HC Deb 17 December 1985 vol 89 cc168-74

4.3 pm

The Minister for Social Security (Mr. Tony Newton)

With permission, Mr. Speaker, I should like to make a statement about the position concerning supplementary benefit board and lodging payments following the Court of Appeal decision last Friday.

As the House will be aware, the court upheld Mr. Justice Mann's decision in the Divisional Court on 31 July that there was no power to make two paragraphs of the regulations passed by the House in April. The court rejected a cross appeal that the Social Security Advisory Committee had not been properly consulted before the regulations were made.

The House will wish to know that the Government do not intend to appeal further. We shall take steps to identify from our records those cases in which arrears may be due because we did not meet the full charge, and to pay these arrears as soon as possible. To this end, we have sought and received from the court today further guidance on how such arrears should be assessed.

I should make it clear that the Court of Appeal judgment does not affect the current benefit position of those in board and lodging. Those payments are covered by the fresh regulations agreed by the House last month which came into effect on 25 November.

Mrs. Margaret Beckett (Derby, South)

Is the Minister for Social Security aware that his statement, both in its nature and in its perfunctory length, is an insult to the House and, much more than that, is an insult to the thousands of elderly, handicapped and vulnerable people who have been illegally cheated and short-changed by the Government since the regulations came into effect? How dare the Minister come to the Dispatch Box to make that statement and utter not one word of apology or explanation for all the suffering that has been caused. It is not even as if the Government can complain that they have not been warned. Initially when the regulations were introduced the Social Security Advisory Committee heard from over 500 organisations that wrote to condemn the proposed regulations. It was the largest number ever to condemn such proposals, apart from those who wrote to condemn the Fowler reviews.

We should like the Minister to say, first, whether it is the case, as he claims in his statement, that the Government sought clarification from the court or whether, as we have been informed, the Government tried once again to put pressure on the court to weaken the judgment that had been delivered so as to deprive claimants. Will the Minister admit that if the Government had accepted the plain implications of the judgment—that cash limits also are illegal—not only would many claimants have been saved hardship but his Department's task in identifying those who should have repayments would have been made singularly easier?

Secondly, will the Minister tell us how his Department proposes to trace those who are owed money? Does he understand that it would be completely unacceptable and grossly unjust to place the burden of the claim upon individuals rather than upon his Department in seeking to identify them?

Thirdly, how far back does the Department intend the repayments to go? The clear implication of the Court of Appeal's judgment is that everything that the Government have done on board and lodging since the freeze in September 1984 has been illegal as well as completely unjust and unworkable and that everybody who has had a claim since then may be entitled in law to a refund. May we therefore have an assurance from the Minister that the cases will be dealt with on that basis? May we also have an assurance that the local authorities, who may have been giving topping-up payments, will have reimbursed to them the several hundreds of thousands of pounds that it has cost them and that they and the claimants will be compensated for all the problems that have been caused?

At this point in this extraordinary saga of incompetence, arrogance, injustice and illegality, will the Minister tell us what confidence anybody can have—indeed, what confidence he has—in the legality of the present regulations, which are also being challenged in the courts and which we have told him repeatedly we do not believe, meet the basic issues raised by the Cotton case? Do the Government yet recognise that the nature of the problem is the increase in homelessness and the increase in the numbers who are in need of care and that the Government should be seeking to help, not to penalise, those whose problems their policies have at best exacerbated and often may have caused, especially those who are physically and mentally handicapped, who stand to be affected next April by the present regulations?

Finally, will the Minister tell the House that his right hon. Friend the Secretary of State for Social Services is now considering withdrawing the regulations—not, as before, in order to do nothing whatever for months and then to rush them through, without consultation, as an emergency at the last minute, but so that he may properly consult his own Social Security Advisory Committee and the many organisations that are anxious to help to solve the problem by tackling its source, not by punishing its victims?

Mr. Newton

May I take the hon. Lady's questions roughly in reverse order. It was precisely because we were concerned to protect those vulnerable people to whom she referred that we sought to introduce fresh regulations a month ago. If the hon. Lady considers both the judgment and what I said when I introduced the regulations last month she will realise that the judgment has vindicated our decision to ensure a clear position for claimants when the judgment was delivered. Otherwise it would have called into question many of the payments that are currently being made to those who are in residential care and nursing homes. In that sense the Government are very aware of the problems expressed by the hon. Member for Derby, South (Mrs. Beckett).

The hon. Lady asked about the legality of the present regulations and compensation for local authorities, an issue that has been raised by at least one local authority. She will know that both issues are the subject of current legal proceedings and the House will understand when I say that I do not think it right to comment further on such matters.

The hon. Lady also referred to the freeze regulations that preceded the April 1985 regulations. I remind her that that was not a specific issue and the position is not on all fours with the April 1985 regulations.

The main thrust of the hon. Lady's points involved the Government's proposals to pay the arrears and their purpose in seeking clarification from the court this morning. The Government intend and expect to be able to identify the relevant claimants from the records. Ever since the original Cotton judgment in July, the Government have ensured, for obvious reasons, that such cases were kept separately marked in local offices so that we could trace and identify cases quickly should the need arise. Arrears have, of course, already been paid in cases affected by the time limits. We shall act with equal promptness to identify cases and pay arrears in relation to the judgment on financial limits.

