HC Deb 23 March 1982 vol 20 cc841-51

'The Secretary of State shall refer to the Social Security Advisory Committee the question of how to administer payments so as to protect recipients and potential recipients of supplementary benefits who will lose by the introduction of the statutory schemes and will lay before Parliament its findings and recommendations thereto.'.—[Mr. Rooker.]

Brought up, and read the First time.

Mr. Rooker

I beg to move, That the clause be read a Second time.

This is a catch-all new clause for its gives hon. Members the opportunity to raise some of the points contained in new clauses 9, 10 and 11 that have not been selected. Earlier in today's proceedings, the Minister alluded to matters that we shall now discuss when he referred to those who will lose the right to supplementary benefit because the raising of the benefit allowances or the needs allowance will be less than the rate of inflation owing to the removal of the housing factor. They could find themselves with a little too much income and resources to obtain supplementary benefit that they would have received but for the passing of the Bill.

People in those circumstances, who would have obtained supplementary benefit before the passing of the Bill, would therefore have obtained automatically the passport benefits—the right to exceptional needs payments to single payments for various items, to possible assistance with heavy fuel bills, subject to the vagaries of the weather, and to free prescriptions—without having to go through another means test.

The Minister said that they could apply quite separately. Some of them will be entitled to assistance with prescription charges because of their income level. None of them, so far as I am aware, will be entitled to single needs payments because they will not be within the coverage of the supplementary benefits scheme in the first place.

Basically, we want to know why the Minister will not accept the new clause. Perhaps I am being too pessimistic, because he has not said a word yet, but I have got used to the Minister's dismissing so far this evening everything that the Opposition have put up. This new clause will not cost the Government or the taxpayer a penny because its basic purpose is to provide initial information to Parliament about these people.

I assume that the Government have done their calculations about the numbers of people affected. That must be so because otherwise the Minister could not have made the statements he made in our earlier debates about the people who are so affected and who can then apply separately for assistance with prescription charges.

We have already talked this evening about people with an income of £60 per week. That is not a very princely sum. It is well under half the current average earnings, based on the latest Government figure of £150 a week. People on £60 a week will lose, the Minister said, when the Bill becomes law.

Given that it has such a bad impact on the low paid, we wish to ask the social security advisory committee to look at how certain people could be protected. I do not think it was the Government's intention—if I am wrong the Minister can correct me—to deprive certain low-income families of the right to help with prescription charges, the right to assistance with fuel, under the existing schemes. I am asking for no new money, no changes in the schemes, but just for their rights under the existing schemes laid down and approved by this House. I do not think this was the Government's original intention, because along the way they have made various changes—0.5 per cent. here, 1 per cent. there, tapers here, different angles on the graphs, all of which have the effect of making things worse.

We therefore hope that the Minister will look favourably upon this new clause. I imagine that the social security advisory committee would want to take on the task involved in the clause. I have not discussed it with the chairman and I do not think that any of my hon. Friends have discussed the detail, but, looking at the work of the committee since it was set up, the nature of the legislation that has been passed by the House and the comments that the SSAC has made so far, I think it will want to get involved in this and will want to find a way of advising the Government how to administer this new scheme from April 1983 so that the low-paid do not lose.

I hope that the Minister will have the grace to accept the clause. It may prevent my hon. Friends discussing the matter for longer than they otherwise would. I ask the Minister to be a little more sympathetic to my hon. Friends than he was in the last debate, because we are under no time constraint tonight. I see no danger of any Conservative Members taking part in the debate because the debate is essentially between the Minister and my hon. Friends. I do not think that the Minister ought to be too concerned about giving way to my hon. Friends, because they are seeking only to elicit information. If he does not have the information, he has only to say so. This would make the debates a little more fruitful. In fact, it would allow my hon. Friends to make their speeches and listen to the Minister respond to them, rather than having to entice the Minister to get up immediately I sit down and then make their speeches afterwards.

