§ The Minister for Social Security (Mr. Nicholas Scott)
With permission, Mr. Speaker. I will make a statement on the social fund. The House will recall that on 21 February the High Court delivered judgment on applications for judicial reviews in three cases concerning the social fund.
The judgment confirmed the power to give directions for the control and management of the social fund. It also confirmed the directions on how social fund inspectors are to review decisions, but found that some guidance was not consistent with the direction. Finally, it found that some aspects of the guidance on budgets was too prescriptive, and therefore not valid as guidance.
On the day of the judgment, the Department sent a letter to social fund officers informing them that the local office budget and the level of priority that might usually be met were factors to be taken into account in reaching a decision, but they were not the overriding factors. I am now in a position to set out in detail the further measures we shall be taking in response to the judgment.
We are today issuing new guidance to all social fund officers to take account of the court's decision that some of the guidance on the budget in the social fund manual was couched in language that was too prescriptive for guidance.
We are also issuing guidance today about applications for review from people who may have had applications to the fund turned down on grounds of insufficient priority because of budgetary constraints. A leaflet for the public to provide information on this matter is being distributed to DSS local offices.
As I have already mentioned, local offices were advised on the day of the judgment that the guidance on budgets was defective. From then onwards, cases should not have been refused on the basis of the defective guidance. However, if any applicants are dissatisfied with the social fund officer's decision they have the right to request a review in the ordinary way.
Although the court found that some of the guidance on budgets was too prescriptive, its judgment explicitly recognised that Parliament clearly intended that the social fund should be subject to strict monetary limits and that the Secretary of State needs to be able to give directions to achieve financial control. In the light of that, and so that there should be no doubt that it is the Government's intention that the social fund should be operated within a firm budgetary framework, I am introducing an amendment in the current Social Security Bill to make explicit the power of my right hon. Friend to give directions relating to the financial control of the fund. The amendment will similarly put beyond doubt my right hon. Friend's power to specify who is eligible for payments from the fund.
We will also take the opportunity to introduce two other minor amendments for the purposes of clarifying the procedures for applications for loans from the fund and the date on which an application to the fund is to be treated as having been made.
Copies of the new guidance on budgets and reviews and of the leaflet are in the Library.
I should also like to take this opportunity to remind the House that on Friday 16 February my right hon. Friend the Secretary of State for Social Security laid the Social 22 Fund (Miscellaneous Amendments) Regulations. These will introduce a number of beneficial changes to the scheme, with effect from 9 April. In particular, they will implement two changes which we announced in the uprating statement. First the change to the capital rule, which he made for social fund cold weather payments in January, will be extended to the other social fund-regulated payments. Thus, people aged 60 or over may qualify for help whilst retaining up to £1,000 rather than £500, in savings. Secondly, the regulations will increase the amount payable for maternity expenses from £85 to £100.
Finally, I wish to turn to the social fund budget for 1990–91. The House will recall that I announced last year that the gross allocation for discretionary payments in the coming year, 1990–91, would be £205 million. However, our experience of operating the loans element of the fund has clearly shown that it will be possible to use the available resources even more flexibly next year through the recirculation of repayments returning to the fund. I am therefore pleased to say that I am now able to increase the gross allocation by a further £10 million for 1990–91 to £215 million. This means that the gross budget for 1990–91 will be £12 million higher than the allocation made in April 1989. The £215 million will be divided to provide £152 million for loans and £63 million for grants. As in previous years, I shall be holding back £2 million as a contingency reserve.
In allocating the budgets to local offices, we have included the value of the additional allocations amounting to £3 million made in December and January to 106 offices facing particular pressure. I emphasise that every one of the Department's 448 local offices will receive a higher allocation next year. Of these, 15 per cent. will receive budget increases of 10 per cent. or more, compared with their April 1989 allocations, and nearly three quarters will get increases of 5 per cent. or more.
I shall circulate in the Official Report a list of the allocations to individual offices. I have also placed a copy of the allocations in the Library, together with a note explaining how they were calculated. I am confident that the measures I have announced today will ensure that the social fund continues to be a fair and flexible scheme for those who are most in need.
