Sophy Ridge on Sunday Interview with Iain Duncan Smith MP

ANY QUOTES USED MUST BE ATTRIBUTED TO SKY NEWS, SOPHY RIDGE ON SUNDAY

SOPHY RIDGE: Well our next guest is at the heart of two very big stories this week. He is a leading Brexit supporter and the architect of the flagship welfare reform Universal Credit so welcome to you, Iain Duncan Smith.

IAIN DUNCAN SMITH: Good morning.

SR: It feels like we should start off with Brexit, a big story of course as always. We understand that Theresa May’s latest backstop offer to the EU would effectively keep the UK in a customs union, is that something you could support?

IAIN DUNCAN SMITH: Not really. It’s very difficult to quite know what is going on at the moment so if I can just take a pace back. People voted to leave, they didn’t vote to half leave, they didn’t vote to half join, they voted to leave, it was a pretty clear decision to take back control of our laws, our borders and our money and I think therefore you have to see everything through that little prism, how does it measure up? I think what’s very clear is that we had agreed an implementation period providing we had a deal and that also hinged £39 billion to the EU if we got that deal. If we end up staying in a customs union for that implementation period we would de facto be in a customs union anyway but the key question is, when does it end and it has to end in a very specific way because being in the customs union is not what the people voted for. We wouldn’t be able to do any trade deals, we wouldn’t be able to look at anything with the USA or with Japan who have been talking about bringing us into the Trans Pacific Partnership, all that would not happen so it’s very, very …

SR: So if there is no clear end date for this backstop plan, customs union plan, you would vote against a deal that included it?

IAIN DUNCAN SMITH: No, I think it’s not just end date by the way, it’s a little bit more than that, it’s not just having an end date, it’s knowing that the UK government will be able to leave. If it was to agree to stay in the customs union, which I by the way should only be over the period of the implementation phase and I do not see any reason why longer, then it should be not just end dated but controlled by the UK. The second thing is, we are in this mess because the government keeps refusing take head on the issue of the backstop. It was a mistake in December last year, I told the Prime Minister walk away from the table, do not sign this, it will box you in and the problem is that the EU and Ireland insist that you have to have a hard border if there is no deal. It’s complete rubbish, even Barnier now admits it doesn’t happen. I mean we wrote a paper the other day, a group of us, to say basically that it’s wholly feasible to have an open border at Dover as well as in Northern Ireland, without border checks at all under existing technology and procedures. That’s been accepted, by the way, by everybody.

SR: So it’s pretty clear that you’re not happy with the way that Theresa May is perhaps moving towards the EU. Do you support David Davis’s call this morning for a kind of Cabinet mutiny if you like, to try and kill it off?

IAIN DUNCAN SMITH: I share one thing in common with David Davis which is we both resigned from the Cabinet when we weren’t in agreement with it and therefore I am always of the view that when you get to the point where you are no longer agree on a fundamental issue, then it’s probably time that you found yourself on the back benches. But it’s up to people to do that themselves.

SR: So do you think that we could see some resignations over this?

IAIN DUNCAN SMITH: I am never a very good speculator but I do say to anyone who’s in Cabinet who has concerns about this, you have to make them very clear to the Prime Minister. We mustn’t have a little cabal outside the Cabinet running this, it has to be a Cabinet decision and more importantly, I think the real question here is we have a very strong set of cards to play, 39 billion and security are all on the table at the moment and the EU – we know BMW and others are now beginning to moan – there was a very good speech made by an MEP called Herr Henkel in the European Parliament the other day and I watched it and he really went for Junker and said you messed up before the referendum and you are about to mess up now. He used a very interesting figure, he said that the departure of Britain isn’t bad for Britain, it’s a disaster for the EU. He said it’s the equivalent of nine small or medium countries leaving the EU at once, we will all over here suffer, you have to have a proper deal with them and so I have a very simple message, I say to the Prime Minister and others look, it’s great if you are going to be a bloody difficult woman over something, that’s a real strength when you are on the right course but when you’re not on the right course sometimes you need to take a pace back and say is there a better way? And I think there is a better way to do this which is to put the ball back in the EU’s court and say look, we have never accepted this backstop, this is a ludicrous political intervention, you now must agree with us there will never be a hard border, with or without a deal, and then the full Canada ++ trade deal is on the table.

SR: You talked about Theresa May there being a bloody difficult woman, I wonder if you would be a bloody difficult backbencher? There has been talk, hasn’t there, about backbenchers being prepared to vote down a budget for example, to effectively wage a campaign of insurrection to try and force Theresa May to change her direction.

IAIN DUNCAN SMITH: I am not in favour of a kind of insurrection. We have a government, we have a party to stay together, we have to get through this together and come out the other side together otherwise the big threat, much bigger than Brexit, is Jeremy Corbyn with a terrible plan to basically tax the hell out of the country …

SR: So would you back Theresa May if there was a no confidence vote?

