HC Deb 21 April 1959 vol 604 cc224-60

3.40 p.m.

Mr. Douglas Houghton (Sowerby)

I beg to move, in page 1, line 17, at the end to insert: Provided that among the qualifications to be prescribed there shall be included the following, that is to say, that the applicant has been entitled during a continuous period of twenty-six weeks immediately before the date of his application and is entitled on that date to sickness benefit under the National Insurance Act, 1946, or to benefit in respect of disablement or of a prescribed disease or injury (being injury benefit or benefit assessed on a basis of one hundred per cent.) under the National Insurance (Industrial Injuries) Act, 1946. This is a proposal to add a fourth category to the three mentioned by the Chancellor of the Exchequer as qualifying for the repayment of post-war credits. It proposes that holders of post-war credits who have been receiving sickness benefit under the National Insurance Scheme, or the corresponding benefit under the Industrial Injuries Scheme, for a continuous period of 26 weeks, should be entitled to claim repayment of their post-war credits.

I realise that in moving the Amendment we are doing one of the things which the Chancellor asked us not do. In his Budget statement the Chancellor said: I must ask hon. Members not to press me to extend these hardship concessions further this year. I am aware there are many other people who on grounds of degree of hardship may have claims as strong as those I have chosen. I am sure that he would not wish us to overlook any really deserving category of persons who might share in the extended repayment of post-war credits now proposed. We have satisfied one of the conditions he laid down when, in the same speech, he said: [would ask hon. Members to bear in mind that we can deal only with categories of hardship that can be defined readily and precisely."— [OFFICIAL REPORT, 7th April, 1959; Vol. 603, c. 62.] The category of persons referred to in the Amendment does satisfy that condition.

Hon. Members on this side of the Committee agree that it would be wrong to ask the Inland Revenue to become the judge of degree of hardship. The Inland Revenue is the repayer of post-war credits and not the administrator of National Assistance, National Insurance, industrial injuries benefits, or the judge of marginal questions of hardship or entitlement. It is, therefore, necessary to give the Inland Revenue evidence, from an authoritative source, of the entitlement of a person to repayment of the credits under the regulations which the right hon. Gentleman will make.

We presume that in the case of those who have been continuously receiving National Assistance for 12 weeks, the National Assistance Board will be the authority to assure the Inland Revenue of entitlement on that ground. My hon. Friend the Member for Stockton-on-Tees (Mr. Chetwynd) made the useful suggestion that the Assistance Board should hold a supply of forms of application for repayment of post-war credits and that, as soon as a person fulfilled the qualification of having received National Assistance for 12 continuous weeks, he should be asked whether he held post-war credits and, if so, given an application form. In the case of the category proposed by the Amendment that could be done by the Ministry of Pensions and National Insurance.

I do not say that the fourth group suggested in the Amendment should take precedence over the first three. We recognise that the first category proposed by the Chancellor, consisting of those who have been receiving National Assistance for a continuous period of 12 weeks, obviously consists of persons in need, otherwise they would not be receiving help from the Assistance Board. Moreover, not only are they in need, but they have been continuously in need for three months. In all those cases we could say that the people concerned are deserving of repayment of any money which the State still holds on their account, in postwar credits.

3.45 p.m.

The second category, consisting of the blind, has a special place in the sympathy of hon. Members on both sides of the Committee and with the public generally, and we would not question for a moment the appropriateness of their inclusion in the Chancellor's three categories. The third category, consisting of those so badly disabled that they are in need of a constant attendance allowance, or are receiving unemployability supplement or corresponding benefits, are clearly a very deserving category. They are people who have been badly shattered, physically or mentally, in war, or as a result of a serious accident at work.

The category covered by the Amendment is one which we would place fourth, and not third or second in the list. Nevertheless, it is a deserving category, consisting of persons who have been in receipt of sickness benefit continuously for at least 26 weeks. Twenty-six weeks is a long time. We have purposely fixed a period as long as that to remove any suspicion that persons might find it expedient to remain on sick list benefit a little longer to qualify for repayment of their post-war credits. We cannot rule out the marginal risk that that might happen even under this proposal, but when a person has been receiving sickness benefit, or total disability benefit under the National Insurance (Industrial Injuries) Act, for six months, we can take it that he must be ill and that he has been seriously ill and will have had his resources considerably depleted as a consequence. We know that he will have been receiving the low sickness benefit under the scheme, and that his domestic situation is bound to have deteriorated during that time.

We recognise that those who, on account of prolonged sickness, need to go to the Assistance Board for help, will, if they are continuously in receipt of National Assistance for 12 weeks, qualify as being in the first of the three categories proposed by the Chancellor. I find that roughly 12 per cent. of those receiving sickness and industrial injuries benefit need to apply for National Assistance. Roughly 118,000 persons in receipt of sickness benefit have their income supplemented in that way.

I cannot tell how many of those in receipt of sickness benefit for a continuous period of 26 weeks have not applied for and received National Assistance for a period as long as 12 weeks. From Table 34, on page 105 of the Report of the Ministry of Pensions and National Insurance for 1957, it appears that the number of persons totally incapacitated by sickness, prescribed disease or industrial injury, month by month during 1957, was never less than 827,000 and, in the peak month of the influenza epidemic, in October of that year, rose to 1½ million. I do not know how many of those people will have been sick for a period of as long as 26 weeks. It may be that the Financial Secretary has made some inquiries which will enable him to help the Committee on that point.

I would say that the majority of sick absences are for a much shorter period than 26 weeks, and during the influenza epidemic of October, 1957, when sickness benefit claims rose to an all-time high, the absences were for only one or two weeks. In the more serious cases the absences would be longer than that, but a period of six months would be a long time. The numbers might not be as large as one would suppose, and the money involved in the repayment of post-war credits to those who woulud qualify under the Amendment would not embarrass the Chancellor. He referred to the other categories in which he was proposing to make a concession and said that information was scant, but that he thought the cost might be about £2 million a year.

The remaining factor, which the Chancellor has mentioned on several occasions, concerns the amount of work involved, and he has suggested that in the next two or three months the Inland Revenue will have about as much to do in regard to post-war credits as it can manage. On 15th April, he said: …the form in which the Bill is drawn makes it possible for further classes to be added by regulation if this is shown to be possible and desirable. It would, however, not be practicable to make any additions to the qualifying classes until after the mass of the new claims under these proposals have been dealt with."—[OFFICIAL REPORT, 15th April. 1959; Vol. 603, c. 1040.] I am sure that hon. Members on this side of the Committee would not wish to be unreasonable. If the Chancellor could say that the fourth category we propose would be the next on his list, and that he would take advantage of the power to be given him under the Bill to bring that fourth category forward at an early date, we should probably not wish to be unduly critical. But we should first want to be satisfied that the numbers involved would add so substantially to the amount of work to be done that some postponement of their claim would be necessary and justified.

That is the case for the inclusion of this fourth category. I hope that the Financial Secretary will not make any difficulty about that category by telling us that the forms are already being printed. I do not know what the forms contain, but I imagine that they make some reference to those who are entitled to claim, and the categories will presumably be set out in accordance with the announcement already made by the Chancellor to this House. I suggest, however, that we cannot be hustled along quite like that. The right hon. Gentleman could have introduced an enabling Bill on post-war credits at any time during the last twelve months. He has not been forced into this position by circumstances over which he had no control.

The right hon. Gentleman was, naturally, anxious that repayment should be made as quickly as possible after he had announced the action that he was proposing to take. No Chancellor, and still less the Committee, would wish those with money to claim to have to wait unduly long for it. One of the special advantages of having an early repayment is that those who wish to spend it upon possibly their first holiday for a long time will have fine weather in which to do so. I hope that the Financial Secretary will not make machinery difficulties for us simply because the forms are being printed in advance of the approval of the House to the Bill. The Bill seeks to give validity to the action the Chancellor is taking in advance of its passing into law, and the House will be very indulgent about that. in the interests of speed and of getting the money into the hands of those who are waiting for it.

But I suggest that it is not a suitable excuse to be made by the Government in declining to accept what we are proposing, even though it may mean a little inconvenience in adding a fourth category, and the forms may be printed. We can print another form. There are plenty of forms about, and another will not make much difference, especially if its printing means the entitlement to receive post-war credits by a category of people not yet included.

Mr. A. E. Hunter (Feltham)

I am pleased to support this Amendment. When introducing the Bill the Chancellor named three groups to whom post-war credits would be repaid. The first was those coming within the lower age groups of 63 for men and 58 for women. The second was to widows of holders of postwar credits. The third was clearly defined hardship cases. This Amendment will help the Chancellor to include more cases in that third group. Disabled and blind persons seem to be clearly defined.

