HC Deb 11 June 1959 vol 606 cc1277-301

The following section shall be added to Part VIII of the Income Tax Act, 1952:— 228A. If the claimant proves that during the whole of the year of assessment—

  1. (a) he has been in receipt of a war disablement pension or an industrial injury pension granted by the Ministry of Pensions and National Insurance and determined by reference to one hundred per cent, disablement, or
  2. (b) though not in receipt of a one hundred per cent. disablement pension or industrial injury pension he nevertheless is disabled in manner and degree equivalent to one hundred per cent. disablement,
he shall be entitled to a deduction from the amount of income tax with which he is chargeable equal to tax at the standard rate on one hundred pounds".—(Mr. Cronin.)

Brought up, and react the First time.

Mr. John Cronin (Loughborough)

I beg to move, That the Clause be read a Second time.

The purpose of this Clause is comparatively clear. It has the intention of enabling disabled persons to deduct £100 from their gross income for taxation purposes provided that they are either in receipt of a 100 per cent. disablement pension from the Ministry of Pensions and National Insurance, or have a disablement equivalent to 100 per cent. As hon. Members on both sides of the Committee fully appreciate, Income Tax law recognises not merely the extent of a person's income, but his taxable capacity; that is, the unavoidable expenses which affect his ability to pay tax as compared with those who have not got such expenses.

For that reason we have marriage allowance, child allowance and several other forms of tax relief, but there are certain persons who suffer from disabilities o health so severely that they are subjected to a constant level of unavoidable expense which seriously impairs their ability to pay tax.

8.15 p.m.

I suggest that those persons are treated with scant justice under our present tax law. Of the expenses these unfortunate people suffer by illness of a diverse nature I shall not give details, but hon. Members can supply numerous examples and no doubt will do so, for we all know that paralysed, crippled and mutilated people require to wear special appliances. They need special means of conveyance and have to pay for special domestic help, appliances to enable them to eat or to look after themselves and they require special clothing and sometimes special food. Blind persons require to pay for guides and also for Braille books and typewriters. All these things involve a heavy outlay of expenditure compared with that of the ordinary taxpayer.

At present, a special relief is given for a person who maintains a resident daughter on account of his infirmity, so the principle of helping a disabled person by x concession has been established, but it is obviously anomalous that a disabled person should receive help if he has a resident daughter, but not if he has to support a son or to find other means of paying for domestic help. He should receive the same treatment.

It seems to me that a very important aspect of this concession is that it would provide an increased incentive to a disabled person to work. Hon. Members know that there is a pleasurable psychological stimulation from earning money. That has a very encouraging effect on a person who is severely disabled, but that encouragement is greatly reduced if the effort he has to make to earn an income is absolutely disproportionate to what he eventually receives when taxation has been deducted.

This would be an incentive to a seriously disabled person to earn his living. I think it would prevent many disabled persons having to be dependent on the National Assistance Board or the National Health Service. Many of these people would keep themselves away from that form of charity through public funds if they had this increased incentive to work and earn their own living. Some time ago we had the benefit of the Report of the Royal Commission on Taxation of Profits and Incomes. I have no doubt that hon. Members have read paragraphs 201–207 in which this problem is dealt with very carefully.

I think it worth quoting the rather succinct words of paragraph 224 in which the Royal Commission said: Grave incapacity (comparable to the 100 per cent. disability recognised in the administration of war pensions) should give rise to a claim for a tax allowance, which should be at least £100. In other words, the Commission makes the recommendation contained in the new Clause. The Chancellor will no doubt tell us what the new Clause would cost the Exchequer, but he will probably have to concede that the cost is very small compared with the beneficial effects it would have.

There are certain apparent arguments against the new Clause. The Chancellor is having a very busy time and I should like to save him some work by making some of the arguments against the Clause. The first is the difficulty of statutory definition. It can be argued that there is some difficulty in deciding who is 100 per cent. disabled if he does not already receive 100 per cent. disablement assessment from the Ministry of Pensions and National Insurance. We already have a satisfactory machinery for that—the machinery of the medical boards used by the Ministry of Pensions and National Insurance.

I cannot do better than again quote from the Royal Commission on the Taxation of Profits and Income, which states, in paragraph 203: But we feel at the same time that the difficulty is not insuperable and ought to be faced. Machinery of the kind that we have in mind does, in fact, exist, though created for the purpose of war pensions administration; and some of the qualifications, e.g., blindness, do, as it were, prove themselves. The difficulty of statutory definition is, therefore, comparatively small.

The Chancellor may also argue that certain disabled persons such as war pensioners and those receiving injury or blindness payments already receive supplementary tax-free grants. There is, clearly, a certain amount of inequity about allowing these people to receive tax-free grants as well as the relief offered by the new Clause. We on this side of the Committee have no objection if the Chancellor, with his extensive facilities, redrafts the Clause and brings it back on Report to ensure that the person who already receives a tax-free benefit may choose between receiving his tax-free benefit and accepting the help given him by the Clause.

It was argued in 1956 by the present Minister of Housing and Local Government, on the same new Clause, that it had the disadvantage that it tended to help persons with large incomes—in other words, people who had to pay tax and not people who, because of the paucity of their incomes, were not paying tax. We know that the Chancellor is a person of considerable delicacy of sentiment, and I am sure that after the massive concessions which have been given to Surtax payers in the last few years by the Government he will not use that argument this evening.

Another argument is that the new Clause gives relief to the 100 per cent. disabled and not, for instance, to a person who is 90 per cent. disabled. I do not think that that can be seriously advanced, because in all Income Tax concessions one has to draw the line somewhere, and 100 per cent. disablement is a convenient point at which to draw the line. There are many persons who are disabled greatly in excess of 100 per cent. and if the figures were allowed to go so high one could call them 150 per cent. or 250 per cent. disabled. A figure of 100 per cent. is, therefore, a very convenient figure at which to draw the line for giving this concession. It has the obvious advantage of simplicity.