Mr. Andrew F. Bennett

Does my hon. Friend accept that when the Minister is as arrogant and incompetent as he was in his last reply he tempts Opposition Back Benchers to call for a vote on the last five Government new clauses and keep the Minister here for an extra one and a half hours?

Mr. Rooker

If my hon. Friend does that he will keep me here for an extra hour and a half.

The Minister can see that harsh words, the clear implication being that he was not even prepared to listen to the question of my hon. Friend the Member for Stockport, North (Mr. Bennett), do not make for a fruitful debate. Labour Members are constantly chastised by the Conservatives who maintain that we want to move away from the concept of parliamentary democracy, yet here we have a Tory Minister who does not want even to debate matters in the Chamber of the House of Commons. It is no use the Minister shaking his head at that because that is what happened in our last debate.

Mr. Rossi

rose—

Mr. Rooker

I must give way after what I have just said. All the Minister has to do is to enter into the spirit of this debating Chamber, as he did in Committee, and when he does not know the answers to be big enough to say so.

Mr. Rossi

The hon. Gentleman is really making a mountain out of a molehill. I listened very carefully to the speech of the hon. Member for Stockport, North (Mr. Bennett) and I did not interrupt him. Then I sought to make my points, and he sought to interrupt me at an inconvenient point, when I could very easily have lost the thread of my remarks. Therefore, I refused to give way to him, but he would have had an opportunity later to intervene or, with the leave of the Chair—and this has happened already this evening—to make a second speech.

Mr. Rooker

It would only have been necessary for the Minister to keep his finger on the line he had reached in the brief that he was reading and then to return to it. If I remember correctly, because I was watching the Minister, when my hon. Friend the Member for Wood Green (Mr. Race) sought the leave of the House to make a further small contribution—

Mr. Deputy Speaker

Order. I am finding it a little difficult to relate these remarks to the new clause.

Mr. Rooker

I am attempting, Mr. Deputy Speaker, to set the framework so that we may debate the new clause rather than get into the procedural mess that will develop if Minister is not co-operative. I have asked all the questions I intend to ask at this juncture. It is quite clear that the Minister must have some answers to the questions, otherwise he could not possibly have made his comments earlier this evening. I shall wait and listen to his answers before I decide whether to seek to catch your eye again, Mr. Deputy Speaker.

Mr. Andrew F. Bennett

I have several new clauses down tonight and there is obviously not much hope of the Government's accepting any of them. It certainly seems to me, however, that this is one that the Minister could make it absolutely clear he accepts. We have a major problem with this part of the Bill because clause 26 and the two or three other clauses that go with it are simply enabling legislation. In parliamentary terms they really say that the Minister can do what he likes.

It surprises me that when the Opposition argue the case both here and outside for general enabling measures so many Conservatives claim that it is anti-democratic and all sorts of things are wrong with it. Yet it is Conservative Ministers who time and again come to the House with general enabling measures. That is really what this is and what is important is how far we retain some form of scrutiny of the new housing benefit system into the future.

One of the ways we can do this is by making sure that the social security advisory committee monitors it carefully and makes regular reports to the House or it. Then at least we shall have some opportunity to debate the way in which the Minister uses the general powers given to him by clause 26.

In Committee we expressed considerable concern about how the new system would be brought into force. It is going to be brought into force by statutory instruments. We want assurances that those instruments will be adequately debated. Amendments were made in Committee providing that when the regulations are first introduced they will have to be laid before the House and be the subject of a minimum hour-and-a-half debate, but anyone who has examined the matter will realise that that will not be satisfactory. We need at least a day's debate—and an informed day's debate. It would be ideal if the social security advisory committee saw the regulations first and commented on them before the House examined them.

7 pm

There is a whole series of areas in which we want to know what the regulations will do. One that concerns me particularly is water service charges. The Minister assured us in Committee that those on existing supplementary benefit rates would have what most people know as the old water rate paid 100 per cent., but those who are just above the supplementary benefit level will receive no assistance. They will have to meet the whole cost, and that upsets many of my constituents. They are entitled to rebates on their general rates, but they are entitled to no rebate on their water service charges. Many complain that they now have to pay more for their water charges than they pay for their general rates, because the rates are rebated. This is a question that should have been put to the advisory committee. I am sure that it would say that it is illogical not to give those on low incomes any help with their water charges.

