HC Deb 05 March 1990 vol 168 cc576-8
9. Mr. Corbyn

To ask the Secretary of State for Social Security what is the total social fund allocation by grant and loan for the current financial year; and what was the equivalent figure for the last year of the single payments scheme.

Mr. Scott

Expenditure on single payments in 1987–88 was £214 million with an average award of £77. The total social fund allocation to local offices for 1989–90 is £204 million with an average award of £203 for budgeting loans and £260 for community care grants.

Mr. Corbyn

Last week, the High Court ruled that the administration of the social fund was illegal. What plans do the Government have to ensure that sufficient social fund money in local social security offices is available to meet the needs of people in every community, and that there will be equity in decision-making throughout the country? Does he agree that the present system of administration of the social fund is blatantly unfair, has resulted in a great deal of misery and represents an enormous cut in social security expenditure? Will he revert to the previous system of statutory single payments so that people in genuine and desperate need can get the help that they require and need not rely on the discretion of a local office which is cash-limited?

Mr. Scott

I do not recognise the hon. Gentleman's description of the social fund. If he took the trouble to look at the figures that I gave to the House—indeed if he had listened to them—he would see that what he said was manifestly out of order. Nor do I recognise his description of the High Court decision. The court simply said that some guidance had been drawn in too prescriptive a manner. Nothing in the judgment undermined the fundamental principles of the social fund. The judge said that he understood that Parliament expected the social fund to be run under strict monetary limits. I see no need to respond in any positive way to the hon. Gentleman's questions.

Mr. McCrindle

Am I correct in thinking that about £3 million of additional resources have been directed to the social security offices under greatest pressure from claims under the social fund? Can my right hon. Friend confirm that, irrespective of where one lives or the period of the fiscal year in which a claim is made, it means that, subject to all the conditions being satisfied, there should be no difficulty meeting the claims?

Mr. Scott

I warmly welcome my hon. Friend back to the House and confirm that what he says is true. We undertook to monitor the operation of the social fund when it was introduced and found £3 million extra to help 106 local offices that were under particular pressure. I cannot completely agree with the latter part of my hon. Friend's statement. Discretion, flexibility and targeting help on those who need it most may mean that different decisions will be taken in different parts of the country. However, our new procedures and the social fund inspectors seek to combine that discretion and flexibility with fairness.

Mr. Meacher

Having been found guilty by the High Court nearly a fortnight ago of operating the social fund illegally, why has the Secretary of State still not issued any revised guidance to end the illegality? Is he aware that contrary to what the Minister of State just said, Lord Justice Woolf declared that the Secretary of State has imposed budget restraints in mandatory terms that were inconsistent with the intended flexible nature of the scheme? When will the right hon. Gentleman remove those budget restraints on the relief of poverty which should never have been imposed in the first place?

Mr. Scott

Nothing in the judgment does anything to nullify the fact that social fund officers should have regard to the budget when making their decisions. The judgment stated that the guidance was an overriding priority when making those decisions. We have notified our local offices that for the time being the budget should continue to be taken into account but that it should not have an overriding impact. We are further considering what other action we may need to take in that area.

Mr. Kirkwood

The Government must take more concrete and positive action as a result of the High Court decision and I hope that the right hon. Gentleman will do that with some urgency. It must be incompatible on the one hand to expect adjudication officers to use their discretion while on the other hand they run up against cash-limited budgets. Does not the right hon. Gentleman understand that it is a double indignity to be given approval for a social fund payment in principle and then to be told that its payment is impossible because the budget has been exhausted? That will simply lead to people being discouraged from making social fund applications in the future.

Mr. Scott

We wish to ensure that the Government come forward with proposals and we shall want to consider whether they will be purely administrative or will need some legislative underpinning. In essence, I want to combine budgetary limits with flexibility. I do not believe that they are incompatible. They can operate in the interests of the taxpayer and of claimants.

Mr. Rowe

Has my right hon. Friend heard a clear statement from any Opposition party that the implied suggestion that there should be no limit on the social fund is its policy?

Mr. Scott

The Labour party has suggested that it wants to return to the old system of single payments, under which 80 per cent. of the money went to fewer than 20 per cent. of the claimants, and where we had an open-ended budget that rocketed up. All hon. Members know from constituency experience that the single payment system was open to widespread abuse.