This Amendment includes other cases which I feel that the Chancellor should accept. It relates to those who have been sick for a period of six months and receive benefit under the provisions of the National Insurance Act, 1946, or benefits assessed on the basis of 100 per cent. disablement under the National Insurance (Industrial Injuries) Act, 1946. They are clear cases of hardship which, in my opinion, the Chancellor should include.

In my constituency there are sick and disabled people who will never work again and the repayment of their postwar credits would help them and their families. One of my constituents came to see me about the repayment of the postwar credits due to him. He is partially disabled and can barely walk. He is unable to follow his normal employment and he wishes to purchase a set of special tools to do light fretwork at home. I sent the particulars of this case to the Chancellor and I trust that my constituent comes clearly within the third category described by the Chancellor when he introduced the Bill.

A period of illness extending over six months would in most cases exhaust the savings of the person involved and create hardship for his family, especially if he is the principal wage-earner. The payment of any post-war credits due to him would be of great assistance not only to him, but to his wife and children. Six months is a long time to be ill, and such an illness must be serious. The Chancellor should accept the Amendment and include among those eligible to receive post-war credits people who have received sickness benefits for six months or who are 100 per cent. disabled. This is a modest request. The people concerned have been waiting for fifteen to seventeen years for these post-war credits. The money was deducted from that which they earned during the war period and this "nest egg" has been laying by for a long time.

In his Budget speech the Chancellor did not state all the cases of hardship clearly. This Amendment will assist the right hon. Gentleman to be fair to this category of persons, and I hope that it will be accepted so that the sick and disabled persons not in the 63-year group for men and the 58-year group for women can be repaid their credits without delay. The people will consider it fair for them to be included in the hardship group.

4.0 p.m.

Mr. Eric Fletcher (Islington, East)

I wish to support the Amendment, which I hope the Financial Secretary will accept, and to explain my reasons for doing so. We are all agreed that the object of the Bill is to accelerate the repayment of postwar credits in the case of hardship. This Amendment is designed to include within the purview of those admitted for acceleration cases—it must be a limited number—where hardship results either because of a period of sickness or because of industrial injury.

With his legal experience, I am sure that the Financial Secretary will be familiar with cases of people who have suffered from injury or disease as a result of their employment. I will not traverse the whole history of the subject, but the hon. and learned Gentleman will be aware that prior to 1946 there were many cases heard in the courts and reported in the Law Reports under the Workmen's Compensation Acts or the Employers' Liability Act.

There was that curious doctrine of common employment and a proliferation of legal case histories on which depended whether a particular individual who, through no fault of his own, had suffered some injury at work should be compensated. The injury might have been caused because of defective machinery or because of the fault of another workman, or even through some semi-negligence on the part of the victim, as a result of which he was incapacitated for a long period, and he and his family were thereby exposed to great economic hardship.

The Financial Secretary will also know that as a result of the efforts of the Labour Government, in 1946, a considerable change in the law was effected by the National Insurance (Industrial Injuries) Act of that year. This Act gave an injured workman certain rights of insurance benefit without the necessity of having to prove some of the things which previously he had to prove. I am sure that the Financial Secretary also will be aware that even since 1946 considerable hardship has been suffered by many men, skilled and unskilled, who, through no fault of their own—perhaps through nobody's fault—were injured in accidents in the factory or the docks where they worked. Such a man might lose a limb or suffer an injury which would incapacitate him for a long time. That is a class of case for which I have particular sympathy.

We have all heard of these cases and had to advise such people about their course of action. We all know that as the English law stands today such people have no absolute right to claim compensation against their employers unless—as is rarely the case—they can prove that there has been some deliberate fault, or omission or trap on the part of the employer or the employing company.

In 99 cases out of 100 these people are dependent on the provisions of the Act of 1946 which, as the Financial Secretary will know, gives them very limited, although no doubt valuable, benefits under those circumstances. They are given specified and ascertainable benefits whether or not they can prove negligence, and even though there may have been some contributory negligence on their part. I am not denying the benefits provided by that Act, but the Committee will know that we are now discussing a class of persons who may be affected by an element of hardship which has no relation to old age or to middle age.

Accidents happen capriciously to anyone at any age and they result in a temporary period of real hardship for the victim and his family. No one can pretend that the benefits provided under the 1946 Act are anything like adequate to compensate a man for the wages which he would have earned had he been able to continue in his employment, and the person involved suffers a definite and sometimes substantial loss of weekly income. Therefore, now that we are considering what people deserve to receive their post-war credits before others we urge that those who, through no fault of their own, have suffered injury at their work, should at least be considered sympathetically.

To a limited number of people the release of their post-war credits at a time when they have suffered injury would be of value, but were payment deferred until they attained the age of 65 it would become, not irrelevant, but less worth while. The time when they are suffering from the result of an accident or infirmity is the moment when they will say, with a throb in their hearts and with a pang of anguish, "Here I am, trying to struggle along for a few weeks on what I get under the provisions of the 1946 Act, when I know that I have a sum of money due to me in the form of post-war credits. This is the time when I could make use of it for the benefit of my wife and children and to tide over this difficult period before I recover from my disability, before I regain my health and am able to resume my work." Therefore, I say with all earnestness to the Financial Secretary, who is an honest and humane man, that these are the people who should be considered.

Hon. Members on this side of the Committee have been pressing for these changes in the system of repayment of post-war credits for many years and I plead most earnestly with the Financial Secretary to include in the categories mentioned in the Bill that particularly deserving class of people who, through no fault of their own, happen to encounter an accident in their occupations. I hope that as a result of any such accident they will be given the benefit of being enabled, as of right, to claim the post-war credits to which they are entitled.

Mr. Donald Chapman (Birmingham, Northfield)

May I add two further reasons to the very eloquent plea made by my hon. Friend the Member for Islington, East (Mr. E. Fletcher). These reasons have not been mentioned, but I think that they will command some support. First, the Chancellor said last Wednesday that one class which should have priority for the repayment of postwar credits were those who would be receiving unemployability supplement under the war pensions Instruments, the Industrial Injuries Acts, or the Industrial Diseases (Benefits) Acts. The borderline between that category and the people on extended benefits under the National Insurance Act is a very slim one.

There are many deserving people in the particular definable category mentioned by the Chancellor—for example, in the Industrial Diseases (Benefit) Acts. But there are also many breadwinners who are ill, and have been ill for years, and it has been a borderline decision as to whether their illness could be attributed to some specific disease, or some specific industrial cause. Many people are outside the three particular categories by chance, by chance medical evidence, or this or that, who, with a little more luck, could have slipped into one of the categories mentioned by the Chancellor but have to stay on extended benefits under the National Insurance Act. We will run into extraordinary difficulties in quietening the demands of people who have slipped outside in this way.

The other argument comes from the fact that the Chancellor has had to make arbitrary distinctions. We have agreed that somebody has to "chance his arm" with these arbitrary distinctions and try to end by making as little discontent as possible. And in that case I think that the Financial Secretary will agree that in making these arbitrary distinctions one must not militate against the people who set out to help themselves.

To illustrate what I mean, let me quote an example of a case that came to my notice in my own constituency, on Sunday last. Since 1955, the man has been unable to work because of what was finally diagnosed as cardiac debility. His heart is not strong enough for him to undertake very much exertion. The trouble had developed late in life, but there was no clear evidence as to its origin. While he was in hospital his wife was on National Assistance for two periods of six months. She has a young daughter and, therefore, has every reason to stay at home. When he came out of hospital the family decided that they were not going to stay on National Assistance, but that his wife would go out to work and in that way they could fend for themselves.

This family could have stayed quite legitimately not only on National Insurance extended benefit, but also on National Assistance. Instead of that the wife decided that she would go out to work and do a full week's work because she preferred her independence and the family would be a little better off than if they stayed on National Assistance. She is at work for a full week and is £1 better off, as a result of deciding that it is worth sticking out for her independence.

Here is a family which could definitely have stayed fully inside the framework of our social services, inside even the distinctions set out by the Chancellor about receiving National Assistance, and it would be wrong to make the demarcation point just the wrong side of this category. Those are two legitimate arguments. We disagree about the borderline business and in making arbitrary distinctions like this one must be careful not to militate against those who help themselves.

I hope that this will add to the weight of arguments, and that we will get from the Financial Secretary at least a pledge that this will be one of the first categories to be brought into benefit under the Bill later in the year.