What is particularly illogical is that the Government have achieved no uniform pattern over the whole United Kingdom. In Scotland people pay a water rate which covers merely water, and not sewerage, and they pay the local authority for the sewerage. The authority can give a rebate on the part of the sewerage charge, so those in Scotland are fortunate in that they receive more help with their water and sewerage charges than those in England and Wales do. I am not sure what the position in Northern Ireland is.

Mr. James Molyneaux (Antrim, South)

It is more complicated.

Mr. Bennett

If the Government 'are talking about a national scheme of assistance, it is illogical to give different levels of assistance in Scotland. The question should be referred to the advisory committee. I believe that the committee would come out firmly in favour of extending assistance, via this scheme, to those who are just above the supplementary benefit level and who have to pay high water service charges.

My hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) discussed the passporting effect. Traditionally those on supplementary benefit have been able to claim all sorts of other benefits merely because they were on supplementary benefit. It was normally possible for them to show their supplementary benefit book as proof of entitlement, as the passport to the other benefits.

With the combined new scheme some people will no longer receive any supplementary benefit. What form will the passport take in future to enable people to establish very simply that they are entitled to assistance—whether with prescription charges, free school meals, or travelling expenses for visiting people in hospital or in prison? What will be the position over dental charges for those who used to be on supplementary benefit but who will now be on the combined housing benefit and will not have a supplementary benefit order book? If the Minister cannot tell us, we shall want the advisory committee to examine the matter.

What will happen to those who come into the new scheme with existing debts? Sadly, many people get into arrears with their rent. Someone asks them what they will do to pay the arrears, and then it is discovered that they were entitled to various forms of assistance. They often go on to rebate or supplementary benefit, which eases their problems in meeting their bills. Under the present provision, it has normally been possible to make deductions from supplementary benefit, though I gather that it is not normally possible to make deductions from national insurance benefits.

I hope that the Minster can assure us that in future small deductions from supplementary benefit can be made in order to start paying off arrears of rents or rates when those are outstanding when someone enters the scheme. If it is not possible, the advisory committee should examine the matter. When one must plead with the housing authority not to evict someone, often all that can be said is that in future the rent must be paid direct, and he must pay off 50p a week or so off the arrears. I hope that the Minister will say that that will be possible in the future.

The whole Bill came about as a result of the comment of the Supplementary Benefits Commission that the whole system was illogical and far too complicated and that it needed reform. The commission put forward many arguments for integration and for producing one system, but it made the point that many people would have a little less money in their pockets. It said that it realised that that was a disadvantage, but also said that there would be some administrative and other advantages. It suggested that the disadvantage could be left to one side, because it was outweighed by the advantages. I am not certain that that is true.

It seems to me that by the new scheme we shall effectively reduce the amount that many people will have in their pockets each week. Admittedly, at present they have the money in their pockets only because they are on the way to paying it to the local authority in the form of rent. Many of my constituents who are paying £15 or £20 a week in rent and rates have that money for a fortnight, because they pay it to the housing department fortnightly rather than weekly. That means that they have the use of the money for a week before they pay it over. That is very important to some of my constituents, because they do not have the advantage of cheques or plastic money to enable them to buy things before they have the money to pay for them. They have to live in a cash society.

One of my constituents can regularly go to a supermarket some distance from her home and do her shopping fortnightly, using her rent money in the first week. It gives her the necessary amount of cash. Because she goes to the supermarket to buy her main shopping for a fortnight she can buy things that much cheaper than at the corner shop. She can afford her bus fare there and a share of a taxi coming home. The next week when she receives her supplementary benefit she can use it not for food but to pay the rent. She never gets into arrears and she has the advantage of that extra cash for a week. It might be said that the system at present works as the people's bank, giving people a little money that they can use.