It can also be suggested that 100 per cent. disabled persons can be helped by the social services, but I ask hon. Members on both sides of the Committee to consider carefully what that means. What help do they, in fact, receive from the social services? They are entitled to medical treatment, but we are all entitled to that. They receive certain occasional benefits and help, but, in general, the amount of help which they receive from the social services is very small.

I therefore suggest that the arguments for this Clause are not easily refutable in terms of equity and justice. It seems economically logical, it is administratively feasible and it is politically desirable. While, in general, it is desirable for us to avoid an emotional approach to our problems in Committee, I hope that the Chancellor will not exclude from his mind the very proper sentiments of humanity and consideration for the afflicted which have always affected members of the Committee and have always received the most ready approbation of our constituents.

Mr. Percy Collick (Birkenhead)

I beg to second the Motion.

The Motion was very ably moved by my hon. Friend the Member for Loughborough (Mr. Cronin). As he rightly said, the object of the Clause is to give an Income Tax concession to those Income Tax payers who are 100 per cent. disabled persons, irrespective of whether they were disabled in industry or in any other way. The test which it is intended to apply is that if they are 100 per cent. disabled persons they should have the Income Tax concession laid down in the Clause.

However carefully one goes through all the Amendments and new Clauses on the Finance Bill this year, in my view one can find no Amendment or new Clause as well warranted as this. It would be easy to argue the case for it merely on sentimental grounds. Anybody connected with organisations for disabled men or familiar with the day-to-day work which goes on among disabled people can quote case after case which would arouse quite easily the sentiments of the whole Committee behind the demands which this new Clause makes to the Government.

That, however, is not my intention in seconding the Motion. I think that the argument for the new Clause can stand solely on the basis of justice and equity. As my hon. Friend rightly pointed out, the basis of Income Tax law is not only that we have regard to what is a person's income, but that in assessing his liability to Income Tax we have regard to what are his expenses in obtaining that income. Unless that is done, obviously there is little fairness in Income Tax administration methods.

It does not require any imagination to understand the position of the 100 per cent. disabled person who is an Income Tax payer and who, by some miracle or another, has so mastered his disability that he is able to earn a livelihood in industry, in the professions or in some other occupation. I do not want to cite individual cases, though I could cite many.

8.30 p.m.

In earning his livelihood, what is the position of the 100 per cent. disabled person as compared with the able-bodied person? I know cases in my own division in Birkenhead where 100 per cent. disabled persons are paying no less than 10s. a day to be taken to and from their employment or profession. The Chancellor may say that under Income Tax law as it now stands there is no allowance to any person for the expenses incurred in going to and from employment. I ask the Committee to contrast the expense which an able-bodied person has in going to and from employment with that which a 100 per cent. disabled person has. The disabled person cannot use public transport, such as buses. The very nature of his disability means that he must either hire a car or make an arrangement for the use of a hired car to take him to his employment.

In Birkenhead, it very often costs 100 per cent. disabled persons 10s. a day, but I know of cases in London—this can be supported; I will give the Chancellor details, if he wants them—where 100 per cent. disabled persons have to pay 10s. or 15s., and sometimes as much as £1, a day in order to be taken to and from their place of professional work or employment.

That is not the only extra expense of a disabled person. Anyone connected with disabled cases knows full well that, for the disabled person to retain even such degree of mobility as he may have, it means the setting up of all sorts of mechanical improvisations in the home. The organisations concerned primarily with this matter could tell the Chancellor of cases which would show him the substantial charges which the individual has in these matters. It is not merely transport; it is not merely improvisation of means. Anyone living with a disabled person or knowing anything about 100 per cent. disabled persons knows the extent of the expense. Very often attendance is necessary. Despite all these handicaps, the disabled person strives to carry on and to make his contribution in industry or in the professions. The number of persons who succeed in doing so is astonishing.

Has the Chancellor considered any more worthy case in this year's Budget than men and women such as those? Of course they have no lobby at Downing Street. Nobody goes to the Treasury to lobby the Chancellor of the Exchequer on behalf of these poor unfortunate persons. The Chancellor had quite enough Questions preceding the Budget to draw his attention to this matter. Particularly having regard to the Report of the Royal Commission on the Taxation of Profits and Income to which my hon. Friend referred, one might reasonably have expected the Chancellor to do something about it.

The Royal Commission dealt with this matter in paragraphs 201 to 207 of its Report. It looked into this matter as closely as any body could possibly do. It spent months examining what should be done about this. Paragraph 202 says: Our general conclusion is that grave disability ought to be the subject of allowance. That is categorical enough. The Chancellor has had that recommendation before him for at least four years and, so far, has chosen to do nothing about it. It is nearly time that the House of Commons insisted that he did.

Having recommended that something should be done about these cases of 100 per cent. disability, the Report continues: It presents itself to us as a personal circumstance that sets apart those who suffer from it and directly affects their relative capacity to pay. The Report goes on: What we are thinking of is a range of additional expense attendant upon the conduct of their normal life, not least upon the maintenance of their earning capacity, which yet goes unrelieved under the existing code. If, after fully considering the whole subject, the Royal Commission came to that conclusion, what reason can the Government possibly have to justify their refusal to adopt the Commission's recommendation? In previous years we have discussed this matter to some extent, though not so fully as we ought to have done, and the time has now come when the Government must be pressed to make a decision, and a favourable decision. They ought to follow the lines of the recommendation of the Royal Commission.

