MOBILITY ALLOWANCE

HC Deb 23 January 1979 vol 961 cc358-68

Mr. Alfred Morris

I beg to move amendment No. 3, in page 2, line 21, at end add— (1A) In subsection (4) (increase in rate of mobility allowance) for the words 'and such other matters as he thinks relevant' there are substituted the words 'any changes in taxation which directly affect the cost of motoring for persons in receipt of mobility allowance and such other matters as he thinks relevant; and he shall lay before Parliament a statement setting out his conclusion and the reasons therefor as soon as is reasonably practicable.'.

Mr. Deputy Speaker

With this we may discuss Government amendment No. 4.

Mr. Morris

The amendments seek to tidy up two of the amendments that were accepted in Standing Committee.

Amendment No. 3 accepts that the Secretary of State, in considering whether the rate of mobility allowance should be increased, should take into account any changes in taxation which directly affect the cost of motoring for persons in receipt of the allowance. That is the substance of subsection (5), and, as the legislation already makes clear, he can take into account any other matters that he thinks relevant.

In accepting that any changes in taxing motoring costs should be considered, however, I must emphasise that this cannot mean that the Government will commit themselves to freezing taxation of the disabled motorist at its present level. The Government are committed to the revalorisation of petrol duty. Energy conservation needs may dictate still further increases in petrol duty in the years ahead.

Mobility allowance is a major contribution—but a contribution only—to the cost of mobility to disabled motorists. Nevertheless, we accept that in considering whether mobility allowance should be increased we should take into account any changes in taxation in this field.

I have been asked on a number of occasions, both inside and outside the House, about the consequences for the disabled motorist of the Government's decision to abolish vehicle excise duty and to replace it by increased petrol taxation. We are studying carefully the situation. At the appropriate time I shall make a statement to the House. I emphasise that there are a number of major and relevant issues, such as the timing of the phasing out of the duty, upon which the Government are committed to consult with industry. These consultations have not yet taken place but it is hoped to begin them shortly.

As my hon. Friend the Under-Secretary of State made clear in Committee on 7 December, there have been inter-departmental discussions already on the position of disabled motorists. I have received a number of representations from organisations representing disabled people, including an appraisal by Mr. Peter Large, the chairman of the JCMD, which I found helpful.

I am watching the developments carefully and I shall keep the interests of disabled people well to the fore.

If any further assurance is required, however, I suggest that it can be found in the amendment. The Secretary of State will be required to consider in each review of mobility allowance any changes in taxation which directly affect the cost of motoring. The move to remove excise duty, from which disabled motorists are exempt, by increased petrol taxation is clearly one such change.

As I have said, there is a lot to be done on this issue, including resolving the starting date. Things cannot be rushed, but I shall make a statement as soon as I am able.

I turn to subsection (7). We have accepted that the Secretary of State should lay before Parliament a statement setting out his conclusions on the matter, but, whereas the original amendment required the statement to be laid not later than 31 May", our amendment provides for it to be laid as soon as is reasonably practicable". It will be sensible for the announcement relating to any increase of mobility allowance to be made at the same time as any announcement relating to an increase in other social security benefits.

Inthe past, these announcements have been made on various dates, sometimes more than once a year, and within the operational limitations it would be possible for such an announcement to be made as late as early June. Hence, we feel it is right to leave the Secretary of State with greater flexibility. Since no specific date is set for the announcement of upratings of other social security benefits, it would seem invidious to single out the mobility allowance in this way. We will, however, undertake to provide the statement as soon as possible after the end of each tax year.

10.30 p.m.

The House has sufficient procedures to prompt the statement if one has not appeared in what seems to right hon. and hon. Members to be a reasonable time. The amendment which was passed in Committee as clause 3(6) and which we are seeking to leave out is that which required the Secretary of State to have regard to any changes in the charges levied under the Motability scheme for leasing vehicles to persons in receipt of the mobility allowance.