§ Mr. Michael Meacher (Oldham, West)
Is the Minister aware that there is a black hole in the middle of his statement? I refer to the fact that he has not told us what his amendment to the Social Security Bill is. He has not told us the one thing that the House needs to know—his answer to the High Court's judgment against him that he cannot have flexibility and discretion and a cash-limited budget at the same time.
Is the Minister aware that the real meaning of this disingenuous statement is that the Government intend to ignore the High Court decision, to give a nod and a wink to social fund officers to muddle through as best they can for the next three months or so, and, when the Bill becomes an Act in the summer, to issue a directive making it clear that the cash-limited budget must in all cases be the overriding consideration? Thus, any pretence of flexibility or discretion is removed.
Is the Minister aware that this is an incompetent, cynical and dishonest response to the High Court judgment? It is incompetent because it leaves local offices in a state of limbo, with a legal national budget to which social fund officers are entitled to have regard, but with 23 local cash limits that DSS staff cannot use as a reason for rejecting applications. It is cynical because, effectively, it puts the High Court decision on ice. It is dishonest because it sidesteps any proper review of past claims in the light of the High Court ruling. On that specific point, will the Minister tell the House why he should not now instruct offices, which know exactly how many cases—and who —have been refused on priority grounds, to contact all these people and to review their claims?
Is it not clear that the statement completely dodges the central issue—that a cash-limited budget of £205 million, which has been raised by less than the rate of inflation to £215 million, cannot act as an adequate substitute in meeting need for the system of single payments, whose budget in 1986–87 of £365 million was almost twice as high?
Is the Minister aware that nothing in the statement eases the intolerable pressures building up on the social fund, which are leading to refusal rates for applications of 60 to 70 per cent? Nothing in the statement prevents the social fund from driving the poorest in our society deeper into poverty and debt. More than 400,000 people are having to repay social fund loans from their basic income support.
There is nothing in the statement that the Minister could not have said on the day of the judgment. We have waited five weeks for him to announce to social fund officers and to claimants that there will be no change. It is, "Business as usual, but do not shout it out too loud until the Government have squared the courts." Is not that a cynical and dishonest response to a High Court decision which found the Minister guilty of illegality?
§ Mr. Scott
On reflection, the hon. Member for Oldham, West (Mr. Meacher) may feel that his last remarks were unfair. Following the long and complicated judgment, it was right, in terms of the guidance that we are issuing today and whether we needed to legislate to put the matter right, that we should have taken legal advice and considered carefully what to do before making a statement to the House.
The purpose of the amendment is to put beyond doubt my right hon. Friend's right to issue directions to ensure that he is able to exercise financial control over the social fund budget.
The hon. Gentleman was wrong on his second point: the court did not find in the terms that he stated. Lord Justice Woolf said:Although Parliament intended individual applications to be handled with flexibility, it … clearly intended that the scheme should be subject to strict monetary limits and the Secretary of State needs to be able to give directions to achieve financial control.Lord Justice Woolf saw no conflict between strict monetary control and the flexibility that is at the heart of the social fund. That flexibility, combined with a firm budget each year, has proved its worth in the operation of the fund.
The reason why I do not believe that it is right for local officers to trawl for every claim and to try to identify the individuals concerned is that it is quite clear from the judgment that the change of circumstances since the original decision must be taken into account. It would be wrong to arouse expectations among perhaps thousands of claimants who might have been turned down only for their 24 change of circumstances to show that they are not entitled to claim. The flexibility that is inherent in the scheme has proved its worth.
§ Sir George Young (Ealing, Acton)
Is it not the case that my right hon. Friend's statement addresses itself squarely to the difficulties that arose from the judgment? The judgment made it quite clear that the social fund was meant to be subject to cash limits and that the Secretary of State must have power to give those directions. Does my right hon. Friend accept that Conservative Members regard the social fund as an effective mechanism for giving relief to those on low incomes and for the Department to plan its budget within sensible limits? With the extra help that my right hon. Friend has announced this afternoon, and with the amendment to the Social Security Bill, Conservative Members regard the social fund as an effective instrument of social policy.
§ Mr. Scott
I am grateful to my hon. Friend, and I agree with his remarks. Predecessor schemes of the social fund —single payments and so on—were totally out of control. Budgets were doubling every two years. It would have been impossible to continue with such provision and behave responsibly towards taxpayers, who provide the money for these schemes. I agree with my hon. Friend that we have achieved budgetary control and have the flexibility and capability effectively to help those most in need.