The present system also gives people the insurance, if things go desperately wrong, of being able to go a week or a fortnight in arrears with their rent. I do not believe that they should go in arrears, but anyone who wants to criticise someone who goes into rent or rate arrears should live on those income levels for several years to know what the problems really are.

I believe that in the Bill we are taking away that option. Few of my constituents want the option; they do not want to use it, because they dread getting into arrears. The choices might be having the gas or electricity cut off or not having enough food for their children. If a child has a disastrous accident and comes home from school having ripped a pair of trousers and it is a question whether he gets to school the following day, they may well be making the right choice in spending the rent money on meeting such a crisis and going a day or two in arrears with the rent rather than facing up to the other consequences.

As a result of this measure, we are taking away cash; we are taking choices and options from people who will be in receipt of the new housing benefit, because it will be paid direct to the local authority. Individuals will never receive it, so they will lose that flexibility. That may have considerable consequences for those on benefits and it is a major aspect that the social security advisory committee ought to be considering after the first six months, to understand the consequences and appreciate what the Government ought to be doing about them. It may be that the Government ought to be raising the general level of benefits so that claimants have that little extra margin; they are not so tightly tied down by the money they have that they cannot have anything on one side to meet an emergency.

The proposals put forward by the Supplementary Benefits Commission stated that although there might be disadvantages, such as reducing flexibility and the amount of money that claimants had in their hands at any time, it had so many other advantages that it was only fair, once the scheme had operated for six months, to reconsider it and ask whether it was working and causing much extra hardship.

What are the scheme's implications for those unable to pay fuel bills? Does it mean that there are greater fuel debts and has it helped local authorities to reduce their problems of debt collection? They are major issues and I hope that the Minister will make it clear that he expects the social security advisory committee to consider all these questions as the scheme comes into operation. If the reports it produces suggest that the problem I have mentioned is major, I hope that the Government will do something to act on it a little more quickly than they have done on some of the other areas where the Committee has been critical of them and where they have been slow to act.

Mr. Race

I shall make only one brief comment on new clause 12 and its interrelationship with new clause 14. As my hon. Friend the Member for Stockport, North (Mr. Bennett) knows, there is a relationship between those clauses.

The relationship is that if the social security advisory committee, which can, of course, consider whatever it likes, has information from local authorities on the way that a scheme is working and whether the administrative arrangements made by the Government and implemented by them are working effectively to the benefit of claimants, it will be unable to get information from beneficiaries. Because of the absence of an appeal system, there would not be a direct way that the SSAC could monitor the sort of complaints that people were making through an appeal system against a local authority refusing to do something.

That relationship represents a major undermining of the SSAC's position. How is it to know the claimant's precise objections towards the system and the way it is being administered if there is no appeal system by which he can get advice and redress when a local authority has done something against his interests? I would be interested to know why the Minister believes that the SSAC will be able to monitor that aspect of the new housing benefit scheme. Will it be unable to undertake survey or research work with local authorities? Will it do that on a national scale? That is important if it is to preserve its credibility. It is essential that the information it is given is from a national scale and not from one or two selected local authorities whose practices may be completely out of line with others.

Therefore, I hope that the Minister will support new clauses 12. and 14 because of the need to preserve the information that the SSAC receives and to preserve the gains that are supposed to flow from this scheme. We are debating this issue only because of the alleged benefits that it will have for claimants. If that system does not work for the claimants and does not mean that they must go to fewer offices, fill in fewer forms and have less hassle. there is no point the House of Commons voting it through.

7.15 pm
Mr. Rossi

Opposition Members raised many matters that they wished the SSAC to consider. I am sure, once it has assumed responsibility, that it will want to consider those matters among others relating to the housing benefit scheme. Indeed, the Government will be anxious to receive its advice on all aspects of housing benefit. However, this new clause requires, in terms, the Secretary of State to ask the SSAC to consider certain matters—the protection of supplementary benefit recipients who lose from the introduction of the housing benefit payments, and for those to be reported and for the report's findings to be put before Parliament. This is a little disparaging to the social security advisory committee,

That committee is an independent body set up to advise the Secretary of State across the whole range of social security matters. Its chairman, Sir Arthur Armitage, and its members are experienced, and I am sure that they will take the responsibility for housing benefits seriously. They will wish to consider all the relevant matters, and are the best placed to decide, in relation to their other priorities, the aspects of the scheme requiring particular attention. Therefore, it is not for the Secretary of State to ask them to do anything; they are independent and must decide matters for themselves. I have no doubt that these important matters will come within the purview of their consideration.

