow Welsh Government to alter the frequency of payments, end the culture of sanctions and long waits, and ensure that payments could go to individuals instead of to households. The model for this, of course, is in Scotland, where the first use of devolved powers by the Scottish Government was to change the frequency of payments from monthly to fortnightly following feedback. They also enabled the housing components to be paid directly to landlords. The new laws in Scotland also place a duty on Ministers to give assistance to people entitled. This means that actions can now be taken behind the scenes to tackle that culture of sanctions.

In Northern Ireland, similar measures to mitigate universal credit have already been agreed and will be implemented upon the resumption of power sharing.

A wider devolved social security agenda has also been made possible by this level of devolution, including extensive policies to mitigate the effects of Westminster’s welfare cuts and the establishment of a social security agency. The devolution of those aspects of social security is supported not just by the SNP, but on a cross-party basis, which includes the Labour Party in Scotland. We need such a consensus here in Wales, here in this Assembly. Unfortunately, it appears that the Government don’t agree. Where is their anti-poverty strategy? What are they doing to mitigate these cruel welfare reforms? If the national health service can be operated by the different nations, then there’s no reason why other aspects of the post-war welfare state can’t be as well. We must put devolution of welfare on the agenda. It makes no sense to keep having a go at the Tories on this when we could be doing things differently here in Wales. As AMs, we risk being just commentators on this—

(Translated)

Carl Sargeant rose—

Photo of Leanne Wood Leanne Wood Plaid Cymru 5:44, 25 October 2017

[Continues.]—complaining from the sidelines without any ability to mitigate, to modify or to change policies. I give way to the Cabinet Secretary.

Photo of Carl Sargeant Carl Sargeant Labour

Thank you. Just for clarity, are you aware how much it costs the Scottish Government to implement just the administration process of this; not the benefit end of it—just purely the administration, providing the ability to do this?

Photo of Leanne Wood Leanne Wood Plaid Cymru 5:45, 25 October 2017

I don’t have that figure to hand. Would you like to tell me?

Photo of Carl Sargeant Carl Sargeant Labour

It’s £200 million upfront that they pay and £66 million each year just for the administration costs paid to the DWP. That’s the issue I have with the administration process here. We should be doing something very different. They should be doing this automatically, not charging Scotland or us to do that. That’s the challenge we face.

Photo of Leanne Wood Leanne Wood Plaid Cymru

But the point is the principle, isn’t it? While Westminster—[Interruption.] While Westminster are making—. While Westminster are making decisions that are increasing homelessness and pushing the people that you are responsible for into hardship, this is something that you should be prepared to consider.

Instead of the Westminster way—[Interruption.]

Photo of Ann Jones Ann Jones Labour

Can you settle down, please?

Photo of Leanne Wood Leanne Wood Plaid Cymru

Instead of the Westminster way, which is failing so many of our citizens, we should be prepared to take responsibility ourselves, and the Assembly should support a Welsh way on welfare. A Welsh way would be based on evidence, on humanity and on justice. That would build a safety net that supports those in need: dignity instead of debt, hope instead of hunger—why not?

Photo of Baroness Mair Eluned Morgan Baroness Mair Eluned Morgan Labour 5:46, 25 October 2017

I’d like to start my intervention with a quote from a constituent of mine in Carmarthen:

Being a single mother scares me. I had a letter today giving me information as to how much universal credit I’ll be entitled to, and I’m going to be £210 a month worse off. I work 16 hours a week and I’m just about making ends meet now. I dread to think what situation I’m going to be in when I finally get switched to universal credit. For every £1 I earn over my work allowance, I have 65p taken off me. How is this meant to encourage and help people to work?’

That’s just one of the 20,000 people in Pembrokeshire alone who are going to be impacted by changes in universal credit, and whilst it’s true to say that some will be better off, the fact is that because of the insistence on pursuing austerity measures by the UK Government, most will be much worse off. The oddest thing of all about this policy, as has already been suggested, is that it’s being implemented and the way it’s being implemented, in many cases, undermines that financial incentive to work.

