HC Deb 16 February 1966 vol 724 cc1418-25

Question proposed, That the Clause stand part of the Bill.

Mr. Tiley

It is not my purpose to start a long discussion on this Clause because the Committee will have the privilege, with two new Clauses later, of debating the whole question of widows and we are not here to waste time. There are a few questions I wish to ask. Some are quite simple and others are about certain wording because this is a most unusual Clause. Three-quarters of it is absolutely simple to understand and follow. I hope that the right hon. Lady will be able to supply the meanings of certain parts because they are in such language that I defy anyone to understand them.

On Clause 2 my right hon. Friend asked whether or not on the appointed day if someone were away ill the period of waiting was backdated to the moment of the commencement of the illness. We shall know the answer to that in due course. It is immaterial to the point I wish to make. We realise that no one could answer all these points without previous knowledge of them. What I want to make sure about is that if a person is ill on the appointed day and away from work and dies during the course of his illness, his widow is entitled to the wage-related benefit for the first 26 weeks of widowhood.

That is a simple point, but to follow that, what is the position of a widow whose husband has been receiving wage-related benefit because of incapacity for four of five months and then dies? I should like the Parliamentary Secretary to confirm that we are dealing with two distinct benefits. One is for 26 weeks for an individual who may be sick, unemployed or away because of an accident. That is entirely separate. If he dies during the last few weeks of the 26 weeks, when the widow begins to receive benefit she gets not merely the conclusion of the 26 weeks but an entirely new 26 weeks period of benefit?

That also is a simple question. I then come to subsection (2, b), which prescribes the year for obtaining relevant income. Who will prescribe the year and what will be the information to be borne in mind to deal with the year? It is not quite clear from subsection (2, a), which says: 'the appropriate income tax year' means the last complete income tax year before the beginning of the earnings-related benefit year in which the widow's husband died; It is not clear. Someone may have been off for 18 months. It is possible to visualise a claim for the widow's earnings, related benefit in relation to someone who has been off for four or five years due to a serious illness. What prescribed year will be taken then, because the last earnings year before a prolonged illness will be one long before increases in pay have taken place?

There was a provision in the old Workmen's Compensation Act by which in cases of difficulty the fair year could be used by an injured man. It is important to get a year which is fair to the injured man, because when he is off sick it is a time of suffering in the family. In that Act there was a provision which allowed the claim to be settled on the basis of a fair year for someone in comparable employment. It was an up-to-date comparison. The claimant might have been off work through injury for two or three years. Consequently his previous earnings would have been out of date.

In subsection (2, c) there is the most perfect bit of drafting I have ever seen: without prejudice to the application of subsections (8)(d) and (9) of the said section 2, subsection (5) of that section, except paragraph (c) thereof, shall apply as it applies for the purposes of subsection (4) of that section. That must mean something to somebody. We have a right to know what we are passing. If we had been short of time, I should not have raised this point.

Subsection (4) contains another long sentence beginning with the words For the removal of doubt. Again, this sentence must mean something to somebody. Although I have perused it several times, it is meaningless jargon to me. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph), who has just left the Chamber for the first time since about 3 o'clock, used the nicest expression I have ever heard—"the lay meaning". That is what we should like to hear from the Parliamentary Secretary.

Mr. Kenneth Lewis

Subsection (2,d) provides that regulations may provide that…at any time during the earnings-related benefit year in which "— the husband— died, the appropriate income tax year shall be such other income tax year as may be prescribed, being a year which was a relevant tax year for the purposes of that entitlement". I have no doubt that there is a valid reason for this provision. Perhaps the Parliamentary Secretary will explain what it means.

When I first read that provision I was optimistic for those who will be affected by the Bill. I thought that they might be able to select an Income Tax year when the Conservatives were in office, because Income Tax was not so high as it is now, or that they might be able to have a cock-shy ahead and select an Income Tax year when we will again be in office and when Income Tax will be less than it is under this Government.

