MATERNITY GRANT

HC Deb 19 March 1980 vol 981 cc444-55

The Under-Secretary of State for Health and Social Security (Mrs. Lynda Chalker)

I beg to move amendment No. 13, in page 9, line 29, after 'residence' insert 'and presence'.

Mr. Deputy Speaker

With this it will be convenient to take amendment No. 14, in page 9, line 45, after 'date', insert: 'not being later than 17th November 1980'.

Mrs. Chalker

As the House will know, the Government were glad to accept the new clause moved by my hon. Friend the Member for Abingdon (Mr. Benyon) in Committee. It makes the maternity grant non-contributory. As the right hon. Member for Brent, East (Mr. Freeson) will know, there has been a convention that non-contributory benefits are payable on the satisfaction of certain prescribed conditions. That has always applied to attendance allowances, noncontributory invalidity pensions, invalid care allowances and so on. Those conditions are "residence and presence" of the person claiming in this country. The new clause as moved by my hon. Friend the Member for Abingdon did not include the words "and presence". Therefore, amendment No. 13 adds the words to the clause.

Although the residence and presence conditions might be referred to under the heading of "residence", I gather that there needs to be power in the primary legislation to prescribe conditions as to residence and presence. Therefore, the addition of the words "and presence" in line 29 after "residence" will fit in with the other aspects of non-contributory benefits payable under the same conditions.

Mr. Andrew F. Bennett

I should like to speak to amendment No. 14.

The Minister explained that the Government had graciously accepted a proposal from a Conservative Back Bench Member, but almost implied that the hon. Gentleman had got it wrong. She should have said that her advisers had given the hon. Gentleman the wrong advice. The Minister went on to say that the Government had been generous in accepting the suggestion to make the maternity grant non-contributory. She forgot to include the qualification that it will not be implemented this year, next year or the year after. It is another example of "Never-never land". I believe that last night the Government mentioned 1983.

Mrs. Chalker

1982.

Mr. Bennett

I am pleased to hear that.

Mr. Freeson

My hon. Friend should not be so pleased. It is November 1982, which is effectively 1983.

Mr. Bennett

It will be a long time before it comes into operation.

If there is a good case for introducing the non-contributory benefit in 1982 or 1983, why not do it now? The delay will spread confusion. People will assume that it takes effect now. The Government will have to take the trouble to explain that the regulations will not take immediate effect.

The change is to be welcomed, but moving it so far into the future detracts from it. It will be difficult for the Government to explain that they believe that the benefits should be non-contributory but that will not be introduced for some time. Our amendment would have introduced the measure in November with the rest of the upratings.

What is the difference in cost between introducing non-contributory benefits now and at a future date? Why is it necessary to save that small amount of money?

During the debate on the Private Member's Bill of my hon. Friend the Member for Kingston upon Hull, Central (Mr. McNamara) a strong case was made out that improving the maternity grant and therefore the mother's care would save the Government money. The number of children born handicapped would be reduced. By improving care only marginally, and cutting down the need to care for three or four such children over their lifetime, we would recoup the cost involved. I believe that the Minister said that the cost of caring for one severely handicapped child was £250,000. The measure would pay for itself over and over again if, by better natal care, one or two fewer children were born handicapped. The Minister should consider making the measure operative now.

I can only assume that the hon. Member for Abingdon (Mr. Benyon) is so disgusted that the Government only offered him a small piece of cake that he is not here to seize his opportunity to push the Government. The Government should be prepared to accept amendment No. 14.

Mr. Orme

The hon. Member for Abingdon (Mr. Benyon) has had a wretched time. He was helped by the Government with his new clause, and prepared a long speech to move it in Committee. Unfortunately, through lack of time the new clause was taken formally. It now appears that it was drafted incorrectly. The hon. Gentleman was in the Chamber earlier, and we should not give the impression that he has not attended the debates. He has been assiduous in attending the debates in Committee and on Report. He addressed the House forcefully last night on child benefit. He looked forward to the implementation of this modest measure at a modest cost, which perhaps the Minister will confirm is only about £1 million. The hon. Gentleman then discovered that the Government did not plan to implement the measure until November 1982.

We have achieved little in the long hours spent on the Bill. When the Bill is complete, I believe that it will have taken about 130 hours. The Government have made little or no monetary concessions, which is extraordinary in a Bill of this nature. We have just wrung out of the Government a concession over the number of days for appeal. My hon. Friend the Member for Kingston upon Hull, Central (Mr. McNamara) moved an amendment last night to increase the maternity grant from £25 to £40. The Government even resisted that modest amendment on grounds of cost.