Single parents with dependent children are particularly hard hit, receiving £3,100 a year less than they received with tax credit: a massive hit on any family budget. And the UK Government has deliberately staggered the roll-out of universal credit so that we can learn lessons, but in Wigan, four out of five universal credit claimants, or over 80 per cent of people, ended up being in rent arrears. I must ask, if that’s the evidence of the lessons, why are we not pausing to rethink how we can make the system easier for some of the most deprived and vulnerable people in our communities?

More than half of the people in receipt of universal credit are in work. They’re doing the right thing for themselves and for the wider society, but now they’re being penalised. I don’t think anyone’s promoting the fact that we should continue with the present system, which is extremely complex, but the way this system is being introduced is proving to be entirely counterproductive.

A particular problem emanates from this point that money is paid in arrears, and at the moment it’s a 42-day wait for the first payment, and others, you’ve heard, can extend to 60 days in arrears. Around half of universal credit recipients so far have been able to access advance payments, but it’s really difficult for vulnerable people with poor reading and writing skills to prove that they’re in need of money to pay for bills or to pay for food. And the fact that the UK Government thinks that this delay in payment is somehow acceptable and possible for people who often have chaotic lives, I’m afraid just serves to underline how utterly out of touch they are with their constituents. And on top of that, just imagine what it’s like for someone who has an addiction—perhaps to gambling, alcohol or drugs—or people with learning difficulties to manage what might seem a vast amount of money then, arriving to them all at once.

It’s interesting to note that the joint committee on human rights has warned that the roll-out of universal credit benefit could expose women to abuse because the benefit is paid to couples through a joint account. We should be concerned that some men may limit their partners’ access to money and force women to stay in violent relationships.

In the pilot schemes we’ve seen, we’ve seen massive increases in rent arrears, which have implications for social housing landlords and council house landlords. We’ve heard already that a lot of people are now homeless as a result. We’ve seen these massive demand increases at food banks. Many have been driven into the arms of ruthless moneylenders, and they charge extortionate interest rates simply to people who want to feed their children. Let’s not forget that, in Wales, one in three children are living in poverty—a shameful situation in a country that is the fifth-richest country in the world, and where the UK Government will have made £80 billion-worth of tax cuts, including £22 billion-worth of income tax cuts, by 2021. I think it’s time to inject some justice into this system, to rebalance the inequality in this country, and to make sure that everyone is incentivised to contribute and to work.

I am afraid that I disagree with the proposal that control over welfare should be devolved. I don’t think there’s any chance that the UK Government will cough up the cash for welfare while relinquishing administrative control. [Interruption.]

Photo of Ann Jones Ann Jones Labour 5:50, 25 October 2017

No, I don’t think you can give way because you are out of time yourself. So, if you could wind up, please.

Photo of Baroness Mair Eluned Morgan Baroness Mair Eluned Morgan Labour 5:51, 25 October 2017

Well, I think it is worth just underlining the massive amount of money that comes into Wales additionally over the block grant as a result of welfare benefits. I think that we would be going down a very, very dangerous avenue if we opened up that can of worms.

Photo of Siân Gwenllian Siân Gwenllian Plaid Cymru 5:52, 25 October 2017

(Translated)

One of the main problems with universal credit is that it is paid to households rather than to individuals, and I will focus on that aspect for a few moments. Only one person can be in receipt of the funds on behalf of the household, so there are issues of equality arising immediately from that because it is likely that it’s the male that will receive that money in most cases, not always, of course—not by any means—but in most cases probably. This will increase the financial reliance of women on men and will militate against the fact that men and women are equal. Women’s right to financial independence is a fundamental right—a right that is undermined through universal credit. It’s therefore a significant retrograde step in seeking full equality between men and women—an effort that some of us have been involved with for 40 years and more. The journey towards full equality is painfully slow as it is. And any retrograde step in this regard—and this what this is—should be criticised by this Assembly and, more importantly, we must change it and use the powers that we could have here in order to change that. Benefits should be paid to individuals, and not to households.

One aspect of this causes great concern. Paying the benefit to one person in a household can mean that some women can be held in an abusive relationship. With the man taking the payment, then that man has the power, and if that man is abusive towards his wife or partner then it’s very difficult for the woman. Those in favour of universal credit argue that there is a mechanism to counteract that, but that’s naïve in my view. Half of the women who are abused fail to leave the relationship because of financial abuse. A woman may remain in an abusive relationship because of concerns of serious financial consequences for her if she were to leave.

