Thursday 10 March 2011

Welfare Reform Bill Second Reading: the facts | Full Fact

Welfare Reform Bill Second Reading: the facts | Full Fact

The Claims

Iain Duncan Smith: The problem is that although from 1992 to 2008 this country saw some 63 consecutive quarters of growth, and 4 million more people were in employment by the end of that period, before the recession had even started we still had some 4 million-plus people on out-of-work benefits. The question is: where did all those jobs go? Under the previous Government, over half of the jobs created went to foreign nationals.

Full Fact found: For details about the economy between 1992 and 2008, see our report The Big Question. We've also tackled the issue of the proportion of jobs going to foreign workers (although when we looked at it, Mr Duncan Smith had claimed that the level was closer to 70 per cent.)

Iain Duncan Smith: I am pleased to say that those principles seem to have received support from a number of stakeholders, including Citizens Advice and the Institute for Fiscal Studies. The IFS said that by and large the measure was a progressive change.

Full Fact found: We're looking into this, and will update later.

Iain Duncan Smith: We anticipate that the universal credit will make some 2.7 million households better off. Over 1 million households will be better off by more than £25 a week-clearly, those will be down in the bottom deciles-and 85% of that increase will go to households in the bottom 40% of the income distribution.

Full Fact found: This is an accurate reflection of what the Department of Work and Pensions forecast in its Impact Assessment on the change to universal credit.

Mr Andy Slaughter: According to the right hon. Gentleman's Department, 70% of those affected by the benefit cap live in social housing.

Full Fact found: We're looking into this, and will update later.

Iain Duncan Smith: We want as many people as possible to get help to engage with the labour market, and we know that about 80% of all lone parents are working or would like to work.

Full Fact found: We're looking into this, and will update later.

Sheila Gilmore: It is not true that someone who receives contributory ESA will receive it for ever without assessment.

Iain Duncan Smith: I remind the hon. Lady that in the support group, the contributory element does not apply. It applies to people with finances that take them above the line. The income-based measure continues-that is not the issue.

Full Fact found: When we looked at assessments for DLA, we foundthat the Government's own guidance noted that evidence was often submitted as supporting information as part of the claimants original application. We're currently looking into how this impinges upon ESA, if indeed it does.

Iain Duncan Smith: Over the past 10 years, overall spending on housing benefit has almost doubled from £11 billion to £21 billion, which is a huge increase. I accept some of the arguments about the reasons for that-the fact, for example, that house building fell to a record low, and more and more people had to be moved into the social rented sector.

Full Fact found: In cash terms this is correct, however using real terms (which DWP itself does in its Budget Expenditure tables) the rise is slightly more modest: in 2010/11 prices the bill has climbed from £14.5 billion in 2000/2001 to £21.5 billion in 2010/11.

Iain Duncan Smith: It is time for fundamental reform of the social fund, which is poorly targeted and open to abuse. Some 17,000 people have received 10 or more crisis loans in the past 12 months, and we have already taken steps to limit the number of crisis loans for living expenses to three in a 12-month period.

Full Fact found: Some background to crisis loan payments can be find in our factcheck from last month, however we're still tracking down Mr Duncan Smith's source for the 17,000 claim.

Iain Duncan Smith: On the second question that she (Yasmin Qureshi) raises about crisis loans being down to the recession, the trend of upward claiming was on track and had started long before the recession.

Full Fact found: Again, we're looking into the details of Mr Duncan Smith's claim.

Iain Duncan Smith: About 50 per cent of those currently receiving DLA did not have to provide any additional evidence to support their original claim, and more than two thirds of current recipients have an indefinite award.

Full Fact found: When we looked at assessments for DLA, we found that the Government's own guidance noted that evidence was often submitted as supporting information as part of the claimants original application. Whether this counts as 'additional' evidence is a matter of interpretation. Similarly, whilst it is accurate to say that two-thirds of the case load are indefinite awards, it is worth noting that two thirds of all new claimants for Disability Living Allowance are given awards for a fixed period. The difference is accounted for by the cumulative effect of indefinite awards.

Iain Duncan Smith: I fully accept that with the complexity of the system, officials made mistakes and that we were often too ready to badge people as fraudsters when in fact they were not necessarily fraudsters but caught up in a system that left them confused and perhaps not making the right or necessary level of statements to the authorities. This process is about separating those people out. A recent trial of a changed reconsideration process at Jobcentre Plus led to a fall of some 15% in the number of appeals being heard.

Full Fact found: We're looking into this, and will update later.

Iain Duncan Smith: We are introducing measures to allow non-resident parents to pay through Maintenance Direct when the case is within a statutory scheme. That will provide further flexibility for parents. We need to keep the burden of the cost of collection under control. In 2009-10, the cost of collecting every pound was more than 40p.

Full Fact found: We're looking into this, and will update later.

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