HC Deb 12 January 1976 vol 903 cc170-8

10.21 p.m.

Mr. Roger Sims (Chislehurst)

I am grateful for this opportunity of raising the case of one of my constituents, Mr. J. D. Scholes, who took up residence in Dublin on accepting an appointment with his employers, Spicers Ltd., on 1st May 1946. He remained in Dublin until 1957, when he was transferred to the company's South African office. He returned to the United Kingdom in 1963 to work for the same organisation in London.

In 1948, when he was abroad, the National Insurance Act was introduced Mr. Scholes had no knowledge of that Act. In 1971 he was made redundant, and on making inquiries as to his pension rights he learned that in certain circumstances it is possible to pay a lump sum in respect of back payments to ensure eligibility for retirement pension rights. However, he was told that in his case, as six years had elapsed since he had become eligible to join the scheme without any action having been taken, it was not possible for him to contract in as he wished to do.

My constituent took up this matter with my hon. Friend the Member for Ravens-bourne (Mr. Hunt), who received a letter from the Department of Health and Social Security confirming what I have already set out and saying that the Secretary of State has power to extend the time limit of six years only if he is satisfied that the failure to pay at the proper time was due to ignorance or error on the part of the insured person which was not due to any failure on his part to exercise due care and diligence". Those words are of particular significance and they appear in the National Insurance (Contribution) Regulations 1969, Statutory Instrument 1696, Regulations 24 and 25.

Correspondence subsequently passed to and fro, in the course of which the Ministry reiterated the contention that I have quoted. Mr. Scholes was not satisfied, and he invoked his right to ask for a formal statement of grounds for the decision. This was duly given on 20th October 1973.

In the course of 1974 Mr. Scholes corresponded with me, as his new Member of Parliament. I finally referred the matter to the Parliamentary Commissioner for Administration. In a letter to me dated 17th October he explained that the Minister's decision was of a quasi-judicial nature and not an administrative decision, and was therefore outside his remit. However, he made an observation, to which I shall refer.

I invited the DHSS to reconsider the case in February 1975. A letter from the Under-Secretary of State dated 7th March 1975 stated that there were no grounds for reviewing the decision because there were no new facts to be considered. I accept that there were no new facts, but I claim that the Minister's decision was taken without due consideration of the facts. I suggest that a reasonable man presented with the facts would have taken a different decision. For that reason I raise the case in the House. It is the only course left open by which to obtain justice for my constituent.

As I see it, the case turns on the claim by the Minister, in his statement of grounds and in correspondence, that he, the Secretary of State, was not satisfied that Mr. Scholes' failure to pay the said contributions before the said date was due to ignorance or error on his part which vas not due to any failure on his part to exercise due care and diligence within the meaning of Regulation 32(1) of the National Insurance (Contributions) Regulations 1969 (Statutory Instrument 1969/1696) and that accordingly the Secretary of State could not direct that the said contributions might be paid within any later period. The wording of this constitutes a curious double negative.

If the Minister is saying that he is not satisfied that Mr. Scholes's ignorance was not due to failure to exercise due care and diligence, he is saying that his ignorance was in fact due to his failure to exercise due care and diligence. I accept that the DHSS has no legal obligation to advise everyone of his liabilities and that nevertheless it sent letters to Mr. Scholes on 7th June 1949, 13th March 1950 and 9th December 1963, but the first two letters were sent to addresses in the United Kingdom when Mr. Scholes was abroad, and the Ministry itself admits that it is not sure to which address the 1963 letter was sent. In his most recent letter the Under-Secretary says that he does not dispute that the letters may not have been received, and in his letter the Parliamentary Commissioner writes: It was accepted that Mr. Scholes had indeed not received the 1963 notice (just as he had not received the earlier notices which were referred to in the Statement of Grounds)". As Mr. Scholes was abroad from 1948 to 1963, I suggest that it is reasonable that he should be ignorant of the National Insurance Regulations, but in fact he periodically inquired of his company's secretarial department in London as to his pension rights and at no time was he told where he stood with regard to the National Insurance Scheme. There is no dispute that he was ignorant of the Regulations and no dispute that his failure to contribute was due to that ignorance, but I find no evidence to suggest that such ignorance was due to failure on his part to exercise due care and diligence. On the contrary, he did exercise such care and diligence as was practical, situated as he was, out of the country.

