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Westminster Hall

Thursday 10 July 2014

[Mr David Amess in the Chair]

Jobcentre Plus

[Relevant documents: Second Report of the Work and Pensions Committee, The role of Jobcentre Plus in the reformed welfare system,HC 479, and the Government Response, HC 1210.]

Motion made, and Question proposed, That the sitting be now adjourned.—(Mr Desmond Swayne.)

1.30 pm

Dame Anne Begg (Aberdeen South) (Lab): I am delighted to lead this debate on the report by the Select Committee on Work and Pensions, “The role of Jobcentre Plus in the reformed welfare system”. It is a bit of a mouthful, but the report contains a lot of interesting things. We published it at the end of January this year, and the Government responded at the beginning of April. It seems a long time between that and this debate, but that is because Parliament prorogued somewhat earlier than expected and our debate got dropped as a result. Some of our findings, therefore, might be slightly out of date, but in general, most of what we discovered when we considered the work of Jobcentre Plus is as relevant today as it was in April and May.

Jobcentre Plus is at the coal face of the benefits system. It is part of an administrative system that processes out-of-work benefit claims from hundreds of thousands of people each year. At the same time, its staff work with people one-to-one to help get them off benefits and hopefully back to work. They are both difficult tasks, but Jobcentre Plus performs them well with limited resources. It is well organised, has hard-working staff and has been officially recognised by the National Audit Office as offering value for public money. Jobcentre Plus has also coped well with the inherent uncertainty that it faces, not least from the large fluctuations in the claimant count brought about by the economy’s shifting fortunes. It has even coped with the innumerable policy changes imposed by the Government.

It was in the context of the unprecedented change brought about by the current Government’s extensive welfare reform agenda that we considered Jobcentre Plus’s effectiveness now and the challenges that it will face in future. Our central finding was that JCP is not currently good at prioritising those claimants who need the most help looking for work and providing them with the personalised support that they need. I know that that is no easy task, and given the volume of out-of-work claims made each year, Jobcentre Plus does remarkably well, but a range of witnesses, particularly those representing the most vulnerable groups, told the same story: there is generally very little in-depth assessment of claimants’ needs at the start of the job-seeking process, meaning that claimants facing particular disadvantages—the homeless, people with disabilities or people with drug or alcohol problems—all too often go unrecognised and get no help beyond a brief fortnightly signing-on meeting at the jobcentre.

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Not for the first time, my Committee called for a much more systematic approach to the initial assessment of claimants’ needs. A classification instrument, to use the jargon, was the first of our key recommendations. In plain English, that means making a thorough, systematic assessment of each claimant’s needs and categorising them according to the level of support they require. That must surely be the logical first step in all effective employment support; otherwise, claimants with the most challenging barriers to employment will continue to be poorly supported and will remain unemployed for much longer than they should.

For some reason, however, the Government continue to dither on the issue. The Department for Work and Pensions told us that classification instruments are the holy grail. I thought universal credit was the holy grail of welfare reform—if so, it has not been found—but if the holy grail is classification instruments, it has already been found. They are already in use in Australia, where a jobseeker classification instrument has been used to good effect for more than 15 years and has been honed and improved through several iterations during that time. I would be grateful if the Minister could offer a proper explanation as to why we in the UK cannot replicate something similar here.

Stephen Timms (East Ham) (Lab): I welcome the report. One of the points it makes is that the Government’s response on that issue was not entirely clear: was it that they cannot do that kind of segmentation assessment, or was it that they are developing something along those lines? It was not clear to me from the Government response which of those was the Government’s position. Has my hon. Friend been able to work that out?

Dame Anne Begg: I am not sure whether I can shed any more light on that than my right hon. Friend. Perhaps the Minister can reply. Certainly, in our briefings with the DWP and relevant officials, they have suggested that the Government are trying to work something out, but that either they believe it is not effective—although the figures that they quoted to us did not necessarily have the interpretation that could have been made from the reports that have been published—or it might cost too much money in the long run, because an up-front payment would inevitably be involved in setting up a classification system.

The Committee contends, however, that doing it properly at the beginning would ultimately save the Government money by ensuring that the correct level of help was given and that the barriers to work were identified early, so that a much more personalised approach could be taken to jobseekers in particularly vulnerable groups. We are talking about more vulnerable and difficult-to-reach groups, because we know that by any measure, Jobcentre Plus is relatively successful in getting mainstream jobseekers into work. That is what it does; it is Jobcentre Plus’s bread and butter. It is what staff do week in and week out.

Stephen Timms: One point in the Government response is that if there were such a tool, it would be only 70% accurate. That struck me as not bad, actually, compared with what happens at the moment. What did my hon. Friend think of that particular statistic?

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Dame Anne Begg: We have been consistent in requesting that the Department introduce a classification tool, so the Select Committee has certainly been convinced of the efficacy of such a tool, and 70% seems not too bad. I think the figure ranged between 50% and 70%, but that is better than nothing. At the moment, it can be a bit hit and miss whether someone is even identified as homeless. Their personal adviser has to recognise that the address they have given indicates that they may be homeless. As well, people with mental health problems will not necessarily reveal all in a short, cursory interview with a complete stranger, but that kind of information would be and is useful to anybody trying to get an individual into work or back into the workplace.

Our report recognised that JCP is good at what it is currently being asked to do: it has become adept at getting people off benefit in as short a time as possible. Since April 2011, JCP’s primary performance measure has been what is called “benefit off-flow”. The old mantra “What gets measured gets done” certainly comes to mind. About 75% of jobseeker’s allowance claimants come off benefit within six months, and some 90% are off benefit within a year. But—and this is a big “but”—is getting someone off benefit quickly always good enough? Is off benefit always a good and sustainable outcome?

Our answer to those questions was a clear no. The evidence suggests that measuring JCP performance primarily by benefit off-flow is unsophisticated. Jobcentre staff are likely to say to themselves, “Let’s concentrate our efforts on people who are most likely to come off benefits quickly—we need to meet our 13-week target—and let’s keep a very close eye on anyone coming up to 26, 39 or 52 weeks on benefit too.” Who can blame them for that? That is how their efficiency and effectiveness is measured, and that is the task that they have been set by Ministers, but JCP needs to be incentivised to take a more sophisticated approach.

Our second key recommendation was that JCP’s performance measures be amended to ensure that Jobcentre staff are more clearly incentivised to get people not just off benefit but into sustainable and long-term employment.

Nigel Mills (Amber Valley) (Con): Does the hon. Lady agree that that would also tie in with the way we assess the Work programme providers and make much more sense in the world of universal credit, assuming that it is fully rolled out? Under universal credit, people will not be coming off benefit. Their level of benefit will perhaps decline based on how much work they are doing, but their level of work could fluctuate from week to week or month to month, so the measurement would be largely meaningless.

Dame Anne Begg: Indeed; that was one of the things we pointed out in our report. We drew particular attention to it in our more recent report on the implementation of universal credit, which was debated in the Chamber on Monday—that is two reports in a week, showing that we are a really busy Committee. Although we might be sceptical of how far universal credit is being rolled out, there is no doubt that, as my friend the hon. Gentleman pointed out—he is my friend because he is on the Select Committee—its introduction provides an opportunity for the Government to think differently about how to measure the real success of Jobcentre Plus.

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Sheila Gilmore (Edinburgh East) (Lab): The other side of the question of what is being measured is the lack of any measurement and follow-up on people who are not moving into work—it appears that no record is kept. A large number of people flow off benefit, but not only do they not flow into sustainable employment, they appear not to flow into employment at all.

Dame Anne Begg: I think people would be surprised to learn that Jobcentre Plus does not routinely record the reason why someone leaves benefit. As far as JCP is concerned, because the primary focus is on benefit off-flows, the important thing is that the person is no longer on a job-seeking benefit. However, as my hon. Friend says, why are they no longer on a benefit? It could be because they have a new job—that is what we hope—and it is possible that they have transferred to a different benefit because they have become ill, but they might be in prison or have gone into the black economy. We do not know, and nor does JCP because it does not gather that information or track claimants’ destinations. We think it is important that JCP does that in order to judge how efficient and effective its work is.

At some point, hopefully in the not-too-distant future, off-benefit is likely to cease to make much sense as a performance measure, particularly with the introduction of universal credit. I think Members agree that a system that merges out-of-work benefits and in-work tax credits, and in which benefits taper off gradually as earnings increase, would be a huge step forward. That is what universal credit is intended to do, but it will require creative thinking from the Government about new performance measures for JCP.

The Department says that it will think about how to formulate such measures once universal credit is implemented—whenever that is going to be. We think that it should be thinking about and testing them now, not leaving it until much later. Even if universal credit continues to slow down, the Committee certainly thinks that the development of a new measure is worth while anyway, whether in conjunction with universal credit or not. The Department must pilot more meaningful performance measures that track JCP’s effectiveness at getting people into work and helping them to stay there for the long term. I hope that the Minister can reassure us that the Government understand the importance of achieving longer-term positive employment outcomes.

Another part of our report that has received quite a lot of attention—perhaps because many Members have experience of it in their constituencies—is Jobcentre Plus’s use of sanctions. There is an inherent tension in what JCP does, between helping and supporting people to find work on the one hand, and, on the other, enforcing strict rules, including financial penalties for claimants deemed not to be trying hard enough to find work. Such is the everyday experience of the Jobcentre Plus adviser and the job-seeking benefit claimant, and it can make for an uneasy relationship.

Pamela Nash (Airdrie and Shotts) (Lab): Does my hon. Friend share my concern about sanctions data? In preparation for this debate, I requested figures on sanctions from my local jobcentre. The staff there said that they had not received any data back since March and so are themselves unable to keep track of the number of sanctions being issued and the reasons for them.

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Dame Anne Begg: I see the Minister taking a note, so hopefully she will address that in her response. It is important that we track very carefully not only the number of sanctions but to whom they are issued.

Almost by definition, the payment of unemployment benefit has always been conditional. To get the dole, people had to prove that they were both out of and looking for work. The concept of conditionality is not new, but conditionality enforced by financial sanctions is much newer. My Committee’s view has been consistent throughout this Parliament: we agree that a conditionality regime is necessary, but have noted the lack of evidence that sanctions on their own incentivise claimants to look for work.

Meanwhile, the system has become progressively more stringent and punitive. Tougher sanctions legislated for in the Welfare Reform Act 2012 include stopping a claimant’s jobseeker’s allowance for three years; prior to the Act coming into force, the maximum sanction was six months. Not only have sanctions become tougher, but they have been applied much more frequently in recent years. The pre-eminent expert in this field, Dr David Webster of the university of Glasgow, highlighted a “dramatic rise” in the use of sanctions under the coalition Government.