There are a number of reasons for this course. Motability is an independent voluntary organisation. Its leasing scheme at present affects only a small proportion of the 145,000 people who will eventually receive mobility allowance, and even when the leasing scheme is fully operative it will still cater for only a proportion of the total number of recipients of the allowance. That is not the principal reason for our amendment. A more important reason is that if Motability charges are to be taken into account the Secretary of State should, strictly speaking, have access to its accounts and financial arrangements. As it is an independent organisation, this inevitably raises problems of law and business practice generally. For these reasons, we would regard this subsection as undesirable. For the detailed reasons I have given, I hope that the House will agree to accept the Government's amendments.

Mr. Patrick Jenkin

I would like to ask a question to which I hope the Minister can reply, or write to me about. As Motability receives Government support, in the sense of administrative back-up, provided at the expense of the Exchequer, does that not automatically give the Public Accounts Committee the right to examine the accounts of Motability? It certainly does so in cases where the Government are contributing to the funds of a private body. For instance, a body like the Family Fund is as much subject to the Public Accounts Committee and the Exchequer and Audit Department as a Government Department itself.

Mr. Morris

As the right hon. Gentleman knows, my Department helps Motability by seconding staff. We have given what we regard as very important help to this organisation. I cannot give a precise answer tonight, as the right hon. Gentleman suspected, on the point he has raised. He asked if I would write to him with an answer. I am glad to give that assurance. He and I, as patrons of the organisation, feel that it has done a great deal of good already. I am certain that the whole House wants Motability to achieve further success in the months and years ahead.

Mr. Hannam

I would like to follow up the point made by my right hon. Friend the Member for Wanstead and Woodford (Mr. Jenkin) in connection with the Motability scheme. I am disappointed that the amendment that was passed in Committee, which inserted this subsection (6) in the Bill, has had to be struck out by the Government. Echoing the words of the Minister, we are all staunch supporters of the Motability scheme. There is grave concern that the scheme is threatened by the lack of finance provided by the mobility allowance to enable it to operate properly. We were endeavouring to build in protection for the Motability scheme by this subsection.

I agree that, technically, as it is an independent, charitable organisation, it cannot be protected in the way we hoped in our amendment in Committee. All hon. Members of the House, Government and Opposition Front Benches, want to see Motability succeed, and I know that this is also the Minister's wish. It is going through some very difficult times. Something has to be done to ensure that it is made to succeed.

In Committee, we discussed the problems that the Motability scheme is facing. We discussed the objective of creating a mobility allowance commutation scheme that would allow Motability therefore to provide necessary vehicles for disabled people in exchange for a four-year commutation of their allowance. This objective is seriously threatened, as we agreed in Committee, by rising prices and by, of course, the rather iniquitous double VAT charge both on the car and on the leasing of the vehicle.

The figures given to us in December by Mr. Jeffrey Sterling, the chairman of Motability, showed that even the cheapest, unadapted mini-car will not now be covered by the £10 a week mobility allowance, An automatic mini, which I suppose is probably the suitable vehicle for disabled people, will now cost about £12.50 a week, if we include the insurance. If we add on the cost of adaptations that are needed for many of the recipients of these vehicles, we can see that these cars are being lifted by increased costs out of the reach of many of the low-income and non-employed disabled people who have to look to Motability in order to provide the replacement vehicles of the Government's vehicle scheme, the trikes.

So the amendment that we passed in Committee underlined the tax claw-back problem that is being faced, where one has the £520 a year mobility allowance, where over £150 a year is being clawed back in car tax and double VAT on the purchase and the leasing of the car, and where, of course, if the disabled person is working and paying the standard rate of income tax a further £170 a year can be clawed back as well.

The Government amendment refers to "any changes in taxation"—and I can understand how that will deal with particular examples, such as changes in vehicle excise duty, or motor vehicle taxation, and so on—and then it says and such other matters as he thinks relevant". I would have liked the right hon. Gentleman to explain a little more fully what was in his mind in that phrase, because he did not really refer to the difficulties of Motability; he expressed the view, which we all share, that he wants the scheme to succeed. He did not go into the details behind the Committee's decision to put this subsection in the Bill. I hope that we shall hear a little more about how the Government are to protect Motability from this gap which is going to open up between the level of the mobility allowance at £10 a week and the minimum cost now of providing and leasing a basic adapted mini-car.

I hope that we can be assured that, in the wording of the Government amendment, Motability and its requirements will be covered, because otherwise the whole future of the vehicle provision for disabled drivers will be in jeopardy.

