Jobcentre Plus debate

On 28 January 2014 the Work and Pensions Select Committee – of which I’m a member – published a report on the performance of Jobcentre Plus. On 10 July 2014 I spoke in a House of Commons debate on our report, and I’ve reproduced my speech in full below.

It is a pleasure to serve under your chairmanship, Mr Amess, and to speak on this very important matter.

One thing that has come out of this report, and has been clear in speeches from across the Chamber, is a recognition that in fact on the whole jobcentres are doing a good job and should be retained for the purposes that they have. A few years ago there was some uncertainty about that. I know that the coming of the Work programme and the change of Government meant that some people—particularly people working in jobcentres—were concerned that the jobcentre’s role could be ended.

Things had already changed substantially in jobcentres. The bad old days—going into a grim office with rows of chairs that were firmly battened down to the ground so that they could not be lifted, to talk through a glass screen to somebody who was behind that glass screen in case someone became extremely angry—had been replaced by an attempt at a more informal atmosphere. People were sitting at a table with their adviser rather than the adviser being on one side and the person using the service on the other, which had felt quite hostile. In some quarters there is concern that taking a heavy approach, through some of the things that I suggest have been happening, could bring that sort of atmosphere back. That would be regrettable. I very much want us not to go back to those days.

Despite some of the remarks that get thrown about in other debates—particularly when we are in the main Chamber—I think we all share the aim of wanting as many people as possible to have the opportunity of employment; we also want to avoid a situation in which people are having long spells of unemployment. It has never been my party’s policy to want people to be unemployed or to think that that is in any way a good thing. Indeed, I have campaigned and argued—and marched, in the past—precisely because we see it as a bad thing. We know it is bad for people’s income, and therefore for their well-being in lots of ways. It is also bad for their mental health and well-being, and their feeling of being a valued part of society. There are a whole host of reasons why we want to see low unemployment.

My party recognises—and again, I hope it might be a shared recognition—that employment is a necessary but not always a sufficient way to get a decent standard of living. That has been one of the differences. It is a simple argument that if people get into employment, all will be well, but, as we have seen of late, that is not necessarily the case with very low-income work and the problems that come with that.

Where we differ sometimes is on the means of achieving the end. That perhaps arises partly from the different perspective there sometimes seems to be about why people are unemployed and their attitude towards employment. Neither the hon. Member for Newton Abbot (Anne Marie Morris) nor the hon. Member for Amber Valley (Nigel Mills) made this sort of comment, but sometimes there is a feeling that the assumption is that there are plenty of jobs out there—in many areas, there are not—and if only people would get a bit of backbone, which we can give them by whipping them into line, they would no longer be unemployed.

I would argue that that is not the case. An interesting piece of research has been published on universal credit. There was a very early survey of two groups of people: one of people who were about to be claimants of universal credit—it was in its very early days—and one of claimants of jobseeker’s allowance. They were matched for similar areas, ages and experience, and they showed remarkably similar attitudes. There were asked whether it was better to be employed than not employed and so on. I do not think there is a fundamental difference of opinion.

The Select Committee’s report is a serious attempt to find ways of improving performance. In its initial response, the Government seemed to be less than sympathetic to some parts of it, but I hope that as we move forward there may be an opportunity to take such matters into account.

The Chair of the Select Committee spoke at length about what the performance targets should be, and the measure of performance being off benefit. We know and I think the DWP knows that only some of those who leave benefit go into employment. There is a whole host of reasons why people may leave benefit without going into employment. A few retire because they reach retirement age. Some lose their entitlement to benefit but do not necessarily become employed. After 26 weeks on contributory JSA, people cease to be entitled to it if they do not qualify for income-related JSA. Many people will not qualify for income-related JSA because they are living with someone who is in employment, even if it is only part-time employment. If there is a source of income in the household they will cease to be entitled to benefit. They may be off benefit, but they will not necessarily have progressed into work.

It is significant that the unemployment figures produced by the Office for National Statistics and the figures for claimant count are moving quite widely apart. Of those who are unemployed on the unemployment count, 47% are not in receipt of an out-of-work benefit. We are talking about almost 1 million people because the number who are unemployed is still over 2 million—2.1 million people are still unemployed according to the general definition of unemployment.