§ Mr. Frank Field (Birkenhead)
Would it be fair to summarise the Government's statement in one sentence: the court found that the Government were breaking their own law in respect of the rights of poor people?
Will the Minister say a little more about the extra money that will now go to all offices? Will it help some claimants who are hard pressed and whose needs have not changed since they were refused help? For example, a disabled pensioner in my constituency who had no bed and borrowed a mattress, and who has found the greatest difficulty in getting up and down from the floor, was refused help from the social fund. Can we, with certainty, assure our constituents in similar circumstances that the extra help announced today will help them, or do the Government believe that such needs can remain unmet?
§ Mr. Scott
I disagree with the hon. Gentleman's opening sentence in which he sought to interpret the judge's findings. The central point of the judge's finding was that some of the guidance that we had issued was set out in terms which were too prescriptive. He said that we should use the language of guidance when giving guidance, not the language of direction. We are changing our policy to accord with the court's judgment because we agree, on reflection, that that is right. That does not mean that we have been behaving illegally.
The hon. Gentleman knows perfectly well that I will not comment on individual cases. However, the fact that we have been able to increase the budget allocation for the coming year in every local office will enable extra help to be given to some of the most deserving in our society.
§ Sir David Price (Eastleigh)
To avoid any doubt as to the full purport of my right hon. Friend's statement, will he confirm that no social fund office will refuse a legitimate claim on the ground that it has temporarily exceeded its local budget?
§ Mr. Scott
My hon. Friend is entirely right to ask for clarity and I shall make the position clear. In the interim between now and when the Social Security Bill reaches the statute book, social fund offices will work on the guidance issued today, which is that social fund offices will have to take account of budget priorities, but those will not be overriding priorities, as indicated in the guidance which was found to be defective. If the Social Security Bill reaches the statute book in its present form, it will make absolutely clear my right hon. Friend the Secretary of State's power to set down firm, financial guidelines for the fund's operation.
§ Mr. James Molyneaux (Lagan Valley)
Will not expectations be raised by the fact that this is a public statement which is presumably being broadcast? Therefore, will the Minister reconsider the suggestion made by the official Opposition that his Department and offices throughout the United Kingdom should contact applicants who have been refused? If that is impossible, can leaflets be made available soon to Members of Parliament who will have to bear the burden?
§ Mr. Scott
The right hon. Gentleman's second suggestion is the right way forward. Leaflets are available today in the Vote Office, if not in the Library. They are also being distributed to local offices, and local office managers are being encouraged not simply to keep them in the offices, but to make them available to citizens advice bureaux and other sources of welfare advice in their area.
§ Mr. David Shaw (Dover)
Will my hon. Friend confirm that the effect of today's announcement is that more money is to be made available for social security? Is it not true that, overall, since the Government came to office, about three times as much money has been allocated to social security? Is not that far more than inflation would have added to social security? Therefore, are not the Government a caring Government when it comes to social security?
§ Mr. Scott
I am grateful to my hon. Friend for his support. Anyone who looks fairly at the Government's record since they came to office will see that, in terms of social security in general and help for the sick and disabled in particular, they have more than fulfilled their pledges to the electorate and performed a jolly sight better than the Labour party did when it was in office. We shall continue to find those resources because we run the economy much more successfully than did the Labour party.
§ Mr. Alfred Morris (Manchester, Wythenshawe)
How will the budget of the social fund be affected if the independent living fund's current financial crisis is not resolved quickly? Will the Minister comment on that problem which, as he knows, is so important for severely disabled people in terms of community care?
§ Mr. Scott
I recognise what the right hon. Gentleman has said. However, he will not expect me to comment in detail today on the independent living fund because he knows that I am in touch with the trustees about their difficulties. We obviously hope to make our intentions clear about future funding in due course. However, I also recognise the valuable service that the fund has provided for severely disabled people.
§ Mr. Robert McCrindle (Brentwood and Ongar)
While I welcome the increase in resources that my right hon. 26 Friend has announced, I notice that approximately 70 per cent. is to be devoted to loans and only 30 per cent. to grants. In the light of the experience of the social fund so far, does my right hon. Friend remain convinced that that is the correct ratio bearing in mind the acute difficulty that some recipients will have in repaying loans? Will he also confirm that if a beneficiary defaults on the repayment of a loan in one year that will not militate against his being able to obtain a grant from the social fund in succeeding years?
