Welfare Reform Bill

My Lords, as has been repeated and endorsed many times, a main aim of universal credit is to make work pay. This amendment seeks to ensure that universal credit makes work pay for women and parents. At present, there are very real fears that, first, the cuts in support for childcare that the Government have introduced and, secondly, the impact on second earners of the way that universal credit has been designed will mean that universal credit leads to fewer women entering or remaining in the workplace. The amendment therefore asks for a review of the impact of universal credit on claimants in these two areas, to enable us to monitor the extent to which such fears are justified. I trust the Minister will not try and tell us that a review costs £1.4 billion—the figure he quoted on 17 January for a review of the introduction of PIP, admittedly with some trialling, which he told us was happening anyway,. He has of course yet to answer my subsequent query on how this figure was reached, but I urge him not to repeat it today. He also told us on 29 November that the Government were investing £2 billion to cover all the costs of implementing and operating universal credit, which is why the figure of over half that for an independent review of a different aspect of the Bill is a little hard to comprehend. Nevertheless, we welcome the Government’s support for the principle of reviews. In the case of child maintenance, according to the letter distributed to Peers mid-morning today, the Government’s amendment to review the impact of all their child maintenance reforms 30 months after the introduction of charging to ensure that the reforms have driven the behavioural change anticipated shows a welcome willingness on the part of the Government to test the evidence to see whether they achieved their aims. This amendment seeks no less. It is to enable the Government to set out the evidence for their various changes and assess the impact on the families concerned. I turn first to childcare. We welcome the additional £300 million for childcare for those working fewer than 16 hours a week; it will help many to enter employment and ensure that work pays. However, that money does not compensate for the cuts experienced by those working above 16 hours a week. Help with childcare through the working tax credit has been cut from 80 per cent to 70 per cent of the costs. This is an average loss of £500 a year for 500,000 families and up to £1,500 for those who get the maximum help. It is estimated that over 30,000 women have already left the workplace to look after their children simply because they cannot make work pay. These are the very same families who will be hardest hit by the decision to freeze the couple and lone parent elements of the working tax credit, making it even harder for them to make work pay. By the time the universal credit has been introduced the Government may have seen fit to reverse these decisions, but the amendment would provide a good and thorough analysis of the impact of childcare spending under the universal credit on families’ ability to use childcare, which is so vital in enabling parents to go to work. We believe that it is vital that both parents in a couple have incentives to enter employment. Women’s employment, after all, has propped up family incomes to an increasing extent over the past 40 years. In fact, over that period, women’s contribution to total household income has more than doubled, from about 11 per cent to 24 per cent in 2008. The second-earners issue is equally important because we know that child poverty is greatest in those couples where only one of them is in work rather than two. The need to consider the value of second earners and how to keep them was discussed in Committee, and the Minister was very sympathetic—his exact words were: "““I would love to do more, but I cannot find any more money””.—[Official Report, 3/11/11; col. GC 468.]" The amendment accepts that, albeit reluctantly. It asks that the situation is monitored so that, when the money is found, the evidence is there for future decision-makers. I am sure that the Minister, as a great supporter of evidence-based policy, will accept this amendment, which I beg to move.