It is deception by the Government to delay this measure until November 1982. They are pushing it as far ahead as possible. The same applies to the EEC recommendations. With one exception, the implementation date is as far ahead as possible. The equal opportunities provisions are as far ahead as 1984.

This small and welcome concession will benefit married and unmarried women. Surely it should take priority over many of the Government's other expenditures, which will be spelt out next Wednesday. The Government are taking a parsimonious attitude, which should be highlighted.

In regional press reports no date is given for the non-contributory benefit. People possibly imagine that the date has fallen off the linotype, and are not aware that the date is November 1982. We are right to be dissatisfied with the Government.

Miss Richardson

The Government's reaction to all the amendments tends to reflect their meanness, and this is the meannest reaction of all. The measure would cost so little. We have been talking of sums of £20 million to £30 million, and my right hon. Friend the Member for Brent, East (Mr. Freeson) said on the previous amendment that £10 million or £11 million was peanuts.

The cost involved here is £1.5 million—perhaps less. That cannot be the reason for the delay. I assume that the reason must be that the Government want to make the change administratively simple by putting the payment on to the computer at the child benefit centre and that that cannot be done for another two years. If that is the reason, it is even worse, because 60,000 women who would have qualified for the grant on a non-contributory basis will not receive it.

5 pm

I am glad to see that the hon. Member for Abingdon (Mr. Benyon) has entered the Chamber. On this amendment, perhaps we ought to refer to him as our hon. Friend. He is welcome and I hope that he will have something to say in the debate.

If 1982 has been chosen solely for administrative convenience—and I do not believe that the cost can be the reason for the delay—that is ridiculous. If the Government claim that they are delaying the implementation of the change because of the cost involved, they should remember that £300,000 of the extra expenditure of £1 million or so will be offset by a saving in supplementary benefit payments to some mothers who do not at present qualify for the grant.

I do not see why the grant cannot be paid through the post by Giro cheques. Why must we wait for the system to be moved on to the computer at the child benefit centre? I hope that the Govern- ment will tell us the reason for the delay. If it is the cost involved, they must be the meanest Government this country has ever known.

One of my constituents rejoiced at the fact that the hon. Member for Abingdon had tabled the new clause in Committee and asked why I had not done so. I explained that the hon. Gentleman beat me to it. My constituent, like many other people, expected the new system to be brought in immediately. When I told her sadly that it would not be introduced until 1982, she said "I suppose that they are saving it up for the election." I am sure that nothing is further from the minds of the Government, but the timing could be seen by some as a small carrot to attract a few votes.

I hope that the Government will see sense. They have gone a little way towards meeting us and making the lives of 60,000 women a year a little easier. For goodness sake, let them introduce the change this year and not in 1982.

Mr. Freeson

I support my hon. Friends and, I trust, the hon. Member for Abingdon (Mr. Benyon), who introduced the new clause in Committee, in urging that the Government should consider carefully what has been said. No great financial issue is at stake here. The Government must know that.

I hope that at long last there will be a positive response on a matter that involves only marginal expenditure but is significant to the individuals concerned. We await with interest to learn whether we are to get that positive response.

Mr. Tom Benyon (Abingdon)

May I first apologise for not having been here at the start of the debate? I was researching in the Library on a matter that I hope to raise later.

We are all grateful that the Government have accepted the proposed change to enable 60,000 women a year, who would not otherwise have qualified for the maternity grant, to be able to receive it. That is a source of pleasure to Members on both sides of the House.

I have to admit that I am disappointed that we cannot implement the new scheme quicker. The women involved will receive a grant that is a derisory sum. It will hardly pay for nappies, talcum power and a pot for the child. Such women are the most disadvantaged in our society. They include the wives of long-term prisoners, girls of 16 and under who have not worked and the wives of students who are out of work. By definition, as they do not pay national insurance, they will be women in most need of the grant.

I am sad that it will be two years before we can implement the new scheme. The cost of £1.25 million to £1.3 million is small in global terms, but I understand that there are administrative problems in introducing the scheme earlier and that it is also not possible to implement it before 1982 on grounds of cost.

As a Conservative Member who fought the election on the basis of getting inflation under control, it does not lie well in my mouth to weasel about the Government's action and to be disloyal to them when they are holding the line against inflation. There are problems in making concessions, however small, and in listening with too much enthusiasm to the siren voices of Labour Members, particularly the hon. Member for Birkenhead (Mr. Field), to spend more and to do so quickly.