§ Mr. Charles Kennedy (Ross, Cromarty and Skye)
Why has not the Minister taken this opportunity to remove one of the most offensive aspects of social security reviews—the withdrawal of a claimant's right to independent appeal outwith the existing social security system with regard to a claim? The Minister has quoted figures about the increases that he is making available. Is it not true that only one in 10 social security offices will see increases in their budgets that keep pace with inflation over the past 12 months? Is it not also true that even those figures are skewed as many people do not bother to claim in the first place, because they know that they will receive a loan which will come off their existing meagre income support benefits?
§ Mr. Scott
On the hon. Gentleman's first point, the system of reviews, including reviews within local offices of claimants' entitlements and also reviews of the work of the social fund inspectors, has worked very well. If the hon. Gentleman takes the trouble to read the judgment of Lord Justice Woolf, he will see that considerable compliments were paid to at least one social fund inspector for the meticulous way in which he carried out his work.
On the hon. Gentleman's second point, inflation is not the main issue which must be borne in mind when we are considering something the size of the social fund. We must bear in mind the level of need and the flexibility with which we can meet it. We must also consider matters such as the income support case load. As that has decreased, I suppose that some people could have made a case for reducing the size of the social fund. We have not done that—we have increased it.
§ Dame Elaine Kellett-Bowman (Lancashire)
Does my right hon. Friend accept that most sensible people believe that the single payment method was gobbling up far too much of the money available and that this method is much fairer? Have any of the 106 offices that are having difficulty run out of money, and, if so, what was my right hon. Friend able to do about it?
§ Mr. Scott
As my hon. Friend is aware, I share her view of the inadequacy of the single payment system and 27 particularly the lack of any budgetary control over such payments. As has been announced already, 106 local offices were coming under pressure towards the end of last year and we were able to allocate about £3 million to help them. As pressures have become apparent in other offices since the turn of the year, we have been able to give another £1.5 million worth of help to other offices that are under pressure. No office has run out of money or is in danger of doing so.
§ Mr. Merlyn Rees (Morley and Leeds, South)
Will the Minister help me to advise my constituents following a meeting of just 100 people last week, many of whom were war pensioners, war widows, and on attendance allowance or disability allowance? We sat with counsellors for a long time discussing their financial problems. Many of them said, "We cannot afford to pay our poll tax. May we go to the social fund to get a loan?" Will they be able to get a loan to help to pay their poll tax?
§ Mr. Tim Rathbone (Lewes)
Having reassured us that no office has run out of money, will my right hon. Friend also reassure us that he is content with the method of assessment of need for individual offices and the allocation of funds to those offices?
§ Mr. Scott
Each year we endeavour to look at the last year's allocation and see how it might be amended according to assessments of demand for the future. That requires a certain degree of fine tuning. With each year that passes we learn more about how to do that. Further, we try to ensure that no local office has too sharp a change in its allocation from one year to another.
§ Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)
After the Social Security Bill has been amended, will it be possible for a local social fund officer to refuse an application on the ground that it will place undue strain on the local budget? Will the Government's guidance notes clarify the situation regarding applications for house repairs? There have been examples of one local office being given them and another not being give them.
§ Mr. Scott
It is up to local offices to exercise their discretion and judgment. Apart from any help under the social fund, income support can provide help, certainly with interest on loans for house repairs. The Department of the Environment also has schemes to help with such matters.
Let me make it clear that the intention behind the amendment, as I have said on several occasions, is to give my right hon. Friend the Secretary of State power to operate the fund under proper financial disciplines. It is absolutely implicit in that that local offices will be expected to adhere to fixed budgets.
§ Mr. David Harris (St. Ives)
Does my right hon. Friend agree that the hon. Member for Oldham, West (Mr. Meacher) at least has the merit of consistency, because he was as over-the-top in his reaction to today's statement as 28 he is to all statements that are made in the House? Does he agree further that there was manifold abuse of the old system of single payments and that, given the flexibility that he spoke about today, the social fund is not only a welcome development but a proper development?