Mr. Dean

May I put to the Joint Parliamentary Secretary an additional question which probably he will be more eager to answer than the questions which he has already been asked? The Clause provides for two things. The first is the extension of the period of benefit from 13 weeks to 26 weeks and the second is the introduction of the earnings-related supplement to the pension. In her opening speech the Minister said that she expected that the extended period from 13 to 26 weeks would mean that about 85,000 widows would benefit anyway, but as for the earnings-related supplement she expected that about 70,000 would benefit. In other words, there is a difference of about 15,000 widows who, I assume, are not likely to be eligible for the earnings-related benefit. I should like to know the reason why.

I assume that the late husbands were earning £9 a week or less and therefore did not come into the graduated benefit or, equally, that the widows are excluded by the earnings stop. I should like a little more information concerning into which categories, on average, the 15,000 fall.

Mr. Pentland

The short answer to the hon. Member for Somerset, North (Mr. Dean) is that the 85 per cent. earnings ceiling does not apply to widows. Among the 15,000 are widows whose husbands had been sick and disabled for a long period and there had been no earnings on which the widows could qualify for a supplement.

The hon. Member for Bradford, West (Mr. Tiley) was concerned about subsection (2, b). This enables the regulations to be varied so that where the husband has been receiving earnings-related supplements to unemployment or sickness benefit just before his death, the widow's supplementary allowance will be based on the same average earnings as were used to calculate the husband's benefit. Subsection (3) extends the period of the present flat-rate widow's allowance from 13 weeks to 26 weeks. It applies to all cases where the husband had died less than 13 weeks before the appointed day. This would mean that the extension will apply in all cases where the widow's allowance of the old duration is actually in payment on the appointed day; the current widow's allowance is £5 12s. 6d.

9.15 p.m.

Concern was expressed about paragraph (c). Here again I am in complete agreement about its wording. The answer is that it ensures that the definitions in Clause 2 of average weekly earnings and of earnings-related benefit shall apply also to the widow's supplementary allowances. After all that wording, that is the short answer.

The other point was about paragraph (a), which provides for the year that is to be taken into account. Paragraph (b) enables regulations to be made varying this so that, where the husband has been receiving earnings-related supplement to unemployment or sickness benefit, the widow's supplementary allowance will be based on the same average earnings as were used to calculated the husband's benefit.

The hon. Member for Rutland and Stamford (Mr. Kenneth Lewis) raised doubts about paragraph (a). In general, the basis used will be the average earnings over the last complete year before the benefit year in which death occurred—that is, the last Income Tax year except in the case where death occurs between 6th April and the first Monday in May, when the penultimate tax year will be used. I hope that is clear to the hon. Gentleman. I must admit that it is not at all clear to me. For greater clarification I nearly went over it again, but I shall not because I am sure that the hon. Gentleman will look at HANSARD tomorrow.

On subsection (4), the hon. Member for Bradford, West and the hon. Member for Rutland and Stamford were concerned about the details involved. This subsection is a minor provision designed to remove any doubt about the effect of the provision in the National Insurance Act about qualification for the receipt of widow's pension following the widowed mother's allowance. Section 28(3) of the Act provides that a widow ceasing to be entitled to a widowed mother's allowance when she is over 50 is qualified to received the widow's pension thereafter.

This provision deals with the case where the widow ceases to fulfil the conditions for the widowed mother's allowance—for example, when the youngest child reaches the age of 19—while she is still drawing the widow's allowance. The doubt which arises concerns whether such a widow can be treated as having been entitled to the widowed mothers allowance for the purpose of the provision in Section 28(3). and this is to remove any such doubt, either in relation to the existing provision or to the corresponding provision in the 1946 Act, which was repealed on consolidation and replaced by Section 28(3) of the National Insurance Act. I apologise for the complexity of the replies, but I hope they contain indications of the powers in these provisions.