Let us be frank. Nothing would give me greater pleasure than for the Government to introduce the new scheme in November this year. That cannot be done on grounds of administration and cost. I mind that and I believe that my hon. Friends mind it as well. All Ministers are having battles with their colleagues at the Treasury. I wish my right hon. Friend the Secretary of State for Social Services well in his battles. He will not always win, but I am sure that he is as concerned as I am that it will be two years before the non-contributory maternity grant can be introduced.

I do not want to make a cheap political point, but at least the new scheme is to be introduced. There was plenty of time under Labour Governments, who have been in power for 11 of the past 15 years, when it could have been done, but was not. I accept what the right hon. Member for Salford, West (Mr. Orme) said about Governments being able to get only so much of their programme carried out, that the proposal was included in Labour's manifesto at the last election and that, although the previous Government had made no obvious provision for it, the cost would have been met out of contingency reserves.

It is sad that the new scheme cannot be introduced earlier, but at least it is to be introduced.

Mrs. Chalker

By leave of the House, I shall respond, because I did not comment on amendment No. 14. I agree that we need to make clear that the commitment given in accepting the new clause proposed by my hon. Friend the Member for Abingdon (Mr. Benyon) was that the maternity grant would be made non-contributory from November 1982. I have listened carefully, not only to what has been said today but what has been put to me outside for many years. This is an important provision to help mothers who do not satisfy the contribution conditions. The problem about that improvement is that it costs money. As hon. Members have said, about 60,000 more women will be getting the grant each year once it becomes non-contributory. We must meet that cost. We can meet it only if we make corresponding administrative savings. My hon. Friend the Member for Abingdon, for whose remarks I am most grateful, is right in saying that we have not only to make administrative adjustments to cope with this matter, but we need the resources to do so.

The only way to devise a method of paying this benefit in the conditions under which this Government have to work is to make the award and payment of the grant centrally rather than through local offices and to make it through the computer operation. I understand the disappointment of hon. Members. I wish I could do what they are asking. I cannot, at this moment, do that. If this matter is to be conducted properly and we are to get it right, we have to operate the maternity grant and child benefit together through the child benefit centre at Washington. That will mean a substantial change in the administration of the benefit, even a small benefit, such as the grant. This will take time.

As my hon. Friend the Member for Abingdon said, there are operational as well as financial constraints. I accept that the House and people outside are most concerned. I cannot make any promises about an earlier introduction but I can give the House an assurance that if it proves possible to reduce the time needed to make the necessary preparations, we shall reduce that time. On one point, however, I must be firm. The change in the rules has to be achieved at no cost. That means a change in the method of administration.

While I accept the genuineness with which many people have commented on the fact that it is regrettable that we cannot make the grants non-contributory until November 1982, we have taken this decision within one year of taking office. It was a decision that the previous Government, until the time of the last election—when they wrote it into their manifesto—refused to countenance. It ill becomes the Opposition Front Bench to criticise us for the speed at which we are acting. As my hon. Friend the Member for Abingdon said, the Opposition did nothing about the grant during the last five years. It became part of their election manifesto only in April 1979.

Mr. Freeson

With the leave of the House, Mr. Deputy Speaker, perhaps I may take up the hon. Lady's last point. The difference is that whatever the failings of the previous Government in carrying through a welfare programme, covering this and other matters that I would wish to have seen done and still wish to see done, the failings were on particular issues in a context of widening social services and welfare provision, and did not take the form of a major contraction such as the country is now experiencing and will experience even further.

It is one thing for a Government seeking to establish a widening of provision, stage by stage, in welfare and public service, to say "We cannot carry out A and B yet, although we intend to come to them because we are busy dealing with other improvements." That cannot be the argument of the present Government. They are contracting back on the first stages that have already been reached. A fine example occurred last night on pension increases. Many instances can be quoted. If there was time to discuss all the matters that the Opposition have placed on the Order Paper, further sharp examples in housing and social services could be quoted. It is not good enough for the Minister to put this argument.

5.15 pm

The hon. Lady is putting the argument to members of the Opposition who were Members of a Government who expanded provision generally across the board but had not reached certain items. Now there is a Government doing precisely the opposite. No hon. Member can, surely, accept that, purely on operational grounds, this proposal cannot be undertaken. We listened carefully to the hon. Lady's carefully-chosen words. She told the House that the Government must meet the additional cost involved in accepting the hon. Gentleman's amendment—endorsed by all sides of the House—by administrative cost savings. I think those were her words.