Concern was expressed for supplementary benefit recipients who lose as a result of the scheme's introduction. They will be beneficiaries floated off supplementary benefit by the new scheme. Those who remain on it obviously get passported 100 per cent. for their rent, rates and water rates and, therefore, do not lose in any way. Who will be floated off? It will be either those who became entitled to topping up because they are losers or those who gain weekly benefit. However, both categories might run the risk of losing entitlement to ancillary benefit. For example, single payments and free benefits under the National Health Service. The Opposition specifically referred to these matters.

We intend to provide a topping-up payment in the regulations and procedures that we shall lay down. That will be a legal supplementary benefit, treated as such, and serve as a passport for the whole range of benefits, in the same way as ordinary supplementary benefit does now. Therefore, the loser's position is fully protected. According to our estimates, gainers number about 73, 000.

Mr. Andrew F. Bennett

The Minister said that there will be passports. However, what will the individual use as a passport, to serve as a supplementary benefit book does at the moment? When he shows someone a supplementary benefit book, he is accepted as being on supplementary benefit. What will he have to show that he is getting the housing benefit and is entitled to other passporting benefits?

Mr. Rossi

He will receive a payment order which will show that he is receiving topping up, a supplementary benefit. I assure the hon. Gentleman that the documentation will be available in some form to people who are entitled to receive the other ancillary benefits, which are the entitlement of all people on supplementary benefits.

Mr. Field

Many hon. Members have to advise their constituents about whether to opt for supplementary benefits or the rebate scheme. We have to decide whether being better off in the short-term is offset by any long-term gains through being on the other benefit. We were worried in an earlier debate today that if the needs allowance is not kept in line with pension arrangements in future it will be even more difficult for us to advise our constituents as to the best deal. Up to now, the needs allowance has been kept in line with increases in the old-age pension. One of the undertakings that the Minister failed to give when he replied to that earlier debate was that it would be kept in line in future. If it is kept in line, it will help us to deal with complicated decisions as to the best buy between the two benefits. Sometimes people opt in the short-term to be worse off on one benefit because they know that in the long run they will be substantially better off.

Mr. Rossi

I accept what the hon. Gentleman says. There is a dilemma at present. It is difficult to know whether to go to the town hall and ask for a rent or rate rebate or to apply for supplementary benefit. One can lose financially by making the wrong choice. The object in bringing forward this new scheme is to obviate the need to make that choice. If a person is entitled to supplementary benefit, he does not have to worry about whether he should claim a rent rebate or a rate rebate, because he will automatically get it. If people are supplementary benefit recipients, they will get a full rebate. They do not have to make a choice.

People who do not receive supplementary benefit have no choice. They apply straight away for the rent and rate rebates, and they are then paid in accordance with the operation of the needs allowance or the tapers in relation to their income, their dependants, and so on. That is how the scheme will operate. We put forward the scheme because of the great simplification that it will bring. It will be much easier for the hon. Gentleman's constituents, who will no longer be faced with this dilemma.

Mr. Field

I thank the Minister for that reply. I wish to be absolutely clear about the position, even though other hon. Gentlemen may have grasped it. Let us assume that a person's unemployment benefit covers his needs allowance and supplementary benefit, as at present. I know that that is not so, but let us assume it, for the sake of the illustration. The only additional payment is the rent payment. In those circumstances, does the payment for the rent come from the DHSS or from the housing office? I thought that part of the aim of this scheme was to cut the responsibilities of one Department and give it to the other.