Currently, if someone is on JSA for any length of time, there is a good chance that they will suffer a sanction. Sanctions do not happen only to a small minority; some 860,000 people were sanctioned in the year to June 2013. That is almost 1 million in a year, and the more recent figure might have reached that level, although it is difficult to find out the exact figures locally. Over 5% of all JSA claimants are sanctioned every month, and that proportion rises to over 8% for jobseekers aged between 18 and 24. We should ask whether that is a reasonable proportion—is that the proportion of JSA claimants who are not doing enough to find work? It seems particularly high to me.

The evidence we heard suggests that it is not a reasonable proportion, and that a significant number of sanctions are incorrectly and unjustly applied. There are innumerable examples of people being wrongly sanctioned, and I suspect that some colleagues might want to discuss some from their own constituencies. Many people—we heard lots of examples—have been sanctioned for missing a jobcentre appointment when they had good cause and had informed Jobcentre Plus in advance or, indeed, had not received notification of the meeting until after it was due to have taken place.

A wide range of witnesses believed that JCP staff were generally much too quick to refer a claimant for a sanction. We were given many real-life examples of JCP applying the strict letter of the law in circumstances in which common sense would suggest that discretion should have been applied. Just yesterday I heard an example of an older person who had fallen out of work and was sent off to use Universal Jobmatch, the new computerised job-search system that all JSA claimants have to use to apply for jobs. But this person had no IT skills, and so was sanctioned for not applying for enough jobs. That is the kind of thing that we feel should be weeded out of the system, because it does not demonstrate the proper use of sanctions.

What is the impact of all these sanctions? The truth is that we do not really know. The assumption of the policy is that it will positively affect the behaviour of

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claimants who are not doing enough to find work, but does it actually work? The evidence seems flimsy at best. If so many people are having to be sanctioned, presumably the punishment is not working. If the punishment is supposed to reform behaviour, why are people being sanctioned more than once and why are the numbers so high? As an ex-teacher, I always thought that I had failed if I had to repeat a punishment, or indeed if I had to carry out the punishment, because the threats had not worked beforehand.

There is certainly a need to find out whether these sanctions are just punitive, whether they are just to increase the numbers of people off-flowing from benefits, or whether they are working more effectively. There is evidence that sanctions increase benefit off-flow because people who are not receiving any money do not bother to turn up to sign on. Of course, if they turn up to sign on, they remain on the unemployment register, but if they do not turn up they drop off it. That is another reason why benefit off-flow does not necessarily indicate a positive outcome.

The Public and Commercial Services Union represents Jobcentre Plus staff, who are the real experts on this issue, and it told us that sanctioning

“just does not work in terms of getting people into work.”

Perhaps the Minister can refer to some hard evidence to the contrary—evidence that sanctioning has a positive impact on employment outcomes—as the Government’s response to our report could not do so.

What about the impact of sanctions on claimants? Do they cause severe financial hardship? Some witnesses were convinced that they do, to the extent that claimants often require charitable handouts to feed themselves and their families. During our inquiry, Oxfam and Church Action on Poverty published a report that made a direct link between the undoubted increase in sanctions and the unquestionable increase in referrals to food banks during the past few years, and many hon. Members wrote to the Committee to ask us to look specifically at this particular issue. The report estimated that in May 2013 half a million people in the UK were reliant on food aid, and that up to half of that number turn to food banks

“as a direct result of having benefit payments delayed, reduced, or withdrawn altogether”.

So, some of that is about sanctions, but in other cases it is about the barriers that many people face in accessing the welfare system, including benefits.

The Trussell Trust recently published data that showed a 54% increase from 2012-13 to 2013-14 in the number of meals provided by food banks. In total, some 20 million meals were given out to people in food poverty last year. We were unable to confirm a conclusive causal link between sanctions and food poverty, as there are insufficient hard data on this issue. While JCP does refer people to food banks, for some reason it does not record the number of referrals it makes or the reasons for those referrals.

I think that is bizarre. By their own admission, it is sometimes necessary for the Government of the UK in the 21st century to refer people to food banks because they cannot afford to feed themselves or their families, but the Government do not take a note of how often that happens. I cannot understand why they would not want to know why this is happening but, judging from

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their response to our report, it would appear that they do not want to know. They reject outright our recommendation that the DWP monitors the extent of financial hardship caused by sanctions, including collecting and publishing data on the number of claimants referred to food banks by JCP. I look forward to the Minister explaining why the DWP could not accept this perfectly sensible recommendation.

Our other key recommendation in this area was for a thorough and fundamental independent review of the operation of the conditionality and sanctions regime across the jobcentre network. We want a much wider reaching review than the limited one recently undertaken by Matt Oakley, whose report—by the way—is now more than three months overdue. We understand that it has been finished, but it has not been published.

The review that we called for would investigate whether sanctions are being made appropriately, fairly and proportionately across the jobcentre network; the link between sanctions and benefit off-flow; and, crucially, whether sanctions are having the desired effect of encouraging claimants to engage more actively in job-seeking.

In evidence given to us, the Minister appeared to provide an assurance that a proper and in-depth review, along the lines that we suggested, would happen. In fact, she told us that she had “already started” on one. Perhaps she can now explain why the DWP has utterly backtracked from that position. It is very clear from the Government’s response to our report that there are no plans for a second, broader independent review. The Oakley review looks only at communications, but I would have thought that it was crucial for the Government to find out whether or not the sanctions regime actually works.

The use of sanctions has been increasing inexorably in recent times, but what is the evidence that sanctions are having a positive effect on the behaviour of job-seeking benefit claimants? Given the widespread concerns about the severe impacts that sanctions can have, and the tensions they inevitably create in the relationships between JCP advisers and the jobseekers they are trying to help, surely it is time to establish whether or not they actually work?

My final set of recommendations concerns the issues with the Universal Jobmatch system. Trying to match jobseekers to suitable job vacancies is a core task for JCP. For years, the system involved jobseekers checking vacancies posted on cards stuck on boards in the jobcentre. Things have moved on quite a way from there, through vacancy databases to “job points” in the jobcentre, and Universal Jobmatch is the latest development. It is essentially a recruitment website, with a vacancy database and an online platform through which benefit claimants and other jobseekers—that is quite important to point out, as other jobseekers are able to access this system too—can search for and apply for jobs.

Expert witnesses broadly felt that Universal Jobmatch represented an improvement on previous systems, and they also believed that it had huge potential to improve the efficiency and effectiveness of claimants’ job-seeking. However, improvements to its functionality are required if it is to reach that potential, but that is not the responsibility of Monster Government Solutions, the

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company that developed Universal Jobmatch; improvements depends on what the DWP asks the company to do and what it is willing to pay for.

Universal Jobmatch is currently a pretty basic online jobs board. To transform the job-seeking experience, the system needs further development to provide, for example, the functionality to offer online training modules or to assess the quality of claimants’ CVs. The Government’s response to our report talks vaguely about planned updates to the system. I would be grateful for some more detail today on the Government’s plans to improve the functionality of Universal Jobmatch, because I am pretty sure that the people who run the system would be happy to do more work in that area.

More worryingly, we found that the DWP appeared to have very little oversight of the vacancies being posted on Universal Jobmatch. Witnesses reported seeing highly dubious vacancies, such as for “diplomats” in the north-east of England; large numbers of duplicate vacancies; and a significant number of vacancies that were no longer in date. This issue is extremely important. Universal Jobmatch is increasingly being used to monitor claimants’ job-seeking, and to check that they are fulfilling their obligations to look for work and apply for jobs. With a significant proportion of dubious, duplicate and out-of-date vacancies on the system, claimants could be wasting their time applying for vacancies that offer no prospect of employment, and they could even face sanctions if they refuse to use the system.

The Government “partly agreed” with us that the oversight of Universal Jobmatch needed to increase. Will the Minister set out what the DWP has done so far to purge the system of those types of vacancies, which threaten to undermine its effectiveness? Just today, I received a briefing from Monster Government Solutions, in which it said it had been working hard to provide an update on fraudulent and duplicate job postings. However, I know from experience that it is quite easy to post a job on Universal Jobmatch, whereas it has actually got much more difficult to take it down.

My right hon. Friend the Member for Birkenhead (Mr Field) and the media have highlighted a very worrying issue, which is the appearance of fraudulent jobs or jobs that would defraud the claimant. The incident highlighted by my right hon. Friend involved a bogus employer fraudulently charging jobseekers £65 for “criminal background checks” as part of a supposed recruitment process, only for the jobseekers to arrive for what they anticipated would be their first day in a new job and finding that no job existed. The concern is that Universal Jobmatch is open to abuse of this kind because it has been designed as a self-service system, making it easier for employers to use. In effect, this means that anyone can advertise on the site with a few clicks of a mouse, and it can make a job more difficult to take down.

The Minister told us in her reply to our letter that the number of fraud cases was “very low” and that DWP has

“well-established procedures to minimise the risks of fraud occurring”

on Universal Jobmatch. I should be grateful if the Minister reassured us today that DWP takes fraudulent use of the system seriously and if she updated us on the actions the Government are taking to tighten up the system, to protect claimants from this type of unscrupulous behaviour and from being accused of not applying for jobs that do not exist.

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Our report highlighted the fact that JCP staff have proved themselves capable of responding well to change and continue to deliver a value-for-money service under difficult circumstances. However, it is crucial that the systems they are asked to administer work in the best interests of benefit claimants and taxpayers. It was not clear to us in the course of our inquiry that that is always the case. I look forward to the Minister’s response to the specific points I have raised.

2 pm

Anne Marie Morris (Newton Abbot) (Con): I am pleased to serve under your chairmanship, Mr Amess. It is always a great pleasure to follow the hon. Member for Aberdeen South (Dame Anne Begg), who is a first class Chairman of our Select Committee. It is to her credit that she looks at these issues in such detail and manages to ensure that we have a reasonably fair debate across both sides of the House.

The issue has been well put forward and well summarised. One challenge in debates such as this is that a Select Committee report is inevitably a glass half empty rather than half full. Select Committees are not there to look at what is going well; by and large, they hold the Government to account and consider what is not working.

In many ways, it is not being forcefully said that jobcentres and Jobcentre Plus work remarkably well. The hon. Lady said that the National Audit Office stated that they provide value for money and we need to listen to that, because the NAO does not often dish out praise. We need to remember that and give the Jobcentre Plus offices the proportional support and credit that they deserve. It is with regret that I say that many jobcentres are on strike today. However, I am pleased to report that in Newton Abbot we are open for business.