The money itself can increase abuse. One partner can withhold money from another using financial power in an unacceptable way. Under universal credit, if a couple separate, then one person has to inform the DWP. Well, the person in receipt of the benefit isn’t going to be willing to make that notification, so in most cases, again, it’s the women who will have to do that and will be caught out by the process at times. A new application has to be made, which will take at least five weeks to be processed. For a woman without access to money and possibly childcare responsibilities, time is everything, and making a new application isn’t always a priority when you’re fleeing for your life or are concerned about the safety of your children. If the benefit were to be paid to individuals, then you wouldn’t have to go through that bureaucratic process of registering when couples separate.

Now, of course, if we did have the right to administrate benefits ourselves in Wales, we could change that. We are talking about administration here, not having the right to create new benefits; we’re not talking about funding, but the administration. And having those levers could be a means of creating a fairer system. Yes?

Photo of Steffan Lewis Steffan Lewis Plaid Cymru 5:55, 25 October 2017

I’m grateful to the Member for giving way, and that is an important point, because, of course, the devolution of budget for the whole of the welfare system would be an enormous challenge to us, given the fiscal constraints of the country. But the administration of welfare is another matter, and, of course, the Cabinet Secretary pointed to the administrative costs earlier. The block grant in Scotland was adjusted the year prior to the devolution of the administration of justice, so that there was a top-up to the block grant in Scotland for the administration costs, the initial costs. So, it isn’t just a matter of starting from a complete baseline. However, that does pose, of course, serious questions.

Photo of Ann Jones Ann Jones Labour 5:56, 25 October 2017

This is an intervention, not a speech.

Photo of Steffan Lewis Steffan Lewis Plaid Cymru

But Welsh local authorities will be paying the price anyway for Tory welfare reform, so we’d be picking up the tab one way or another anyway.

Photo of Siân Gwenllian Siân Gwenllian Plaid Cymru

(Translated)

Thank you for that explanation. In Scotland when some welfare powers were devolved, the UK Government did actually work out how much needed to be added to the block grant and a baseline was put in place. So, there are ways around these financial problems, and we are talking here about the administration—and that’s what we must emphasise time after time. And that is the point: if we were able to get hold of the administrative levers, we could change some elements of the benefits system. It’s too easy to cast the blame on the Tories in London. Yes, we should, of course, point out that this is part of an ideological crusade in terms of welfare reform, but we need to do more than that; we need to provide solutions, and this is one solution that we’re proposing here today: give us administrative control here in Wales, so that we can create a fair system. And if you believe in the creation of a fair system in Wales, well, if you’re not persuaded today then just look into it and come with us to look for alternative ways to move forward, to create a system that doesn’t militate against the most vulnerable in our society.

Everyone who wants a better system should work towards this end. You’ve heard about creating a shield to protect Wales from the extremes of the Conservatives and the UK state. Well, administrative control of part of the welfare system would be a shield against some of the extremes of universal credit and an utterly unfair system.

Photo of Gareth Bennett Gareth Bennett UKIP 5:58, 25 October 2017

Thanks to Plaid for bringing today’s debate. The new system of universal credit is causing major concern among those who will be affected by it. We are seeing this from the results of the roll-out so far. So, in UKIP, we share the concerns. We agree with Plaid to that extent, and we think that Plaid are right to bring this forward as a subject for debate, although we don’t support Plaid’s ambition that welfare should be devolved to Wales. In that regard, we actually support Labour on this occasion, in that we don’t think that devolving the welfare system to the Welsh Assembly is a viable solution to the problems facing Wales, and it may actually make things a lot worse, because of the reasons that we’ve heard advanced, of Wales being a net recipient of welfare and the lack of knowledge that we will get the same level of funding if welfare is devolved. I accept that Steffan Lewis may have raised a point that needs to be further investigated, but that’s our position as it stands at the moment.

We also agree with the Conservatives to some extent, in that the principles behind universal credit may have been laudable in terms of helping people back into work, as a concept. It is just that the way that the new set-up has been designed is so very flawed that it leaves us very probably in a worse situation than we were in before.