4.15 p.m.

The Financial Secretary to the Treasury (Mr. J. F. S. Simon)

The Amendment would result in the payment of post-war credits to many of the long-term sick and disabled. As we know, that is a class which is very frequently in financial difficulties. I do not suppose many of us are under any other impression but that they are a class which is frequently likely to suffer hardship. if anybody were in doubt, after hearing the very eloquent, and if I may say so the very persuasive, way in which the hon. Gentleman the Member for Sowerby (Mr. Houghton) put the case, and the way it was supported by the hon. Gentleman the Member for Islington, East (Mr. E. Fletcher), the hon. Gentleman the Member for Feltham (Mr. Hunter), and the hon. Gentleman the Member for Birmingham, Northfield (Mr. Chapman), that doubt would no longer exist. The hon. Member for Islington has a wealth of legal experience in handling industrial injury cases, and the other hon. Members have a wealth of experience in social constituency matters.

I am sure it is right that this is a category in which one finds many cases of hardship. Nevertheless, successive Treasury Ministers and Chancellors have refused to deal with cases of hardship at all. The reason is a perfectly simple one and is known to every hon. Member of the Committee. It is the difficulty of drawing the line. Whatever case one brings, there will always be cases left out which seem as hard to us as some of those which have been included. Some of those cases are very much harder than some of the cases where post-war credits are repaid, and successive Chancellors have said that it is impossible to draw a line, and that hardship should, therefore, not be adopted as a criteria. As I think my right hon. Friend said, either in the Budget debate or in moving the Second Reading of the Bill, the difficulty arises not so much in the cases one includes, but in the cases one leaves out.

Nevertheless, I think that there was an overwhelming desire that a start should be made with this problem if it was possible, and in a sense my right hon. Friend was performing an act of faith in doing that. He was responding to the wish of the House in the belief that he would not be pressed to extend the classes which he thought it was right to start on. I was grateful to the hon. Gentleman the Member for Sowerby for indicating that he thought the classes we had chosen were the priority classes, although he rightly urged the claims and the hardship of the people under discussion in the Amendment. My right hon. Friend did, however, say: I ask them not to press for any immediate extension or alteration of the classes who are to receive payment."—[OFFICIAL REPORT, 15th April, 1959; Vol. 603, c. 1039.] The first reason is that as soon as we move the borderline, there will be others.

The second reason is a matter to which the hon. Member for Sowerby referred, namely, that the Inland Revenue and its machine has had loaded on to it in this operation as much as it can manage for the time being. As the hon. Member, with his wide knowledge of the Inland Revenue staff problems, reminded us, very rightly, on Second Reading, these repayments will mean extensive overtime during the summer months in the Inland Revenue.

We hope, by the way we have handled this matter, to get at least the bulk of the credits—all except the difficult cases —repaid by the end of August. Then, as the hon. Member knows better than I do, one is almost on the autumn routine in the Inland Revenue offices. The Committee will realise that we are imposing a very heavy burden on the public servants in the Inland Revenue Department, which they are shouldering willingly. There is, however, a limit beyond which one cannot push them.

There is the other matter, to which the hon. Member referred, of the printing of the claim forms. I do not say that we should be the servants of the printing machine, but in the wish to respond to what was, obviously, the desire of the House, and in the light of the reception that these proposals got in the Budget debate, we have pushed on with the printing of the claim forms on the basis of my right hon. Friend's proposals. Indeed, the printing has now been completed and distribution has begun. It was necessary to do that if the forms were to be out in the post offices by 4th May and repayments were to start on 1st June.

I do not doubt that it would be possible to print supplemental forms dealing with other cases and, as I say, we should not regard ourselves as necessarily bound by the exigencies of our printing programme. Nevertheless, it would cause considerable difficulties and muddle to have additional forms coming in on to the post office counters. It would cause additional work in the Inland Revenue as the mistakes between the two forms are sorted out, and so on. On both those grounds, therefore—the fact that in response to what we believed, and what we have been led to understand, was the desire of the House that we should push on with this work and that we should do so even if it meant drawing, as the hon. Member for Northfield rightly put it, an arbitrary line—we thought it right to proceed in the way that we have done.

Having said that, I would mention two other minor points which the Committee will want to consider. The first is that the Amendment does not fit into the pattern of the Bill. Again, it is not necessarily conclusive, but it would be a little odd to write one special class of hardship category into the Bill when we were dealing with the other classes in a Statutory Instrument.

Mr. Houghton

How else can we do it?

Mr. Simon

I realise that this is a sensible and legitimate way of getting the matter discussed in Committee, and of course, the only way. I make no complaint. That is, however, a matter that the Committee will want to consider if it comes to deciding whether to press the Amendment to a Division. It would make legislative nonsense.

I am not going into the details, but there are, furthermore, technical defects in the Amendment. It excludes certain categories of person among the chronic sick whom we would wish to include if it were possible to do so. I need not go into that in detail at the moment.

Then, there is the question of the cost and the numbers likely to be involved. I ant advised that about 200,000 initial applicants would be involved and that this would entail a cost of between £7 and £8 million. The Committee will, therefore, see that it is much more than is involved in any of the other hardship cases. Indeed, it is more than my right hon. Friend could at present contemplate. He has made the remissions of taxation and the repayments of post-war credits that he proposed as generous as he thought right in the circumstances with the need to maintain a balance in the Budget and the limitation which necessarily must be put upon borrowing.

Mr. E. Fletcher

Can the hon. and learned Gentleman split up the £7 million as between sickness and industrial injury beneficiaries?

Mr. Simon

I am sorry; I cannot give the breakdown. If the hon. Member wishes to have the information, I can, perhaps, ask for it and write to him. In future years, one would expect 100,000 or 150,000 new cases each year, which would give an annual cost of between £3 and £6 million.

There is one other thing I ought to say before I sum up. The hon. Member for Sowerby was quite justified in claiming that the criterion and the condition here satisfies what, I think, the whole Committee has recognised as a necessary criterion: in other words, that it must. be some objectively assessable class. This class certainly falls into that category.

For the reasons I have given, I ask the hon. Member for Sowerby not to press his Amendment. Having said that, however, I repeat that this is obviously a class of person whose claims must excite the sympathy of anyone who knows anything of the suffering and needs of the long-term sick. My right hon. Friend is asking the House of Commons to give him power to extend the present classes for repayment by statutory Order and although I cannot commit him as to time or specifically as to any special class, I can say—and I hope this will meet the views which have been put forward in the Committee—that this is obviously one of the very early classes whose claims my right hon. Friend or any successor of his would consider.

Mr. Gordon Walker (Smethwick)

I am sorry about the reply—not its tone, but its content and substance—of the Financial Secretary to the Treasury, especially after his sympathetic and understanding opening words. On Second Reading, I gave a pledge that we would not improperly push these cases. We agreed that to pay hardship cases at all lines must be drawn, and that there must be people one side and the other of the lines. We said that if we did this at all, we would do it with great responsibility. The hon. and learned Gentleman will, I think, agree that we have done so. We have put forward only one case. A great many others could have been pressed. The one that we have put forward can be tested by objective standards, as the hon. and learned Gentleman has said.

The Amendment cannot be claimed to be the thin end of the wedge. We have put forward one case only. Owing to the machinery that has been chosen for carrying through further repayments, it appears to be impossible for the Opposition ever to make any other proposal. Repayment will be done, I imagine, by affirmative Order and it is impossible for us to make any other proposals. It is for the Government of the day to use the machinery of regulation. Therefore, there is nothing in the argument that this is the thin end of the wedge. As my hon. Friend the Member for Birmingham, Northfield (Mr. Chapman) pointed out, the specific class whose claims we are advancing merges closely into those already dealt with by the Chancellor.

We do not feel that there is much in the printing argument. Indeed, the hon. and learned Gentleman advanced a series of arguments, not one of which he regarded as conclusive in itself. Each one did not carry a great deal of weight. The hon. and learned Gentleman's main case was that the whole lot put together, no single one of which was conclusive, somehow added up to a case against the Amendment. Thds was, no doubt, due to the Financial Secretary's general sympathy towards the class of person, but that was what it amounted to. There is not one argument put forward by the hon. and learned Gentleman on which, taken by itself, he could have rested an argument that the Amendment should be refused.