The Government were particularly anxious to achieve clarification on two particularly important issues, and I hope that the hon. Lady will accept that that was done in good faith this morning. First, we sought clarification as to whether there was any maximum at all in the light of the judgment made last week. As I explained to the House when this matter was last debated in November, it was not entirely clear whether the outcome would mean that the old local limit system under the 1983 regulations came back into effect or whether there would no longer be an effective maximum between April and November. That point has been clarified by the court and there is no maximum between 29 April and 24 November in these cases.

The other point, to which the hon. Lady will probably attach more importance, is that one possible interpretation of last week's judgment was that young people would not qualify as boarders and that they would have to be reduced to the non-householder rate from 29 April to 24 November. It has been established that it is proper for these people to be regarded as boarders and therefore to pay them as boarders and to discharge the obligation on arrears as soon as possible.

Sir Anthony Kershaw (Stroud)

While I accept that public money was being extracted by many people, will my hon. Friend nevertheless bear in mind that a minority have suffered gravely as a result of the regulations? The people who have particularly suffered are those who have no family of their own and have made a new family by living for some years in lodgings. I trust that he will remember those people because they need his help.

Mr. Newton

I assure my hon. Friend that we shall bear that group in mind, as we sought to do with the regulations that have now been partly overturned and in the fresh regulations that were brought before the House in November. We shall continue to do everything to protect those people.

Mr. Frank Field (Birkenhead)

On behalf of Simon Cotton, my constituent who took the Government to court over this matter, I thank the Minister for his statement this afternoon.

The Minister must be aware that his policy has been declared illegal and unlawful, twice by the courts and that that policy has resulted in some young people being made homeless, many being underpaid and others moving around the country in an attempt to claim benefit. Will the hon. Gentleman explain what measures he will take to trace the claimants? He spoke about keeping records since the Cotton judgment. What steps is the Minister taking to trace the 60,000 or 70,000 claimants who attempted to claim benefit prior to the Cotton judgment?

I would like the Minister to look to the future. He confidently asserts that the Government's current regulations are lawful, but he must be aware that the Cotton success paves the way for the present legislation to be challenged in the courts. He must also be aware, and should have told the House, that when the Government's lawyers said that they might appeal to the House of Lords, the Lord Chief Justice said that if they had the nerve to return he would reject that application out of hand.

Is the hon. Gentleman aware that on Friday 13 December Camden council obtained leave for a judicial review against the current regulations? There is a large question mark over the Government's current proposals. Surely it would be advisable for the Minister to follow the advice that is constantly offered by the Opposition. In our opinion, he cannot gain the powers by regulation; he needs to seek primary legislation and he will gain the Opposition's support if he deals with the abuse that undoubtedly exists, particularly if he concentrates on the landlords.

Mr. Newton

I thank the hon. Gentleman for the characteristic generosity of his opening remark. However, I did acknowledge, although I did not refer directly to Camden, that there were further court cases in process. That was why I did not feel that it was correct to comment, as they are manifestly sub judice.

I have already explained what action will be taken to trace claimants. Plainly, we cannot directly trace through the records people who did not establish claims, and for whom no record exists. But if cases arise they will be considered, though I emphasise that in these cases, as in others, it is not for Ministers but for adjudication officers to decide what the entitlement may be within the current available guidance on the law.

Mr. Robin Squire (Hornchurch)

I welcome the news that my hon. Friend is not proceeding further with legislation in that particular aspect of the regulations. None the less, as other areas of the regulations are being challenged, will he undertake that if or when he is convinced that the current regulations are flawed he will come back either with new regulations or, if necessary, with new primary legislation?

Mr. Newton

I assure my hon. Friend and the House that the Government will continue to ensure that their obligations to Parliament and to the court's rulings in such matters will be faithfully adhered to. As all hon. Members will agree, the Government responded very rapidly in the appropriate cases to the original Cotton judgment. By my statement today I hope that I have made it clear that the Government intend to respond with equal rapidity to the Court of Appeal judgment last week.

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

I also welcome the Minister's statement, although I reiterate the opposition of the alliance to a system that is particularly pernicious in the way that it affects young people.

Let me press the point made by the hon. Member for Birkenhead (Mr. Field). The Minister said that his Department was contacting the claimants who had outstanding money due. Does that mean that claimants will be written to individually? When will the local offices get confirmation that that is what the Minister requires of them?

Can the hon. Gentleman also say how much money is at stake, as my arithmetic suggests that a considerable sum of public money is involved? In future, when the Minister is considering changes in the system of delivering benefit—everyone can argue about the benefit levels, which can be changed by secondary legislation and nobody objects to that—will he learn a lesson and make changes by primary legislation so that the implications can be properly rehearsed in the House?