As has been mentioned, the key role for Jobcentre Plus is administering working-age benefit—that is its first purpose—and providing public employment services for the unemployed, and it seems to me that it does well on both counts. Let me discuss first its role as an employment service. It needs to do three things: effectively advise and support those looking for work; ensure that claimants fulfil their responsibility to look for work; and support an efficient and flexible labour market, matching employees to jobs.

As I said, the NAO stated that the Jobcentre Plus organisations delivered value for money and that they responded efficiently to policy changes. I note, as a Committee member, that there are concerns about universal credit, because—steady as she goes—it will be a major change. None the less, the NAO must have been aware of that when producing its report. It was also positive about the ability of Jobcentre Plus to respond to fluctuating numbers, which is a real challenge: managing resource, particularly the numbers that are going to change as the benefits system changes, is a challenge. Again, the NAO was complimentary—and in a time of recession, when Jobcentre Plus would be expected to be under significant pressure.

On Jobcentre Plus’s aim of being an employment service, let me look at the issue of effectively providing advice and support. Much of what the Committee Chairman said is right; there is a need for some sort of tool to ensure that those who really need help the most get it. In our debate, we talked not just about more help

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for those furthest away from the workplace, but about trying to save time in respect of those who will clearly find it easy to find a job. There was discussion about some people getting lots of face-time support, although they did not need it, and about using that time better for those who are much more needy.

The problem is, however, that if there is no tool at the outset to enable people to work out who needs what, those details are difficult to find out. I support what the Chairman said: we need to look properly at such a tool. The Government have considered the matter, but at the moment we have no clarity about what they are doing and what the options are. We need to know, because it is an important issue, and not only from an economic point of view. Why spend time and resource on those who least need it, when those who need it are not being best helped to get to the workplace?

The Chairman’s second point on advice and support was about the particular challenge of employment and support allowance claimants—particularly those in the work-related activity group, those with fluctuating conditions and those with mental health problems. In a sense, whatever tool we come up with, that group clearly needs particular support. There should at least be some means of identifying that group and considering what we can do for it, because as a Committee we share a concern that the work-related activity group is incredibly wide. It probably would be better to narrow it, if we could find a better way to make decisions about which of the three groups individuals fall into.

On the plus side, the feedback that we received about support—the Get Britain Working tool, which contains six schemes—suggested that it was working well. That is a positive.

I am particularly concerned that youngsters—and, indeed, those who have been made redundant and seek to enter the marketplace again—should have the opportunity to consider self-employment. The all-party group on micro-businesses, of which I am chair, did a piece of work looking at all the Work programme providers, to see how many were able to help people start up their own businesses. It found that fewer than half were.

Certainly, from the feedback that we have received, and my experience with the jobcentre in my constituency, there is now a significant amount of support to help people set up their own businesses. Indeed, specialist advisers are doing that in my local jobcentre. That is positive. There are good stories of people who have set up some interesting, innovative new businesses.

Sheila Gilmore: Obviously, there has been a big increase in the number of people who have become self-employed in recent years and there are a lot of advantages for people in being self-employed. However, does the hon. Lady share my concern that the average earnings of self-employed people have substantially dropped over that period? There is a danger that, although some people are regarded as being off benefit because they have gone into self-employment, self-employment is poorly remunerating them.

Anne Marie Morris: Having set up and run my own business, I know just how hard it is. Nobody here would say that setting up a business is the way—for most of us—to become a millionaire; there will be one or two,

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but by and large it is a real challenge and the income from doing so, certainly in the early years, cannot be compared to what people might get later. However, it is much better, both psychologically and economically, to be in work, whether self-employment or employment. I do not really share the hon. Lady’s concerns.

The Chairman mentioned the claimant fulfilling their responsibilities. Overall, the claimant commitment, which I believe has been entered into by 600,000 individuals, is positive. I think we all agree that that is a good thing, because it provides a feeling of self-worth, and because more people should be in work than not in work—quite apart from the economic issue. If there is better understanding between the claimant and the adviser about what exactly is involved, without a sense that it is a choice or option to be on benefits, that is the right thing by the taxpayer and by the individual. That is a positive step, of which the Government should be proud.

Of more concern to me and the Chairman, on the issue of those who have agreed with an adviser what steps they might take to get back into the workplace, is the sanctioning process. The Select Committee met a number of individuals for whom the process simply had not worked, and that is certainly reflected in the constituents who come to my surgeries. That issue cannot be ignored, and it needs to be sorted out. I agree with the Chairman on that point.

From all the evidence we took from Ministers and officials, I get a sense that, although we might not have the clarity we want on exactly what sort of review might take place—it might not be the type we want—the Government recognise the problem and want to do something about it. It will be interesting to hear from the Minister exactly what she is doing and why she thinks it will be the best way of resolving the problem.

The very fact that the Government listened and introduced the new exemption on the homeless, so that the sanctioning process would not operate in the draconian and, in many ways, wrong way that it has, is a good thing. There is a recognition—much to the credit of Shelter, who I think put forward the campaign—that the homeless have particular problems in getting to appointments, because they do not have a home and all the facilities that those with homes enjoy.

Another aspect of Jobcentre Plus is its role as an employment service. Clearly, one of the main things it needs to do is provide a flexible labour market. The Chairman sensibly referred to the challenges of the Universal Jobmatch programme. I found it interesting to listen to both sides of the debate on that. It is clear that the organisation that operates it is, as she said, welcome to look at changes and improvements to ensure that it functions better, but I will be very surprised if I hear the Minister telling us anything other than, “The Government are on the case and the tool must work appropriately.”

One concern, expressed by some of the witnesses, is the challenge of getting a greater range of jobs on the system. Without that range, we will not be able to meet the needs of all the different jobseekers. A little bit of marketing needs to be done to ensure that employers up and down the different sectors and sizes of business see Universal Jobmatch as a useful tool. We had evidence from a couple of individuals who said that it was a fantastic tool that saved them money in recruiting and

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delivered able people, willing to work, who they would not have otherwise found. People came to us to say that it is a good tool.

The other challenge is on trying to make the tool more accessible and attractive to the smaller business. The bigger business, in a sense, understands these systems—they have human resources departments and it all makes sense. For very small SMEs, it is a different ball game. We all know that much of the growth and recruitment is in that area, so we need to find a way to attract more smaller businesses to use Universal Jobmatch. The Chairman referred to the challenge with jobs that have been filled, spoof jobs and so on. My understanding is that the Government are already looking at that, but she is right that the issue is serious and needs to be addressed.

Another thing that Jobcentre Plus administers is working-age benefit. Despite the NAO report, there are clear concerns about resource and whether the universal credit and the influx of people who have been unsuccessful on the Work programme—and have to be placed on community work places, found training courses or asked to sign on daily—will increase the work load. It will be interesting to hear the Minister’s prediction of the additional need for resource. How can that be met in a flexible way?

At the end of the day, one of the important things in administering a working-age benefits system is to ensure that it works. One of the Chairman’s key points was that if we are simply measuring the number of people off benefit, which is how it works now, we are not getting any insight into where those who are no longer claiming have gone. At the end of the day, we are trying to get people into jobs or self-employment, rather than just getting them off benefit.

Clearly, there are challenges, but I am hopeful that the Minister will explain what those are and why there is a reluctance to look at them. If a system is about trying to get people into employment, we need to have a measure that shows that people have got into employment.

Overall, Jobcentre Plus works extremely well and, frankly, it is to the credit of all parties—the system has been going for some time—that it does work so well. Although we need to address some of the challenges for the minority who use it, we must never forget the strength of what we have.

2.15 pm

Debbie Abrahams (Oldham East and Saddleworth) (Lab): It is a pleasure to serve under your chairmanship, Mr Amess. It is also a pleasure to follow my colleague on the Select Committee, the hon. Member for Newton Abbot (Anne Marie Morris), who, as always, made a balanced speech. I am particularly pleased to speak on behalf of my constituents, many of whom are claimants and use their Jobcentre Plus, but I also speak on behalf of those who work within the Jobcentre Plus network and more widely within the Department for Work and Pensions system. I have been contacted by a number of people since the Select Committee started looking at this issue, and I want to air their views as well.

My speech will focus on sanctions, which both the previous speakers have touched on. The Select Committee’s report raised concerns on whether sanctions are being applied

“appropriately, fairly, proportionately and in accordance with the rules, across the Jobcentre network.”

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The principle of conditionality has been accepted across all the parties represented in the Select Committee and beyond. It is that if claimants are receiving financial support from the state, there are conditions around that—on job search and on having regular meetings with jobcentre advisers, for example. That principle is long established and has in recent years been extended to involve financial penalties or sanctions being applied to the claimant, with benefit payment being stopped for a limited period if the conditions are not met. Even more recently, it has been extended to people who are sick or disabled, who can have work preparation conditions, with associated sanctions, applied to their benefits.

As many know, two thirds of those who receive social security payments are in work. The Government have already mooted that in-work conditionality and conditionality for in-work social security payments is likely. We should remember that and reflect on the particular issues we are facing with those on out-of-work or ill-health payments. The Welfare Reform Act 2012 introduced a new regime of sanctions. Instead of a maximum of six months of sanctions, the maximum period of a JSA benefit sanction is three years. The minimum is a month. Under the previous system, people could perhaps tide themselves over for a week’s sanction—they might have been able to borrow off family members or friends. A month, however, is a different kettle of fish. Later, I will come on to what that change means for so many individuals and families.

Many fair-minded people would say, “If you’ve done something wrong, it is only right that you should be punished for it.” That was raised by the Committee and has been mentioned today. My colleagues and I, however, have received overwhelming evidence, and investigative journalists have highlighted, that people are being sanctioned for doing nothing wrong at all. They are being set up to fail.

A whistleblower—a former JCP adviser—came to my constituency office and said that stitching up claimants was part of the job. He referred to a “bullying” culture, driven from above, in which claimants were constantly harassed to get them “off flow”, off benefit and off register. If advisers resisted pressure from managers, they were issued with a performance improvement plan, which is the start of a disciplinary procedure. Targets were set for advisers to cover targets for decision makers, resulting in perverse behaviour. He described advisers setting claimants up to fail, including making appointments about which they had no knowledge so that they were automatically sanctioned when they did not turn up. That is absolutely outrageous and there is growing evidence that it is happening up and down the country.

