Welfare Reform Bill

My Lords, I rise to speak in support of Amendment 61B, to which my name is attached, and to Amendment 61C in my name. The amendments have a particular resonance for me. One of my clearest memories when I worked at the Child Poverty Action Group was sitting below the Bar during the passage of the then social security Bill under the Fowler review, of which we heard earlier, and literally jumping for joy when the Minister announced that the then Conservative Government would withdraw their proposal to pay family credit through the wage packet. I was given a severe warning by the attendant. During my subsequent academic career I conducted Joseph Rowntree Foundation-funded research with Jackie Goode and Claire Callender that demonstrated the importance to the well-being of both children and women of paying benefits for children to the mother who was in all those families the parent with main responsibility for the day-to-day care of the children. This research helped to persuade the previous Labour Government of the error of their ways when they proposed to pay working tax credit through the wage packet. Now here we are again having to persuade the Government why it is so important to pay money for children direct to the parent who has the main responsibility for the day-to-day care of the children and for day-to-day budgeting. This time the stakes are higher, as the noble Baroness, Lady Meacher, has made clear because universal credit wraps up so much in it, including housing costs. The noble Baroness, Lady Meacher, has already made the case very powerfully for why what is colloquially known as ““wallet-purse”” is such a crucial issue, particularly for children and women. I want to pick up a couple of the arguments made by the Minister in Committee, some of which I have to admit I was not convinced by. First, I make reference back to a point made by the noble Lord, Lord Lester, earlier when he talked about the report of the Joint Committee on Human Rights, which came out after our proceedings in Grand Committee. It commented on the reduction in the financial autonomy of women, resulting from the payment of universal credit to only one member in the household. In order to address that, the Committee suggested that the Bill could be amended to allow payments intended for children to be labelled as such and to be paid to the main carer. One of the points made by the Minister was to try to reassure the Committee that making universal credit as a single payment will not now be a problem because the Government are committed to ensuring that people can access support to manage their payments and help them to budget effectively, including access to budgeting products, such as jam-jar accounts, as mentioned by the noble Baroness. I put that argument to an expert who understands jam-jar accounts much better than me, and who shares the Minister’s enthusiasm for them. Her response was that it was a bit of a smokescreen as there is no coherent link between budgeting accounts and the decision as to whom the benefit is paid. Moreover, what is at issue is not budgeting capabilities but financial autonomy. It is about ensuring that the parent with the every day care of children has control over the money allocated for them. That brings me to another argument used by the Minister that the Government want to enable couples to decide between where their payments should go. It is not for the Government to dictate how a family arrangements its finances. The only decision that the couple can make is between payment into one or other single account or a joint account. As the noble Baroness has already explained, joint accounts are not necessarily the answer. Research by Fran Bennett of Oxford University and others shows that the existence of a joint bank account does not guarantee access by both partners to the money held in it. While I agree that it is not for the Government to dictate how a family arranges its finances, is it not the case that their belief in the power of nudge might point them to supporting this amendment? Presumably, the Government want the money allocated to meet the needs of children to be spent on children. As the noble Baroness pointed out, that is much more likely to happen if the money is clearly labelled for children. If the Government refuse to countenance that approach, then I suggest that Amendment 61C might be the answer. It provides for a couple to choose for the payment to be split between accounts without earmarking any of the money for specific purposes. This would meet the Minister’s concern that universal credit should be seen as a single payment. In this case, it would be a single undifferentiated payment, but split between the two bank accounts when the couple so wished. It would allow for the variety that exists in the ways that couples organise their finances. I acknowledge that it is not a perfect solution for, as the Minister observed earlier in our proceedings, effective choice exists only when the balance of power is equal, and the gender balance of power is still often very unequal, but it would be more consistent with the Government’s position on choice and would be better than the only choice offered in the Bill, which potentially puts all the money into the hands of one partner. As the noble Baroness emphasised, neither of these amendments would cost money, but they would help millions of women and children and address the very real problem of hidden poverty which can result when resources are not shared fairly within families.