IAIN DUNCAN SMITH: I don’t want to see a leadership change, I want to see a leadership change her mind and go in a different direction and to listen to people who say look, nobody voted to stay in the customs union. We want to get through this and out the other end. People out there have decided, let’s get on with it, let’s deliver it, let’s get out.

SR: I’m keen to talk to you about Universal Credit as well, it’s been in the news an awful lot recently, a lot of criticism. Now when you first announced the policy eight years ago, we can just have a look at what you said which is: “It is the proud duty to provide financial security to the most vulnerable members of our society and this will not change. This is our contract with the most vulnerable.”

IAIN DUNCAN SMITH: Indeed.

SR: Currently do you think the Conservatives have broken that contract?

IAIN DUNCAN SMITH: I don’t yet. When I set Universal Credit it’s because I studied for some years the mess that the tax credit system had got into, housing benefit, all these different places people went to, got confused. Quite often single women would go in to work, lose their jobs at 15 hours, after a while they’d come out and take nearly two months to get their housing benefit back and we know that with tax credits many of us had people coming into surgeries saying after a year of bad estimates they ended up with massive debts on their hands. In fact as tax credit recipients go over to U.C. they’ve been carrying about £6 billion worth of tax credit debts with them as well as the housing benefit debts so any wonderful ideas that what this replaces was not damaging are mad, it was a very bad system we had before. So the purpose of Universal Credit was to make things simpler to understand so that people knew they made one claim and, more importantly which is forgotten, they had a human person there, a person who is their advisor, they can go and see and talk to.

SR: You see those aims sound very noble but some of the analysis …

IAIN DUNCAN SMITH: Well those are the things we’re working out.

SR: … but some of the analysis is worrying. The Work and Pensions Secretary admitting that some people will be worse off, the Resolution Foundation saying three million people, families, will lose more than £2000 a year, it’s concerning.

IAIN DUNCAN SMITH: Well let me bring that into context. The structure of what is rolling out is rolling out well, it’s moving out to all the Job Centres and the advisors are having a much better relationship, and there are tens of thousands of people who find this a better system. However, you’re talking about the money. When I launched this we specifically set down an amount of money that would allow this to roll out correctly and have the levels of payment at the right level. In the 2015 spending review a very significant amount of money was taken out of Universal Credit, I had big issues over that, there was another attempt to take more money out at around Christmas 2015 and for me that was the final straw. I then resigned as there were a number of other cuts and changes too which I didn’t agree with including the disability one. My view is and has been for some time, that government has a really, really transformative policy on its hands, you do not underfund it as it goes in because if you do that what you do is lose the great benefit of it and then end up starving people …

SR: And potentially breaking that contract with the most vulnerable.

IAIN DUNCAN SMITH: Exactly and …

SR: Just going back to your policy to look after the most vulnerable, one of the things that people are saying now is that some of the people who could be about to lose out are those who are the most vulnerable – lone parents for example. You’re a father, you know how difficult it is to bring up a child …

IAIN DUNCAN SMITH: I do.

SR: These are people in work. People trying to do the right thing.

IAIN DUNCAN SMITH: I couldn’t agree with you more which is why for the last two and a half years I proposed constantly that we put the money which was taken out of this, nearly five billion was taken out, back in.

SR: So £5 billion of cuts?

IAIN DUNCAN SMITH: Well the government has actually been quite good, they have actually put about two billion back in, what’s left is between about two and three billion I would think.

SR: And you want that addressed in the budget do you?

IAIN DUNCAN SMITH: Well I think it’s wholly feasible. You don’t have to add any new spending. They have a plan at the moment to raise the tax threshold which is a manifesto commitment but the trouble is we’ve raised them so high now that most of the poorest don’t get affected by another rise in tax thresholds, about 20% would get any benefit from this because so many are out of tax whereas with Universal Credit if you put the money that was there into the allowances, which is like a tax threshold for very poor people, then in actual fact what you do is nearly 80% of your money goes straight to the poorest four deciles. Now I think it’s a no-brainer, if you take that money you will deliver on what I said and at the same time you will really improve the lifestyles of people in the poorest circumstances. That’s what Universal Credit was designed to do, it’s why I brought it in, it is now ready to do that, we just need to grab this bull by the horns and say this money should go right to the poorest.

SR: Now there are a few more things I do want to talk to you about on Universal Credit but we do need to take a break unfortunately so don’t go anywhere and do stay with us just for a few moments, thank you.

SR: Welcome back, Iain Duncan Smith is still with us. I’m just having a look, I know you are not on Twitter – possibly very sensibly – but just in the break having a look at some of the reaction that I can see to the interview, for example somebody talking about ‘Iain Duncan Smith who shoulders no responsibility for the complete screw up of Universal Credit’. Is that hurtful because you were …?

IAIN DUNCAN SMITH: Well some of those will be people who have a very vested interest.