Another whistleblower from the midlands this week reported the pressure that she is under to meet targets to push people, including the sick and disabled, off benefits, such as being told to “disrupt and upset” claimants. The article states:

“Managers repeatedly question them on why more people haven’t been sanctioned. Letters are sent to the vulnerable who don’t legally have to come in, but in such ambiguous wording that they look like an order to attend. Tricks are played: those ending their contributory entitlement to a year on ESA need to fill in a form for income-based ESA. But jobcentres are forbidden to stock those forms. These ill people’s benefits are suddenly stopped without explanation: if they call, they’re told to collect a form”—

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but of course the jobcentre does not stock them. The article continues:

“If someone calls to query an appointment they are told they will be sanctioned if they don’t turn up, whatever. She said: ‘The DWP’s hope is they won’t pursue the claim.’”

It is shocking.

Figures for the new sanction regime introduced at the end of 2012 show that sanctions have increased by 11% on the same period and that 1.35 million people on JSA were sanctioned in the first six months, with 553,000 upheld on appeal. For the same period, 11,400 people on ESA were sanctioned, including a constituent of mine who had a heart attack in the middle of a work capability assessment. The nurse said, “You’re having a heart attack. We’re going to have to stop. You’re going to have to go to hospital.” He received a letter two weeks later to say that he had been sanctioned.

The work that Citizens Advice in Manchester did on the effects of benefit sanctions on claimants showed that 40% did not receive a letter informing them of their sanction; they just had their money stopped. Over half of claimants said that they had not received any information about how to appeal.

When the Minister attended the Work and Pensions Committee in November, I asked her how sanctioned JSA claimants would affect JSA claimant figures and she said that, as long as they kept signing on, they would be counted. What she did not say, however, is that the Department does not keep such data. No one knows how many sanctioned JSA claimants keep signing on. If more than half of those sanctioned do not know that they can appeal, how many will know they need to sign on stay on register? Will JCP tell them? I would query that. I did some basic maths: taking the May JSA claimant figure, if 5% of 1.09 million people are sanctioned every month, the actual JSA claimant figure would be 1.147 million. It is apparent how the number can be distorted because the actual JSA claimant figures are not being kept.

I also asked the Minister whether she would commit to a second, broader independent review, as mentioned by my hon. Friend the Member for Aberdeen South (Dame Anne Begg), to look at inappropriate sanctions. At the time, she agreed. The Work and Pensions Committee certainly believed she had—it was one of our recommendations—but it is disappointing that the commitment has since been reneged on. I ask the Minister once more whether she will commit to that important piece of work in light of the compelling and growing evidence that has come forward since our inquiry and the potential distortion of the JSA claimant count.

The impact of benefit sanctions on people’s lives is becoming well documented. The Trussell Trust, which runs so many food banks up and down the country, cites benefit changes and delays, including sanctions, as the main reason why people visit it needing help. People are not able to feed themselves and their families. The principle of social security conditionality is well established and supported, but it needs to be examined in the round, as my hon. Friend said, to ensure that it is effective and produces the desired behaviour.

Stephen Timms: My hon. Friend is making a powerful case. Regarding the documentation of problems with benefit sanctions, has she seen the website devoted to the topic? It is entitled “A Selection of Especially Stupid Benefit Sanctions” and contains a raft of ludicrous

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examples, including the case of her constituent not completing his work capability assessment because he had a heart attack in the middle of it.

Debbie Abrahams: I have seen that website. Following the inquiry and people becoming more aware, a whole raft of unbelievable examples are coming forward.

As I said, the principle of social security conditionality is well established and supported, but the reports of punitive, unfair and inappropriate sanctioning and bullying behaviour in JCP offices should be a cause for concern. I urge the Minister not to turn her back on the issue and the people it is affecting this time and to do right thing by committing to an independent review of inappropriate sanctioning.

2.27 pm

Nigel Mills (Amber Valley) (Con): It is a pleasure to speak in this debate and to follow the hon. Member for Oldham East and Saddleworth (Debbie Abrahams). Members of the Work and Pensions Committee have been debating different aspects of the Committee’s work in various rooms this week, and it is a pleasure to do so again.

Trying to think back six months to when the report was published was quite challenging, and it was interesting to see what has changed since. There have certainly been various improvements to various things. I was keen that the Committee held this inquiry because, with all the changes to the welfare system, actually trying to work out where best Jobcentre Plus fits and where it can contribute the most was not straightforward. At one extreme, one could say that if the Work programme is the way to go, why do we wait for people, with all their different skills, incentives and expertise, to spend a whole year unemployed before passing them on? Perhaps we should completely divorce the welfare enforcement and welfare support roles. We could use providers to do support and Jobcentre Plus could concentrate on enforcement. It was clear from the evidence received by the inquiry—I asked that question of nearly every witness—that there was no motivation for that at all. It would have been costly and would have undermined the great work that jobcentres do in all our constituencies by providing the right amount of support at the right stages for each individual claimant. The Committee completely rejected the idea of such a divorce and we can see that jobcentres have an important role to play in the future of tackling unemployment.

We are left with what the hon. Member for Aberdeen South (Dame Anne Begg), the Committee’s Chairman, referred to as the holy grail challenge. Everyone recognises that we need to provide the right kind of support at the right time. In an ideal world, that support would be more individual and focused for some and much more light touch for others. A lot of people who fall out of work might find more pretty quickly by their own endeavours, so they do not need much money spent on them. The holy grail is how to work out early in the process which people need more intensive support and which ones can be left pretty much to their own devices.

If we could find an assessment tool to do that, it would tackle the awful situation of people who have fallen out of a job but who will struggle to find another

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one, even though they might have had a long and successful work history—perhaps after they have been in the job for a while, their industry has left the area completely, or their skills have become completely out of date—because nothing they have been doing before is still there for them. It is a horrible situation of someone falling through the holes, because we do not realise how much support they need to reskill until they have been jobseeking hard for six months, and they will have become demoralised by failing, and so are getting further from the labour market as the weeks go by. There is a danger of that awful progress—the longer it takes someone to find a job, the harder it gets.

I agree entirely with having a tool to identify who needs intensive support right at the start, so that we can get them the retraining, the new skills or whatever early in the process, rather than leaving it for six months, until the Work programme or, heaven forbid, even until after the Work programme has failed them as well. That has to be the right answer; a key to enable the Department to focus its resources on those who need them, rather than risking simply helping those who might not need them.

In another situation, Government policy is to ask jobcentres to do a whole new area of work, in-work conditionality. If the journey of claimants with the jobcentre does not end when they find their job—once they have found a job, we want to help, support and encourage them, and perhaps even stronger than that, to increase their hours or their wage rate to get their level of benefit claim down even further—how we find the resources and mechanisms to support people on that continued journey will be a real demand on a jobcentre. It will require a different set of skills and approaches of jobcentre staff. Helping someone who does not have a job to find one in the first place, with job searches and so on, is different from helping them to increase their skills while in work or to look for extra hours or ways of getting more skills to get promoted.

How we resource and skill that policy is important if we are to make in-work conditionality work. Otherwise, I suspect, it can only be a phone call every few months to say, “What are you doing to find extra hours?”, “What are you doing to look for a better job somewhere else?”, or “Do you realise you can’t just stay where you are, doing exactly what you are doing?”, and I am not sure that that is a helpful process to get into. Exactly how we mesh that with universal credit and changes to how advisers approach such situations leaves us looking for a relatively fundamental change in work processes. Almost certainly, that means that the existing target—how many people can you get off benefits?—will no longer be a meaningful target.

If one of the advantages of universal credit is that people can be in work for a few weeks and drop out again, but their benefits will go back up automatically, or they find more work or perhaps their hours fluctuate, the target to get people off benefits will not apply, because they will not ever be off benefits under the new definition. Currently, people move off out-of-work benefits, on to tax credits and, heaven forbid, back again. Now, however, as a way of measuring what we are trying to achieve, we will need to find a more sophisticated target, one which looks at sustained employment or at how we follow people into and through their jobs. We

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heard evidence to say that that was a hard thing for jobcentres to do—finding out who people were employed by, phoning up the former claimants or their employer—when neither had any great need to engage. If people have found a job and stopped claiming, phoning the jobcentre a few weeks later is not on their agenda.

Dame Anne Begg: The hon. Gentleman suggests that people, once they have gone off benefit, are not interested in engaging at all. One of the excuses that the DWP gave us for not doing any measure other than the benefit calculation was that people did not want to be bothered, or that employers were not interested in letting the jobcentre know that the person was still in a job.

Nigel Mills: That is exactly the problem—how we motivate engagement on both sides, which we will need with universal credit and any in-work conditionality. We have to find a way of gathering reliable data. It is similar to a high-level instinct, or perhaps real-time information will provide something. Perhaps the RTI feed will show that the person is still in employment or even at the same employer—if we wanted to track the data that far back—but that looks to be a pretty clunky and limited way of checking things. Unless there are flags that show when employment has stopped, flagging it back to the jobcentre, we would not know that people had ceased to be in sustained employment, perhaps meeting the 12 or 26-week target, or whatever was set in that situation. I am not sure that there is an easy solution to anything, but for us to find a set of targets and work routes that work in such a situation will be important to how the jobcentre role develops.

The next area that I want to touch on is one that was topical last summer, when we started the inquiry: what happens to people when their two years on the Work programme finishes and they become the jobcentre’s responsibility again. This time last year, I remember speaking to the staff at my local jobcentre and they were not entirely sure what they were going to be doing with people in that situation when the first Work programme cohorts finished. Jobcentres have an important role to play, because we are talking about people who have not got a job in their first year of unemployment and who then got through the Work programme for two years and not found sustained work. We could expect them to need some intensive support, but it is a little hard to see that jobcentres would be geared up for that, having not been doing it for people in that key two-year period previously. So what would we do with them?

Last week, I was pleased to meet a new subcontractor, Acorn, which is in Derbyshire dealing with what I think are now called community work placements, a new set of rolled-out private sector providers offering a different type of Work programme service that is not the Work programme and does something subtly different. I confess that the procurement of the service and how we chose the providers has passed me by, but in the east midlands, for example, we have G4S. Luckily for the east midlands in some ways, it is not one of the Work programme providers, because we have a completely separate, third firm in Derbyshire to do things. We have, however, found a sensible programme of community placements that are not meant to be free labour for unscrupulous private sector operators, but are meant to be getting people who have gone through three years of support

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finding something that at least gets them used to working normal working hours and some skills on their CV, making them more employable.

Sheila Gilmore: Obviously, it is early days to know how the post-Work programme arrangements are working, but a complaint of many of my constituents about the Work programme was that it was not particularly intensive. If anything, it was very light touch—“Come in every seven or eight weeks”, and sometimes the only contact was by phone. It seemed to concentrate everything on CV writing and applying for jobs. If the more intensive approach is important, should it not be starting much earlier than three years into unemployment?