We heard evidence on the subject on the Equality, Local Government and Communities Committee. We had academics from social policy units coming in who’d interviewed a lot of the claimants who were involved in the roll-out, and a sample of the claimants were asked what they thought about the new scheme. Overall, the new system wasn’t welcomed. The major issues included accessing the system in the first place, delays over payment, issues over whom the payment goes to where there are joint claims, and sanctions.

One aspect of the new system is the difficulty of making the claim in the first place. Now, a few years ago we had a change from a system whereby most new claimants for benefits would make an appointment to see someone, a real-life person, at a jobcentre or a similar office, to a system whereby the majority of new claims were made over the phone. So, that raised one level of difficultly. Now, with universal credit, we’re moving on to a new level of difficulty, because now the initial claims are made online. So, this raises the issue that some claimants aren’t online and can’t do things online, and the risk is that many of those people could fall through the cracks.

Once you actually get your claim processed, the next problem is the delay over payments. Well, we’ve heard a lot on that subject today. Bethan Jenkins detailed that in her opening contribution when she highlighted the risk of claimants falling into more debt due to the delays. There’s also the risk of the rent arrears, which we’ve also heard about, due to the system whereby the claimants themselves get paid the rent in a large lump sum, and it’s not actually paid direct to the landlord. Unfortunately, this method does increase the risk of people getting into arrears and landlords not getting their rent. Eluned Morgan highlighted the issue of the problems of the joint claims, and who gets the payment, and the fact that there isn’t really any protection built into the system for women and children, although, obviously, it’s not always the woman who gets the payment, but in general that is a point that we need to consider.

Once you are in the system and you are getting your payment there is the ever-present threat of sanctions, which Leanne Wood mentioned. Now, under universal credit, the sanctions regimes are tougher, and, of course, as in any bureaucracy—and the welfare system is a massive bureaucracy—the sanctions can be misapplied. Here is a for instance. The universal credit system has to deal not only with people not in work, but also people who are in work, but who are in low-paid jobs. This is because it is also replacing working tax credits. The problem is that, under the old system, you could claim working tax credits without visiting the jobcentre, as they were claimed through the tax system. Now, if you have a job, but it is low paid, you still have to go to the jobcentre to claim your top-up payments. So, you are in work, perhaps in a regular full-time, nine-to-five job, but you also have to go to the jobcentre at regular intervals. I wonder if you can see where we are going with this: yes, people who have jobs are being given jobcentre appointments that clash with their hours of work. They’re missing these interviews, understandably, and are then sanctioned by the jobcentre for failing to keep them. If one is caught up in this kind of trap, one is entering a Kafka-esque world of battling against a heedless bureaucracy, and the individual will very rarely win that battle.

Even if you have a job that takes up, say, 10 hours, you will encouraged—in other words, blackmailed—into getting another job for 15 hours. This inflexible approach leads to absurdities such as a woman of 60-plus who had three jobs totalling 21 hours and was still told to get another job. Sanctions can come quite randomly, and can occur six months after the alleged misdemeanour occurred. The problem with this is twofold. One issue is that the person being sanctioned will probably no longer remember the reason for it, so won’t be able to effectively appeal. Another issue is that it will be largely unforeseen, so it again raises the risk of the claimant going into debt or rent arrears—

Photo of Gareth Bennett Gareth Bennett UKIP

Yes. So, in general, we agree that this is a massive problem. The other issue that no-one’s talked about, which I don’t have time to go into, is that there is no meaningful way of retraining people through the system at the moment, and that is the crucial element. If you’re going to get people into work, why is there no real emphasis on retraining them and getting them into meaningful employment? Thank you very much.

Photo of David Lloyd David Lloyd Plaid Cymru 6:04, 25 October 2017

Now then, as we’ve heard, when universal credit was first proposed, many people welcomed aspects of it as a simplification of what has become a ridiculously complex system. However, such is the rare talent possessed by Iain Duncan Smith MP that defeat has been well and truly snatched from the jaws of any minor possible positive result.

