Welfare Reform Bill

My Lords, I am delighted to have actually made it. With regard to the previous amendment and the proposal for pilots, it pilots may well be relevant here, too. This amendment would introduce a specific earnings disregard within the universal credit to ensure that carers juggling work and care are not left worse off as a result of the new system of disregards. Approximately 250,000 carers currently in receipt of the carer premium to means-tested benefits such as income support, will be moved to universal credit. Under that, the earnings taper will be more generous than the withdrawal rate of existing benefits. Many claimants who are in work, including many carers able to juggle work and care, will be able to keep more of their benefits as they earn. However, this will depend on which earnings disregard they have access to and their level of earning. Under existing plans, it appears that certain groups of carers would see the size of their earnings disregard in universal credit reduced, compared to their existing income support disregard. Currently, individuals in receipt of income support are eligible for a £20 a week earnings disregard, that is £1,040 a year, which allows them to earn £20 a week before their benefits start to be withdrawn. The Government have announced the following disregard groups for universal credit claimants, with approximate disregard levels: for a single person without children it is £700, about £13.50 a week; for a couple it is £1,920; for a lone parent £2,260 plus £520 for the first child and £260 for the second and third children; and for single disabled people or a couple where at least one person is disabled it is £2,080. The Government have said that, taken together with the taper, this would leave couples, singles, lone parents and disabled people significantly better off in low-paying jobs. That is good as far as it goes. However, it does not apply to single carers, who currently have access to £20 income support through receipt of the carer premium, but who would be able to access only a basic single person disregard of about £13.50 a week under universal credit. Although £13.50 would be an improvement for unemployed single people being moved onto universal credit from jobseeker’s allowance, where they currently receive only £5 a week disregard, it would see the earnings disregard for single carers on income support drop from £20 a week, that is £1,040 a year, to £13.50 a week, or £700 a year. Those carers who would see their disregard reduced would be those unable to access the higher disregards for couples, lone parents and those with children or covered by a disability disregard. Carers losing out would be those living on their own, who do not have children and who are caring for a disabled person who does not fall within their universal credit household. This latter group includes carers looking after a disabled or elderly friend or relative living elsewhere and carers looking after an adult disabled child, a parent or other elderly relative living with them but who is not considered to be within the same household for the purpose of universal credit. The Government have estimated that around 20 per cent of households that receive means tested benefits and include a carer would not have access to any of the higher disregards for couples, lone parents or households that include a disabled person. With approximately 250,000 carers on means-tested benefits, this would leave approximately 50,000 carers able to access only the lowest earnings disregard if they were able to juggle work and care. I end with a case study to put this in perspective. Sheila is on income support and cares for her mother, who is 58, has early-onset dementia and receives disability living allowance. Sheila is single and has reduced her working hours as a librarian to just two hours a week. She currently earns £20 a week and, because of the existing £20 disregard, her benefits are unaffected. Under universal credit she would be eligible only for a single person's earnings disregard of £700 a year—around £13.50 a week. Sheila's earnings above £13.50 would be subject to the universal credit taper, which would mean that she would be £15.75 better off from her £20 earnings. She would be £4.25 a week—£221 a year—worse off than under the current system even though she would be earning the same amount. I will not go on to outline the full impact because I have given an impression of what it would be. I look forward to hearing how this unfairness can be tackled. I beg to move.