Nigel Mills: I agree. I was trying to explore with G4S when I had that meeting with it and Acorn exactly what the financial remuneration was for successful outcomes under the community work placement, and how that compared with the rewards under the Work programme for some of the harder-to-deal-with people who are further from the labour market. I was trying to work out whether we could expect Work programme providers to do such work placements if they had someone whom they were struggling with on the Work programme. Is there a need to tweak the contracts or to change the incentives slightly? We could try to get such support provided during the two years, not after the two years. For some reason, they were not totally inclined to give me a clear answer on those numbers. Perhaps it was the wrong time to ask them.

It is always about the sequencing of things—how do we step up the intensity of support at the right time? I am sure that we want a system in which if somebody really needs the most intensive support, they get it early in the process, rather than one in which we see how long we can demoralise them before we give them what they probably needed in the first place.

It is intriguing. When looking at the role of the jobcentre we thought, perhaps slightly competitively, that we had a real chance to prove that where a Work programme provider has failed the jobcentre can help people and sort the situation out. But we have ended up with another outsourced programme. Does that suggest that in many ways we do not feel that the jobcentre’s role is to provide any intensive support to people—that its role is enforcement plus some coaching in the early days and some relatively light-touch support? I am not saying that that is my view, but it appears now that for every situation we come across we find a different outsourced programme.

Finally I want to touch on Universal Jobmatch and the role of IT. I see Universal Jobmatch as a great success. I played with the old job search system in jobcentres and looking at the new one it is clearly much easier to use—for example, people can work it at home—and looks like the right direction of travel. I share the hope that Monster has managed to fix the problem of the artificial, unethical or non-existent job placements that had been going on to Jobmatch, to try to make it as effective a system as possible. I suspect that there is no way that these things can be perfect, and that people will always be able to get through any filters to put rogue ones on, so it is a matter of how effectively we can monitor the service and get those taken off once they are found. But clearly the problem should not have been on the scale that it got to.

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As for IT, having enough computers in jobcentres—and enough staff to support people using them—is quite important, especially when we are requiring IT job searches and will sanction people who do not do them. The library in Heanor, a town in my seat, had to close for reasons of maintenance—or the lack of it—and we lost the IT provision in the town centre. It then became quite hard for claimants who did not have IT access at home and had lost their library. Trying to convince the jobcentre that it needed to find at least some temporary solution to get IT provision back into the town and to support people while the library was finding an alternative site was not as easy as I might have liked it to be.

I suspect the vision for modern jobcentres is for them to have lots of computer terminals so that IT job searches are perfectly possible. I know that one of the jobcentres in my seat was down for an early upgrade to get extra IT, but we need to make sure that every jobcentre has IT provision. If we are expecting people to use the service themselves and will sanction them if they do not, we have to make IT facilities available to them.

We can do more with the Universal Jobmatch system, as the Chair of the Select Committee remarked earlier. We ought to be looking to see whether we can make all the data on it flow two ways. Surely it can be a great tool. If someone has put their CV on it and has applied for 100 jobs but has never, ever been put forward into the best 50 applicants—or whatever number get prioritised—for the employer to see, that must surely say to somebody that that person’s CV is not good enough and they either need to produce a better one, or they need to have some training urgently to get more skills to put on it, or they are applying for completely the wrong jobs.

There ought to be a way of using the system to spot that some individual jobseekers need that kind of support—a better CV or some more skills—or perhaps even to spot that, say, there have been no jobs within a 20-mile radius that match the skills on a person’s CV in the last year, so there is no point in them keeping on applying for things that they are not going to get. That could then create a flag back to their jobcentre adviser, to say, “Something needs to happen with this person.” If we can find innovative ways of using the system to provide extra support—rather than just forcing people to go on it and mandating them to do so many job applications, some of which they are not too enthused about anyway—we might get a far better result for the investment we have made than if it is used purely as a job search tool.

Overall, the conclusion of the report is clearly that jobcentres do great work and have an important role. To share my own experience, when I have held jobs fairs in my seat the two jobcentres have been extremely helpful in getting employers and jobseekers there. They are working practically to try to tackle the problem, which is a pleasure to see in my seat.

2.45 pm

Sheila Gilmore (Edinburgh East) (Lab): It is a pleasure to serve under your chairmanship, Mr Amess, and to speak on this very important matter.

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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

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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

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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

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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

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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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3.8 pm

Dr Eilidh Whiteford (Banff and Buchan) (SNP): As always, it is a pleasure to serve under your chairmanship, Mr Amess. I begin by congratulating the hon. Member for Aberdeen South (Dame Anne Begg) and her Committee on the report, which identifies some key issues for jobcentres, for staff and for those who use the services that they provide.

On a day when many jobcentre staff are on strike to highlight the impact of the Government’s austerity measures on their own incomes, I want to take the opportunity to thank the jobcentre staff in my constituency for the work that they do on their clients’ behalf, and in particular for the helpful way they engage with my constituency office staff. I have many examples of cases of individuals that have been resolved quickly and efficiently, without the need for ministerial letters or interventions, because of the common sense and helpful advice of our jobcentre staff. It is important to pay tribute to them today.

The report we are debating covers a wide range of important issues, but I want to focus on just one, which has been highlighted by a number of previous speakers—namely, the challenges facing those who are furthest from the labour market.I am particularly concerned about the support available to people coming off ESA and moving on to JSA. A number of people have highlighted that aspect of the report, which really merits further attention.

It is not simply that the work capability assessment finds too many people fit for work who are not, but that some of those who are potentially fit for work are limited in the kind of work they can do. Most ESA claimants are in late middle age, and many have solid work histories, but they have developed chronic health problems late in their working lives and often struggle with more than one condition. We have debated the shortcomings of the assessment and appeals process many times, but the point here is that these people face enormous barriers to employment and need extra support.

At best, any employer will be reticent about taking on somebody in, say, their late 50s who has a significant gap in their employment history due to ill health and who is likely still to be afflicted by chronic health problems or disability. All of us know that sickness absence, even for a short period, can cause havoc in a workplace; it can put huge pressure on colleagues, cause problems for the efficient running of an organisation and add significant costs if additional labour has to be brought in. Those are enormous hurdles for people with chronic health conditions to overcome when looking for work. Even where people have fully recovered or have a well-managed condition, an employer’s perception remains that the risk involved in taking them on is high.

That is before we consider the kind of jobs available. In my part of the world, we are fortunate to have low unemployment; for a skilled and able-bodied person, finding a job there is not nearly as difficult as it is in some other parts of Scotland. However, many of the available positions involve very physical labour. There are often vacancies for care assistants, for example, but people will need to be reasonably fit, and they will need a car. There are also often jobs in food processing, but, again, people will need to be able to be on their feet for

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hours at a time, and they will need a level of physical dexterity and fitness that many people with chronic conditions will find difficult to achieve.

The Committee is therefore acutely concerned about the ratio of support in jobcentres for sick and disabled clients, particularly those coming off ESA and moving on to JSA. People are likely to need sometimes quite intensive support to get into suitable work, while some employers will need support to help them overcome their fears and manage taking on a disabled person or someone with a long-term health condition. In Scotland, the Scottish Association for Mental Health does a lot of work to support employers in that way, but we need more systematic support from jobcentres to assist those who are potentially fit for work, but face significant disadvantages in accessing suitable employment in the labour market. As others have said, we also need to do a better job on the long-term tracking of outcomes.

The other related issue I want to touch on, which previous speakers have also mentioned, is sanctioning and the overlap between those previously in receipt of health and disability benefits and those being sanctioned. I have seen far too many people who are falling through the net. They are just not well, but they are being sanctioned. Previously, I have raised concerns with Ministers about those with mental health problems. In this case, I urge the Government to think again about their rejection of the Committee’s recommendations on sanctions.

We can all see the impact of inappropriate sanctions in our constituencies. We see it in the growth of food banks, even in relatively wealthy areas such as mine. We also see it in the rising number of people who are seeking assistance from MPs and from statutory and voluntary sector agencies or who are seeking emergency support. We should not hide from those realities, however unpalatable they are, and we really should not hide our heads in the sand.

For many of those with serious health problems, sustainable employment is an ambitious goal, but it is not an unrealistic one. However, it will not be achieved unless the systems improve and we take a more holistic view of an individual’s circumstances and of the context in which they are seeking work. I therefore echo earlier comments about how we measure and collect performance data. Above all, however, I urge the Government to look much more seriously at how we tackle the structural disadvantages some jobseekers face in the labour market and to ensure that there is support for them.

3.14 pm

Pamela Nash (Airdrie and Shotts) (Lab): Let me echo my colleagues and say what a pleasure it is to serve under your chairmanship again, Mr Amess.

I will not replicate my colleagues’ remarks about the report, but it will not surprise Members to hear that I agree with the vast majority. I congratulate the Committee’s Chair, my hon. Friend the Member for Aberdeen South (Dame Anne Begg), on all its work, but particularly on this report and on giving us the opportunity to debate it today.

The first issue I want to concentrate on is support for claimants with health conditions and disabilities. In one of the report’s recommendations, the Committee asks the Government to take urgent action to improve the

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level of jobcentre support for claimants with health conditions and disabilities, including by addressing unacceptably high work-related activity group case loads.

One of the most heart-breaking things I have seen in my four years as a Member of Parliament is the number of people coming to my surgery, or requesting a home visit because of their health conditions, who it is clear—even to the naked eye—are not fit for work, but who are still put in the work-related activity group for ESA. Let me give one example from my constituency, although it represents the stories of many other people there. My office spoke this morning to a constituent who wants to remain anonymous. She is 59, and she had to stop work due to ill health. There has been a series of errors since she applied for ESA.

My constituent, who suffers from arthritis and panic attacks, among other health conditions, attended an assessment, but she did not receive a copy of her assessment report afterwards—I have heard the same point made repeatedly over the past four years. She was just told that she had “passed” the medical. Does that mean that she is healthy, or that she will receive the benefit? It is an ambiguous term.

My constituent was given no information about the difference between contribution-based and income-based ESA. After 365 days, she was moved from one to the other with no notice. The only indication that something had changed was the unexpected drop of £118 per week in the amount of money going into her bank account. That is an extremely large amount for a low-income household.

I will not go any further, because I may be drifting a little from the report, but I ask the Minister to look at what has been a recurring theme today: the data and analysis available on the success of jobcentres and the DWP. Will she publish more information so we can look at the problems? If we do not know what they are, how can whoever is in government seek to fix them?