We shall, of course, get a reply from the Treasury Bench tonight, but I have never yet heard from the Government any substantial explanation of why the Royal Commission's recommendation cannot be accepted. If the Government had the will, it could be accepted. We want to know whether the Government will heed the will of what I would have thought to be the whole Committee, irrespective of the side on which we sit. Unless the Government have some more substantial reply to give than we have had in previous years, it seems that the only thing the disabled can do is to make themselves as powerful a lobby at the Treasury as some of the vested interests to which the Chancellor has been so willing to listen in this and previous Budgets.

Dr. King

It is a pleasure to follow my hon. Friend the Member for Birkenhead (Mr. Collick), whose eloquence we enjoy, and whose courage under physical adversity we admire tremendously. I support the case that he and my hon. Friend the Member for Loughborough (Mr. Cronin) have put up for the new Clause in respect of the 100 per cent. disabled, and I should also like to say a word in support of the new Clause relating to incapacitated children, and the other new Clause entitled "Relief for disabled persons." All three seek to give some reliefs for special kinds of disability.

In her latest book, "Social Science and Social Pathology", Baroness Wootton points out that we have not yet abolished real poverty; that, despite the Welfare State, certain misfortunes can take people below the poverty line. I suggest to the Chancellor that that is particularly true of the misfortune of 100 per cent. disability. Although disability pensions have been improved, they can never be big enough, and one might, therefore, ask the Chancellor to give a fiscal increase to the disability pensioner, and, in so doing, to make himself an ally of his right hon. Friend the Minister of Pensions and National Insurance, who has done some notable work in improving the lot of this class.

This evening, I would ask the Committee to look at the matter, not in that way but in the moral way that has been so feelingly put by my hon. Friend the Member for Birkenhead. Income does not mean the same thing to different people. A sum of £5 is less money to a disabled man than it is to an able-bodied man. The disabled man has to pay for so much that the able man can do for himself. The disabled man needs so many little things that the able man can do without. The disabled man very often needs special food, special appliances, all of which cost money. To give two people the same income, when one is 100 per cent. disabled and the other is 100 per cent. able, is to treat them differently.

That is the moral case, and it is the moral case for which we have the utter and complete backing of the Royal Commission. I would say that, apart from bereavement, the most distressing inheritance of the past wars is the man who has been disabled; who lost everything except his life to keep this a free country. The new Clause would ease his financial burden, and would show these sad heroes of the Second World War that Parliament always has their sacrifices in mind. What I have said about the 100 per cent. war-disabled veterans is also true of those disabled 100 per cent. by disease, or by accident in modern industry. I, therefore, hope that the Chancellor will accept the first of this group of new Clauses.

The next new Clause would give a tax concession to the parents of incapacitated children. In a recent debate in another place, very moving references were made to the parents of children born incapacitated in some way. In recent Finance Bills and pensions Acts we have improved, to some extent, the lot of the parent of the incapacitated child, but not yet, by any means, have we done enough for the father or mother of a disabled child.

Some of the mothers and fathers devote almost the whole of their lives to children who remain children for ever. I know of someone in my own town whose child of 23 has the mind of a child of perhaps 6 or 7. These children who never grow up always need care and supervision. There is not enough room for them all in the special institutions we have set up. Although we are steadily increasing the number of these schools, each of the existing ones has a huge waiting list. As a result, some of the children, who are children at the age of 18, 19 or 20, never get a chance to get into a special school, even if the parents want them to.

8.45 p.m.

Moreover, some parents do not wish to send their incapacitated child away from home, and other children are so incapacitated as to be beyond benefiting even from any of the fine places that we are setting up.

The parent of a child over the age of 16 who is bright and brainy and makes his way to college or university is helped by the Treasury. The child is not a wage earner and is a liability and certain tax reliefs are given for him. Even if the child stays on after the age of 16 and goes to a special school the Treasury helps him. This was a concession which we managed to secure in previous years. It is worth remarking that, through no fault of their own, the best parents in the world may have incapacitated or defective children. That is no slur on parenthood. It is merely a misfortune of nature if a parent still has to maintain, nurse and care for a child of 18 with the brain of a child of 8, or has to look after a spastic youth or young maiden, for whom there is no Income Tax relief.

Between the ages of 16 and 21 when the unfortunate child becomes an adult there is a gap which I would ask the Chancellor of the Exchequer to see if he can fill in some way to ameliorate the financial burden that is borne by the parent of such a child. I hope that the Chancellor will look very favourably on the Clause—"Incapacitated child over the age of sixteen years." The new Clause—"Relief for disabled persons"—tackles yet another aspect of disability; it seeks to equate the burden of incapacity to earn one's living with the burden of being old. As hon. Members will know, Her Majesty's present Government have begun to treat specially for Income Tax purposes people over the age of 65. This is part of what I referred to in an earlier debate—this tailoring of tax to the kind of person who is being taxed.

We suggest that there is a moral case for applying this special treatment which we give to people at the age of 65 to those people who are not yet 65 but have lost the capacity to earn their own living. Age and bodily infirmity make money less valuable. They make demands which younger and able-bodied people are not called upon to meet.

It is in that spirit that I address myself to these three Clauses. I echo the words of my hon. Friend the Member for Birkenhead, and suggest to the Chancellor that these new Clauses, whatever they may cost, are about the most worthwhile, humane Clauses that he can concede in the long debates on this Bill. I know that the Chancellor is a humane man and I ask him to address himself seriously to this problem and to con- sider how far he can go in conceding what we are asking for.

8.45 p.m.