The hon. Lady went on to repeat that point by saying that this improvement must be achieved at no cost. That remark has much deeper implications than the issue before the House. I wish we had known it last night when we were debating maternity grant improvements. The implication of that statement, if taken literally, is that we can look forward, in the next two, three or four years, to no improvement in the maternity grant. We hoped that, perhaps, the matter would be left open, although we lost our moderate proposals last night to increase the amount from £30 to £45. The literal implication of the hon. Lady's words means that we can look forward over the next three years to no improvement in the maternity grant. What does that mean?

Mr. Frank Field (Birkenhead)

I was puzzled by the Minister's statement. In one respect, the statement is meaningless. Even if the grants are not increased over the next three or four years, as my right hon. Friend says, how will that be marked up as saving so to introduce the reform at nil cost? I understand the Minister to mean that there would have to be a saving in other parts of the social security scheme to pay for this. Or did the Minister mean that there had to be some marvellous administrative savings to cover the cost?

Mr. Freeson

Ministers have received instructions from the Treasury. They have been told that they would be allowed only to accept the amendment tabled by the hon. Member for Abingdon (Mr. Benyon) if they could show that by the centralisation of maternity grants with the child benefit provision, there would be equivalent administrative savings. That is not what was stated precisely, but that is what has happened. There is no willingness to use new money and contingency money. The implications for maternity grant generally are significant and worrying. Major implications, possibly, for what we were debating last night, are now revealed. There is no intention to consider improving the maternity grant levels over the next two or three years. If there is, the hon. Lady's words cannot be taken literally. There must be additional expenditure.

I return to the question of the cost that would be involved. It is obviously right to seek to reduce the cost of the administration of benefits. If that can be done by November 1982, or earlier, as the hon. Lady suggested, all well and good. No one will argue on policy grounds about that. If, however, the date is to be November 1982 and not earlier, the Government are saying that for two to two and a half years beforehand, there will be an additional £1 million to £1¼ million expenditure, in cash terms, until that cost is absorbed into administrative improvements.

Are we really being told that this country cannot even afford that amount over two years and two Budgets to bring forward the introduction of non-contributory maternity grant? By November 1982, we are told that there will be an equivalent cost saving. It is for two years only. Our amendment asks that about £2½ million should be spent in the coming two years. After that, we are told, it will be absorbed into administrative cost savings. That is what is at issue. Is it not a shame that, by the time it is introduced, the real value of the maternity grant will be about £20 at present inflation rates? Let us assume the best, that inflation will be only 10 per cent. soon. I hope that it will be lower but we would be crying in the wind if we thought that we could achieve that Government Members support moves to do something about the maternity grant and help those who are not in receipt of it now, but the Government say that £2½ million cannot be spent in the next two years.

Mr. Tom Benyon

I agree with much of what the right hon. Member for Brent, East (Mr. Freeson) said. Many of my hon. Friends would like to see an uprating in the maternity grant. The main difference is that we believe that a precondition of increasing expenditure on the social services is to find ways of paying for it, as opposed to printing money. That is why the inflation rate is so high. The needs in many other areas are as great as the updating of the maternity grant. Improvements need to be made in child benefit, the death grant and assistance for the disabled. Emotional speeches can be made about them all. It is not good enough to say that all we have to do is to raise taxes. We must create the wealth first.

Mr. Freeson

I resist the temptation to enter a general discussion on economic and financial policy, although major social implications are involved. Nobody denies that the issue partly involves the creation of wealth. However, the real issue revolves round how a society chooses to use its resources.

The Government chose to redirect resources in their last Budget to the upper end of incomes on a massive scale. I am speaking of people who are down the line but pretty well-off. I include Members of Parliament. We received benefits in the last Budget which should have gone to the people about whom we are talking today. A precondition must be a willingness to apply resources in a civilised fashion. We are moving away from that.

We have had assurances about 1982. However, that assurance is not in the Bill. We want to know why. I accept the sincerity of the Under-Secretary of State. However, we know that events can change unless Parliament legislates. Anything can happen in government. Something is happening about child benefit, as I expect we shall learn next week. Anything can happen to undermine the Under-Secretary of State's genuine intention. I do not attempt to forecast her ministerial or political position in 1982 if her best intentions on this and other issues about which she has spoken warmly do not come to fruition. She will have to judge at the time.

There is no date in the Bill. There is no guarantee that the date promised by the Minister will be applied. The Minister can change; the Chancellor of the Exchequer and the composition of the Government can change. I know that there is a genuine intention, but my main anxiety is that false reasons have been given. It would have been simple for the Government to spend £2½ million for two years by introducing Girocheque payments in the meantime and absorbing the additional costs in November 1982. We are disappointed. It was a good move which has gone sour unnecessarily at the hands of the Government.

Amendment agreed to.