Another issue is support for those in the work-related activity group. There are some who clearly should be in that group. However, the type of work they can do is severely limited, although they might be able to work with the correct support. My understanding is that that is exactly why this policy is in place—to allow these people to go back to work. If they can contribute, therefore, they should be supported so that they can do so. However, the Committee’s inquiry found that relatively few resources were devoted to providing that support in jobcentres; in fact, the figure is one adviser to every 600 claimants. Is the Department looking at improving the support available to help these people back to work?

Another issue related to ESA, which I became aware of recently, is the actual average clearance time. The headline figures for ESA show that, since the Government came to power, waiting times have gone down. However, I asked the House of Commons Library to look into that, and it told me that the figure relates only to the time between a new claim being made and a decision being taken on whether the person should have an assessment. The total time, if we look at how long people have to wait for a work capability assessment, is 118.9 days on average. What is the Department doing to bring that figure down?

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I want to say something briefly about sanctions. Again, I will not replicate what has been said, and I agree with much of what my colleagues have said. However, I would ask the Minister to comment on the repeated claims from Jobcentre Plus whistleblowers, which we have heard about in the press and here today, that there are quotas or that there is pressure on staff to impose a certain number of sanctions on their client base.

I also want to talk about the fact that there are no crisis loans any more, with the localisation that was touched on in the report. In Scotland the Scottish welfare fund is the replacement, but that specifically may not give money to people who have been sanctioned. I simply want to put the question to the Minister: what are those people supposed to do? How are they supposed to eat, with no income at all? When people are convicted of a crime we do not starve them; yet people who have been sanctioned turn up at my office—and the vast majority get the sanction overturned on appeal, for reasons such as we have heard today, and because of mistakes—and they are left in dire straits.

I am ashamed sometimes to be an MP in a country where all I can do is send those people to a food bank. They are sent for payday loans. They should not be getting those if they have no salary, and if they are given them that is shocking. Even worse, they often go to criminal loan sharks. That is the one business that has thrived during the recession, which is a disgrace. What does the Minister expect people who have been sanctioned to do, to meet their basic needs for survival?

The report examines in depth the flexible support fund and its uses. It replaced a few other funds; many of the relevant people would have been affected more recently by the removal of the return to work credit, although I realise that that was a much longer-term support for people returning to work. I worry about some constituents who receive a job offer—which is happening increasingly; I welcome the fact that unemployment is reducing in my constituency and there are many new businesses, and the town centre is more thriving than I can remember. However, some constituents find it difficult to go back to work, because they do not know how they will survive for the first month.

I have been told by my local jobcentre that the usual flexible support fund payment is rarely more than £50 for travel to work. Housing benefit runs on for a month, too, but apart from that there is little, if any, support to enable someone to pay bills or perhaps buy clothes for a new job—or, indeed, lunches for the first month. Being out of work often causes a drop in confidence, so people want to make a good impression and not to have to worry about such basic things in the first month of a new job.

Work experience contributes to building up confidence. I know that the Government have made work experience programmes part of Get Britain Working, but in my experience there are few opportunities for young people to get such experience. What are jobcentres doing to increase opportunities for placements? I am setting up a work experience programme in my constituency, and letters to more than 400 local businesses are being produced as I speak. That is being done in conjunction with the jobcentre, which has difficulty finding enough work experience placements for the people who want them. Some of my colleagues are setting up similar

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projects in their constituencies, but what is happening at Government level, so that it will not matter whether MPs spend time doing that, and people will not need their MP to set up work experience projects to make placements available to them?

I found work experience useful, because I was on the dole at one point after university. The jobcentre told me I would be sanctioned if I did voluntary work, because I would not be spending that time looking for jobs; however, since then, there has been cross-party support for and understanding of the idea that voluntary work and work experience can lead to full-time sustainable employment.

Debbie Abrahams: I congratulate my hon. Friend on setting up work experience in her constituency. I have done that too, for 18 to 24-year-olds, starting next week for two weeks. It is the first time I have done it, but I have been asked whether I would consider something for older people. We need to think of them as well.

Pamela Nash: Definitely. The work experience programme that I am setting up is aimed at young people, but it is not just for them—it is certainly for others too. At the other end of the age range in the work market, and particularly with the pension age going up, there are many people who want to work a bit longer but are having difficulty finding jobs. That affects every age group in between, too.

In fact, there was a good news story from my local jobcentre when I visited last Friday. A gentleman had been out of work for 20 years, and, with the new programmes, one of the advisers who recognised his need could spend much longer with him. He has now started a full-time job.

The hon. Member for Newton Abbot (Anne Marie Morris) said that Select Committees are often negative because of their role in holding the Government to account, and I think that that often applies to Opposition MPs as well; we appear a bit crabbit, to use a Scottish word, and negative. However, holding the Government to account is our job. I certainly do not think that everything is wrong, but there is a lot of room for improvement.

Finally, I want to comment briefly on the Work programme, which comes outside the work of Jobcentre Plus. My area has very good and very bad examples of the way it is run. I am angered when I go to the jobcentre and staff tell me how good the success rate is for people leaving the Work programme after two years, and being found work quickly. There are people who are ready and desperate to work, but who were not given the support they needed during the Work programme.

When I meet constituents who have been on the programme, they always tell me two things. First, they tell me that they can end the two years without even a CV—which is ridiculous—or basic IT skills. Secondly, I am constantly told about their intention to apply for training; there are many positions in security in my area, so they might want to go for a Security Industry Authority badge. Yet that is not available—nor is any small cost for training that might keep their skills up to date or improve their job opportunities.

If those people had been under the care of the jobcentre at the time in question, those things would have been available to them, but the contract that the Work programme providers have does not include such

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provision, and obviously the providers will save costs whenever they can. That is relevant to the debate, because the situation increases the work of the jobcentre, when the people in question go back. If the Government are not going to scrap the Work programme as it stands, will they take another look at the contracts, and make it clear what is expected of Work programme providers in the way of support for participants? Can that be published? Are there guidelines for the providers that Members of Parliament can see?

The hon. Member for Newton Abbot talked about negative comments. On Friday I visited my local jobcentre, as I do regularly—my office is a couple of doors away and it is no accident that I get most of my casework from there. The staff were excited about the prospect of becoming a digital jobcentre. We saw the work being done, and I think much of what is happening will improve the service for my constituents, so I look forward to that.

3.28 pm

Stephen Timms (East Ham) (Lab): Like everyone who has spoken in the debate, Mr Amess, I want to say what a pleasure it is to serve under your chairmanship. I thank the Select Committee, and welcome the work that it has done on such an important topic.

It is disappointing, however, that the Government’s response to a very good report has been so negative. Of 24 recommendations only five were agreed to; five were rejected outright and the remaining 14 were partly agreed, although in quite a number of cases it struck me that the amount of agreement was very partial indeed. The Committee is right to affirm the value of a public employment service for unemployed people. Jobcentre Plus has been admired around the world, and we have been reminded, rightly, of the recent conclusion by the National Audit Office that it continues to do an efficient job. I very much concur with that judgment.

Jobcentre Plus does an efficient job. It also does a very important job. My hon. Friend the Member for Edinburgh East (Sheila Gilmore) is absolutely right to draw attention to the links between having employment and having good health. I noticed that the Prince’s Trust recently undertook research on that issue. Martina Milburn, its long-serving chief executive, makes this point:

“Unemployment is proven to cause devastating, long-lasting mental health problems among young people.”

Whether someone is in a job is a very important issue, so the task that Jobcentre Plus has is very important.

I visited Germany last year to look at the way in which youth unemployment was being tackled and visited an office in the town of Wolfsburg, Hanover, where the Volkswagen plant employs 60,000 people. I went into the office, which is jointly run by the local authority and the federal employment service, to talk about how it was supporting unemployed people, and one thing that struck me about it was that above the door it said “Jobcentre”. The people there had chosen to adopt the English term for that establishment, and the reason was that 10 years ago, when the Germans made the big reforms to their welfare system—the Hartz IV reforms—they took inspiration from what had happened in the UK. Jobcentre Plus was quite new at that time. They wanted a name that showed their ambition for a very

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effective, modern service, and they were inspired by the English system, so they have adopted the term “Jobcentre” for their establishments.

As we have heard, jobcentres in the UK are still doing an efficient job. Nevertheless, I am afraid that something has gone quite badly wrong in recent years. I do not think that anyone else in the world today would be inspired by what they hear is happening in our jobcentres, and the issue of sanctions, which has been highlighted in this report and debate, is a big part of the explanation for what has happened. I agree with the hon. Member for Newton Abbot (Anne Marie Morris) that it is clear that too often sanctioning goes wrong.

Of course, there are a lot of statistics about benefit sanctions. One that interested me was one that I got in a written answer on 25 March 2013 at column 986W of Hansard. I asked what the total amount withheld from jobseeker’s allowance payments as a result of benefit sanctions was, and the answer came back that the benefit withheld from fixed JSA sanctions was, in 2009-10, the year leading up to the general election, £11 million, in 2010-11 £43 million, in 2011-12 £45 million and in 2012-13, up to October 2012 only—in other words, just the first half of 2012-13—£60 million. That suggests that the amount being withheld in benefit sanctions had gone up tenfold up to October 2012, compared with the year leading up to the general election.

It is important to underline the truth that sanctions are an indispensable part of a benefits system designed to promote employment. No one should read into anything that I am saying—or, I think, what anyone else in the debate has said—that we should scrap sanctions, but there is a pertinent question, raised in this report, about whether something has gone quite badly wrong in the way in which they are being applied at the moment.

Nigel Mills: I apologise to the right hon. Gentleman, the hon. Member for Aberdeen South (Dame Anne Begg) and you, Mr Amess, because I need to leave for a constituency engagement shortly, but on the point that the right hon. Gentleman raises, will he therefore join me in regretting the fact that when the unions came to give evidence to us in this inquiry, they did not support sanctions having any part in the benefits system?

Stephen Timms: In the discussions that I have had with trade union members about this issue, the point has not been put to me that there should not be any sanctions. Sanctions have been part of the benefits system ever since the system was invented; there is nothing new about sanctions. I have not heard a case that sanctions should be entirely scrapped, but I do think that there is justified concern, partly expressed in this debate and certainly expressed by trade unions and others, including citizens advice bureaux and disability organisations, about the way in which the system is working at the moment.