Mr. Newton

The hon. Gentleman has made that point in several different forums within the past few hours and he will have heard what my right hon. Friend said to him recently in another forum on that wider matter. We shall certainly do our best to contact claimants by whatever means. Writing will normally be the most appropriate means—

Mr. Frank Dobson (Holborn and St. Pancras)

What addresses will the Minister send the letters to?

Mr. Newton

I shall deal with the intervention from the hon. Member for Holborn and St. Pancras (Mr. Dobson) when I have dealt with the original question.

Writing will normally be the most appropriate means, and that will be a responsibility of our local offices. We are proceeding urgently with the issue of instructions to our local offices, but at present I cannot give the hon. Gentleman an exact time by which those instructions will go out. However, I point to the precedent earlier in the year followng the original Cotton judgment, when we acted within a week to get instructions out and completed the payment of arrears within two months.

For obvious reasons, I cannot at present give the hon. Gentleman estimates of the numbers of claimants who will be entitled to arrears or the amount involved, but he may like to know that, in the case of the time limits, we have paid arrears in 8,500 cases, and the total amount of money involved has been just under £250,000.

Mr. Roger Gale (Thanet, North)

Does my hon. Friend recall that the regulations were originally introduced to curb the abuse of a system which was designed to help the elderly but which was being abused by unscrupulous rest home owners? Does he also recall that young people were being exploited by unscrupulous landlords? Many Conservative Members believe that my hon. Friend acted entirely honourably and are extremely grateful for the action that he took last summer. Will he assure the House that he and his Department will take whatever action is necessary to prevent any recurrence of the sort of abuse that we faced last summer?

Mr. Newton

I am grateful to my hon. Friend and I assure him that we shall continue to prevent abuse in this area. I am also grateful to him for acknowledging that, whatever the concern about the policy in the past, it must be right for the Government firmly to hold to their obligations to the courts and the findings of the courts in the way that I have indicated this afternoon.

Perhaps I can do the hon. Member for Holborn and St. Pancras the courtesy of responding to his sedentary intervention. Clearly, we shall seek to correspond with people at the addresses that we have on file, but there will manifestly be a problem if we are unable to trace claimants. However, by making this statement, I hope that they will become aware of what has happened. We are now talking not about people who have necessarily been moved on but about cases in respect of the financial limits.

Mr. Tam Dalyell (Linlithgow)

With my experience of being Parliamentary Private Secretary to the late Dick Crossman 17 or 18 years ago, I have the feeling that Alan Mane or the late Dame Muriel Riddesdell and their lawyers would have warned the Secretary of State. At any time did any of the hon. Gentleman's lawyers or senior civil servants give him some kind of premonition of the Cotton judgment and that what he was doing might be ultra vires? My experience of the Department was that those lawyers, who are jolly clever and competent, would have warned the Minister. Did not they do so in this case, and did not the Minister have an inkling that this would happen?

Mr. Newton

The convention is that Ministers do not normally refer in detail to the advice that they receive, but I hope that the hon. Gentleman will recognise that Ministers—

Mr. Dalyell

Were you warned?

Mr. Newton

In view of the imputation that the hon. Gentleman is seeking to make, I would be grateful if he would listen to the end of my sentence. I hope that he will accept from me that it would be inconceivable—if he does not, I can only assure him with all the emphasis at my command—that neither I, the Secretary of State nor anyone else would deliberately have proceeded to maintain regulations that we were advised were unlawful.

Mr. Tony Baldry (Banbury)

Is it not somewhat bizarre that, whenever the High Court rules against a Government Department, the Opposition shout that the Minister concerned has broken the law, as if that Minister had deliberately offended against the criminal code? Surely the reality is that English law is now so complex that there will inevitably be occasions when the High Court will be asked to interpret legislation and the actions of Government Departments. On occasions it will rule against Government Departments and on others it will rule in favour. The protection for us all is that there is a High Court that seeks to protect the interests of all citizens by interpreting the laws and ensuring that nothing unlawful is carried out.

Mr. Newton

I am grateful to my hon. Friend and I agree with what he says. A number of people both inside and outside the House may have overlooked the fact that these regulations were submitted to the Joint Committee on Statutory Instruments in the normal way. Their vires were not questioned by the Joint Committee and they were passed by Parliament in an affirmative vote.

Mr. Lewis Carter-Jones (Eccles)

In view of the admitted difficulties involved in tracing the claimants, will the Minister give an assurance that he will give generous time limits so that people can claim the arrears?

Mr. Newton

We will expect to deal with this in as open and fair a way as possible to make sure that we pay arrears to those to whom they are due. The House can certainly have my undertaking that we shall do that.

Mr. Andrew Faulds (Warley, East)

On a point of order, Mr. Speaker. This is to do with the answer that we have just received—

Mr. Speaker

Is it a continuation of it?

Mr. Faulds

No, it is a quite different point, but it is relevant to what we have just been told. Can we for once break with the conventions of the House and agree that, since they cannot defend themselves, the response to the question by my hon. Friend the Member for Linlithgow (Mr. Dalyell) should come from the Civil Service Box?

Mr. Speaker

The point of order was addressed to me, not to the Minister, and it is not a matter for me.