And, yes, problems with the benefits system figure largely in my surgeries—my GP surgeries now. They always have. Issues with poverty and benefit payments figure largely in the medical sphere because of the poverty and the stress and the anxiety and the depression that follow on from complete mismanagement of how people who need money cannot get what was—as the Cabinet Secretary said—social security. We’ve forgotten that bit, about making sure that our people who need it have security.

There have been huge concerns about aspects of how universal credit was designed from the start, as we’ve heard from Bethan Jenkins and others: the monthly payments, the high taper rate, the penalties for second earners and so on. And obviously we’ve seen as well, in areas where we’ve had roll-out of universal credit, that the use of foodbanks has reached epidemic levels. The current situation, plainly, is totally unacceptable.

But the concerns about universal credit, those monthly payments, the penalties for second earners and so on, you know, you can tackle them, as we’ve heard, quite simply—you change the payments to fortnightly or weekly, you allow the housing components to be paid to landlords direct, if that’s what people want, to prevent arrears, you pay individuals not households, you don’t charge people to call the helpline and allow alternatives to online interaction for those digitally excluded, and you end the culture of sanctions on the most disadvantaged people in society.

These mitigation steps are already in place in Scotland and Northern Ireland as they are already devolved there. So, devolving administrative control to Wales would allow us to make payments fortnightly not monthly, make payments to individuals not households, pay the housing components direct to landlords to prevent arrears and evictions, to become responsible for professional development of DWP staff, which will allow far greater flexibility for reducing sanctions if not actually eliminating them completely, and linking DWP schemes with existing skills schemes could create a Welsh new deal and retraining.

Now, as I’ve said, and it has been said, welfare is already devolved in Scotland and Northern Ireland. Administrative control costs are taken care of as the level of benefits and funding remains set by the Treasury. Labour supports devolving the benefits system in Scotland. In fact, it’s always pushing the SNP Government to go further. There is no issue there about not wanting benefits devolved in Scotland from a Labour point of view; they want the SNP to work even harder on it.

So, changing the frequency of payments will prevent evictions and homelessness, which carries a considerable cost to Welsh public services as well, which has to pick up the tabs of evictions and homelessness, not to mention slashing the use of food banks. We have to administer this rotten system better: give us the tools to do that, as Labour is pushing the SNP in Scotland. Labour supports the devolution of social welfare from Westminster to Holyrood and any moneys that need to administer it have obviously been taken care of. So, supporting devolution of benefits in Scotland is fair enough for Labour. Supporting it in Wales—not on the agenda. Support the Plaid Cymru motion and mitigate the disastrous consequence of universal credit in wales. Diolch yn fawr.

Photo of Jeremy Miles Jeremy Miles Labour 6:08, 25 October 2017

Last week, I went to visit a job centre where I met a team of people rolling out universal credit. The individuals I met are doing what they can to support their claimants, but their operating system is broken, a system that has been designed without any regard for the lives of claimants, designed for how the Government feels people should live, not how people do live—no regard for the realities, the stress, and the sheer complication of getting by on a very low income.

People who try to manage from week to week are having to wait for six weeks for their benefits. Who is not going to struggle without income for six weeks? Many people will be left in desperation, and we’ve all heard terrible personal stories of real hardship, of the six-week wait, of payment in arrears, of struggling to manage to pay the rent and to put food on the table.

Now, we hear that some are being given an advance and some are being offered fortnightly payments, but delays are much more typical, and those discretions, where they exist, are exceptions and are at the individual decision of case handlers. Those decisions should not be based on individual discretion. They should be a matter of course. I’m certain that a Welsh Government with powers over the way in which universal credit was run and administered would do things differently: faster, more frequent payments reflecting the reality of people’s lives and not the lives we wish they had. But let’s be quite clear: it isn’t just the roll out of universal credit that’s the problem; the whole way in which it’s designed is deeply flawed. It was intended to make work pay, but it won’t make work pay whilst you lose 63p of benefit for every extra £1 that you earn, and, for those out of work, the situation is even worse. Universal credit doesn’t even begin to meet any realistic living costs, including the cost of housing, and we all know that this is putting landlords off taking universal credit tenants.

