LOCAL SCHEMES (Hansard, 23 March 1982)

§ Mr. Andrew F. Bennett
I beg to move amendment No. 83, in page 22, line 35, leave out clause 28.
I wish to probe the Government a little about local schemes. The amendment is to leave out the provision for local schemes. I am sure that the Government might feel aggrieved since, had they left out local schemes, they might feel we would have pressed to put them back in, but in Committee we spent no time discussing this question.
It sounds a nice idea that local councils should be able to have their own local schemes and it would have to be a more generous scheme, but there are one or two snags in that the Government ought to have had a careful look at this issue. First, if there is to be a local scheme and, if it is to be of any significance or worth administering, it will need quite a lot of extra money to make it work. In present circumstances it is unlikely that most local authorities will have the money to make a more generous local scheme. In addition to local authorities not having the money to make a more generous local scheme, I wonder how much thought the Government have given to how one dovetails a local scheme into the national scheme, because we have all sorts of provisions such as passporting and topping-up. What happens if a local authority has a slightly more generous scheme? How does it affect passporting or the topping-up to the supplementary benefit part of it? For instance, does one have to take into account extra money which has been made available in a local 883 scheme in calculating the follow-up benefits from supplementary benefit? There are considerable problems here. I hope that the Minister will tell us that he has thought it out and that he has also thought out how local authorities will have the money so that they can make more generous local schemes.

§ Sir George Young
I can reassure the hon. Member for Stockport, North (Mr. Bennett) that there is nothing sinister in the local schemes. Subsection (2) states that the local schemes can improve the position Only as far as the claimant is concerned. The subsection makes it quite clear that No modifications under the section shall be such that a person to whom the statutory scheme would otherwise apply receives a rebate or allowance less than that which he would have received under that scheme; In other words, there is no down-side, and there is a considerable up-side for the claimant. No one can be worse off.

§ Mrs. Ann Taylor
The local scheme could obviously give the claimant slightly more than he would have received from the overall national scheme. Circumstances could arise in which the claimant receives a small additional sum from the local authority and is, therefore, no longer eligible for a topping-up payment because the amount that he receives is greater than the small amount he might have received from topping up. What provision will the Minister make to ensure that the people who fall into that category are fully aware that they will lose their passporting entitlement?

§ Sir George Young
That is a rather up-market intervention that should be addressed to Ministers in the DHSS. The impact of the scheme is to enable local authorities to disregard sources of income that the DHSS would otherwise take into account. For example, under existing schemes which entitle local authorities to vary arrangements, local authorities have disregarded the whole of war widows' and war disablement pensions when assessing entitlement to rebates or allowances. Basically, local authorities have the power to disregard incomes that the DHSS takes into account, and thereby increase a claimant's entitlement to housing benefit. Against that background I do not see how anyone could be worse off.

§ Mr. Andrew F. Bennett
The question that my hon. Friend the Member for Bolton, West (Mrs. Taylor) and I are asking is, will supplementary benefit officers have the power to disregard any extra allowance given under a local optional scheme, or will any benefit given by a local authority be taken into account when working out the rest of supplementary benefit?

§ Sir George Young
The hon. Gentleman is being unnecessarily complicated. The whole object of the housing benefit scheme is to take housing costs out of supplementary benefit. Supplementary benefit officers will continue to deal with the ordinary non-housing needs of claimants. It will be for local authorities to deal with housing costs. Local authorities have a certain discretion in how they treat a claimant's income when dealing with his entitlement. A local authority's treatment of a claim for housing benefit is independent of how the supplementary benefit officers deal with the non-housing costs. Against that background I do not see how the problems described by the hon. Gentleman arise.
884 We have had considerable correspondence, particularly from Scottish hon. Members, impressing on us the importance of continuing the discretionary power of local authorities to disregard war pensions. That is an integral part of clause 28, which the amendment seeks to delete. Therefore, I hope that hon. Members will accept that this is a helpful part of the Bill which it would be wrong to take out. It is in the claimants' interests that this discretionary power should remain, and that the House should resist the amendment.

§ Mr. Andrew F. Bennett
I do not believe that anyone suggested it was not a helpful scheme. We were hoping that the Minister could have thrown some light on the way in which a slightly more generous local scheme would interact with the rest of the supplementary benefit system. It is sad that the Minister could not tell us. Unless he can tell us now, or unless the information is given in another place, it will make a considerable difference as to whether more generous local schemes are set up. I cannot see many local councillors opting for a more generous scheme if they discover that some of their claimants end up worse off because of the interaction with supplementary benefit, or that the local ratepayer is paying for something which could have been paid by supplementary benefit. There are major problems.
I hope that this point can be raised in another place and that we shallelicit from the Government an assurance that if a local authority introduces a scheme there will be no interaction with supplementary benefit resulting in claimants being worse off.

§ Sir George Young
It is important to sort this out I tried to explain that the local authorities dealing with housing costs of claimants have the discretion to disregard certain types of income which the supplementary benefit or the DHSS may have taken into account. There is no interaction between decisions taken by local authorities in dealing with housing benefit—there is, so to speak, no backlash—on supplementary benefit entitlement, which has already been disposed of. I hope the hon. Gentleman will not pursue that line of attack.

§ Mr. Bennett
That intervention did not help. I have suggested that the matter should be pursued in the other place but the Minister asks for an example. If someone applies to the housing department and the department decides to give 100 per cent. assistance with rent and rates, that raises the question whether the person is entitled to a topping-up payment from supplementary benefit. Will that topping-up payment be paid on the basis of the local scheme that may disregard various parts of income? Or will it be made on the basis of the national scheme that wall be less generous? The Minister may have the answer on the piece of paper that he has received. If so, I am willing to give way. I suspect, however, that there are problems. There could be a more generous local scheme in respect of disregards or levels—