We heard a good deal in the debate, and I was very interested to hear the contributions about what hon. Members have been told by whistleblowers because I have had a similar experience. One of my constituents, who works at a jobcentre, raised with me very similar concerns to the ones that we have heard about what is

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going on. I was very concerned by that. I forwarded her concerns to the Minister. The Minister responded, for which my constituent and I were grateful, and my constituent subsequently wrote to the Minister directly and copied me into what she said. I will quote from her letter, which said that

“staff at the Jobcentre are actively encouraged to impose benefit sanctions and are threatened with PIPs”—

I was not sure what they were, but I gather from my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) that they are performance improvement programmes—

“if they fail to get certain numbers of people off benefit per week…all too often it is the more vulnerable in society it is affecting, and probably not the customers who are too smart to be caught out by the sanctions. The large increase in people using the food banks is mainly due to the unfair benefit sanctions being imposed upon customers. I know the food bank in Hoxton has actually had to ask the JCP in Hackney to stop making so many referrals to them as they are unable to cope with the numbers”.

My constituent goes on to say that staff

“have never experienced working conditions like they have in the last few years…people who have worked so hard implementing the unpopular policies have been treated in an awful manner.”

My hon. Friend the Member for Edinburgh East raised the concerns that people have repeatedly drawn attention to that staff in jobcentres are being given targets. There have been the odd, well documented examples of where that has been the case, although in those instances Ministers have stepped in to make it absolutely clear that there are no formal targets, but it is the case, as I understand it, that in regular staff appraisals—this was confirmed, I think, in a written parliamentary answer—the number of sanctions that an adviser has issued is one of the bits of data on the table for the appraisal. Staff understand that, understandably and probably rightly, as indicating that they are, in part, being evaluated by how many sanctions they have issued—not whether those sanctions were accurate or appropriate, but whether there are enough of them. I think that it is clear that a culture has been developed in which staff are under pressure to issue more sanctions. My constituent talked about the awful working conditions. Let us be frank: that is part of the background to the industrial action taking place today.

A good deal of the external interest in this report has focused on the question of sanctions. There is no doubt that the dramatic increase both in the number of sanctions and in the amount of money taken off people—the duration of sanctions, which my hon. Friend the Member for Oldham East and Saddleworth also talked about—has been a big factor in the growth of food banks. The hon. Member for Banff and Buchan (Dr Whiteford) is absolutely right to say that no one should hide their head in the sand about that. I had not quite twigged it, but my hon. Friend the Member for Oldham East and Saddleworth made this telling point. Will people who have been sanctioned for a period of months, a year or even three years carry on signing on every fortnight just so that they appear in the claimant count? Of course they will not, and undoubtedly the claimant count is being depressed as a result.

Of course, all these reports, from whistleblowers, charities and food banks, can be and sometimes are dismissed as anecdotal. However, the pretty distressing picture that staff whistleblowers are painting is consistent with what a lot of jobseekers say. A few weeks ago, I

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was invited by Tesco to visit a new store with its HR director. Through the impressive regeneration model that Tesco has developed in partnership with the Union of Shop, Distributive and Allied Workers, the company had been very careful to recruit and train a large number of staff at the new store who had previously been unemployed. Tesco put them through an eight-week training course before the store opened. I was introduced to four of the staff who had been recruited in that way, and we talked about their experience. I asked them about their experience with Jobcentre Plus, and all four said that the main aim of the jobcentre had seemingly been not to help them but to catch them out and sanction their benefits. I think it is a real tragedy how badly the reputation of Jobcentre Plus has been damaged by the aggressive approach to sanctioning that has been introduced. It will take a lot to repair that damage.

In its briefing for the debate, Crisis told us about somebody called Billy

“who was sanctioned for turning up to a meeting that turned out to be cancelled and then failing to attend another appointment he knew nothing about because the letter arrived six days after the date of the interview”.

We have heard several such stories during the debate. I draw attention to the website “A Selection of Especially Stupid Benefit Sanctions”, which has pages of this stuff:

“You get a job interview. It’s at the same time as your job centre appointment, so you reschedule the job centre. You attend your rearranged appointment and then get a letter saying your benefits will be stopped because going to a job interview isn’t a good enough reason to miss an appointment.”

That one came from the Daily Mail.

“Your gran dies during the night. The next morning your partner calls the job centre and asks if you can come in the following day instead. The centre agrees, and you sign in the next day. Then you get a letter stating that you failed to sign in and would be sanctioned if you don’t reply within seven days. You reply, explaining the situation. The job centre gives you a six-week sanction for not replying.”

That one came from NetMums.

“You get a job that starts in two weeks time. You don’t look for work while you are waiting for the job to start. You’re sanctioned.”

That was from The Guardian.

“You apply for three jobs one week and three jobs the following Sunday and Monday. Because the job centre week starts on a Tuesday it treats this as applying for six jobs in one week and none the following week. You are sanctioned for 13 weeks for failing to apply for three jobs each week.”

That was from the Pontefract and Castleford Express.

“You have a job interview which overruns so you arrive at your job centre appointment 9 minutes late. You get sanctioned for a month.”

That one was from Consumer Action. As I say, there are pages and pages more on the website. Of course, those are anecdotal, but the jobcentre network now has that reputation and it will take a great deal to repair the damage that has been done.

A number of references have been made during the debate to the report that the Government commissioned. It is rather rare for the Opposition to be able to force the Government to do anything, but we were able, because the Government needed legislation quite quickly, to force Ministers to set up the review on sanctions, which was carried out by Matthew Oakley. Like everyone else,

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I am eagerly awaiting the report, which we thought would be published by the end of May but which has still not been published. I asked the Minister about that in a written answer the other day, and characteristically—of Ministers in the previous Government as well as in this one—the reply came back that it would be published “in due course.” Can the Minister give us any more detail? If she can, it would be welcome.

As we have heard, the Minister appeared to agree in her evidence to the Work and Pensions Committee that there should be a further review to consider not only Work programme or employment programme sanctions, but sanctions more generally. It was a disappointment to everybody that that commitment was not reflected in the Government response to the report, and I hope that the Minister might reaffirm the view that she expressed to the Committee.

It is particularly disappointing, although not surprising, that the Government have rejected recommendation 17 on page 47 of the report about recording the number of people who are signposted to food banks. There is no doubt that the increase in sanctions has played a big part in the remarkable growth of food banks over the past few years. The Committee recommended, as we have heard, that the Department should

“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 claimants’ need for assistance in these cases.”

The way in which the Government have dealt with the Trussell Trust has been pretty disgraceful. When the Secretary of State was appointed, he rightly took a good deal of pride in announcing that he was lifting a ban on jobcentres referring people to food banks if they were in hardship and did not have enough money to buy food. I was the Minister for employment for a while, and I did not know that there was a ban on referring people to food banks, but apparently there was. The Secretary of State rightly said that that was wrong, and lifted the ban. The problem was that food banks started counting the number of people who were being referred from jobcentres and the reasons why they were being referred, which became far too embarrassing, so the Secretary of State reintroduced the ban on jobcentres referring people to food banks, although he said that it was all right to “signpost” people. I believe that the difference between signposting and referring is that when someone is signposted by a jobcentre to a food bank, they are not allowed to fill in the piece of paper issued by the food bank that states why they are being referred. The former approach enabled the Trussell Trust to collect data on how many people were being referred to food banks because they had been the victim of sanctions, benefit delays or other problems at the jobcentre, and the whole thing became too embarrassing for the Secretary of State so he said that he did not want it to continue.

It is a great shame that the Secretary of State has refused to meet the Trussell Trust and talk about the matter, because it has a number of sensible ideas about how the system could be made to work better, which would not cost the Government anything. The Secretary of State has accused the trust of having a political agenda simply, as far as I can tell, on the basis that it insists on publishing numbers about how many people go to food banks. That is a completely innocuous and

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public-spirited thing to do, but because the trust refuses to stop publishing that information, the Secretary of State accuses it of having a political agenda and being opposed to welfare reform.

Given that the Secretary of State has not been willing to meet the Trussell Trust, a couple of months ago I asked the Prime Minister if he would be willing to do so. He said that he would, and I am pleased to say that that meeting has taken place and the discussion was constructive and useful. Why on earth the Secretary of State is not willing to meet the trust for a similar discussion is a mystery to me, and I still hope that he might change his mind. I share the despair expressed by my hon. Friend the Member for Airdrie and Shotts (Pamela Nash) about the extent of the reliance on food banks nowadays. The Trussell Trust makes it absolutely clear that it expects the need for food banks to continue. The scale of the dependence—a million people over the past 12 months—and the rate at which it is growing are causing the trust great concern and prompting questions about whether it can cope with the demand.

I want to mention two other points that my hon. Friend the Member for Aberdeen South (Dame Anne Begg) has highlighted as the main recommendations in the report. Recommendation 21 on page 48 argues for

“the formulation of JCP performance indicators which promote and measure sustained job outcomes and better reflect the changing role of JCP consequent on the implementation of universal credit”.

The Committee makes the point—it is often suggested, and I think it is right—that the current measure incentivises behaviour that nobody wants. For example, if somebody goes in and out of claiming benefit—they do a couple of weeks’ work, then go back on benefit because the job fails, then do a couple of weeks’ work somewhere else, then go back on benefit—it makes a big positive contribution to benefit off-flow, because that person is coming off benefit a lot and the fact that they go back on benefit straight away is not picked up in the statistics. Of course nobody would regard that as a success in any meaningful sense of the word. It is certainly not what Ministers want to happen in jobcentres.

The Government’s response to that recommendation says:

“The current JCP performance metrics, focussing on off-flows, make best use of the data currently available to the Department, but do not track people once they leave benefit, as this is not cost-effective.”

That is the bit that I want to query. I do not understand why the Government are suggesting that it is not cost-effective to track what happens to people after they go off benefit, because the Government require Work programme providers to do exactly that. Work programme providers are remunerated entirely on the basis of whether somebody is in sustained work. Clearly, the Department has taken the view that it is cost-effective to require Work programme providers to find out that information, so why is it not cost-effective for Jobcentre Plus to do so? That seems to make no sense, and the Committee is right to highlight it in a recommendation. I hope that the change will be made before too long.

The other recommendation that I will mention was highlighted by the Chair of the Committee, and I agree with it. It is about segmentation. Recommendation 4 on page 44 of the report says that the DWP should

“continue to work to develop a ‘segmentation’ tool, to be conducted by Jobcentre advisers face-to-face with claimants, to allocate

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claimants to separate work streams according to their distance from the labour market and relative need for intensive employment support.”

I know that it is a long-held view among numerous people, including senior Jobcentre Plus staff, that segmentation is a rather illusory thing—my hon. Friend the Member for Aberdeen South used the term “holy grail”—that everybody would like to be able to do: “We would like to be able to tell how much help a person will need to get back into work, but it is unachievable in practice.” However, like my hon. Friend, I am mystified as to why it can be done in Australia but not in the UK.