Mr. Newton

Having set my hand to drafting for the Committee stage the amendments that are now being replaced, and having had the satisfaction of seeing them inserted in the Bill in Committee, I can hardly be expected to be totally enthusiastic at seeing them messed about with by some replacement Government amendments.

Mr. Alfred Morris

The Government amendments are improvements.

Mr. Newton

The right hon. Gentleman says that the Government amendments are improvements. I was about to say that I am rather flattered by one aspect of them, in that the wording chosen in relation to taxation is identical with my amateur draftsmanship in Committee. I take that to be very flattering indeed, because, in my relatively limited experience in this place, much of it serving on Finance Bill Committees, the parliamentary draftsmen and Ministers between them will almost invariably find some good reason for changing any Back Bencher's wording, since that makes them feel that they are one up in the game. I hope that I can be forgiven for feeling slightly one up in the game, since my wording has been accepted in that part of the Government amendment.

As the Minister has said, there were three elements in the amendments that we passed in Committee, one relating to tax, obviously with vehicle excise duty most in mind, one to the Motability leasing charges, and one to the question of publishing the conclusions and assessment of the annual review by the end of May. The Government amendments retain the first element and the substance of the third but leave out the second. I shall return to that omission.

We are satisfied with the outcome on the points about tax and publishing the results of the review. We on the Conservative Benches feel that what has happened to disabled people as a result of the Government's proposals on vehicle excise duty and petrol tax is important. I reiterate for the sake of the House the simple figures that I used in Committee. On the assumption that the disabled person is driving 6,000 miles a year in a car that performs at the rate of 30 miles to the gallon, and that the increase in petrol tax is 20p per gallon, the Government's proposed change would cost a disabled per about £40 per year more. In the context of the income of a disabled person and the Motability allowance, that is a significant sum and one about which he is understandably cancerned.

It was unfortunate that the change was proposed in the same month as disabled people began to get the benefit of the vehicle excise duty exemption. They undoubtedly felt that something that they had just been given was being immediately snatched away.

It is unsatisfactory that there is little definite commitment that disabled people in receipt of mobility allowance will be compensated. The Minister tried to sound as sympathetic as possible, but the White Paper had no commitment to compensation. It said that compensation would be considered.

On Second Reading we were told that it would be considered. When I questioned a Treasury Minister at Question Time last week, I was told that it was still to be considered. In effect, the Minister told us tonight that it is still to be considered. We are entitled to ask for a definite assurance not about the method by which it will be done but about the fact that disabled people will be compensated if the policy goes ahead and they lose sums of the order that I have mentioned.

When the Under-Secretary was talking in Committee on 7 December, he gave the clear impression that discussions with organisations for the disabled were taking place and that they would have moved along successfully by the time we reached the Report stage. That is at variance with what has been said today and with the remarks of the Minister of State, Treasury last week. It was stated tonight that no discussions had taken place. The Minister said that he had received some representations but that consultations had not yet begun. There is some confusion here. If consultations have not yet begun, why not? It is some time since the White Paper was published. The concern is well known. If in a couple of months' time a measure is to be moved in the Budget, it is high time that the consultations proceeded so that a result could be indicated.

I am pleased that the Minister has accepted the substance of my amendment about publishing annually the assessment and conclusions reached on the review of mobility allowance. I take his point on removing the specific date which was in our amendment in Committee. Both I and my right hon. and hon. Friends are satisfied that we have achieved what we sought on the question of publication.

I turn finally to the missing ingredient of Motability. I endorse what my hon. Friend the Member for Exeter (Mr. Hannam) said. It would be difficult for my hon. Friends and me to resist the point that Motability is a non-statutory body and that there is some difficulty about writing it into the Bill in the form that I suggested.

I do not insist too hard upon that, but I emphasise the importance of Motability leasing charges to the situation that concerns us all. We all know the background. After the introduction of the mobility allowance, which the Minister has rightly claimed to be a great advance in some respects, it appeared that it was not an advance at all for some people because they had vehicles and were in practice, whatever had been intended, to lose them because the vehicles were being withdrawn and they would not be able to afford a substitute vehicle out of the mobility allowance.

10.45 p.m.