It is tempting for people to say that the claimant count is down in their area, and for Ministers to say that the claimant count is down in someone else’s area, but there is a serious issue with people who are not being counted. Not only are they not being counted, they are not being helped. We should deal with the serious issue of why the gap is growing. There are other reasons. Some people on employment and support allowance lose that allowance after a year if they are in the work-related activity group. They may be off benefit, but not receiving assistance towards resuming employment.

When ESA was introduced, the previous Government commissioned an ongoing survey of those found fit for work. It looked at a group of people after three months and after a year. The significant finding was that 43% of those who had been found fit for work after a year were neither in employment nor on an out-of-work benefit. I do not know whether things have got better or worse. I do not know where those people are now and whether they eventually got fit and found work, or found themselves back on ESA—I suspect that that was the case for many of them—and DWP does not know either. That research did not go further than that and was not recommissioned. If we do not have such information, we have no way of telling whether policies are helping or working.

As I said during a debate I had on employment and support allowance, I suspect that quite a lot of people are not getting better and their health is not improving, and that they reclaim ESA sooner or later. That may be an explanation for the fact that the total number of those on that benefit has not fallen as much as the fit-for-work decisions. There is a mismatch there.

That ties in with some of the other things we have said here about jobcentres and DWP’s attitude to following through what happens to people, and we should look at that. Even if it becomes easier in future to track people in employment through things such as real-time information and, as the hon. Member for Amber Valley (Nigel Mills) said, some of those who now go off benefit stay on benefit with the universal credit, those who come off benefit for other reasons are simply lost in the system.

That brings me to sanctions and pressure on people. It is not necessary to exaggerate the position because this is really happening to people and we all have examples. The fact that so often when people ask for a decision to be reconsidered, especially if they ask through their MP or an advice agency, that decision is often overturned, and overturned quite quickly, suggesting that something was wrong with the initial decision making. That must give pause for concern because if the initial decision making was right, that would not be happening. In the meantime, people are finding themselves without income. Their housing benefit, if they had it, will be suspended at the very least and they will have to contact that department to get it sorted out

What worries me is the people who do not come to us or to an advice agency. What happens to them? Many of them will not be aware of sources of help. I had a constituent who eventually came for help, but he had been sanctioned for six months. He had a learning disability that was not fully acknowledged by his family. He was not a young man—he was in his late 30s or early 40s—and he had just given up. He was not signing on. He would not have been receiving any money anyway, but he was no longer part of the system, and that is a worry. He had family. His pensioner parents were supporting him from their own limited income. He was not destitute or on the streets, so there was not that sort of high drama, but the family were struggling to support him. He had fallen out of the system because of his learning disability. That is why he had not done what he should have done and co-operated. Somehow, that was not picked up. We need to know how many such people there are.

Many people would be concerned that the pressure to get people off benefit also applies to people on ESA. We thought that eligibility for ESA was tested for. We all know about the issues surrounding the work capability assessment, but people who have gone through that, been awarded ESA and been placed in the work-related activity group are not, by definition, fit for work at the present time. They do not need to be hounded back into work because the system has said that they are not ready to go back into work. So why are so many of them being sanctioned?

The number of people on ESA who are being sanctioned is rising. The latest available figures are for December 2012 to December 2013 when there was a fourfold rise in the number of people in that position being sanctioned. The number rose from 1,102 a month to 4,789 a month, but that was not because there had been a similar increase in the number of people in that group, so we cannot just say it is the same number. The number of people in the work-related activity group had gone up by considerably less than that. Many of these people were sanctioned for failing to co-operate with the Work programme, and the number of people on ESA being referred to the Work programme seems to have been going down during the same period in which the number of sanctions have gone up. That is a matter of considerable concern, especially if these people are the least likely to get help and to be able to reinstate their benefit position and will be counted as some kind of success for a jobcentre. They are likely to be people with mental health problems or learning disabilities.

There are what are often regarded as scare stories, in some respects. Yesterday, an article in The Guardian had yet another apparent whistleblower from among Jobcentre Plus employees saying that their performance was indeed measured by the proportion of people they got off benefit, and that included people on ESA. This is not just a JSA matter. It may not be a specific target that is stuck up on a wall, but it is about the performance of that employee, and they are expected to get people off benefit, including people who, by definition and by test—who have already been through the work capability assessment—are not regarded as being fit for work, and I think that is a matter of considerable concern.