Mrs. Harriet Slater (Stoke-on-Trent, North)

I wish to add my plea to that of my hon. Friend the Member for Southampton, Itchen (Dr. King) on this human problem. When my hon. Friend was speaking I was thinking of a girl who lives in Stoke-on-Trent. Her mother went out to work, as well as her father, who did a heavy job, because the child was born a spastic. She could not walk properly and her sight was sadly impaired, though her mental capacity was very good. Wherever the child went she had to be taken by someone—first, to school and later to a typing school. Her mother and father spent many hours not only working hard, but worrying on her behalf.

That girl, through courage, patience, endurance and persistence, has become a very efficient typist and is holding a job in one of our council departments. Had her mother and father not been able to go out to work, that girl would have been a grave liability not only to the local authority, but to the country as a whole. Transport charges have been incurred in getting this girl to the typing school, and even now she has to be accompanied when she goes by public transport. She has incurred additional expense for special boots, spectacles and clothes because of her physical limitations.

What has been this girl's great contribution? She has been able to earn a living in her own right, and that has not only a social and economic value but a psychological value as well. Her parents could have gone through life, having given up hope, saying, "We do not know why this has happened and why we should suffer. We will do nothing about it. We hope the State will make all the necessary provisions." If those parents were working today and the girl were a small child, they would be called upon to pay Income Tax. Yet they would be suffering this great inequality, for it is an inequality which is borne by people like that.

There is another reason why we should accept the new Clause. Why do local authorities, like that in my own city, take a great deal of trouble to establish very efficient workshops for the blind?

Why have we set up our welfare department for handicapped people? Why are we taking great trouble, through the Government, to try to do something about factories such as Remploy? In the first place, of course, we want to see these people working and making a contribution to the country's economy but, more than that, we want to give them a lift in the psychological sense, and make up for all their disabilities. When local authorities and the Government themselves are trying to provide facilities for these people, at least we should encourage them when they are able to earn their own living by giving this extra allowance. We should encourage the parents of children who are in the sort of position I have described.

Something has been said already about the extra clothes, additional pairs of boots, and so forth, which are required by people with various disabilities. It is sometimes necessary even to alter the doors in their homes, and there is extra wear and tear on the walls and decorations because of the wheeling in and out of chairs and the consequent damage to walls and furniture. Special surgical appliances are needed. Above all, such people need extra nourishment and special foods. They need extra medical care, also. These are all added liabilities which they have to suffer.

The Chancellor has very many things to consider, but we ask him to look at this particular problem again, realising that these people ought not to be penalised further when they are already heavily penalised by the disabilities which they suffer.

Mr. T. Brown

I support the new Clause. My hon. Friend the Member for Stoke-on-Trent, North (Mrs. Slater) has reminded the Committee that, when persons are disabled as a result of war injuries or accidents sustained in heavy industries, their expenditure is increased because of the extra things they have to buy. As I have said many times, I always speak in support of the men who work in heavy industry, particularly the miners. We have today about 530 paraplegics in this country, and their interests, too, are involved in the new Clause.

I do not say that the Chancellor will turn the new Clause down He is sympathetic, and the hon. and learned Gentleman the Financial Secretary, too, is sympathetic towards this type of case. We are not asking that the Chancellor should forfeit £6 million or £7 million as we did on a previous new Clause, but we ask him to give a concession to those disabled in war or in their occupations. We must always remember that they have to bear extra expenditure.

The Chancellor is very sympathetically inclined to our argument, and he may say that this is a matter for people to put to the Inland Revenue authorities. However, while he may be sympathetic, we find that, when we approach the Income Tax people with a view to obtaining a small concession or, so to speak, putting a little elastic into the requirements of the Revenue, we find that they are very half-hearted. I do not say that with any disrespect, but if he includes this Clause in the Finance Bill it will help considerably to alleviate the very great hardship which these men have experienced over a number of years.

If there are two sections of the community which warrant our sympathy—not expressed in words, but in deeds—they are the war disabled and those who, unfortunately, have met with serious accidents in the pits, steel industry and foundries. Surely the Chancellor can accept this Clause. It will not upset or unbalance the Budget. It will simply prove to these people, who have experienced misfortune in several walks of life, that the Chancellor is sympathetically inclined towards them. We have a saying in Lancashire which I have mentioned once or twice here. It is, "Sympathy without relief is like mustard without beef". In other words, it is very sharp.

Mr. Ellis Smith

The Chancellor remembers what my hon. Friend said once before.

Mr. Brown

The Chancellor rightly took me to task, but that does not matter. I am not one of those supersensitive people who criticise a man for taking him to task, but the right hon. Gentleman missed the point when he told me that I was wrong in accusing him of being skinny.

Mr. Ellis Smith

That was the word.

Mr. Brown

That was the word that I used. It is true that we were discussing the provisions of Clause 12, but I had better not develop that point or you, Sir Charles, will rule me out of order.

The reason we have tabled this new Clause for the consideration of the Chancellor and for his Department is this. Instead of telling these people, "We have every sympathy with you in your misfortune. We do not like to be hard-hearted. We would like to help in every conceivable way", let the right hon. Gentleman apply the sympathetic spirit towards these unfortunate people and accept this Clause. He knows full well that it will not upset the balance of the Bill.

Mr. Amory

I hate having to recommend the Committee to resist these Clauses because none of us can fail to feel sympathy with the unfortunate men and women who are the subject of the Clause moved by the hon. Member for Loughborough (Mr. Cronin) who, we all recognise, speaks with particular knowledge of this subject.

I should like to join in the tribute paid by the hon. Member for Southampton, Itchen (Dr. King) to the courage that we all know is displayed by the hon. Member for Birkenhead (Mr. Collick) in meeting his physical disabilities. The people in question, by definition, are unable to lead a full and normal life and many of them are subject constantly to varying degrees of physical distress. Governments of all parties have for long recognised an obligation to help the disabled, and I think that they have fulfilled that obligation.