If you’re unemployed in your early 20s, you’re on £58 a week. In an economy where the cost of living continues to rise, who on earth can manage on that? Compare that with the support the state gives people in work: the personal tax allowance is worth £220 a week. The share of our national wealth going to personal tax allowance is going up, and the share of our national wealth going on universal credit benefits is going down. That tells you everything that you need to know. A benefit that was claimed to be about making work pay is actually about making claimants pay. And, as universal credit is being rolled out, the UK Tory Government will just steamroller on, not caring for the distress it causes, not bothered for the people this is hurting, too weak to see the flaws in its plan, too weak to stop and think again.

Photo of Ann Jones Ann Jones Labour 6:11, 25 October 2017

Thank you. I call on the Cabinet Secretary for Communities and Children, Carl Sargeant.

Photo of Carl Sargeant Carl Sargeant Labour 6:12, 25 October 2017

Thank you, Deputy Llywydd, and I thank Members for their contributions in this debate. I share Members’ concern regarding the devastating impact the roll-out of universal credit is having on vulnerable people here in Wales and across the UK. We are deeply concerned about the UK Government’s relentless welfare cuts and how they’re having an impact on low-income families, particularly those with children. I have repeatedly expressed our concerns to the UK Government, and have written calling for the roll out of universal credit to be paused.

Llywydd, I welcome the belated decision by the Secretary of State for Work and Pensions last week to make the universal credit call line free from next month. The length of time people have to wait before they receive their first payment of universal credit—some six weeks or more—is one of the biggest issues affecting people moving on to universal credit, and I’m grateful for Angela Burns’s contribution yesterday; she’s absolutely honest and right in what she wrote. Most worrying is that, for those new universal credit claimants who are seeking vital support for their housing costs, many will not be able to afford to pay their rent to their landlord until the first payment is received. Local authorities where universal credit full services are already in operation are seeing increases in rent for many tenants, and this is causing, or exacerbating, debt problems for those most in need of support, and has serious consequences, Llywydd, for many people who face eviction as a result of not having any money to pay their rent. We hear from the UK Government that claimants can request an alternative payment arrangement to ensure that their first housing costs are paid direct to their landlords. I’m not convinced the current processes are secure enough, though, or flexible enough to ensure that this happens for the most at risk of not paying their housing, with the risk of eviction and homelessness. Mark Isherwood eloquently quoted me a part of what I said about universal principles over how this operates. The introduction of universal credit wasn’t wrong—he’s right in what he says there—but he didn’t finish off what I said about the universal principles were okay, but, actually, the system is flawed, it doesn’t work, and it’s having a desperate effect on our communities, and that’s why we need to halt.

Our most vulnerable people, who are already trying to cope with the difficult, complex circumstances in their lives, now find themselves having to go through the additional obstacle to get access to this urgent support through universal credit. The Secretary of State promised on 2 October that this waiting time would be reduced for people when making a claim for universal credit by requesting immediate same-day payments for some of the money or asking for a 50 per cent advance payment. I do not consider that this quick fix is sustainable as a permanent solution for vulnerable claimants who might already now be in debt, and this borrowing could well plunge them further into the abyss of debt. It’s not working. It needs to be stopped. As a matter of urgency, the UK Government needs to significantly reduce the waiting time for the first payment, getting rid of the seven-day waiting period and changing the default position for those with housing costs to be paid direct to the landlord. They also need to reinstate two-weekly payments for those who require more regular payments.

I listened to the contribution by Plaid Cymru Members. The fact here is that the UK Government can do this. They can reduce the waiting time. They can reinstate the two-weekly payments. The system that’s operating in Scotland is exactly the same system that is operating in England and Wales. It’s just a trigger on the machine. [Interruption.] Of course I’ll give way.

Photo of Huw Irranca-Davies Huw Irranca-Davies Labour 6:15, 25 October 2017

I thank the Cabinet Secretary for giving way. He makes the absolutely appropriate point. The tragedy of this—. There are human tragedies and we’re seeing them unfold now and it’s going to get a lot worse, but the governmental tragedy of this is that it has been trialled. The evidence has been clear, not for the last six weeks or six months, but in the years that this has been trialled from the very instigation of this, that the design was wrong, and they can make it right. I think, actually, the reflection of Members—including some Conservative MPs and including some on the benches here as well, I have to say—is the compassion that says, ‘Let’s make this policy work. Fix it at that end so that it genuinely makes it worth going to work and work will pay.’ It can be done and they should be doing it now, and they could do it.

