Clause 17 - Universal credit conditionality

Skills and Post-16 Education Bill [Lords] – in a Public Bill Committee am 9:25 am ar 7 Rhagfyr 2021.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Question proposed, That the clause stand part of the Bill.

Photo of Maria Miller Maria Miller Ceidwadwyr, Basingstoke

With this, it will be convenient to discuss new clause 8— Benefit eligibility: lifelong learning.

The secretary of state must ensure that no learner’s eligibility to a benefit will be affected by their enrolment on an approved course for a qualification which is deemed to support them to secure sustainable employment.

Photo of Alex Burghart Alex Burghart The Parliamentary Under-Secretary of State for Education

Clause 17 seeks to change the law so that some students could keep their universal credit entitlement while studying.

It may help if I explain to the Committee that financial support for students comes from the current system of learner loans and grants designed for their needs. Section 4(1)(d) of the Welfare Reform Act 2012 sets out that one of the basic conditions of entitlement to universal credit is that the person must not be receiving education, which is defined in regulations made under subsection (6).

Where students have additional needs that are not met through this support system, exceptions are already provided under regulation 14 of the Universal Credit Regulations 2013, enabling those people to claim universal credit. This includes, for example, those responsible for a child—either as a single person or as a couple—or those aged 21 or under studying non-advanced education, such as A-levels, who do not have parental support.

It is an important principle that universal credit does not duplicate the support provided by the student support system. The core objective of universal credit is to support claimants to enter work, earn more or prepare for work in the future. There is an expectation that people who are able to look for work or prepare for work do so as a condition of receiving their benefit.

Let me reassure the Committee about the important work already that is under way. Officials at the Department for Education and the Department for Work and Pensions are working closely together to help to address and mitigate the barriers to unemployed adults taking advantage of our skills offers. For example, DWP Train and Progress is a new initiative aimed at increasing access to training opportunities for claimants.  As part of this, in April 2021, a temporary six-month extension in the flexibility offered by UC conditionality was announced. As a result of this change, adults who claim universal credit and are part of the intensive work search programme can now undertake work-related full-time training for up to 12 weeks —or up to 16 weeks as part of a skills bootcamp in England—without losing their entitlement to UC. That builds on the eight weeks during which claimants were already able to train full time without losing their UC entitlement. This flexibility has now been extended to run through to the end of April 2022.  Such measures are helping to ensure that UC claimants are supported to access training and skills that will improve their ability to gain good, stable and well-paid jobs. Claimants who enrol on a longer course that is not advanced education can also retain their entitlement to UC, provided they can still meet their UC conditionality requirements.

More broadly, we are continuing to support working families on UC. As we set out at the spending review, we have reduced the taper rate to 55% and increased work allowances to £500 per year, allowing UC claimants to keep more of what they earn. This is an effective tax cut worth £2.2 billion, meaning that almost 2 million of the lowest paid in-work claimants are better off overall by around £1,000 a year on average. We do not think it is necessary for the UC regulations to be amended in this way, and the clause should therefore be removed from the Bill.

New clause 8 seeks to ensure that eligibility to benefit is retained for claimants undertaking certain courses deemed to support them to secure sustainable employment. In addition to what I have stated on universal credit and Train and Progress, claimants on new-style jobseeker’s allowance are able to undertake a full-time course of non-advanced study or training—not above level 3—for up to eight weeks if work coaches identify a skills gap and are satisfied that it will improve the claimant’s prospects of moving into work more quickly.

The time spent on the course can be deducted from the hours of work search that the claimant is expected to undertake. Claimants on new-style employment and support allowance can already receive benefits while in education, whether full or part-time study, as long as they satisfy the eligibility conditions.

The DWP is monitoring the impact of Train and Progress, with the review date due in April, and will make decisions on continuing based on the evidence available. This will include the potential to extend the legacy benefit groups that have not transitioned to UC.

New claims for legacy benefits are no longer possible, so this is a diminishing case load. Existing claimants can still study part time as long as they meet their conditionality requirements and are willing to give up their study for employment, which they have agreed to look for.

The core objective of universal credit and other working-age benefits is to support claimants to enter work where appropriate, earn more or prepare for work in the future. There is an expectation that people who are able to look for work or prepare for work do so as a condition of receiving their benefit. We therefore do not think it is necessary or appropriate to change eligibility criteria to benefits for those who enrol on a course, so the clause should not stand part of the Bill.

Photo of Toby Perkins Toby Perkins Shadow Minister (Education)

It is vital that the cross-party support in the House of Lords on ensuring that those in receipt of universal credit are not penalised for undergoing level 3 training is upheld in the Bill.

What the Minister just said, however, somewhat undermines other things that we have heard from him and other members of the Government about the importance of skills training and education. Much of the Government’s approach to skills, which we support, has been about the importance of qualifications and apprenticeships being proper qualifications that are given depth and that develop people’s learning. For that purpose, apprenticeships are a minimum of one year; level 3 qualifications are longer, and even level 2 apprenticeships are a minimum of one year.