The Motability scheme was devised as a means of overcoming that important problem. However much the House welcomed the mobility allowance concept, hon. Members would not have agreed to it if they had thought that a significant number of people who already had vehicles would lose their mobility as a result of the introduction of the allowance. That is still happening and will continue unless Motability works as well as everyone hoped and intended. My hon. Friend the Member for Exeter has given the figures and reasons for supposing that there are still serious problems about its providing an adequate alternative to the old invalid trike for some people.

It is a highly relevant factor to be taken into account, and even if it is not to be written into the Bill in the form that I proposed and the Committee accepted, we should like an assurance from the Minister that, in the general phrasing of the commitment being written into the Bill and the continued use of the phrase "other relevant factors". In his annual review of the mobility allowance the Minister will take into account the charges levied by Motability. That is all we ask. We accept the problem of writing that into low, but we emphasise the practical importance of the scheme and the need for Ministers to take it into account when considering the level of the mobility allowance in future.

Mr. Alfred Morris

I well understand the position of the hon. Member for Exeter (Mr. Hannam). He is a widely respected officer of the all-party disablement group in the House and he spoke with great sincerity. I know that his motive is further to improve the wellbeing of disabled people. I have said that we cannot legislate to cover Motability's leasing charges in the way that he wishes.

The hon. Member for Braintree (Mr. Newton) asked for an assurance that we shall take into account changes in Motability's leasing charges. Clearly, Ministers will want to take all factors into account, but, given that Motability is a voluntary, independent organisation, we do not feel that we should legislate as has been suggested.

The hon. Member for Braintree can derive a great deal of satisfaction from what he has achieved by his drafting. I hope that he will be drafting amendments to Government Bills for many years to come. He has shown great skill in doing so and I am sure that Government after Government will appreciate the help that he can give in using his skills in seeking to amend Government legislation.

As the hon. Gentleman said, the projected phasing out of the vehicle excise duty is an important matter for disabled people. They feel that the sweet of exemption may be snatched from their lips almost before they have got to know its taste.

It has been nut to me by one disabled person after another that I must watch their interests in this matter very carefully. I have said tonight that I shall want to make absolutely certain that the interests of disabled people are well to the fore. The right hon. Member for Wan-stead and Woodford (Mr. Jenkin) appreciates that this is a matter for interdepartmental discussions. It is not just the Department of Health and Social Security. Other Departments are also involved. I have said that I will make a further statement as soon as possible.

My hon. Friend referred in Committee to discussions that I was having with organisations of and for disabled people. He had no intention of misleading the Committee. I am in constant dialogue with representatives of organisations representing disabled people, as the hon. Member for Exeter and others will appreciate. I mentioned tonight the viewpoint of Peter Large. At the same time, I made it clear that the submission he has made to me is one which I found very helpful.

Mr. Newton

I have no wish at all to pursue the Under-Secretary of State, because I am certain, knowing him, that he had no intention of misleading the Committee, but may we be quite clear about this? As I understand what the Minister is saying, there have so far been no discussions with representatives of disabled people about this policy. The Minister is simply saying that he regularly talks to them but there have not yet been consultations with disabled people about the White Paper on vehicle excise duty. Is that the position?

Mr. Morris

What I am saying is that there have been no formal discussions specifically to deal with the phasing out of vehicle excise duty. My hon. Friend was well aware that I am day by day, not to say hour by hour, in discussion with representatives of disabled people. He knows that I have had a great many representations on this matter. I am grateful to the hon. Gentleman for appreciating [...] position. Everything said tonight by the hon. Member for Exeter and by the hon. Gentleman will be taken fully into account.

Mr. Newton

The Minister has plainly tried to overwhelm me by flattery of my drafting, and he has gone some way to satisfy our anxieties, at least for the moment. We shall look forward to the further statement that he has promised and give it the keenest possible scrutiny when it arrives. With that assurance, that there will be a further statement reasonably soon, I beg to ask leave to withdraw—[Interruption.] I am sorry, Mr. Deputy Speaker.

Mr. Deputy Speaker

Order. The hon. Member for Braintree (Mr. Newton) has been carried away by the flattery accorded him.

Amendment agreed to.

Amendment made: No. 4, in page 3, leave out lines 20 to 31.—[Mr. Deakins.]