Having looked at the papers in this case prior to this debate, I hope that the Minister will agree that, despite the fact that there is no provision for appeal against a Minister's decision in such cases, the circumstances here are such that he will agree to review my constituent's case.

10.28 p.m.

The Under-Secretary of State for Social Services (Mr. Michael Meacher)

I wish to congratulate the hon. Member for Chislehurst (Mr. Sims) both on the lucidity with which he presented his constituent's case and on the perseverance with which he has pursued his constituent's rights. I hope that I may be able to give him some satisfaction in stating the position as we see it, and I shall try to answer what I believe to be the crucial points that he has raised.

I wish to make it clear at the outset that the matter raised by the hon. Gentleman on behalf of his constituent, Mr. Scholes, has been the subject of a formal decision by the Secretary of State for Social Services under Section 64(1) of the National Insurance Act 1965. The decision was given on 3rd August 1973. It is important that I should make that clear.

I wish to emphasise, first, that a decision of the Secretary of State is of a judicial or quasi-judicial nature. The hon. Gentleman also used the word "quasi-judicial". Such a decision is given only after a painstaking and careful examination of all the evidence. Sometimes an oral inquiry is held, as happened in Mr. Scholes' case, conducted by a legally-qualified person, who takes evidence on oath and makes a report to the Secretary of State.

Mr. Scholes gave evidence on oath, he questioned official witnesses, and made submissions. In view of the judicial character of the decision, which was given under the authority of the then Secretary of State, it would be wrong for me to enter into discussion of the matter. Such a decision has to be given judicially and in strict accordance with the relevant Acts and Regulations quoted by the hon. Gentleman, which there is no power to waive or vary on any ground in a particular case.

The second point that I should emphasise is that there are legal remedies available to any person who is aggrieved by a decision of the Secretary of State. Such a person has, first, a right of appeal to the High Court on a question of law under Section 65(3) of the National Insurance Act 1965 and, secondly, a right, under Section 66(1) of the Act to apply for a review if there are new facts to bring to the notice of the Secretary of State or if the decision was given in ignorance of, or was based on a mistake as to, some material fact. Mr. Scholes has at no time appealed against the decision on a question of law. There is, in Mr. Scholes' case, a time limit of 21 days for an appeal, and this has long since expired. However, the Secretary of State has powers to extend the time limit.

The hon. Member wrote on Mr. Scholes' behalf on 12th February 1975 to the then Under-Secretary of State, and that letter was treated as an application for a review of the decision. In the reply sent to the hon. Member on 7th March 1975 it was explained that after a most careful examination and consideration of the hon. Member's representations it had been decided that there were no grounds for reviewing the decision given on 3rd August 1973.

The hon. Member will also be aware that in May and June 1974 he asked the Parliamentary Commissioner for Administration to investigate a complaint on behalf of Mr. Scholes. The complaint concerned the Secretary of State's decision, which is the central issue in this debate. The Parliamentary Commissioner wrote to the Department and sought clarification of certain matters relating to Mr. Scholes' case. He also sought confirmation that a procedure exists whereby Mr. Scholes, or any other dissatisfied person in his position, can, by his own action, move the Department to reopen a case on which a decision of the Secretary of State has been given.

The hon. Member will know that the Parliamentary Commissioner wrote to him on 17th October 1974. With the hon. Member's permission I would like to quote the whole of the second paragraph of that letter, which is particularly relevant, because, in putting the case, the hon. Member argued that a reasonable person might take a different view as to the facts. The facts were not in dispute; it was a question of their interpretation. The second paragraph says: As you know, my function under the Parliamentary Commissioner Act is to investigate complaints relating to 'action taken in the exercise of administrative functions' of the Government Departments to which the Act applies. Formal decisions given on contribution questions by the Secretary of State for Social Services under Section 64 of the National Insurance Act 1965 are, I have been advised, of a judicial or quasi-judicial nature rather than an administrative nature; and indeed frequently they are taken—as happened in the case of Mr. Scholes—only alter an inquiry presided over by one of the Department's legal advisers. The Parliamentary Commissioner concluded—and, with the hon. Member's permission, I would like to quote again from the Parliamentary Commissioner's letter— the Secretary of State's decision was reached after full consideration of all the relevant facts, and no further action is therefore open to me. The hon. Member, in introducing this debate, has suggested that Mr. Scholes should be allowed to pay now the arrears of contributions in question on the ground that, despite the decision given in this case, he was in ignorance of the prescribed time limits governing payment of contributions. Furthermore, the hon. Member has insisted that Mr. Scholes' ignorance of the relevant regulation was not attributable to any failure on his part to exercise due care and diligence", to quote Regulation 32/1, to which reference has been made.