Mr. Tiley

It is almost as difficult listening to the explanation as it is making it. Perhaps the hon. Gentleman will be kind enough to clear up the other two points I made. The first concerns the case where the husband was away ill on the appointed day—in other words, where the claim is being paid on the old rate. Will the widow become entitled to related benefits?

Mr. Pentland

Can the hon. Gentleman clarify that? We still cannot grasp what he is driving at. He referred to a husband who was away ill and then asked what the position would be when the husband died?

Mr. Tiley

I am trying to make certain that everybody is in benefit on the appointed day and that when there is an illness on the appointed day, a claim is not treated under the old Act so that the widow receives nothing. What I am trying to establish is that every person in insurable employment will be in benefit on the appointed day so that there will be no hardship cases arising because of the ruling that the person concerned was away ill or unemployed or as a result of an accident on the appointed day and, not having paid any contributions at the new level, could not benefit. Our sympathies are with the Minister and the Parliamentary Secretary in their efforts to answer these questions. This has been an enormous day of technical questions and now the broody Chancellor of the Duchy comes in to cast his benign influence over the Committee and I dare say that he finds it a relief from his studies.

The Chancellor of the Duchy of Lancaster (Mr. Douglas Houghton)

Curiously enough, I know the answers to most of these questions.

Mr. Tiley

The right hon. Gentleman has time to do his homework.

Secondly, I was trying to establish that there were two separate benefits of 26 weeks each and that when a husband had been ill or unemployed for 20 weeks and then died, his widow would get a separate benefit of 26 weeks, in other words, that there would be two separate claims for two separate periods of 26 weeks.

Mr. Pentland

This gets more complicated as it goes on, but we can return to it later when the answers to these questions will be supplied.

Miss Herbison

It is difficult to get to know what the hon. Gentleman wants to know. If a person has been off sick for one, two or three years and then dies, there is no earnings-related supplement for the widow, because there will have been no earnings on which to base earnings-related supplement. An earnings-related supplement is based on the previous tax year and if a man has been off ill for a considerable time, there can be no earnings-related supplement in respect of his earnings. I hope that that clears up the difficulty.

Mr. Tiley

I am disappointed that the Bill should mean that, because once again we shall be creating a further anomaly when two widows living alongside each other and in similar circumstances will be in receipt of different benefits. There will not be many such cases, but it is a pity not to bring in everybody who is insurably employed on the appointed day. This week I had a letter from a widow who said that her husband had paid contributions for about 26 years and that she now gets no benefit. That is the sort of anomaly which we have created.

I hope that it is possible to reconsider the present proposals before Report, for I am sure that both sides of the Committee would want to cut out any injustice. So long as there is a year's work close to the date of death, a complete year, or a prescribed year, or an Income Tax year, the claim would be regulated not by the length of the illness but by the fact that the person had worked within, say, the last two years. Whereas anyone who is unfortunate and is just outside that limit would find himself with the wage-related pension.

Miss Herbison

The hon. Member says that this is going to create more anomalies. This is a Bill dealing with earnings relation to ensure that there is not going to be a sudden drop in the income of any household. If one takes the man who has been away ill for a considerable time, he will be getting the flat-rate benefit for himself and his wife. There will have been no earnings contribution paid and no Income Tax year on which to base benefit. His widow will get the benefits of the increase in the period of widow's allowance to 26 weeks instead of the present 13 weeks. I hope that helps to soften the blow for the hon. Member.

Mr. Dean

The Joint Parliamentary Secretary confirmed in answer to my earlier question that there is no earnings stop so far as earnings-related benefit for widows is concerned. Would I be right in assuming that his calculation of 15,000 widows who will not be given the earnings-related benefit means that there are 15,000 widows whose husbands were earning less than £9 per week in the previous Income Tax year?

Miss Herbison

No it does not mean that. There are other classes of people who are not entitled to the earnings-related supplement.

Question put and agreed to.

Clause ordered to stand part of the Bill.