Mr. Rossi

I hope that I understand the hon. Gentleman. If people are receiving only help with their housing through the DHSS, and not in receipt of any other supplementary benefit, they are the people who will be floated off. If, as a result of floating off, they have to pay a rent of a given figure and find that their income is then below the needs allowance, they will be topped up. They are the topping up class—the potential losers who, as a result of being floated off supplementary benefit on to housing benefit then find that their income falls below the supplementary benefit level. They will then be topped up to the supplementary benefit level. Because they receive that topping up, they will automatically receive all the ancillary benefits about which the hon. Member for Birmingham, Perry Barr (Mr. Rooker) expressed concern.

We are thus left only with the gainers. They are the people who will find themselves financially better off to the tune of about £1.40 to £1.43 a week as a result of the change that we are making. Potentially, they stand to lose indirectly, because they are no longer in receipt of a supplementary payment, either as housing assistance or as topping up. They will not then be passported automatically to the other benefits, such as the free prescription charges. We believe that most of them will be entitled to those benefits and services on other grounds. For example, if retirement pensioners fall within the category of gainers, as floaters off, they will get free prescriptions because they happen to be retirement pensioners. Where they are not, there are existing arrangements whereby people not on supplementary benefit or FIS qualify on the ground of low income for free welfare foods, free prescriptions, and help with NHS charges. Broadly speaking, people will get this kind of help if their incomes are at or marginally below or marginally above the supplementary benefit levels. As we discussed on an earlier amendment, there will be ways in which those people can claim these ancillary benefits, even though the consequence of floating them off the supplementary benefit does not give them an automatic passporting to them.

Mr. Race

Is there any benefit that people claim through an income eligibility scale because of low income—for instance, free prescriptions or free dental treatment—as a result of which they are likely to be caught when floated off supplementary benefit, thus losing their automatic passport to other benefits? If there is any other benefit where the income eligibility scale creates that difficulty? Can the Minister assure us that the scheme will be changed to remove that problem?

Mr. Rossi

None comes to mind. Obviously such problems are teething problems in any new scheme. We shall monitor the scheme carefully. And I hope that the SSAC, too, will monitor the scheme and tender advice. We shall have to judge the scheme in the light of experience, and the necessary changes will be made to ensure that there is no unintentional hardship whereby people lose rights that they otherwise would have. Of course, when it comes to spending money, I must show the usual caution and say "Subject to resources and economic and other circumstances allowing".

That brings me to what the hon. Member for Stockport, North (Mr. Bennett) said about water charges. What he proposes would involve a substantial financial commitment. It would cost roughly £74 million to do what is suggested in new clause 10 which has not been selected for debate.

For all the reasons that we have discussed in connection with other amendments—the nil-cost basis, the lack of resources, the constraints upon me and so on—I would not have been able to accept new clause 10 if it had been selected. I do not have £74 million for that purpose. If I had £74 million to play with there are lots of other things in the social security field that I would prefer to use that money for rather than for the payment of water charges, which, like utility charges, both Governments have accepted should not be met from benefit specifically intended for other matters.

I cannot accept the new clause in the terms that it has been proposed to the House because it requires the Secretary of State to impinge and infringe upon the independence of mind of the SSAC. It is a matter for the committee and we hope that it will look at these matters. I am sure that it will. However, it is up to the committee when, how and why it does it. Beyond that I cannot help the House.

7.30 pm
Mr. Rooker

No Labour Member is impugning the integrity of the SSAC by saying that it is not independent. That should not be read into the debate at all.

As he and his colleagues did last Thursday, the Minister always answers my hon. Friends' calls for change by saying that he has not got the money and if he had he would have other priorities. He never tells us what those other priorities are. I think that it can be fairly assumed from the Minister's remarks that he accepts the spirit of the new clause. He did say that if unintentional hardship was caused the matter would be looked at. He then realised that he had stepped beyond the bounds and qualified it by saying "if economic circumstances permit". However, if the Minister—even in this Government—admits that hardship is again being caused he will not stand idly by, in what will be election year, and do nothing.

That being the case, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

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