It would be easy to print an extra form if one wanted to do so. That is one of the simple things which could be done. The hon. and learned Gentleman did not advance seriously his argument about the pattern of the Bill. We realise that we cannot have a Bill containing only one hardship case, but there was no other way in which we could bring the matter forward. We would willingly abandon the Amendment if the hon. and learned Gentleman gave a clear undertaking that its effect would be introduced in the regulations. He said that it would make legislative nonsense, but if the Amendment were carried or accepted by the hon. and learned Gentleman it would not make nonsense to the chronic sick, who, by general consent, are amongst those facing the gravest and most serious hardship.

4.30 p.m.

For all these reasons, we must insist upon the Amendment. We have not been given the assurance for which my hon. Friend the Member for Sowerby (Mr. Houghton) asked, that this proposal would be effected, if not immediately, quickly and certainly. We have only been told, in effect, that it will be sympathetically borne in mind and that it may be possible to do it one day. I find the total cost of three and a half times all the other hardship cases a little hard to believe. These must be tentative figures on all sides. The cost of any of these proposals must be extremely tentative, because the figures are not known.

Mr. Simon

If one can form an estimate of the number of likely applicants, all I do is to multiply that by the average figure of post-war credits. That was why I gave a spread. Before the right hon. Gentleman finally commits himself, I beg him to think before he presses the matter to a Division. I pointed out that my right hon. Friend the Chancellor of the Exchequer was performing an act of faith. We have taken a risk, perhaps an unjustifiable risk, in saying that we will deal with certain ascertainable classes even though there are other classes into which they merge. It will make it very difficult for any future Treasury Minister to make a concession in this sort of case, which, I believe, the whole House desired my right hon. Friend to make, if he is pressed on this sort of matter.

Mr. Gordon Walker

I agree that it would be a pity to divide on this, as there is broad agreement on the general merits of the Bill. None the less, unless we can get a firm assurance—because, so far, we have been given no real assurance at all—I do not think that we have any other way of showing how strongly we feel on this matter. If we divide, it will not be on the merits of the Bill, but to show the strength of our feelings.

We think that the Amendment could have been accepted. We do not think that the argument that this will make it impossible for future Chancellors to make this sort of concession is a powerful one. I realise the various difficulties, and said so on Second Reading. That is why we have been very responsible during this Committee stage. We have shown our sense of responsibility by putting forward only one case, and refusing to put forward many others that we could have advanced had we just been courting popularity. If all hon. Members will always behave as responsibly in opposition as we are behaving now there is no danger of future Chancellors being deterred from such an act as this, which we think important. But unless we get a firm assurance from the Financial Secretary we must divide the Committee, because we feel very strongly on this subject.

Mr. Ray Mawby (Totnes)

It would be a very great pity to divide on this point and so disturb the general agreement there now is on the new attitude towards the repayment of post-war credits. We can all agree on the points that have been put forward. We all know that any man who has been on sickness benefit for more than six months is a needy case, as, also, are the other categories that have been mentioned.

My hon. and learned Friend has said that many other people, both in groups and as individuals could be regarded as needy cases, but my right hon. Friend the Chancellor has said all the way through that these easily ascertainable groups that have already been chosen should be dealt with first. In that way, the administrative machinery will not be bogged down, as it would be if it had to deal with much larger numbers within a reasonably short time.

During the Second Reading debate, I sail: that I could not think of any other easily ascertainable group that could be brought in. This Amendment proves me wrong, but it does not alter the point I then made, that it would be folly to try to move this demarcation line, which will always be a problem. We shall always have difficulty with it, and those left on one side of the line will find things more difficult and painful than those on the right side of it.

If we were now further to move the line we might delay the repayment of those deemed to be the most important cases because the administrative machine could not cope with the additional claims. I would not like that to happen. In saying that the cases the Committee is now discussing will be taken into consideration as soon as it is found possible to deal with them, my hon. and learned Friend is moving forward.

There is so much theory about the whole thing. My right hon. Friend can only theorise about the numbers that will be involved even by the Order that is to be laid. Again, a certain amount of theorising is involved in determining how long it will take the Inland Revenue to deal with the different claimants. That depends very much on the number of claimants who still possess their certificates. If a large number have mislaid them, the theoretical view of the probable time the operation will take will go completely haywire.

I therefore ask the Committee to seek to resolve this matter by some means other than a Division. On all sides we have shown my hon. and learned Friend that we feel that these are desperate cases, and that we should take them into consideration as soon as we can without interfering with the rights of others. If we take my hon. and learned Friend's assurance on that now, we shall be serving the Committee better.

4.45 p.m.

Mr. John Diamond (Gloucester)

I agree that we should try to resolve this. Hon. Members are in a very difficult position. The question is how to resolve it. Do we resolve it by asking the Financial Secretary to say a little more, or do we resolve it by asking my right hon. Friend completely to forgo his feelings? No one wants to stop the Chancellor making the sort of gesture that has been made on this occasion. Equally, no Chancellor can claim, before a full discussion in this Committee, everything about the sincere feelings of each hon. Member. So long as what we are suggesting is not outside the framework or the spirit of the proposals, is not making a misshapen gesture out of this small Act but is rounding it off, one is really acting very responsibly in insisting that something should be paid to the category mentioned in the Amendment.

I shall not go happily into the Division Lobby. It would be a great mistake to divide the Committee when, with a little more understanding and co-operation we could agree in the interests of the people whom we are all anxious to serve. The hon. and learned Gentleman has said that he is putting them almost at the top of the list, but he will not say how near the top they are either in position or time. Our difficulty is that we do not control the Government's timetable, or the opportunities they give for discussion or action. The Financial Secretary has spoken with the greatest understanding and sympathy, and with the greatest desire to get the two sides of the Committee together. I appeal to him to say something a little more helpful than he has so far said.

Mr. Simon

I always find it very difficult to fail to respond to the appeals of the hon. Member for Gloucester (Mr. Diamond)—or, indeed, to the tone of the right hon. Gentleman's final reply, but I am sure that hon. Members will see that I am going as far as any Minister standing at this Box can go in these circumstances. Obviously, I cannot commit the Chancellor to a payment of £8 million which cannot be made at the moment. It must be fed into the machine and cannot take place at any particular time or in priority to other expenditure. I am sure that hon. Members will appreciate that.

What I do say is that we are taking power, and the House obviously approved that we should take it, to add different classes by regulation. As I think I have made quite plain, my right hon. Friend will consider very carefully what has been said today about what is a clearly definable class and one that contains a high degree of what one ordinarily calls hardship and financial need. Obviously, when one has to consider extending the classes for repayment this one must rank very high indeed.

Nobody has suggested any other class that ranks higher. I do not say that, on scrutiny, there may not be such another class, but in the absence of suggestions the class mentioned in the Amendment must rank very high indeed for repayment. I hope that the Committee will see that in saying what I have said I have gone as far as any Financial Secretary is entitled to go, if not further.

Mr. George Chetwynd (Stockton-on-Tees)

What the Financial Secretary has said goes a long way towards satisfying me, at least. I said on Second Reading that I could not think of any other clearly-defined category of people who could come within the scope of the Bill, but I have been proved wrong by this Amendment. I doubt whether the cost of accepting this proposal would be as high as the hon. and learned Gentleman thinks, as I am quite certain that quite a large number of those who qualify because of six months' sickness will, at the same time, qualify by the 12-week period on National Assistance. Taking that fact into account, is the net figure still £8 million? If it is, I find it extremely difficult to understand.

Will not the Financial Secretary say that when the next move is made for the repayment of post-war credits this class of people will have first priority? If he could say that, I think that it would satisfy all my right hon. and hon. Friends. I understand that these regulation-making powers are sought so that we shall not have to wait for another Budget or another Bill before taking any further action. Can we infer from that that there is likely to be another "dishing out" of post-war credits before this time next year? Can we also infer that when that time comes this category will be put at the top of the list? To hear that from the hon. and learned Gentleman would at least satisfy me.

Sir James Duncan (South Angus)

should like to reinforce the pleas made to the hon. Member for Sowerby (Mr. Houghton) to withdraw his Amendment. We are all agreed on the general principle. We are all agreed that this class deserves the earliest possible repayment. And as far as I could gather from my hon. and learned Friend, he has gone as far to agree with the rest of us as any Minister in his position could reasonably be expected to go.

The right hon. Member for Smethwick (Mr. Gordon Walker) seemed to assume that if his hon. Friends gave way on this there would be no further opportunity for discussion of this class, as further action would be taken by regulation. I think that he is mistaken in that assumption. We have the ordinary process of Parliamentary Questions and of Adjournment debates. There is the Queen's Speech, and the next Budget debate. Opportunities can be found for raising, and pressing, this matter at all periods of the Parliamentary year. I do not think that there is any force in that argument.