Photo of Carl Sargeant Carl Sargeant Labour 6:16, 25 October 2017

The Member is right in what he says. We are pressing the UK Government in that space. What we do know is that a failure to—[Interruption.]

Photo of Ann Jones Ann Jones Labour

Excuse me, can we stop having discussions amongst the benches, please? We will listen to the Cabinet Secretary. I don’t want to tell anyone to be quiet, but you’re pushing me today and it’s because it’s the end of term, I’m sure. So, we’ll listen to the Cabinet Secretary, please.

Photo of Carl Sargeant Carl Sargeant Labour 6:17, 25 October 2017

I’m grateful, Llywydd. What we don’t recognise here is that, actually, a claimant who fails to turn up to one of the meetings, for whatever reason—illness or, as the Member said earlier on, going to work—actually is sanctioned. Well, maybe we should start those sanctions with the MPs who didn’t turn up in Parliament, the Tory MPs who didn’t vote in the universal credit debate. That’s where we perhaps should start.

I’m grateful for Members’ contributions here, but I was slightly surprised at the contribution made by the leader of Plaid Cymru in terms of the process for introducing the benefit to Wales. When I asked her about the cost of this, the Member was completely unsighted. Actually, this principle of what she’s trying to achieve is—. I don’t disagree with her, but, actually, you haven’t done the homework about the Scottish Government paying £200 million upfront and then £66 million annually just to administer this—nothing to do with the benefit system at all—when actually the UK Government, if it’s the right thing to do, should be doing it in the first place.

Photo of Carl Sargeant Carl Sargeant Labour

Of course I will, yes.

Photo of Steffan Lewis Steffan Lewis Plaid Cymru

The point I made in an earlier intervention was that the Scottish Government managed to negotiate a fiscal framework that allowed an adjustment to the Barnett block in order to administer welfare in Scotland. Is he saying that he doesn’t have the confidence to go up to London and negotiate a settlement for Wales so that he can administer welfare here and end the injustice now?

Photo of Carl Sargeant Carl Sargeant Labour

Let me tell you that I’ve been to London and I’ve talked with Lord Freud about the very issues that your colleague mentioned, particularly about women’s issues and the way that claims are made. But what the Member should really consider—[Interruption.] What the leader of the opposition—. What the leader of Plaid Cymru, I should say, should consider is that, actually, her contribution was a weak one when she didn’t even know the numbers. So, we may park that there.

Let me point out to the Member’s intervention that, actually, if he thinks it is right to pay £266 million in the first year for administration costs when the UK Government can do this at the stroke of a pen or by just telling the computer, ‘This is how we want the system to operate’, and when we could use that money more carefully for supported intervention, the Member has a long way to consider the intervention on this.

Photo of Carl Sargeant Carl Sargeant Labour

I’m not going to take any more interventions from Members because—[Interruption.] Well—

Photo of Ann Jones Ann Jones Labour

No—carry on, then.

Photo of Carl Sargeant Carl Sargeant Labour

The issue here, Llywydd, is making sure that what we do here is fit for purpose, protecting our most vulnerable in our communities. Plaid Cymru have obviously brought to the table a thoughtful consideration for the Chamber—

(Translated)

Rhun ap Iorwerth rose—

Photo of Carl Sargeant Carl Sargeant Labour

[Continues.]—but they haven’t fully thought that process through, particularly on the costs around this.

Photo of Ann Jones Ann Jones Labour 6:20, 25 October 2017

Thank you very much. I call on Bethan Jenkins to reply to the debate.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

Thank you very much. I think, if nothing else, we’ve had another lively debate, and I think it’s good for democracy. I think it’s important that we start on the administrative costs that Steffan Lewis has intervened on twice. The fiscal framework agreement—[Interruption.]

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

[Continues.]—between the UK Government and Scottish Government in 2016 states that the baseline Barnett formula—he’s not listening to me, even—will be adjusted to reflect the responsibility over welfare, including costs and administration—including costs and administration. It says in point 31, and I quote,

Both Governments have agreed that the UK government will provide £200m to the Scottish Government to support the implementation of new powers. This will represent a one-off (non-baselined) transfer, supplementing the block grant, to support the functions being transferred. The profile of this transfer is to be agreed by the JEC.’