I hope that the Minister tells us that the Oakley report will be published shortly. We have been waiting for it now for some time and I understand that it has been completed. It was recognised that that report’s terms of reference were relatively limited, which is why the Select Committee asked for a more far-reaching report to look at such things as whether the sanctions actually work. Are they having the desired effect? If they are not, they become particularly pointless.

It is interesting that a report, called “Smarter Sanctions”, was published earlier this year by the Policy Exchange. The Policy Exchange is not known as a particularly left-wing or radical think-tank—at least in the left-wing sense; it is radical in other senses—and it, too, felt that there were real problems with the sanctioning system. I would not necessarily agree with some of its recommendations and conclusions, but it was clear that too many people were getting low-level sanctions—those might be just for one month, but one month, as my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams)said, is considerable when someone is on a very low income—and that they were being given inappropriate sanctions and wrong decisions were being made. Despite the fact that we are still waiting for the Government-commissioned report to come through, it is significant that that organisation has given voice to some concerns that people have. I hope that the fact it comes from that source would give it considerable weight.

The Select Committee recommended—and these Select Committee recommendations are unanimous—that the

“DWP take urgent steps to monitor the extent of financial hardship caused by benefit sanctions, including by collecting, collating and publishing data on the number of claimants ‘signposted’ to food aid by Jobcentres and the reasons”

for that. The Minister has to give a real explanation why that comparatively modest recommendation was rejected.

If the Government are right that, as they said in their response to our report:

“The use of food banks is not exclusive to benefit claimants”—

which it probably is not—and that it somehow has nothing whatever to do with welfare reform changes or sanctions, surely co-operating with the request to publish that kind of information might answer those points, so I would argue that doing so is in their interests as well.

Earlier speakers spoke about an issue that the Committee thought was important, which was the mismatch of aspiration and ability to deliver. A good proposal will often be made, such as that people, when they are first unemployed, should be given longer with an adviser. We all know that sometimes appointments with advisers are very short and they become routine—it is a matter of ticking the boxes and asking, “Have you done the right number of applications?”, without going into any real depth. Longer meetings sound very good, but there is a severe doubt whether they are feasible. The last speaker touched on that in relation to the arrangements that had been made when people come back from the Work programme. The sort of intensive help that is promised may not be feasible. If people are going to be asked to sign on every day, for example, how does that affect the rest of the jobcentre’s work? Will it be about someone just coming in, signing their name, and then going away again—in which case, how will it help? How will it improve the situation, unless it is intended to make people get fed up and give up? It is all very well to come up with these ideas, but we need to make them work, which may need a greater resource.

It is a sign of the failure of some of what we have been doing to date that so many people are coming off the Work programme and are still very far, it would appear, from employment. I think the employment Minister herself said, during one debate we had on the issue, that there were people in that situation who still had poor rates of literacy and numeracy, and one thing her Department wanted to do was to help those people overcome those obstacles. That is all well and good, but what has the Work programme been doing for two years, and indeed, what may well not have been happening before that?

It is a criticism of the Work programme that it really is not delivering what we were promised it would deliver. The criticisms made by many of my constituents have not necessarily been that they have been hounded. In some cases, it is almost the opposite: that it was very light touch, that they were not given much help and assistance, and that the idea of specialist help—I remember it was said that people would get help with health problems, debt problems, educational problems and skills problems—just is not happening. People are not able to get skills training and they are being told, “There isn’t the money to do that. We can’t afford to put you on that course. We can’t afford to pay for child care to let you go on that course and improve your chances of getting employed.”

The return of so many people, out of the Work programme, apparently still very far from being employable, is a very serious issue. As a Select Committee, we are looking at issues relating to people who have disabilities and long-term conditions and illnesses, and at what other things we could put in place for them. There is a concern that at jobcentre level, there are not enough specialists to help, and that the number of disability advisers is just not sufficient to help people at an early stage and not wait until very much later.

As I said, I hope that we will see further progress on many of the report’s recommendations, because if we share the same end, as I think we do, we have to will the means and the resources to make it happen.

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Press release: Jobs figures show Tories and SNP are letting down Edinburgh

Responding to today’s unemployment figures, Sheila Gilmore said:

Here in Edinburgh, 2200 people have been unemployed for a year or more, with 245 of these being aged under 25. Both the Conservative and SNP Governments are still letting down our city.