When I was Minister of Pensions—which, I should like to say, in passing, was an office which I not only enjoyed holding very much but felt was one of the most worth while offices to hold I learned something of the problems of the disabled. However, we must give our help in such a way as to bring the greatest benefit to those who need it most. I very much doubt whether the proposal in the Clause would do that. The two reasons why I must reluctantly resist the Clause are, first, that I do not believe this is the best way of giving the help where it is most needed, and secondly, that it would be opening a door which would become wider and wider and that if we once started on this principle I do not know where we would stop.

9.0 p.m.

I can deal with the arguments briefly, because a similar proposal was debated fairly fully last year and in 1954 and 1956. On 2nd July last year my hon. and learned Friend the Financial Secretary explained clearly the difficulties that we see in accepting this proposal. The reasons which he gave then still seem to us to hold good.

If I may remind the Committee briefly of those reasons, the main and fundamental one is that in our view it is impossible for the Income Tax to take into account as closely as this proposal implies the personal circumstances and disabilities of the individual taxpayer concerned. Help for the disabled by way of tax remission would inevitably be a good deal a matter of hit and miss. It would give help, undoubtedly, to many who needed it, but it would miss a great many of those who need help and it would benefit some who do not.

The proposed allowances would, for instance, give no help to those whose incomes are so low that they pay no Income Tax, while it would give a sizeable benefit to incapacitated persons with substantial income who pay tax at the higher rates. Indeed, there seems to be some inconsistency between the tenor of the criticisms by hon. Members opposite of the Income Tax proposals in general in the Bill and their suggestion in the Clause for giving relief in this way.

Mr. Collick

I cannot square the right hon. Gentleman's argument. In his own Income Tax arrangements this year in the Bill he leaves out of account altogether those who do not pay Income Tax, but he has given substantial Income Tax reliefs to those who are very well off. Therefore, why does he say that the Clause cannot be applied to disabled persons because it would give something to people who are well off and nothing to those who are less well off? That is exactly what this year's Income Tax arrangements do.

Mr. Amory

I am not saying that it cannot be done. What I am saying is that the assistance that can be provided from public funds for the benefit of the disabled could be channelled to the disabled in better ways than is proposed under these Clauses.

It has been suggested that an Income Tax allowance of the kind proposed is a good way of taking account of the extra expenses which disabled people must incur. I do not deny that most disabled people incur additional expenses. That again, however, points to some of the difficulties and anomalies which adoption of this proposal would involve. The Clause proposes relief for the 100 per cent. disabled. It does not try to take account of the particular extra expenses that a 100 per cent. disabled man or woman would incur. It is difficult to assess the extra expenses that would be incurred in terms of a particular degree of disability.

When one considers individual cases, it will he found that the additional expenses incurred would vary very much indeed between one 100 per cent. disabled person and another. It will also be found that the extra expenses incurred would often be more in the case of somebody with, say, a 75 or 90 per cent. disability than in the case of many of those with 100 per cent. disability. It would be virtually impossible administratively to take cognisance of those differences or probably to go any further than the 100 per cent. disablement register. It would be most unsatisfactory to stop at that point. We would be driven, in fact, to try to go further, and there is where the difficulties would start, because any assumption of equivalence would involve medical investigation and that would be something quite impossible for the tax authorities to undertake.

Mr. Ellis Smith

So this is a case in support of increased benefits as soon as possible.

Mr. Amory

That is another matter that does not arise on the new Clause, as the hon. Member knows.

Several hon. Members referred to the recommendation of the Royal Commission on the Taxation of Profits and Income. There were two important provisos in that case. The recommendation was in favour of an allowance in 100 per cent. disablement, but that carried the rider that such an allowance should not be in addition to, or in parallel with, any tax-free disablement benefit, and also that if it were given certain other current allowances should be withdrawn. In general, if that recommendation were followed it would seem to me that it would carry no advantage to the war disabled or to those in receipt of industrial injury benefit, because those tax-free benefits would be greater, even in the case of somebody with a high income, than the benefits recommended under the Clause. Therefore, if the Royal Commission recommendation were accepted literally it would frustrate the objects of the Clause.

It is the Government's view, for these reasons, that fiscal proposals of this kind are not the best way to help the disabled, and that the best way is to direct help specifically to the individual, taking account of his individual disability, circumstances and needs. That is what we have done in recent years, and, as hon. Members know, we keep the services provided under constant review with a view to improving them whenever that seems justified and desirable.

There is, for example, extensive provision under the National Health Service for special services for the disabled—such things as the provision of invalid tricycles, artificial limbs and domestic help, to give only a few instances. Then the Ministry of Labour provides invaluable assistance in the way of rehabilitation and vocational training. I think that these are the best ways of all to help the disabled. In addition there are tax-free pensions with supplements for disabled members of the Armed Forces and persons disabled in industry.

The hon. Member for Itchen referred to the problem of incapacitated children over 16 years of age. I think that he was referring to the position that arises where the children's allowances are no longer payable. I am sure he will realise that there are grants available through the National Assistance Board to young people over the age of 16 whose means are assessed independently of the means of their parents. So a grant would be payable to young people of that kind if they are incapacitated, without regard in general to the means of the parents. This helps to deal with the situation about which the hon. Gentleman is particularly worried, where the children's allowance is stopped at the age of 16 or later, if and when education starts.

Dr. King

I am grateful to the right hon. Gentleman for giving way. Would he deal with this point by way of question and answer? In this proposed Clause we want to compare like with like. The father who has an able child who goes to a university gets an Income Tax concession. That child may get a university scholarship. We want to put exactly on all fours, from the point of view of Income Tax, the father who has a child who is a complete liability. I admit the point about National Assistance. It is one of the improvements we have made in recent years.