The hon. Member for Sowerby himself appreciated the present administrative difficulty of extending the repayment of post-war credits beyond those in the various age groups, the widows and those in the existing hardship classes. I understand that 1,400,000 people may be able to claim, plus the 300,000 who will be covered by a normal year's payment—a total of 1,700,000, and that the cost will he about £71 million.

That is a very big operation for the Treasury to undertake. Although I did not take down his words—because I did not think that there would be any question of a Division, nor did I intend to speak— got the impression from the hon. Member for Sowerby that he would be satisfied if he got an assurance that the class of people mentioned in the Amendment would be dealt with as soon as the Treasury could do so, or would be dealt with in the next instalment of repayments on hardship grounds.

I believe that the hon. Gentleman is satisfied. It is the right hon, Member for Smethwick who does not seem to be. I hope that the intervention of the hon. Member for Gloucester (Mr. Diamond) will force the right hon. Gentleman to change his mind, because both sides of the Committee agree that we want to get this done as soon as possible and as soon as the administrative machine and the economic situation of the country can afford the extra money.

I earnestly appeal to the hon. Member for Sowerby and to the right hon. Gentleman to change their minds and not force a Division.

Mr. Norman Cole (Bedfordshire, South)

I hope that we shall not find cause to spoil the happy proceedings which we had on Second Reading last Wednesday, when the House was united on something that we all want. The Amendment is concerned with two classes of people who are seriously ill or in-

capacitated, those who, for 26 weeks, have been receiving National Health benefit and those in receipt of 100 per cent. industrial injuries benefit. To put it shortly, but sympathetically, I would say to the Financial Secretary that the sooner provision is made to pay these people the post-war credits to which they are due the better. It would be better for it to be done now than in a year's time.

Mr. David Jones (The Hartlepools)

listened to the last speech of the Financial Secretary in which he said that he had gone as far as a Financial Secretary could go. I wonder whether, however, between now and Report, he will consult the Chancellor and make a much firmer statement than the one he has made before the Bill becomes law.

Mr. Ede (South Shields)

It will be quite easy to make such a statement, because there will be no Report stage.

It is about time that we said frankly that we are getting tired of the way in which some Government Departments present Bills to the House and being told that the Parliamentary Secretary or Financial Secretary in charge of them can make no concession during the debate since they have their orders and dare not move one way or the other. There was a Financial Secretary who once made a concession without orders. That was in the days when the right hon. Member for Woodford (Sir W. Churchill) was Chancellor of the Exchequer. He had his reward—he became a peer.

Question proposed, That those words be there inserted:—

The Committee divided: Ayes 191, Noes 230.