It appears that the Government’s approach to universal credit is that those who are seeking to get themselves into the jobs market should be allowed to do very basic training of the sort I have seen on many excellent work programmes, but that if they want to develop the qualifications they would gain on a one-year course they will be unable to do so while claiming universal credit.

It is essential that those who are furthest from the labour market have every opportunity to find work.

Photo of Alex Burghart Alex Burghart The Parliamentary Under-Secretary of State for Education

What one-year courses is the hon. Gentleman thinking of where claimants may continue on universal credit while studying?

Photo of Toby Perkins Toby Perkins Shadow Minister (Education)

Apprenticeships are a one-year course. Many people might be on an apprenticeship and on universal credit. I have had the opportunity to see many courses that people are not on for longer than what the Minister said and face perhaps significant barriers to accessing the world of work. We have real concerns, which were shared by those in the other place, that rather than helping people to move from universal credit into work this programme will prevent them from doing so.

Photo of Rachel Hopkins Rachel Hopkins Shadow Minister (Cabinet Office)

It is a pleasure to speak for the first time in this important Committee under you, Mrs Miller.

One of the key points that we have seen is the move to online learning for many people, which would be time away from seeking work. Many of the modules last for a quarter, six months or a year. Does my hon. Friend agree that, under the clause, many people will feel uncertain about whether they can undergo training?

Photo of Toby Perkins Toby Perkins Shadow Minister (Education)

I absolutely do agree. Under the original drafting of the clause it was clear that to access universal credit people had to be on an approved course that took them towards the world of work. It fits in with the principles of universal credit, as we are led to understand them. Under the clause,

“the Secretary of State must review universal credit conditionality with a view to ensuring that adult learners who are—

(a) unemployed, and

(b) in receipt of universal credit, remain entitled to universal credit if they enrol on an approved course for a qualification which is deemed to support them to secure sustainable employment.”

The word “sustainable” is very important. The Government’s approach seems to be that it is better to get anyone off unemployment and into work in any capacity, even if it is only a few days of casual employment, than to allow them to take sustainable steps to develop skills and get a job on which they can rely in the long term. My hon. Friend, many Labour Members and possibly Conservative Members will have come across constituents who are bedevilled by unstable employment—a day here or a few days there—without anything on which they can rely in the long term to sustain their families financially. Sustainable employment that they can trust is vital.

Photo of Ben Bradley Ben Bradley Ceidwadwyr, Mansfield 9:45, 7 Rhagfyr 2021

I shared many of the hon. Gentleman’s concerns so I went to the Department for Education to seek clarity. As I understand it, many of the things that he is suggesting are already possible. Under both the current system and the new proposals, if a job coach accepts that a qualification would help someone into work, that coach can already approve that qualification and allow someone to do that training instead of job seeking under the work-based requirements for universal credit. Someone can also do a part-time qualification outside of working hours and still receive universal credit. Does he accept that that is true and perhaps contradicts some of his comments?

Photo of Maria Miller Maria Miller Ceidwadwyr, Basingstoke

Before Mr Perkins responds, may I remind Members that an intervention is just that; if you want to make a speech, make a speech.

Photo of Toby Perkins Toby Perkins Shadow Minister (Education)

A very well made point, Mrs Miller.

I accept that what the hon. Gentleman describes may be true on some occasions. However, the way in which the Bill is drafted and the very fact that the Government seek to oppose it, means that many job coaches, and many learners, will think that the Government would prefer to get them off the dole and into any job, at any moment, rather than invest in their skills. I have met many people in a variety of projects who are employed by the private sector, social enterprise or Jobcentre Plus to support people into work whose absolute focus seems to be to get one person from one list on to another. I fear that the long-term contribution to that person and ensuring that their training and qualifications are sustainable—the purpose of the Lords amendment—is lost as a result.

The hon. Member for Mansfield appears to be saying that the principles of the Lords amendment are already in operation given how job coaches operate. If that is the case, what is the harm of including the amendment in the Bill? If those rights and opportunities already exist for people, I cannot see the point in the Government’s opposition to the amendment.

The noble peers saw the value in the amendment, which enjoyed cross-party support. It is disappointing that, by their attitude, the Government are continuing to create the impression that people on universal credit who have the audacity to invest in their skills rather than simply take the very first opportunity to get off the dole and into work, however unsustainable or unreliable, should be discouraged from that.

On Second Reading, I was struck by the contribution from Peter Aldous. He said:

“the Government have placed much emphasis both on the importance of making work pay and on the current high level of job vacancies. Unfortunately, many people are currently some distance from the workplace and are not able to take advantage of these opportunities. However, many of them would be able to do so if universal credit conditions were reformed so that they could more readily access education and training. With that in mind, I urge the Government to consider carefully the amendment tabled by the Lord Bishop of Durham.”—[Official Report, 15 November 2021; Vol. 703, c. 416.]