Mr. Amory

If the hon. Gentleman thinks about this I think he will see a difficulty that would arise if what he is suggesting were done. If such an allowance were made for an incapacitated child between the age of 16 and 21, why should it stop at the age of 21 particularly? Again, it would be extremely difficult to draw a line there, and we would find ourselves led on into a wider and wider field.

It is really for those two main reasons that we feel, to start with, that this is not the most satisfactory way of helping the disabled. If there is more help due to the disabled, that is another question. If we once accepted this principle we should be led into a wider and wider field and find it more and more difficult to draw any acceptable lines or to know where to stop. As I say, it is with very deep regret, and after a great deal of thought, that I have come to the conclusion that I cannot recommend the Committee to accept the Clause, much as I should like to do so.

Mr. T. Brown

Before the right hon. Gentleman leaves that point, he referred to two branches of Ministries which were always prepared to help people who are disabled or incapacitated. If he will consider carefully, I think he will find that there are many cases of people who cannot get help from either the Ministry of Labour or the National Assistance Board or even under the Industrial Injuries Acts, because their case was in existence before those schemes came into operation.

May I give an illustration of what I mean, Sir Charles? Looking at me you would not think I had been disabled, but I have to wear a surgical belt. When I first bought a belt on the recommenda- tion of the doctor, I paid £5 5s. for it. I have renewed it two or three times. I have renewed it again today and the price I paid today for that surgical belt to sustain me physically was £16 9s. That is a high price if it has to be paid by an injured workman. Therefore, I say that if the Chancellor would consider this carefully he would find that it does not apply to all cases. It is true that Government schemes help some people, but not all people, and we want to help all cases by introducing this Clause into the Finance Act.

Mr. Amory

What the hon. Gentleman has said illustrates the extreme difficulty of this suggestion. One starts by dealing with one specific case and then realises that the next case is substantially as hard, and one gets led on again. It is extremely difficult to deal through Income Tax with that problem. Wherever we stop we shall be faced with a very unsatisfactory position. I cannot give any assurance that I can see my way to doing anything now, but I will think about the arguments that have been adduced and I will keep this problem very much in my mind. I cannot see any hope of doing anything in the Bill this year that I would find satisfactory, for the reasons I have given. I recognise the problem, however, and if I should ever be convinced to the contrary and find that it would be a good thing to do it through Income Tax, no one would be more ready to do it than I.

9.15 p.m.

Mr. Douglas Jay (Battersea, North)

I found the Chancellor's reply very disappointing and unconvincing. He did exactly what my hon. Friend the Member for Ince (Mr. T. Brown) feared he would do—he gave sympathy without help. He did not do full justice to the persuasive and eloquent arguments of three or four of my hon. Friends, including my hon. Friend the Member for Birkenhead (Mr. Collick) and my hon. Friend the Member for Ince, who are themselves living examples of some of the arguments which they put forward. The Chancellor seemed to be trying to find difficulties to put in the way of our proposals.

On the new Clause relating to 100 per cent. disablement he said that the method which we proposed would not provide precisely the proportionate amount of relief which was appropriate for the need in each case. My hon. Friends did not argue that this was necessarily an absolutely ideal and perfect way of meeting that need, but they said that it would give a great deal of relief where a great deal of relief was needed.

The Chancellor did not do justice to the basic argument of the Royal Commission on the Taxation of Profits and Income, that to earn a living, as many of them succeed in doing, disabled persons necessarily incur expenses which the rest of us do not have to incur. The case of the blind was mentioned. I was rather struck by the fact that at Question Time two days ago, when some of my hon. Friends pressed that relief should be given for guide dogs for the blind by way of expenses, the Chancellor then explained that under the rules governing expenses that was impracticable. We now propose a different way, by means of personal allowances, and he says that that, too, is not the right way.

This is not a proposal brought forward by hon. Members who are moved by the human problems and by the relief which they have known from their own experience. This is a proposal of the Royal Commission. I put it to the Chancellor that the Royal Commission considered all the arguments about alternative ways of doing it and took into account the relief which is given by social services and in other ways. The Royal Commission was fully conscious of the argument, as we all are, and which we always get from Chancellors—" If you do this, you open the door to all sorts of other things."

In spite of that, the Royal Commission said that grave disability ought to be the subject of an allowance, and it called the present relief anomalous and limited. The Chancellor also said that this would be an impossible way, because it was not the business of the Inland Revenue to define hardship and, in terms of distress to define the difference between one case and another. We had that argument about post-war credits, but the Inland Revenue is now to do almost exactly what the Chancellor declared to be impossible. If he succeeded in that instance, by using a number of special definitions, I am not convinced that it cannot be done in this case.

The Chancellor's most extraordinary argument was that if he gave tax reliefs to disabled people in this way, more relief would go to those with the largest incomes. That comes very strangely from a Chancellor who has just made Budget concessions of £400 million almost entirely on the principle that the higher the income, the greater the relief. When he comes to this special category of people who are in distress he says that that is the wrong way to do it and that he is not prepared to offer any concession.

I could not help reflecting, when he said that, that the cost of what we are proposing—and he did not tell us and I do not know whether he would care to make an estimate—must be infinitesimal compared with the total reliefs, even the total Income Tax reliefs, given in the Budget.

In spite of what the Chancellor said about National Assistance in the case of the incapacitated child over 16, as the Royal Commission pointed out, the fact remains that there is this anomalous gap which causes needless hardship between the ages of 16 and 21. There is an inequity between the particular incapacitated child before the age of 16 and after, and also, as my hon. Friend pointed out, between a child of 18 or 19 who is incapacitated and not able to go to university and does not get an allowance, and a child of the same age who goes to university or some other full-time education and gets the full allowance.