Mr. Scholes has, at his own request, been provided with a statement of the grounds of the decision. The statement set out the facts found by the Secretary of State in reaching the decision, and the relevant law applied. From those facts it seems that there are three points in time during Mr. Scholes' insurance history when he might have been expected to do something. This is relevant to the crucial question of whether Mr. Scholes did or did not exercise "due care and diligence."

The first of these points in time is on or after 5th July 1948, when the Act came into being. On going to Dublin in 1946, although having been insured from 1933, Mr. Scholes, I understand, took no steps to safeguard his rights under State insurance. Bearing in mind his geographical closeness, the availability of British newspapers and radio broadcasts, the exercise of even a little care to inquire about the National Insurance Act 1946 would have revealed the existence of provisions regarding overseas contributions. I can only conclude that Mr. Scholes manifestly failed to do so.

There was also the period on or after going to South Africa. Here, of course, the physical considerations I have just mentioned are absent. Nevertheless, having failed to do anything about national insurance when in closer contact with the United Kingdom, distance can hardly be pleaded as a mitigating factor here.

In other words, if Mr. Scholes had been going to do anything about national insurance while abroad, he would have done it by 1957.

There was also the period of his return to the United Kingdom in 1963. Here, Mr. Scholes began to pay Class 1 contributions as an employed person. In fact, until April 1971, he made no inquiries as to his retirement benefit under the National Insurance Act 1965. Had he made inquiries in 1963 he would have found that he could have paid contributions back to September 1956. Moreover, had he made inquiries after 1963 he could have paid a steadily diminishing number of arrears up to final exhaustion after six years.

That is a fair statement of the possibilities open to Mr. Scholes in each of the periods of his insurance history. He took up none of them.

There is another point that I should emphasise. Mr. Scholes wrote to the Department on 15th November 1974 asking for the address to which his contribution records were sent on 27th June 1949, 13th March 1950 and 9th December 1963. A full reply was sent on 2nd December 1974 and it was accepted by the Department that none of these records had reached Mr. Scholes. Although extensive efforts are made by the Department to advise insured persons of their contribution records, the Department is under no obligation in law to advise insured persons. It is up to the individual to ensure, without reminders, that he maintains a full contribution record.

The Secretary of State, in reaching the Judicial decision, was not satisfied that Mr. Scholes' failure to pay the contributions for the period from 5th July 1948 to 2nd June 1963 was, in the words of the Regulation, attributable to ignorance or error on his part which was not due to any failure on his part to exercise due care and diligence". I accept that that is a double negative, but the hon. Member has correctly understood its meaning. I have indicated why this view has been taken, and it has not been disputed, perhaps for technical reasons, by the Parliamentary Commissioner for Administration.

The hon. Member asked me to look sympathetically at this matter again. I pay tribute to his perseverance. He has done everything possible in this case, including raise it here again. I hope that he will appreciate that in the light of the debate my ability to accede to his request is strictly limited. It is not a matter of the discretion of Ministers, but of what is contained in statutes. Apart from a right of appeal on a question of law this matter can be subject—here I précis the legislation to which the hon.

Member referred—to a further review only if there is an emergence of new material facts. If there are new material facts we shall, of course, give full and sympathetic attention to them, but on the basis of the facts already stated and on the interpretation that we have put upon them the matter must remain as it stands at present.

Question put and agreed to.

Adjourned accordingly at nineteen minutes to Eleven o'clock.