§ Mr. Scott
When I see the hon. Member for Oldham, West (Mr. Meacher) at the Dispatch Box, I am sometimes reminded of what the late Lain Macleod said about Lord Callaghan—"The law of averages is suspended—he is always wrong."
Of course we all knew of the evidence of abuse under the single payment scheme—it was manifest around the country. Offices had thousands of applications for similar needs within a very few weeks because of take-up campaigns rather than real expressed need within their communities.
§ Mrs. Audrey Wise (Preston)
Will the Minister confirm that he does not collect information about different priorities given by different offices for the same types of need? How can he know whether payments are either equitable or adequate if, for instance, he does not know whether some offices deem shoes for disabled people a low priority and refuse grant on that ground?
§ Mr. Scott
We will monitor a number of aspects of the social fund to see whether it is meeting needs. Perhaps more important than that and more likely to meet the hon. Lady's particular requirements is the fact that, as she knows, we have commissioned research by the social policy research unit at York university. It is monitoring in some detail the effects of the social fund, and it will report next year on whether the social fund is meeting the needs that it was designed to meet when it was set up. All hon. Members will look forward to that research.
§ Mr. Speaker
Several hon. Members are now rising who were not doing so before. I must put a limit on questions until 4.10 pm. We have an important debate ahead of us, in which I shall have to impose a 10-minute limit on speeches, and a ten-minute Bill.
§ Mr. Patrick Thompson (Norwich, North)
Despite the negative attitude of members of the Opposition Front Bench, who, as usual, are long on criticism and short on constructive policy, will my right hon. Friend accept my welcome for the extra money that is to be provided for the social fund which will benefit many of my constituents in Norwich? Can he explain under what circumstances my constituents, who have previously been refused payments from the social fund, will be able to reapply as a result of the statement, and will he also accept my congratulations on the swift way in which my local offices in Norwich respond to inquiries from Members of Parliament on behalf of their constituents?
§ Mr. Scott
I am grateful to my hon. Friend both for his praise about his local offices and for his gratitude about the money that we have been able to find to increase the level of the budget for the coming year. Anybody who has been turned down for a loan or a grant need only ask for his or her case to be reviewed by the local office. Those cases will then be reviewed in the light of the guidance that has been issued today.
§ Mr. Speaker
Order. If hon. Members ask single questions, I may be able to call all those who wish to put a question.
§ Mr. Alan Williams (Swansea, West)
Will the Minister confirm that the £12 million increase that he boasted about earlier does not take any account of the fact that, as he has said, he has had to increase by £4.5 million the amount that is given to social security offices during the year? Therefore, as compared with the current year's outturn, is not the increase really about £7 million, or about 3.5 per cent., at a time when the cost of living is rising by 9 per cent. for the people he describes as the most deserving in our society?
§ Mr. Scott
I hope that several of the reasons that have put local offices under particular pressure will be considered one-offs for last year. In the extra resources that we are giving local offices for the coming year, we still retain an ability to respond flexibly to special circumstances, such as to what happened in north Wales recently and to other pressures that are put on local offices. We intend to retain as much flexibility as we can within the overall budgetary allocation.
§ Mr. Andrew Rowe (Mid-Kent)
Did my right hon. Friend hear that in the question that attacked him for being disingenuous, the hon. Member for Oldham, West (Mr. Meacher) stated that the single payments fund was virtually double the present fund? By so doing, he clearly ignored about £65 million. Does my right hon. Friend agree that that carelessness with figures is precisely one of the reasons why the hon. Member for Oldham, West will never have the opportunity of being Secretary of State for Social Security?
§ Mr. Dafydd Wigley (Caernarfon)
Is the Minister aware that he let the cat out of the bag in his reply to the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) when he admitted that, after the passing of the Social Security Bill, even those who are top priority cases may not get any help if there is a directive to that end? Can the right hon. Gentleman contradict what I have just said and give an assurance that no top priority case will ever be refused simply because of lack of money?
§ Mr. Richard Holt (Langbaurgh)
Did my right hon. Friend hear BBC Radio 4 last Friday evening when there was a one-sided, biased, typical BBC attack on the social fund, in which one of the so-called "typical claimants" complained that she had to repay her loan for her television and video? Does my right hon. Friend agree that there are many people who would like to have a video but cannot afford one?