The Chancellor said that there was no reason why the allowance should stop at the age of 21 if it went on from 16 to 21. The Royal Commission answered that. It pointed out that after the age of 21 it was open to the parent to make arrangements that do not apply below the age of 21, by covenants, and so on, to get relief for the child, so I was not very convinced by that argument either.

I think that the only argument that the Chancellor advanced which had any persuasive effect on my hon. Friends was when he came near to saying that there was a case for a relief but that it should be done not through Income Tax but by some increase, which he did not specify, in social service benefits. When he was asked what they were going to be and when they would be introduced, he said that this was not the occasion to go into further details.

If the Chancellor would like to give us a firm assurance tonight that he has proposals in mind to cover this in some other way and that they will be introduced without any substantial delay, I think my hon. Friends might be pre-

pared to withdraw these Clauses. Unless the Chancellor is prepared to do that, for the reasons that my hon. Friends gave and to encourage the Chancellor not to make this sort of reply again, I hope that my hon. Friends will press these new Clauses to a Division.

Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 128, Noes 179.

Division No. 130.] AYES [9.23 p.m.
Allen, scholefield (Crewe) Howell, Charles (Perry Barr) Parker, J.
Beswick, Frank Hughes, Emrys (S. Ayrshire) Plummer, Sir Leslie
Blackburn, F. Hughes, Hector (Aberdeen, N.) Popplewell, E.
Blenkinsop, A. Hunter, A. E. Prentice, R. E.
Bottomley, Rt. Hon. A. G. Hynd, H. (Accrington) Price, Philips (Gloucestershire, w.)
Bowden, H. W. (Leicester, S.W.) Irvine, A. J. (Edge Hill) Pursey, Cmdr. H.
Brockway, A. F. Isaacs, Rt. Hon. G. A. Redhead, E. C.
Brown, Thomas (Ince) Jay, Rt. Hon. D. P. T. Reynolds, G. W.
Burke, W. A. Jeger, George (Goole) Rhodes, H,
Butler, Mrs. Joyce (Wood Green) Jenkins, Roy (Stechford) Rogers, George (Kensington, N.)
Champion, A. J. Johnson, James (Rugby) Ross, William
Clunie, J. Jones, David (The Hartlepools) Royle, C.
Collick, P. H. (Birkenhead) Jones, J. Idwal (Wrexham) Silverman, Sydney (Nelson)
Cronin, J. D. Jones, T. w. (Merioneth) Skeffington, A. M.
Crossman, R. H. S. Kenyon, C. Slater, Mrs. H. (Stoke, N.)
Darling, George (Hillsborough) Key, Rt. Hon. C. W. Smith, Ellis (Stoke, S.)
Davies, Ernest (Enfield, E.) King, Dr. H. M. Sorensen, R. W.
Deer, G. Lawson, G. M. Soskice, Rt. Hon. Sir Frank
de Freitas, Geoffrey Lee, Miss Jennie (Cannock) Sparks, J. A.
Diamond, John Lever, Leslie (Ardwick) Spriggs, Leslie
Dodds, N. N. Lindgren, G. S. Steele, T.
Ede, Rt. Hon. J. C. McAlister, Mrs. Mary Stewart, Michael (Fulham)
Edwards, Robert (Bilston) McCann, J. Stonehouse, John
Fletcher, Eric MacColl, J. E. Strachey, Rt. Hon. J.
Forman, J. C. MacDermot, Niall Stross,Dr.Barnett(Stoke-on-Trent,C.)
Fraser, Thomas (Hamilton) Mclnnes, J. Taylor, John (West Lothian)
Gibson, C. W. McKay, John (Waltsend) Thomson, George (Dundee, E.)
Gordon Walker, Rt. Hon. P. C. McLeavy, Frank Thornton, E.
Greenwood, Anthony MacPherson, Malcolm (Stirling) Ungoed-Thomas, Sir Lynn
Grey, C. F. Mallalieu, E. L. (Brigg) Viant, S. P.
Griffiths, David (Rother Valley) Mallalieu, J. P. W. (Huddersfd, E.) Warbey, W. N.
Griffiths, William (Exchange) Mellish, R. J. Weitzman, D.
Hall, Rt. Hn. Glenvil (Colne Valley) Mitchison, G. R. Wells, William (Walsall, N.)
Hamilton, W. W. Moody, A. S. Wheeldon, W. E.
Hannan, W. Morrson,Rt.Hn.Herbert(Lewis'm,S.) White, Mrs. Eirene (E. Flint)
Hastings, S. Moyle, A. White, Henry (Derbyshire, N.E.)
Hayman, F. H. Mulley, F. W. Williams, Rt. Hon. T. (Don Valley)
Healey, Denis Neal, Harold (Bolsover) Williams, W. R. (Openshaw)
Henderson, Rt. Hn. A. (Rwly Regis) Noel-Baker, Francis (Swindon) Willis, Eustace (Edinburgh, E.)
Herbison, Miss M. Oliver, G. H. Wilson, Rt. Hon. Harold (Huyton)
Hilton, A. V. Oram, A. E.
Hobson, C. R. (Keighley) Owen, W. J. TELLERS FOR THE AYES:
Holmes, Horace Padley, W. E. Mr. Pearson and Mr. J. T. Price.
Houghton, Douglas Pannell, Charles (Leeds, W.)
NOES
Agnew, Sir Peter Bell, Ronald (Bucks, S.) Chichester-Clark, R.
Aitken, W. T. Bevins, J. R. (Toxteth) Clarke, Brig. Terence (Portsmth, W.)
Alport, C. J. M. Bidgood, J. C. Conant, Maj. Sir Roger
Amery, Julian (Preston, N.) Biggs-Davison, J. A. Cooper, A. E.
Amory, Rt. Hn. Heathcoat (Tlverton) Bingtiam, R. M. Cordeaux Lt.-Col. J. K.
Anstruther-Gray, Major Sir William Bishop, F, P. Corfield, F. V.
Arbuthnot, John Black, Sir Cyril Craddock, Beresford (Spelthorne)
Armstrong, C. W. Body, R. F. Crowder, Sir John (Finchley)
Ashton, H. Bonham Carter, Mark Cunningham, Knox
Atkins, H. E. Bowen, E. R. (Cardigan) Currie, G. B. H.
Baldwin, Sir Archer Boyd-Carpenter, Rt. Hon. J. A. Dance, J. C. G.
Balniel, Lord Boyle, Sir Edward D'Avigdor-Goldsmid, Sir Henry
Barber, Anthony Brewis, John Deedes, W. F.
Barlow, Sir John Brooman-White, R. C. Dodds-Parker, A. D.
Barter, John Burden, F. F. A. Doughty, C. J. A.
Batsford, Brian Butler,Rt.Hn.R.A. (Saffron Walden) Dugdale, Rt. Hn. Sir T. (Richmond)
Baxter, Sir Beverley Carr, Robert Duncan, Sir James
Bell, Philip (Bolton, E.) Cary, Sir Robert Eden, J. B. (Bournemouth, West)
Erroll, F. J. Johnson, Dr. Donald (Carlisle) Pott, H. P.
Finlay, Graema Johnson, Eric (Blackley) Powell, J. Enoch
Fisher, Nigel Jones, Rt. Hon. Aubrey (Hall Green) Price, David (Eastleigh)
Fletcher-Cooke, C. Ken, Sir Hamilton Prior-Palmer, Brig. O. L.
Gammans, Lady Lambton, Viscount Redmayne, M.
Garner-Evans, E. H. Leather, E. H. C. Rees-Davies, W. R.
Glover, D. Leburn, W. G. Remnant, Hon. P.
Glyn, Col. Richard H. Legh, Hon. Peter (Petersfield) Ridsdale, J. E.
Godber, J. B. Lindsay, Martin (Solihuil) Roper, Sir Harold
Graham, Sir Fergus Linstead, Sir H. N. Ropner, Col. Sir Leonard
Grant-Ferris, Wg Cdr. H. (Nantwich) Lloyd, Maj. Sir Guy (Renfrew, E.) Russell, R. S.
Green, A. Longden, Gilbert Sharples, R. C.
Gresham Cooke, R. Loveys, Walter H. Shepherd, William
Grimond, J. Lucas, Sir Jocelyn (Portsmouth, S.) Simon, J.E. S. (Middlesbrough, W.)
Grimston, Hon. John (St. Albans) Lucas-Tooth, Sir Hugh Smithers, Peter (Winchester)
Grosvenor, Lt.-Col. R. G. Macdonald, Sir Peter Spearman, Sir Alexander
Gurden, Harold McLaughlin, Mrs. P. Stanley, Capt. Hon. Richard
Harris, Frederic (Croydon, N.W.) McLean, Neil (Inverness) Stevens, Geoffrey
Harris, Reader (Heston) McMaster, Stanley Steward, Sir William (Woolwich, W.)
Harrison, Col. J. H. (Eye) Macpherson, Niall (Dumfries) Stuart, Rt. Hon. James (Moray)
Heald, Rt. Hon. Sir Lionel Maddan, Martin Studholme, Sir Henry
Heath, Rt. Hon. E. R. G. Maitland, Hon. Patrick (Lanark) Summers, Sir Spencer
Henderson-Stewart, Sir James Manningham-Buller, Rt. Hn. Sir R. Taylor, Sir Charles (Eastbourne)
Hesketh, R. F. Marlowe, A. A. H. Teeling, W.
Hicks-Beach, MaJ. W. W. Marshall, Douglas Thornton Kemsley, Sir Colin
Hill, John (S. Norfolk) Mathew, R. Tiley, A. (Bradford, W.)
Hinchingbrooke, Viscount Maudling, Rt. Hon. R. Turton, Rt. Hon. R. H.
Hirst, Geoffrey Manny, R. L. Vickers, Miss Joan
Hobson, John(Warwick & Leam'gt'n) Maydon, Lt.-Comdr, S. L. C. Wade, D. W.
Holland-Martin, C. J. Medlicott, Sir Frank Wakefield, Edward (Derbyshire, W.)
Holt, A. F. Nabarro, C. D. N. Wall, Patrick
Hornby, R. P. Nairn, D. L. S. Ward, Rt. Hon. G. R. (Worcester)
Hornsby-Smith, Miss M. P. Neave, Airey Ward, Dame Irene (Tynemouth)
Howard, Gerald (Cambridgeshire) Nicolson, N. (B'n'm'th, E. & Chr'oh) Webbe, Sir H.
Howard, John (Test) Noble, Michael (Argyll) Webster, David
Hughes Hallett, Vice-Admiral J. O'Neill, Hn. Phelim (Co. Antrim, N.) Williams, Paul (Sunderland, S.)
Hughes-Young, M. H. C. Osborne, C. Williams, R. Dudley (Exeter)
Hulbert, Sir Norman Page, R. G. Wills, Sir Gerald (Bridgwater)
Hutchison, Michael Clark(E'b'gh,S.) Pannell, N. A. (Kirkdale) Wilson, Geoffrey (Truro)
Hyde, Montgomery Partridge, E.
Hylton-Foster, Rt. Hon. Sir Harry Pickthorn, Sir Kenneth TELLERS FOR THE NOES:
Irvine, Bryant Godman (Rye) Pilkington, Capt R. A. Mr. Bryan and Mr. Whitelaw
Jenkins, Robert (Dulwich) Pitman, I. J.