Furthermore, thousands of people in work are struggling to make ends meet because inflation is rising faster than pay.

Labour would combat this by restoring the value of the national minimum wage, getting more employers to pay a living wage, extending free childcare provision, freezing gas and electricity bills and getting the next generation into work with apprenticeships and a compulsory jobs guarantee.

ENDS

Notes to editors:

Here are the unemployment figures by constituency:

Constituency                                     Long-term unemployment          Long-term youth unemployment

Edinburgh East                                  550                                                         60

Edinburgh North and Leith                605                                                         60

Edinburgh South                               265                                                         25

Edinburgh South West                     455                                                         55

Edinburgh West                                325                                                         45

Total                                                      2,200                                                     245

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Sanctions and Zero Hours Contracts

Under Jobseekers Allowance, claimants are able to refuse job offers involving zero-hours contracts and avoid being sanctioned. This was set out in a response to a Freedom of Information request which included the statement:

Jobseeker’s Allowance claimants are not required to apply for zero hours contract vacancies and they will not face sanctions for turning down the offer of a zero hours contract.

However I’m concerned that this could be set to change under Universal Credit, following another response to an FOI request, which includes the statement:

We expect claimants to do all they reasonably can to look for and move into paid work. If a claimant turns down a particular vacancy (including zero hour contract jobs) a sanction may be applied but we will look into the circumstances of the case and consider whether they had a good reason.

On 10 February 2014 I wrote to the Secretary of State for Work and Pensions Ian Duncan Smith to seek clarification – you can see my letter here. I received a response from Esther McVey, Minister for Employment at the DWP, dated 1 March 2014 – again you can find it here.

The Minister states that, at present, DWP don’t require JSA claimants to apply for zero hours contracts because short periods of work could end a JSA claim, requiring new claims to be made in periods where earnings fall. However this will change under Universal Credit. Ms McVey justifies this as follows:

Universal Credit is payable when people in work as well as out of work so the need to reclaim when earnings fluctuate is removed. In addition Universal Credit is designed to be responsive to variations in earnings to each monthly payment will reflect the amount actually earned, even if this includes some weeks when no work was done.

The Minister concludes by emphasising that ‘the coach should still consider whether the role is suitable for the individual’ and, when considering sanctions, Decision Makers should take into account the reasons claimants give for not taking particular jobs. I’m concerned that this isn’t happening under JSA at present, and so while I don’t object to the principle of either Universal Credit or zero-hours contracts, I am concerned about this policy change. I also fear that if people are required to take jobs with zero-hours contracts, they could be prevented from taking training courses or applying for other jobs that might lead to more stable and sustainable employment in the long term.

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Cost of living crisis must end

On Monday I wrote a column for the Edinburgh Evening News on insecurity at work. I’ve reproduced this in full below.

Families in Edinburgh are facing the biggest cost of living crisis in a generation, and this is being compounded by rising insecurity in the workplace.

Recent figures show that the number of people feeling insecure at work has almost doubled from 6.5 million to 12 million since 2010. There are a number of factors at play here.

For a start there has been a rise in the number of employees on zero-hours contracts, with some figures estimating there could be as many as one million people now employed on them. Just last week I met a constituent who was waiting every week for a text message from her employer, a private homecare firm, to tell her what hours, if any, she would be working that week. This caused her budgeting problems from week to week. Luckily her daughter was now a teenager so short notice calls didn’t cause her childcare issues, but for others they do.

In addition, the number of people working part-time but who want to work full-time has risen by more than 350,000 to more than 1.4 million over the same period. And many of these people are paid the minimum wage which has declined in value by almost five per cent over the last four years. Finally, changes to the law have made it easier to fire workers instead of hiring them.

This is a shocking situation. While both employers and employees need flexibility, this shouldn’t mean people in Edinburgh lacking job security and struggling to afford the weekly shop.

That’s why Labour’s plans to deal with this issue are so important. We would ban zero-hours contracts where they exploit people, end the scandal of false self-employment, strengthen the minimum wage, and incentivise employers to pay a Living Wage through “make work pay” contracts.

Insecurity at work is a huge challenge and this will still be the case after the next election in May 2015, whichever party is in power. But only by taking real action will government have any chance of tackling the issue. And only then will people Edinburgh be able to earn their way out of the cost of living crisis.

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