So, it’s entirely possible, should the Welsh Government want it, to go to London and demand to have those types of conversations. The fact that you won’t even bother to go and ask is testament to your leadership, not to Leanne Wood’s leadership for making a speech, and you deciding you want to ask her a question. It’s testament to your leadership, as Cabinet Secretary in this regard. And it’s not just us who believe that, potentially, we should devolve some of those powers—Jeremy Miles said it today. And on the equalities committee recently, we had academics down from Scotland who told us that, where 15 per cent of disability benefits have been devolved to Scotland, they’ve done it in a humane, principled manner, and we will be actively looking at those proposals as a committee—[Interruption.] It’s phenomenal now that I’m not even being listened to, when we have—

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

[Continues.]—constructive ideas to build our own potential welfare system for the future here in Wales, so that we won’t, potentially, have to put sanctions on people, and that we can administer payments with respect for the individuals. Why can that not be considered by the Welsh Government? We’re not hearing that answer here today.

We won’t be supporting the Tory amendment in this regard. The Centre for Social Justice, which Mark Isherwood pointed to, is a Tory think tank with the most paradoxical name ever thought up for a think-tank. I’ve got two—.

Photo of Rhun ap Iorwerth Rhun ap Iorwerth Plaid Cymru 6:22, 25 October 2017

The only reason I make this intervention is to have it on the record that the front bench are laughing at this, which is a serious matter—[Interruption.]

Photo of Ann Jones Ann Jones Labour 6:23, 25 October 2017

[Inaudible.]—vote to be taken. I have asked politely. I have asked politely—

(Translated)

Mark Isherwood rose—

Photo of Ann Jones Ann Jones Labour 6:23, 25 October 2017

Sit down, Mark, please. I have asked politely for you all to listen. We are not in a playground. We actually are trying to have a sensible debate. I don’t want people telling me when to shout, ‘Order’, because those people are doing as much barracking as others. So, if we can all now listen to what Bethan Jenkins has got to say in reply to the debate. Don’t wave your arms at me, don’t point at anybody and we’ll get through this, before I call for somebody to put the vote. I don’t want to do that lightly, but I will do it, because we’re getting nowhere. Bethan Jenkins.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

Thank you. I think it’s important that we take this debate seriously, because we’ve seen on Westminster benches previously when people have taken this too lightly, and it doesn’t go down well with the public. It doesn’t go down well with the public if people see people laughing in the Chamber.

The point that I wanted to make to Mark Isherwood is that this was set up by Iain Duncan Smith, who actually then admitted that their own policies were wrong with regard to the benefits system. So, how can we take that think tank seriously?

Photo of Mark Isherwood Mark Isherwood Conservative 6:24, 25 October 2017

Yes, it was set up by Iain Duncan Smith. That’s a statement of fact, but he deliberately brought in a chief executive who was not a member of the party. Actually, he was a former communist—certainly, far to the left of the Conservative Party. He deliberately populated the centre with non-Conservatives, and he deliberately has Labour MPs and former MPs on his board of management.

Photo of Bethan Sayed Bethan Sayed Plaid Cymru

Okay. Thank you very much. As you may have realised, my voice is going; I don’t have Strepsils like Theresa May, and therefore I’m not wishing to speak for very much longer. But I think what’s important is we’ve had the debate, we’ve aired the concerns, but we always describe the problem here in this Chamber. We describe it because it’s bad, but as opposed to continuing to describe the problem, I think we could be coming up with real solutions here in Wales, calling for those powers here in Wales, taking a look at what is being done in other parts of the UK, and forging our own future in this regard. Diolch yn fawr iawn.

Photo of Ann Jones Ann Jones Labour 6:25, 25 October 2017

Thank you very much. The proposal is to agree the motion without amendment. Does any Member object? [Objection.] Then we will defer this until voting time.

(Translated)

Voting deferred until voting time.

Photo of Ann Jones Ann Jones Labour 6:25, 25 October 2017

Unless three Members wish for the bell to be rung, I will proceed directly to voting time.