Division No. 86.] AYES [4.54 p.m
Ainsley, J. W. Brown, Rt. Hon. George (Belper) Dodds, N. N.
Albu, A. H. Brown, Thomas (Ince) Ede, Rt. Hon. J. C.
Allen, Arthur (Bosworth) Burke, W. A. Edelman, M.
Bacon, Miss Alice Burton, Miss F. E. Edwards, Rt. Hon. Ness (Caerphilly)
Baird, J. Butler, Herbert (Hackney, C.) Edwards, Robert (Bilston)
Balfour, A. Callaghan, L. J. Evans, Albert (Islington, S.W.)
Bellenger, Rt. Hon. F. J. Castle, Mrs. B. A. Fernyhough, E.
Bence, G. R. (Dunbartonshire, E.) Champion, A. J. Finch, H. J. (Bedwellty)
Benson, Sir George Chapman, W. D. Fitch, A. E. (Wigan)
Beswick, Frank Chetwynd, G. R. Fletcher, Eric
Bevan, Rt. Hon. A. (Ebbw Vale) Clunie, J. Forman, J. C.
Blackburn, F. Collick, P. H. (Birkenhead) Fraser, Thomas (Hamilton)
Blenkinsop, A. Craddock, George (Bradford, S.) Gaitskell, Rt. Hon. H. T. N.
Blyton, W. R. Cronin, J. D. George, Lady Megan Lloyd (Car'then)
Bottomley, Rt. Hon. A. G. Dalton, Rt. Hon. H. Gibson, C. W.
Bowden, H. W. (Leicester, S.W.) Darling, George (Hillsborough) Gooch, E. G.
Bowles, F.G. Davies, Ernest (Enfield, E.) Gordon Walker, Rt. Hon. P. C.
Boyd, T. C. Davies, Harold (Leek) Greenwood, Anthony
Braddock, Mrs. Elizabeth de Freitas, Geoffrey Grenfeil, Rt. Hon. D. R.
Broughton, Dr. A. D. D. Diamond, John Grey, C. F.
Griffiths, David (Rother Valley) McCann, J. Short, E. W.
Griffiths, William (Exchange) Mclnnes, J, Silverman, Julius (Aston)
Hale, Leslie McKay, John (Wallsend) Simmons, C. J. (Brierley Hill)
Hall, Rt. Hn. Glenvil (Colne Valley) McLeavy, Frank Skeffington, A. M.
Hamilton, W. W. MacPherson, Maloolm (Stirling) Slater, Mrs. H. (Stoke, N.)
Hannan, W. Mann, Mrs. Jean Snow, J. W.
Harrison, J. (Nottingham, N.) Marquand, Rt. Hon. H. A. Soskice, Rt. Hon. Sir Frank
Hayman, F. H. Mason, Roy Sparks, J. A.
Healey, Denis Mayhew, C. P, Stewart, Michael (Fulham)
Herbison, Miss M. Mellish, R. J. Stonehouse, John
Hewitson, Capt. M. Mikardo, Ian Stones, W. (Consett)
Hilton, A. V. Mitchison, G. R. Strachey, Rt. Hon. J.
Hobson, C. R. (Keighley) Monslow, W. Strauss, Rt. Hon. George (Vauxhall)
Holman, P. Moody, A. S. Stross, Dr. Barnett(Stoke-on-Trent, C.)
Holmes, Horace Morris, Percy (Swansea, W.) Summerskill, Rt. Hon. E.
Houghton, Douglas Morrison, Rt. Hn. Herbert(Lewis'm, S.) Swingler, S. T.
Howell, Charles (Perry Barr) Mort, D. L. Sylvester, G. O.
Howell, Denis (AH Saints) Moss, R. Taylor, Bernard (Mansfield)
Hoy, J. H. Moyle, A. Thomas, Iorwerth (Rhondda, W.)
Hughes, Cledwyn (Anglesey) Noel-Baker, Francis (Swindon) Thomson, George (Dundee, E.)
Hughes, Emrys (S. Ayrshire) Oliver, G. H. Timmons, J.
Hughes, Hector (Aberdeen, N.) Oswald, T. Tomney, F.
Hunter, A. E. Owen, W. J. Ungoed-Thomas, Sir Lynn
Hynd, H. (Acorington) Padley, W. E. Usborne, H. C.
Irving, Sydney (Dartford) Pannell, Charles (Leeds, W.) Viant, S. P.
Isaacs, Rt. Hon. G. A. Pargiter, G. A. Warbey, W. N.
Jay, Rt. Hon. D. P. T. Paton, John Watkins, T. E.
Jeger, George (Goole) Pearson, A. Weltzman, D.
Johnson, James (Rugby) Peart, T. F. Wells, Percy (Faversham)
Jones, Rt. Hon. A. Creech(Wakefield) Pentland, N. White, Mrs. Eirene (E. Flint)
Jones, David (The Hartlepools) Plummer, Sir Leslie Wllkins, W. A.
Jones, Elwyn (W. Ham, S.) Prentice, R. E. Williams, Rev. Llywelyn (Ab'tlliery)
Jones, Jaok (Rotherham) Price, J. T. (Westhoughton) Williams, Rt. Hon. T. (Don Valley)
Jones, J. Idwal (Wrexham) Price, Philips (Gloucestershire, W.) Williams, W. R. (Openshaw)
Jones, T. W. (Merioneth) Probert, A. R. Willis, Eustace (Edinburgh, E.)
Kenyon, C. Rankin, John Wilson, Rt. Hon. Harold (Huyton)
Key, Rt. Hon. C. W. Redhead, E. C. Winterbottom, Richard
King, Dr. H. M. Reeves, J. Woodbum, Rt. Hon. A.
Lawson, G. M. Reid, William Woof, R. E.
Lee, Frederick (Newton) Reynolds, G. W. Younger, Rt. Hon. K.
Lee, Miss Jennie (Cannock) Rhodes, H. Zilliacus, K.
Lindgren, G. S, Roberts, Albert (Normanton)
Lipton, Marcus Ross, William TELLERS FOR THE AYES
Logan, D. G. Royle, C. Mr. G. H. R. Rogers and
McAlister, Mrs. Mary Shinwell, Rt. Hon. E. Mr. Deer.
Agnew, Sir Peter Cary, Sir Robert George, J. C. (Pollok)
Aitken, W. T. Channon, H. P. G. Gibson-Watt, D.
Amery, Julian (Preston, N.) Cole, Norman Glover, D.
Arbuthnot, John Conant, Maj. Sir Roger Glyn, Col. Richard H.
Armstrong, c. W. Cooper-Key, E. M. Godber, J. B.
Ashton, H. Cordeaux, Lt.-Col. J. K. Goodhart, Philip
Atkins, H. E. Corfield, F. V. Cough, C. F. H.
Baldwin, Sir Archer Courtney, Cdr. Anthony Gower, H. R.
Balniel, Lord Craddock, Beresford (Spelthorne) Graham, Sir Fergus
Barber, Anthony Crosthwaite-Eyre, Col. O. E. Grant, Rt. Hon. W. (Woodside)
Barlow, Sir John Crowder, Sir John (Finchley) Grant-Ferris, Wg Cdr. R. (Nantwich)
Barter, John Crowder, Petre (Ruislip—Northwood) Green, A.
Batsford, Brian Cunningham, Knox Gresham Cooke, R.
Baxter, Sir Beverley Currie, G. B. H. Grosvenor, Lt.-Col. R. G.
Beamish, Col. Tufton Davidson, Viscountess Gurden, Harold
Bell, Philip (Bolton, E.) Davies, Rt. Hn. Clement(Montgomery) Hall, John (Wycombe)
Bennett, F. M. (Torquay) D'Avigdor-Goldsmid, Sir Henry Harris, Frederic (Croydon, N.W.)
Bennett, Dr. Reginald de Ferranti, Basil Harris, Reader (Heston)
Bevins, J. R. (Toxteth) Dodds-Parker, A. D. Harrison, A. B. C. (Maldon)
Bidgood, J. C. Donaldson, Cmdr. C. E. McA. Harvey, Sir Arthur Vere(Macclesf'd)
Blggs-Davison, J. A. Doughty, C. J. A. Harvey, John (Walthamstow, E.)
Bingham, R. M. Drayson, G. B. Hay, John
Birch, Rt. Hon. Nigel du Cann, E. D. L. Heald, Rt. Hon. Sir Lionel
Bishop, F. P. Duncan, Sir James Heath, Rt. Hon. E. R. G.
Black, Sir Cyril Eccles, Rt. Hon. Sir David Henderson, John (Cathcart)
Body, R. F. Eden, J, B. (Bournemouth, West) Henderson-Stewart, Sir James
Bossom, Sir Alfred Errington, Sir Eric Hicks-Beach, Maj. W. W.
Boyd-Carpenter, Rt. Hon. J. A, Erroll, F. J. Hill, Rt. Hon. Charles (Luton)
Boyle, Sir Edward Farey-Jones, F. W. Hill, Mrs. E. (Wythenshawe)
Braine, B. R. Fell, A. Hill, John (S. Norfolk)
Braithwaite, Sir Albert (Harrow, W.) Finlay, Graeme Hinchingbrooke, Viscount
Bromley-Davenport, Lt.-Col. W. H. Fisher, Nigel Hirst, Geoffrey
Brooman-White, R. C. Fort, R. Holland-Martin, C. J.
Browne, J. Nixon (Craigton) Freeth, Denzil Holt, A. F.
Burden, F. F. A. Galbraith, Hon. T. G. D. Hornby, R. P.
Butler, Rt. Hn. R. A.(Saffron Walden) Gammans, Lady Hornsby-Smith, Miss M. P.
Carr, Robert Garner-Evans, E. H. Horobin, Sir Ian
Howard, Gerald (Cambridgeshire) Marlowe, A. A. H. Smithers, Peter (Winchester)
Howard, Hon. Greville (St. Ives) Marshall, Douglas Smyth, Brig. Sir John (Norwood)
Hudson, W. R. A. (Hull, N.) Mawby, R. L. Speir, R. M.
Hughes-Young, M. H. C. Maydon, Lt.-Comdr, S. L. C. Stevens, Geoffrey
Hulbert, Sir Norman Milligan, Rt. Hon. W. R. Steward, Harold (Stockport, S.)
Hurd, Sir Anthony Molson, Rt. Hon. Hugh Steward, Sir William (Woolwich, W.)
Hutchison, Michael Clark(E'b'gh, S.) Mott-Radclyffe, Sir Charles Stoddart-Scott, Col. Sir Malcolm
Hyde, Montgomery Nabarro, G. D. N. Storey, S.
Irvine, Bryant Godman (Rye) Nicholls, Harmer Studholme, Sir Henry
Jenkins, Robert (Dulwich) Nicholson, Sir Godfrey (Farnham) Summers, Sir Spencer
Jennings, J. C. (Burton) Noble, Michael (Argyll) Sumner, W. D. M. (Orpington)
Jennings, Sir Roland (Hallam) Nugent, G. R. H. Teellng, W.
Johnson, Dr. Donald (Carlisle) Oakshott, H. D. Temple, John M.
Johnson, Eric (Blackley) O'Neill, Hn. Phelim (Co. Antrim, N.) Thomas, Leslie (Canterbury)
Jones, Rt. Hon. Aubrey (Hall Green) Orr, Capt. L. P. S. Thomas, P. J. M. (Conway)
Kerby, Capt. H. B. Page, R. G. Thompson, Kenneth (Walton)
Kimball, M. Pannell, N. A. (Kirkdale) Thompson, R. (Croydon, S.)
Lancaster, Col. C. G. Partridge, E. Thorneycroft, Rt. Hon. P.
Leavey, J. A. Peel, W. J. Thornton-Kemsley, Sir Colin
Leburn, W. G. Peyton, J. W. W. Tiley, A. (Bradford, W.)
Legge-Bourke, Maj. E. A. H. Pickthorn, Sir Kenneth Tilney, John (Wavertree)
Legh, Hon. Peter (Petersfield) Pike, Miss Mervyn Tweedsmuir, Lady
Lindsay, Hon. James (Devon, N.) Pilkington, Capt. R. A. Vane, W. M. F.
Lindsay, Martin (Solihull) Pitt, Miss E. M. Vickers, Miss Joan
Linstead, Sir H. N. Pott, H. P. Vosper, Rt. Hon. D. F.
Lloyd, Maj. Sir Guy (Renfrew, E.) Powell, J. Enoch Wade, D. W.
Longden, Gilbert Prior-Palmer, Brig. O. L. Wakefield, Edward (Derbyshire, W.)
Loveys, Walter H. Ramsden, J. E. Wakefield, Sir Wavell (St. M'lebone)
Low, nt. Hon. Sir Toby Redmayne, M. Wall, Patrick
Lucas-Tooth, Sir Hugh Rees-Davies, W. R. Ward, Dame Irene (Tynemouth)
McAdden, S. J. Remnant, Hon. P. Watkinson, Rt. Hon. Harold
Macdonald, Sir Peter Renton, D. L. M. Webster, David
McLaughlin, Mrs. P. Ridsdale, J. E. Whitelaw, W. S. I.
Maclay, Rt. Hon. John Robertson, Sir David Williams, R. Dudley (Exeter)
McMaster, Stanley Robinson, Sir Roland (Blackpool, S.) Wills, Sir Gerald (Bridgwater)
MacLeod, John (Ross & Cromarty) Roper, Sir Harold Wilson, Geoffrey (Truro)
Macmillan, Maurice (Halifax) Ropner, Col. Sir Leonard Wood, Hon. R.
Macpherson, Niall (Dumfries) Scott-Miller, Cmdr. R. Yates, William (The Wrekin)
Maddan, Martin Sharples, R. C.
Manningham-Buller, Rt. Hn. Sir R. Shepherd, William TELLERS FOR THE NOES:
Markham, Major Sir Frank Simon, J. E. S. (Middlesbrough, W.) Colonel J. H. Harrison and
Mr. Bryan.

Motion made, and Question proposed, That the Clause stand part of the Bill.

Mr. Houghton

I wonder whether the Financial Secretary has given further consideration to the matter which was raised by several hon. Members during the Second Reading debate, relating to arrears of unpaid tax outstanding which are being set off in many cases against post-war credits when they are repaid? The hon. and learned Gentleman said that we must not exaggerate this problem and I do not exaggerate it, but, by an unhappy coincidence, one of the most grievous cases of all came into my hands the other day. It was a case in which almost everything seems to have gone wrong. When circumstances of this sort arise, the Chancellor should give directions for sympathetic treatment.