As I said at the time, the hon. Gentleman was absolutely right to say that.

Given the twin challenges of Brexit and covid, Ministers must do all that they can to ensure that those who are furthest from the labour market are able to retrain or upskill. It has never been more important to ensure that we make the best of every single person. We know that there are staff shortages and we can respond to that in two ways. We could say, “Well, we have got shortages in staff, so let’s just get people into those jobs and fill the gap with a body.” Or we could say, “Let’s make sure we upskill the people who are currently furthest from the labour market, so that they are able to make a sustainable, long-term contribution.” That is the approach adopted by the Labour party.

The Opposition believe that it is a travesty that people in receipt of universal credit can be penalised for taking up an opportunity that could help them move into sustainable employment. We understand that the Government want to prevent people from undertaking qualifications for the sake of it, but those in receipt of universal credit should be supported to undertake training that is deemed appropriate by their work coach, in line with the principles outlined in the Bill. I hope that Members recognise the importance of supporting the clause.

New clause 8 is designed to probe why the Government may be against people in receipt of other benefits developing their skills so that they get closer to the labour market. Many people who are on a variety of benefits, such as incapacity benefit and other legacy benefits, may be very nervous about losing their entitlements to them. We all know that it is much easier to be taken off those benefits than to be put back on them. With some patience, tolerance and support, those people would be able eventually to join the world of work. There is a false dichotomy between those who Jobcentre Plus says are ready to go into work and should be spending every hour of every day looking for a job and other people who the Government accept will never get into work. Instead, we should be supporting everyone, rather than threatening them. We tabled new clause 8 to understand for what reason the Government would be against people developing their skills in a manner that pushes them to the labour market, even if they are in receipt of benefits that do not prompt the immediate response from Government that they should be doing all that they can to find work. I commend the new clause and clause 17 to the Committee.

Photo of Matt Western Matt Western Shadow Minister (Education)

It is a pleasure to serve under your chairship, Mrs Miller.

I support clause 17 and new clause 8, tabled by my hon. Friend the Member for Chesterfield and me. The new clause relates to the universal credit conditionality clause that was inserted during Lords consideration of the Bill by the Lord Bishop of Durham and Baroness Bennett of Manor Castle. It relates to the issues surrounding adult learners who are unemployed and in receipt of universal credit, who would remain entitled to that benefit within law if they were on an approved course.

To put it simply, the current welfare system actively discourages people from getting the skills that they need. A person loses their rights to receive unemployment benefits if they take an educational training course. Surely that cannot be right. The “Let them Learn” report from the Association of Colleges that was published recently highlights the great work of colleges with Jobcentre Pluses to support unemployed people into work. In fact, the Association of Colleges described the current system as “unjustifiable and incoherent”. Indeed, the principal of my local college wrote to me ahead of our consideration of the Bill to express her concern about the universal credit restrictions. She viewed them as causing barriers to retraining and upskilling. That cannot be right.

The truth is that unemployed people, or those in low-paid jobs, are the least likely to take out a loan for fear of risking greater indebtedness and poverty for themselves and their families. As someone who in the course of their career did courses at evening classes, I know that access to such courses is really important. However, if someone cannot afford to get to them, they simply will not take them up. The truth is that this will impact far more on certain groups than on others. We know that 53% of those on universal credit are women. We know that, as of July 2021, 30% of claimants were aged 16 to 29; 40% of people on universal credit are working.

How can those workers justify taking a cut in their monthly pay and finding time to reskill? Indeed, the Department for Education’s impact assessment reveals that the cost of study is the greatest barrier to further study. That is why we propose new clause 8 and will vote against the Government. We believe that the clause introduced by the Bishop of Durham and Baroness Bennett of Manor Castle should be in the Bill.

Photo of Alex Burghart Alex Burghart The Parliamentary Under-Secretary of State for Education

We believe that it is important that the welfare system helps people to get into work as quickly as possible, but we are not blind to the fact that some people will need or desire additional training. I referred to the flexibilities we have introduced to allow people to do bootcamps—a very productive way of reskilling at speed. On my visits to Salford, Bedford and Doncaster I met people who had been referred by their work coaches and were acquiring new skills that would often lead them into new professions.

Similarly, as the hon. Member for Chesterfield mentioned, it is possible for people to be on apprenticeships while claiming universal credit if their pay is low enough, and courses for the new lifetime skills guarantee that the Prime Minister made will often be available to people who are on universal credit.

We have shown that the system is capable of flexibility. We do not believe that people ought to be able to claim benefit while on long courses. However, there are opportunities to skill up, move into work and still receive some protection from universal credit.

Question put, That the clause stand part of the Bill.

Rhif adran 15 Skills and Post-16 Education Bill [Lords] — Clause 17 - Universal credit conditionality

Ie: 4 MPs

Na: 9 MPs

Ie: A-Z fesul cyfenw

Na: A-Z fesul cyfenw

The Committee divided: Ayes 4, Noes 9.

Question accordingly negatived.