I know that that point has been made to Jobcentre Plus staff, who respond by saying that Australia and the UK are different, but they are not that different. I visited Australia last September to, among other things, see how the jobseeker classification instrument worked. Nobody is claiming that it is infallible. In Australia, if someone is placed in one stream and it subsequently turns out that they need a different level of support, they can change. It is not a completely inflexible, wooden instrument, and it is certainly helpful. It means that people are more likely to get the right amount of help than if there were no segmentation. Even the length of time that someone has been out of work, which is easy to establish, is a big indicator of how much help they will need.

Of course, we already have segmentation in the UK. In the Work programme, customers are placed in different payment groups, based not on the kind of segmentation for which the Committee rightly calls but on which benefit they receive—jobseeker’s allowance or employment and support allowance. That does not necessarily tell us anything about how much help someone needs to get back to work, and in practice, as I think is pretty widely recognised, it has proved hopeless.

That is one reason why people a long way from the labour market have been so badly let down by the Work programme, as the National Audit Office pointed out last week. Among claimants of employment and support allowance who spend two years on the Work programme, the latest data suggest that the rate of failure to achieve sustained job outcomes is 93%: only 7% of those attached to the Work programme achieve a sustained job outcome.

In an earlier intervention, I asked my hon. Friend about the Government’s statement, in their response to the report, that their efforts to develop a tool have produced only 70% success. Of course it would be great if we could do better than 70%, but given that it is possible for people to change their stream after they have been streamed initially and that 70% success is certainly better than streaming people simply on the basis of what benefit they have been on, it seems to me that it strengthens the case for the Committee’s argument that it would be a worthwhile thing to do.

It would be the intention of a Labour Government, should one be elected next spring, to implement a segmentation tool as the Select Committee recommends. We would like to see it in place, again as the Committee recommends, in time for the commissioning of the Work programme’s successor. It will be possible, in designing that tool, to draw on the fantastic data that providers have gathered during their experience of the Work programme. There are now numerous rich data

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sets giving useful evidence about how much help individuals in a variety of circumstances need in order to get into work.

I welcome the report. The Committee has done the House and the cause of employment support a great service by providing it to us. Along with everyone here, I look forward to hearing the Minister’s response.

3.57 pm

The Minister of State, Department for Work and Pensions (Esther McVey): It is a pleasure to serve under your chairmanship, Mr Amess, as everybody has said. I thank the Select Committee on Work and Pensions for its work on the report that we have been discussing. The Government welcome the Committee’s endorsement of the role of Jobcentre Plus in a reformed welfare system. Through the recession and into the period of recovery, it has provided good value for money and excellent levels of service to claimants and employers.

With employment rising to record levels, unemployment falling and sustained reductions in the number of people on welfare benefits, Jobcentre Plus continues to be a model other countries follow. As the right hon. Member for East Ham (Stephen Timms) said, they use it in Germany. They totally copied it and are following our model, as other countries are coming to follow what we do. More recently, the creation of Jobcentre Plus is reckoned to have raised national GDP by 0.1%—worth £5.5 billion to the UK economy by 2015.

The achievements of Jobcentre Plus stand as a testament to the hard work and dedication of the Department’s staff. I thank the staff who came into work today to ensure that all our jobcentres are open and that everybody who requests to see an adviser can do so. Despite staff reductions, Jobcentre Plus continues to make a major contribution to improvements in our labour market. We know that more people are working now than ever before: a record 30.5 million, up 780,000 over the past year and 1.7 million since 2010. That is a record-breaking number of people into work in a year, and it must be down not only to the hard-working staff of Jobcentre Plus but to all the people working so hard in the welfare to work industry.

The unemployment rate has fallen in every country and region of the UK over the last year. We have had the largest annual fall in long-term unemployment since 1998: 108,000 in just one year. The Work programme, which was set up in June 2011, has made a major contribution to that fall—the biggest since 1998, as I said. We have seen 1.5 million people go through the Work programme. Of those, 550,000 have got a job start and 300,000 have gone into sustained work. That is a significant contribution. I agree with the National Audit Office that the programme had a slow start, but it has improved considerably and its stretching targets will be achieved by its end.

If people have read the NAO report, they will know that the Work programme will actually be 12% better than the flexible new deal and 17% better than the pathways scheme once we have completed our work. It is therefore undoubtedly better than any other programme that has gone before, despite its being talked down. It is hard for me to reconcile what I have heard today with what the NAO agreed, which has to be welcomed.

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When I looked into the sanctions applied under the Labour Government’s pathways into work scheme, I saw that they were significantly higher for ESA claimants. It is interesting to note the difference between what has been said today and what the previous Government delivered.

Pamela Nash: I admit that I have not seen the NAO figures, but is there any specific focus on youth unemployment? Although unemployment figures are coming down—I completely welcome that and the success in my constituency—youth unemployment is not coming down at anything close to the same speed, particularly not in my constituency. Is there any focus on how the Work programme is affecting youth unemployment?

Esther McVey: If the hon. Lady had looked at the youth unemployment figures, she would welcome them as much as I have. We have had nine consecutive months of decreasing unemployment, and the figure is now nearly 100,000 lower than at the general election. We have given significant focus and support. We have put in place a youth contract that helps people with work experience—I am delighted that people now agree how important that is—and 180,000 people have now gone on work experience. Of those, around 150,000 have been young people—other people are eligible—and 40% have got a job. So I feel I have answered the hon. Lady’s question—

Pamela Nash: You haven’t answered it.

Esther McVey: We have done a considerable amount of work and we continue to do so. That is key and should be welcomed. Youth unemployment has fallen across the country.

Pamela Nash: The rate is three times slower.

Esther McVey: We know that at the heart of the Government’s plan is the desire to build a stronger, more competitive economy.

Stephen Timms: Will the Minister give way?

Esther McVey: I will give way in a moment, but I want to ensure that we hear what Jobcentre Plus is actually delivering, which is a significant amount. I want people to understand how the more than 26,000 jobcentre staff are helping people and how many people come through the doors each day.

Stephen Timms: I have just been looking at the National Audit Office report, which seems slightly different from the impression the Minister is giving. A press release on the NAO website from 2 July says:

“After a poor start, the performance of the Work Programme is at similar levels to previous programmes, according to a report today by the National Audit Office.”

It also says:

“The Programme has…not improved performance for harder-to-help groups compared to previous schemes.”

Esther McVey: I will give the right hon. Gentleman greater clarification: that was at the very start of the scheme in June 2011, but the report says that, given

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the way performance has increased and what would be expected by the end of the programme, it would be 17% better than the pathways to work programme.

Stephen Timms: As the Minister says, the report does make the point that the Work programme got off to a rocky start and has improved, but its conclusion is currently that the programme has

“not improved”—

this is now, not at the start—

“performance for harder-to-help groups compared to previous schemes.”

Esther McVey: If the right hon. Gentleman looks into all the footnotes, everything associated and all the figures about what is expected by the end of the programme, he will find the numbers I cited. I can get the report out and go through it—I know that he has been flicking quickly to various points on his iPad, but I can give the full report because I went through it in quite some detail.

We are here to look at what Jobcentre Plus has been doing. It has carried out more than 25 million adviser interviews to help to prepare people for work. We talk about the scale; it is huge. Jobcentre Plus advertises 4 million job vacancies for around 390,000 employers. More than 97% of our JSA claims were processed within 16 days—an improvement of 10% from last year. The process of continual improvement that we talk about is happening.

We have reduced the average time taken to answer calls at our call centres from 4.55 minutes in 2012-13 to 1.07 minutes in 2013-14. According to our last survey, nine out of 10 employers were satisfied and a quarter are extremely satisfied with what we are doing. More than eight in 10 claimants on disability, carer or unemployment benefits report that they are satisfied with the DWP’s service. All that shows—

Mr Frank Field (Birkenhead) (Lab): Will the Minister give way?

Esther McVey: I am afraid that, because the right hon. Gentleman has just walked into the debate as I am giving my closing speech and has not heard from other Members, I cannot give way. There is only a limited amount of time, and since it is a three-hour debate, I have many questions to answer.

We have seen the complete modernisation of the Jobcentre Plus system. The system has been personalised and adapted to new technology. We have seen greater employer engagement—how do we get a tailor-made service so that a jobseeker really is ready to go into work? That is what we have tried to do.

When we talk about personalising the service and getting as many people as possible into jobs, one key thing that has come out is the claimant commitment. The claimant feels that they are in charge of the journey they are on and that the adviser can help them. I am pleased to say that more than 26,000 of our staff have received the required training and now all 714 jobcentres offer the service. That is helping 600,000 claimants who have signed the new agreement.

Debbie Abrahams: Will the Minister give way?

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Esther McVey: I appreciate the hon. Lady’s request, but she has just taken the question from the right hon. Member for Birkenhead (Mr Field). I will not be taking questions until I have finished responding to everything. I appreciate what she is doing, but I will continue.

We are also increasing technology: we will be delivering wi-fi across all jobcentres, with 6,000 new access devices. All that is key towards helping to get record numbers of people into work.

Many Members mentioned segmentation, which is, of course, important and one of our aims. How do we support people best, help them and target support at them? We looked closely at the Australian jobseeker classification instrument and tested it against our own version in 2010. We found that it was not accurate enough at predicting whether someone would become long-term unemployed. For every accurate prediction, it made two wrong predictions. For that reason, it was better for us to pursue what we were doing and make our system better.

That is why we have done things such as introduce the claimant commitment. We are getting people ready for work straight away and really focusing on day-one support so that we can see whether someone needs extra IT support or NVQ maths and English training. That is what we are now doing from day one so that we understand people’s ability, or perhaps lack of ability, and how to support them.

Sheila Gilmore: Will the Minister give way?

Esther McVey: I presume that the hon. Lady wants to ask the question passed to her by her right hon. Friend the Member for Birkenhead, but go on.

Sheila Gilmore: I do not.

Esther McVey: Well, he has tried everyone else.

Sheila Gilmore: I wanted to ask this: to what extent is the claimant commitment really a substitute for a segmentation tool? Is the Minister now saying that she has given up on looking at such a tool?

Esther McVey: Nobody has given up. That is the whole thing about welfare to work—we continue trying and we continue pilots, to see how we can best support people who need to have a job. No, the claimant commitment is not a substitute, but what we have brought in to give both sides greater certainty and it is working very well. It is also about empowering the individual who is looking for a job. Equally importantly, within it we can look at what the barriers are. They could be disability or health barriers, but we would modify the claimant commitment to reflect what somebody needs to do, so that it really is tailor-made for them.

What we have seen with the claimant commitment is that, despite what has been said today about how people who work at Jobcentre Plus feel, actual engagement and positivity within the work force has gone up by six percentage points. Again, that has to be praised, as well as being a positive step in the right direction.