This case concerns a man who has now reached 65 years of age. He had two lots of post-war credits, one his own, and the other belonging to his son, who was killed in the war in 1945. He has held his late son's post-war credits for fourteen years. Apparently, when the son was killed the certificates were reissued in the name of the father. Now, on attaining the age of 65, the father has asked for repayment of the post-war credits left by his son.

When he asked for the repayment of £29 14s. he was told that only £14 15s. was due, first, because there had been two certificates in one year, one for £9 18s. 3d. and the other for 17s. 6d. and one replaces the other. The smaller replaces the bigger, as it nearly always does. He was also told that his son owed £5 os. 9d. arrears of tax.

This is a shocking case. How can this man deal with an alleged tax arrear of £5 os. 9d. due from his late son who was shot down over Germany in 1945? I ask the Committee, how can the father clear up a matter of this kind? As for the issue of duplicate certificates, that, no doubt, was a grievous error on someone's part, or one certificate was issued without it being made clear that the previous one was no longer valid. I impress on the Financial Secretary the need for holders of post-war credits to know exactly what they have to their credit before the time of repayment comes.

Many post-war creditors have still to wait a long time, unless the Chancellor is to accelerate the repayment on one ground or another. It is not fair to ask taxpayers to rummage about among old papers, if they have still kept them—who, after all, wants to keep Income Tax papers any longer than is necessary?—to find out what happened fourteen, fifteen, sixteen, or twenty years ago. Any doubts or difficulties of this kind—alleged arrears, duplicate certificates, and so on—should be cleared up. Otherwise, there will be constant difficulty at the point of repayment when expectations are at their highest and disappointment will be felt most acutely.

5.0 p.m.

Any of us might be told, years before post-war credits are due on present prospects, "You have not as much as you thought you had. You owe a bit of money which you never paid. If you like to go into that we shall do our best to satisfy you". We could take that situation more calmly now than when we arrive at the date when repayment is due and when, probably weeks or months in advance, we have decided what to do with the money, to put it in the Post Office, or in a building society, or to buy something we have wanted for a long time. To find then that one is unexpectedly short would be extremely disappointing. I hope that the Financial Secretary will take this fresh appeal very seriously indeed. This Clause puts in the hands of the Chancellor power to lay regulations proposing further payments of post-war credits either by reference to hardship qualification or by reference to age.

I was rather interested to notice the other day that the Prime Minister announced, at an apparently very enthusiastic Conservative youth meeting, that he had recently drawn his post-war credits. He said that his right hon. and hon. Friends had to look on the ageing, souring countenances of my right hon. and hon. Friends on this side of the Committee and he felt sorry for his right hon. and hon. Friends having that sort of outlook every day. But is there anything very inspiring about the benches opposite just now? I do not see them packed with dewy-eyed youths and adventurers —those who are marching to the future with a fixed look on their faces. I think that a meeting of Conservative youth is a singularly inappropriate moment for the Prime Minister to put himself in pers- pective by saying that he has just drawn his post-war credits.

Mr. Ede

I have not drawn mine.

Mr. Houghton

I would not like to speculate on the reasons why my right hon. Friend has not been able to do so. Probably he is unable to find proof of age. I should not be a bit surprised if that were so, because my right hon. Friend has the secret of eternal youth.

This Clause gives to the Chancellor the future responsibility for the repayment of post-war credits. A beginning has been made and we welcome it. The House of Commons has had very little power up to now over the rate of repayment of postwar credits. It has found it singularly difficult to get any debate on the subject at all. There have been frequent attempts to do so on Finance Bills, but they have failed because there was apparently nothing to which an Amendment could be moved. Procedural difficulties have undoubtedly stood in the way.

I hope that the Financial Secretary will not take it too much to heart that we divided a few minutes ago on the one opportunity that we had of registering opinion on the adequacy of the hardship categories. It is always extremely difficult to divide against the hon. and learned Gentleman on anything, because he is so gracious and generous in all his references to his opponents. There are, however, occasions when even under such engaging blandishments it is necessary for the Opposition to register their opinion. After all, what is one Division more or less when most hon. Members are proud of their Division record?

Mr. Gerald Nabarro (Kidderminster)

I rise to draw the attention of my hon. and learned Friend under Clause 1 (2) to a very small but not undeserving body of people who hold post-war credits and who have the intention of permanently emigrating from this country. I must confess that I did not think of this matter until a constituent, a lady aged 54, wrote to me on the day following the Budget, drawing attention to the fact that she was leaving for Canada in a few weeks—

Mr. Jack Jones (Rotherham)

No wonder.

Mr. Nabarro

Does the hon. Gentleman wish to intervene?

Mr. Jack Jones

I said "No wonder".

5.15 p.m.

Mr. Nabarro

The lady concerned has been a member of the Kidderminster Conservative Association for very many years, so it is unlikely.

This lady wrote to me pointing out that her husband and herself were emigrating permanently to Canada and that under the recent Treasury relaxations concerning transfer of sterling and conversion into Canadian dollars, she would be able to take with her a maximum of £5,000, instead of the former limit imposed of only £1,500. This lady has not that sum of capital, so far as I am aware.

I make the point to my hon. and gallant Friend that the Treasury thought it desirable recently to make this important dispensation in relaxation in the amount of sterling that may be freely converted to American or Canadian dollars in the case of a permanent emigrant, and I should have thought that in the circumstances of a relatively minor sum of money involved, such as the payment of post-war credits to men and women permanently emigrating, although administratively difficult, would, in the long term, save administrative work in the Treasury and other Government Departments.

I ask my hon. and learned Friend what will be the situation a few years' hence if someone who goes from this country to live in North America makes application for repayment of relatively small sums, such as £25, £50 or £75. I ask him to realise the amount of work involved, particularly if that person has no banking account in this country or in North America. in ensuring that he has the money.

I am sure that my hon. and learned Friend would not be able to ascertain what a relaxation of this kind would cost in a full year, but I say to the Committee with confidence that there cannot be many women old enough to possess post-war credits who intend to emigrate permanently. I should have thought that as an act of graciousness, and particularly in view of the fact that under this Bill it is intended to make Orders to be laid before the House by the Treasury authorising repayments to certain classes of persons, we should do well to consider the conditions of persons emigrating permanently from the United Kingdom and facilitate the repayment of post-war credits due to them before the date of their departure.

Mr. Diamond

I am encouraged by what the Financial Secretary said earlier about finding it difficult to resist an appeal from me to rise in support of my hon. Friend the Member for Sowerby (Mr. Houghton) and to particularise in regard to the suggestions which he made.

I say straight away, in relation to what the Prime Minister said, that I find myself in a very different position. During our financial debates I am always astounded by the look on the face of the Financial Secretary which implies generosity and flexibility of mind and by the ever-smiling countenance of the Economic Secretary which is of a kind to suggest that one has only to make one's point to have it accepted and acted upon. I would not like to go beyond the Front Bench opposite.

Mr. Nabarro

Why not?

Mr. Diamond

As I am not a member of the Kidderminster Conservative Association, I do not have to escape to Canada.

The Financial Secretary, in his Second Reading speech, referred to this difficult question of the difference between the post-war creditor and the post-war credit certificate holder. I gather that there is a subtle distinction. The post-war certificate holder is a person who has a certificate and who is led to expect by the amount on the certificate that that is the amount that he or she will receive. A post-war creditor is a person who is a creditor for the amount which is on the certificate less the amount which has been deducted for arrears in some other way.

Obviously, everyone expects that there should be repayment of the amount shown on the face of the certificate. I am the last person to be in a position to make this case strongly because I understand only too well the difficulties of the Inland Revenue and how it comes about that a second certificate has to be given on occasion and how it was virtually impossible in the earlier stages to delay the certificate until the amount of tax had been finally agreed and settled. I understand that, but I also understand, as we all understand, the great feeling that is aroused, especially in cases of inheritance, when someone has inherited from the original holder who has died, and finds for the first time that there is a deficiency between the amount shown on the certificate and the amount to be repaid.