SR: Of course but does it hurt that for some people you are the face of all the problems with Universal Credit and how some people would view as sort of the nasty party if you like?

IAIN DUNCAN SMITH: Yes but it’s not. I mean the point is, you can believe that if you want, sometimes people get ridiculous politicised, I mean Momentum troll everybody at the moment so there is just no way out of that but my point however though is that this benefit was deliberately set to be rolled out as a test and learn process. When tax credits were rolled out, they were rolled out in one go and nearly three quarters of a million people didn’t get their money at all and have never received their money.

SR: So the implementation …

IAIN DUNCAN SMITH: So the implementation was deliberately careful and slow., We looked at it, we did it like this so that when you meet an issue or problem, you check whether it is an operational problem or a technical problem and then you make the adjustments accordingly. That’s exactly what’s been going on. Last Christmas they made some adjustments, I was recommending those as well, changes to the way in which people coming off housing benefit and coming on could continue to keep their housing benefit so they invested another billion and that was exactly the point that I’m making. So Universal Credit is a better benefit and what very rarely happens is that people don’t hear from the tens of thousands of people who actually find this a much better benefit, they are allowed to take very low hours work if necessary, if they have got caring responsibilities, so getting it right is important. I’m not shirking any responsibility, I resigned back in 2016 because I did not agree with the government’s position over taking the money out of this and a couple of other areas as well.

SR: Do you take any responsibility for what some would see are the design flaws in Universal Credit, things like for example people having to wait five weeks for a payment? If you are on the breadline it’s no surprise is it that people are falling behind on rent payments, that they are having to rely on food banks if they are having to wait that amount of time.

IAIN DUNCAN SMITH: Let’s be very careful though, benefits have always been paid in arrears. There is some kind of mystery that somehow previous benefits were paid in advance, they have never been paid in advance, they are paid in arrears. They were then paid two weeks in arrears. The grounds for Universal Credit was a month in arrears for a very good reason …

SR: Why, when it was two weeks to a month?

IAIN DUNCAN SMITH: The vast majority of jobs are actually paid a month in arrears. If you aren’t capable of coping with that then you are going to go into a job and crash out quite quickly so there is another element that runs alongside Universal Credit which hasn’t been completely rolled out, it’s called Universal Support. So the idea of Universal Credit is if you identify somebody who has a problem, debt problems etc, they are moved to Universal Support working with the local authorities, the charities and all those other bodies, in the local area. They are then put onto debt counselling or if they have drugs problems they are meant to be moved over into rehabilitation. The point about Universal Credit, it will identify that minority of people who have real problems, who will not be able to move in to work with those problems and then try and resolve them. That’s the real design of U.C., it is not completely rolled out in that sense, we need to put more effort on to Universal Support which is the parallel bit beside it which allows those advisors to go and say right, this individual now needs to get into some kind of remedial help before we can get them back into work.

SR: A quick thought, what do you make of Labour’s position? It feels as if it is perhaps slightly shifting, John McDonnell saying that they wanted to get rid of it, Shami Chakrabarti was slightly more circumspect perhaps.

IAIN DUNCAN SMITH: Yes, well it’s all very well to attack but you are quite right, Labour at the moment are I think in a bit of a mess because at first they said well, before Corbyn came in they were supportive and they wanted to get changes made, then suddenly it was sweep it all away, we’ll go back to another system which frankly, if anybody thinks tax credits or housing benefit were in any way fair, then they really need to have their brains examined, so now they seem – as you said in that interview – to say well if the government puts the money in, which is what I want, then we’ll continue to look at the mechanism but there’s one area where they are in a real mess over and this is the real problem. There has always been agreement on both sides of the house that if people don’t do what they have been asked to do while they receive benefits, then they would stand to lose some of those benefits for a period of time. Labour has said that will never happen. That means that someone never turning up for an interview, never doing anything with regards to taking a job or anything they’ve been asked to do specific to receiving that benefit, tax payers will end up paying a huge amount more money.

SR: And finally, who is to blame? You’ve admitted there are issues with Universal Credit and that a lot of very vulnerable people could be worse off, who’s to blame? Is it George Osborne, is it Theresa May, is it Esther McVey?

IAIN DUNCAN SMITH: No, I think the key thing is the structure works, we need to put the money in. I think this government is listening, I think the Chancellor is listening and I’m asking him to do that. If we do that and get the money back to where it should be, the reality is that nobody should lose at all.

SR: And if you don’t?

IAIN DUNCAN SMITH: Well if we don’t I am going to continue to badger away because I think it’s the right thing to do. One thing I’ve always said, and Theresa May stood on the steps of Downing Street and said, I want to look after those who are just managing. Universal Credit is the single best instrument to get to those who are just managing, it’s better than a tax system, it’s better than charitable giveaway’s, it gets the money to that bottom four deciles in a way that no other system does.

SR: Iain Duncan Smith, thank you very much.