§ Mr. Scott
On the other hand, that shows the flexibility of the social fund. I do not know the circumstances of that case, but I do know that one lady who was suffering from agoraphobia and who was unable to go out was granted a 30 loan to buy a television set and a video recorder to enhance the quality of her life. That shows the flexibility of the social fund in an imaginative way.
§ Mr. John Battle (Leeds, West)
Why has the list of priority groups not been extended to include the homeless? I refer especially to women and children who have suffered domestic violence and who end up in hostels, but who cannot be rehoused by local authorities because they cannot get a social fund grant with which to set up a new home.
§ Mr. Scott
There is national guidance on this, but local offices also have the ability to set their own priority cases and to give guidance to that effect. Incidentally, although the legislation at the moment is permissive, enabling local area social fund officers—normally the local office manager—to give such guidance, that will be mandatory on them in the new scheme.
§ Mr. Anthony Beaumont-Dark (Birmingham, Selly Oak)
We all sympathise with the view of any Minister who has a cash-limited budget, but a real problem arises as to where there is a genuine need. If there are more people in need than there is cash available, can my right hon. Friend assure us that it will not be spread so thin that somebody's need will not be met? That is the problem.
§ Mr. Scott
Any system that offers such lump sum payments within a controlled budget faces difficulties. In the New Statesman and Society on 2 March, Mr. Tony Lynes said that nobody has ever found a satisfactory way to cope with this situation. He was referring back to single payments as well as to the social fund. If Opposition Members—particularly the hon. Member for Birkenhead (Mr. Field), who is Chairman of the Select Committee on Social Services and knows a great deal about this—reflect on the matter, they will know that that is true. There will be difficulties in running a scheme at the margins of a social security provision that has to cope with exceptional needs and exceptional circumstances and is budgeted. The alternative—a single payment scheme—is unacceptable.
§ Mr. Robert N. Wareing (Liverpool, West Derby)
Is it not the case that, because of the inadequacy of the social fund budget in meeting the needs of all needy people, more and more needy people will be driven into institutional care? Is that efficient? Does it deal with care of the needy? Is that the economics of the Government in dealing with this matter? Is not this system inefficient, and should not the Minister think again?
§ Mr. Scott
The hon. Gentleman knows that the community care grants under the social fund are an important part of the community care policy. He also knows that substantial and radical changes are being made to the policy for care in the community, to operate from April 1991, when local authorities will have extra responsibilities in this sector. We must look at community care in the round, and not narrowly at community care grants.
§ Mr. Geoffrey Dickens (Littleborough and Saddleworth)
Had not the old system become a licence to print money? Does not the new system have the great merit, in an age of recycling, that it recycles money so that it can be lent again? Therefore, a lot of money benefits a lot more people.
§ Mr. D. N. Campbell-Savours (Workington)
Does not the cash limiting of a budget that provides for the poorest, and often the destitute, only reflect how the Government are simply not interested in poverty and the position of the poor? Does not the by-election in Mid-Staffordshire tell the Government that many millions of our people—
§ Mr. Speaker
Order—one question. The hon. Gentleman is being unfair to his colleagues. We have only three minutes more.
§ Mr. Campbell-Savours
Mr. Speaker, every time I ask a question, you interrupt me. Can you cease this practice? You are always doing it, and it is being commented on by my hon. Friends.
§ Mr. Speaker
I asked for single questions in the interests of the House, so that other hon. Members could ask questions. The hon. Gentleman always asks more than one question.
§ Mr. David Winnick (Walsall, North)
Under the single payment scheme, poor people could receive assistance for essential items such as furniture and clothing, but now they receive only a loan, which has to be paid back out of the lowest income—income support. Why is it that, time and again, the Government inflict further punishment on the poorest?
§ Mr. Scott
The hon. Gentleman overstates the attractions of the single payment scheme, whereby specific and detailed regulations determined whether somebody received any help. If they were just outside the provisions, they were denied any help, and if they were just inside, they got it. The social fund has an enviable flexibility.
§ Mr. Tom Clarke (Monklands, West)
Precisely how many personnel in the Minister's Department are employed to deal with the reviews which he has mentioned, where are they located and why do we not have a normal system of appeal?