None of us has to look far to find an example. I would quote a letter from an inspector of taxes dated 17th April, which says that my constituent Mr. X died on 10th September, 1946… Notices for the two later years"— that is, for 1944–45 and 1945–46— were issued on 30th July, 1947 "— nearly twelve months after the death. No appeal or other objection was made against any of the assessments. Of course, no appeal was made, because the assessed person was by that time nine months' dead. It is most unlikely that in those circumstances, since this was a modest income and a person without great knowledge of Income Tax affairs, that the widow or anybody else would be in a position or have the necessary knowledge to object to any assessment.

I am asking, therefore, for two things. I do not know whether the Financial Secretary could grant more than I ask, but I do not ask him to limit it. I do not ask for anything different from what my hon. Friend the Member for Sowerby asked should be done. I do not want anything to happen to burden the Revenue in such a way that there will be delay in payments of those post-war creditors who are to receive payment straight away and for whose convenience we are rushing through this provision as fast as we reasonably can.

For those who are to receive payment straight away I ask, first, as a matter of administration and nothing else, which I am sure the Financial Secretary will grant, that in every case where the amount to be repaid is less than the amount appearing on the certificate there shall be a full explanation given at the time, showing details of the four or five years' assessments in question and the arrears deducted.

I cannot imagine that that is very difficult. The Financial Secretary told us there are few cases, and that means that only a small proportion of those will be dealt with now. It cannot be a difficult question. The Inland Revenue has all the papers and assessments. At all events, if this were done it would lessen the blow and would meet a good deal of the difficulty that arises through the expectation of something more than will actually be repaid.

The second thing for which I ask is a matter of an ex-statutory concession. There are many such concessions already. It is only a matter of administrative action. The Financial Secretary knows that it is the practice to publish a list of them from time to time and he can easily add to that list without troubling the House of Commons. In those cases where post-war credits are inherited there are circumstances in which the post-war creditor, the original holder, the original taxpayer, might have been in a position to deal with the assessment and to find out whether tax arrears were properly assessed or not, but where the inheritor succeeds to the post-war credits obviously the inheritor is probably unlikely to be able to deal with it. It comes as a complete shock. Generally, it is a case of a widow such as I have quoted. In those cases I submit that the Financial Secretary should agree that no time-limit should be imposed against the re-opening of the assessment.

In addition to all the details of the assessment being given in those cases where it was quite impossible in normal circumstances for the widow to have objected in time, she should not be penalised by not having had the knowledge to object in time. In many cases the Revenue could rely upon the passage of time and refuse to open an assessment, but this would be unfortunate in these cases. This concession would cost the Revenue absolutely nothing. It would merely give an opportunity to the taxpayer's inheritor to do what was necessary so that the right figure might be arrived at. These are simple requests to help smooth the way and I hope that the hon. and learned Gentleman will give them consideration.

Mr. Cole

I, too, would like to ask my hon. and learned Friend the Financial Secretary for his consideration of the points made about the worrying matter of the post-war credit certificates not representing what is actually due. My chief concern, as expressed on Second Reading, and again today by the hon. Member for Sowerby (Mr. Houghton), is to try in some way to palliate or lessen the disappointment of people who find that they are not entitled to what the certificate had led them to believe.

I was glad to hear my hon. and learned Friend say on Second Reading that the number of these cases should not be exaggerated, but that number has no significance to a person who is a case in point. I am most anxious that my hon. and learned Friend, somehow or other, should sound the alarm about this matter without creating alarm among those to whom this correction of the face value of the certificate does not apply. There should be some way of awakening people to this possibility. We are glad that the Government are making this repayment of post-war credits. Since rapid progress is being made, this matter of the face value of the certificate is of great importance. I believe that the Inland Revenue would be greatly helped if some way could be found to deal with it before actual cases arise.

I would ask my hon. and learned Friend to go into the possibility of adopting some method. This difficulty springs from the laudatory action of the Inland Revenue, when post-war credit certificates were first issued, in putting something by way of a certificate into the hands of a creditor as soon as possible. It now appears that that good intention may come back on the Inland Revenue and give it more work, and create disappointment among certificate holders. I am sure that, with all the skill and brains available in the Civil Service, some way can be found to lessen this blow and to avoid people finding at the last minute, and not at a reasonable time beforehand, how they stand. The faster we go in paying post-war credits the larger and more imminent the problem becomes. I want to impress that fact upon my hon. and learned Friend.

Mr. Simon

Five points arise on the Question, "That the Clause stand part of the Bill". The first was raised by the hon. Member for Sowerby (Mr. Houghton), the hon. Member for Gloucester (Mr. Diamond) and my hon. Friend the Member for Bedfordshire, South (Mr. Cole). It arises from this difficult matter of arrears. Since Second Reading, my right hon. Friend the Chancellor has gone into the matter, as he promised. In saying that the dimensions of the problem should not be exaggerated I was, of course, echoing the words of the hon. Member for Sowerby on Second Reading. I find that these cases constitute about 2 per cent. of the total. Therefore, what we both said fairly represents the dimensions of the problem. The amount of money involved may be about £2 million to £3 million in all.

My right hon. Friend considered very carefully whether any concession in the way of repayment of the face-value of the credits could be undertaken. The analogy was put of the remission of tax arrears owed by Service men at the end of the war. That analogy is not an exact one, because that was a remission of a debt owed to the Exchequer. This is the repayment of a sum which, ex hypothesi, was never paid.

5.30 p.m.

The Committee knows all the circumstances in which this situation arose, in which the amount shown on the face of the certificate differs from the amount due to the creditor. Generally speaking, it was due to the fiscal system in force during the first two years. There were other cases where the taxpayer had changed his job. There were even some cases where he had taken evasive action and left arrears of tax. One must recognise that there was the odd case where the mistake was that of the Inland Revenue, but the Committee will recognise that the Inland Revenue is manned by human beings, and that, therefore, mistakes are hound to occur. Also, it should be remembered that the Inland Revenue was working under great pressure during the war years, with an extremely depleted staff.

My right hon. Friend, having, gone into the matter with great care and sympathy, feels that this is not a case where it would be proper to say that the amount shown on the face of the certificate should be repaid, notwithstanding the warning on the back of the certificate, which I read out to the House during the Second Reading debate. The reasons are as follow. The first reason is that in cases where the credit has already been repaid, which are over one-third of the whole, we have restricted repayment, and it would be impracticable to reopen those cases. Secondly, in many cases no doubt the arrear was not the fault of the taxpayers but in others, the odd cases, it must have been due to his negligence and, in the minority of cases, even to wilful evasive action or default on the part of the taxpayer.

The third is really the conclusive reason, as I am sure the Committee will agree. It is that we ought not to repay public money amounting to the substantial sum I mentioned, which has never been received. Therefore, with every good will, my right hon. Friend felt that this was a measure that could not be countenanced.

The hon. Gentleman the Member for Gloucester was reasonable in asking that where there is this discrepancy a full explanation should be given by the Inland Revenue. That is an undertaking which I am prepared to give. He also asked for an extra-statutory concession where We post-war credit is inherited. I do not want to commit myself on that point until I have looked into the legal position, because if the Act of Parliament says that the matter is concluded then it may be far beyond the proper limits of the extra-statutory concessions, and we have a responsibility in these matters to the Public Accounts Committee, and, through it, to the House. However, I can say that the Inland Revenue will give special consideration to the case where the assessment for the post-war credit year is disputed, whether it is an inherited case or not.

The third point was raised by my hon Friend the Member for Kidderminster (Mr. Nabarro), that of the permanent emigrants. All I can properly say is that when consideration is given to extending the classes for repayment that class will be considered in the light of his observations.

Mr. Nabarro

I am very much obliged.

Mr. Simon

The fourth matter that seemed to me to arise only remotely on the Question, "That the Clause stand part of the Bill" was that of the countenances of my hon. Friend the Economic Secretary and myself and how far we were dewey-eyed, so perhaps I can be forgiven if I do not dwell further on that point.

I will refer, lastly, to what was said by the hon. Gentleman the Member for Sowerby. Of course, I do not take it amiss personally that the previous Amendment was pressed to a Division. I think that it was unfortunate for the reasons I gave, but I should like to say how grateful I am for the way that the Bill has been received and for the expedition which the Committee is according it.

Mr. Diamond

May I say how grateful I am to the Financial Secretary for having listened so sympathetically to what was said? I promise not to ask him for anything more for the rest of today.

Mr. E. Fletcher

May I ask a question arising out of the Financial Secretary's last few remarks? If the hon. and learned Gentleman comes to the conclusion that he can make what he calls an extra-statutory concession, will he make it known in the House and elsewhere in general terms, so that everyone can be aware of it?

Mr. Simon

Yes, Sir.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Clauses 2 to 4 ordered to stand part of the Bill.