§ Mr. Brian Wilson (Cunninghame, North)
It seems that the Minister is more interested in pedantry than poverty. Will he elaborate on local officers not being obliged to take overriding account of their budgets? What is the practical change between the position now and what it will be in a fortnight's time? What happens to the local manager who overruns his budget in response to local needs? What happens to the poor people who are deprived if that manager is in fear of the Minister's retribution?
§ Mr. Scott
I do not know whether the hon. Gentleman was in his place earlier when I said that I saw no problem 32 in any local office outrunning its budget. I see that position continuing. Local managers are being asked not to give overriding priority to budgetary issues but to take into account a range of other factors. They have been doing that, incidentally, since the day of the judgment, but today we have issued specific guidance in that area.
§ Mr. Dennis Skinner (Bolsover)
Now that the Minister has admitted that in real terms the amount of money available in total will be less next year than it was this year, taking into account inflation, why does not the Minister go to cardboard city at Waterloo, instead of leaving this place and running to a television studio to be interviewed and to twist words to try to give the impression that a real advance has been made, and address the people there who have finished up in a heap because they have been unable to get the grants that used properly to be available? Why does not he tell them how many cardboard boxes could be purchased with a £2 million contingency fund?
§ Mr. Scott
Although I said that inflation was not the most important element which had to be considered, and that there were other factors such as the income support case load, in practice the allocation for the coming year, compared with the allocation announced for April of last year, will be broadly in line with the index that is used for calculating increases in costs, leaving out housing costs.Basis of Social Fund Allocations 1990–911. This note explains the basis on which the social fund budget allocations for 1990–91 have been calculated.Total Social Fund Budgets2. The breakdown of the social fund budget for Great Britain for 1990–91 is as follows:Community Care Grants: £63 millionLoans: £150 million (gross)In addition £2 million has been held back centrally as a contingency reserve for meeting unforeseeable demands on offices in the course of the year (eg a local flood).Principles of allocation to local offices in 1990–913. The 1990–91 allocation is based on a three component formula as follows:
- (i) 86 per cent. of the national grants and loans budgets are distributed between local offices on the basis of their 1989–90 budget allocations;
- (ii) 6 per cent. of the budgets is distributed on the basis of need as expressed by the offices' share of the national income support caseload;
- (iii) 8 per cent. of the budgets is distributed on the basis of demand as expressed by the offices' share of social fund expenditure and the estimated value of refusals on grounds of insufficient priority.The details of each of the components in the allocation formula are spelt out in more detail below.Distribution by 1989–90 allocation4. This simply allocates 86 per cent. of the total budget on the basis of an office's actual allocation for 1989–90. It includes where appropriate the value of any additional allocation made to 106 offices in December 1989-January 1990. The relatively high weighting given to this component ensures that the pace of change from one year to the next is contained.Distribution by caseload5. Caseload figures used were the average of income support caseloads at August and November 1989. Distribution was then made on the basis of an office's share of the national caseload for each of 4 client groups as follows:P PensionersE Unemployed claimants paid through Unemployment Benefit Offices33D Claimants (not pensioners) receiving a disability premiumO Other income support claimantsSocial fund data were then used to weight the distribution in respect of the 4 client groups on the basis of their share of payments made in the period April to December 1989 (the latest available) as follows:
|Community Care Grants
|Allocations for 1990–91
|81 City (London)
|84 Crystal Palace
|92 Greenwich Park
|96 Hither Green
|99 Isle of Wight
|100 Kennington Park
|107 New Forest
|108 New Malden
|113 Portsmouth North
|114 Portsmouth South
|123 Thames South
|125 Tunbridge Wells
|Allocations for 1990–91
|3. Midlands region
|134 Birmingham, Bradford Street
|135 Birmingham, Edgbaston
|136 Birmingham, Erdington
|137 Birmingham, Handsworth
|138 Birmingham, Ladywood
|139 Birmingham, Northfield
|140 Birmingham, Perry Barr
|141 Birmingham, Ravenhurst
|Allocations for 1990–91
|142 Birmingham, South Yardley
|143 Birmingham, Sparkhill
|144 Birmingham, Washwood Heath
|146 Burton on Trent
|150 Coventry, East
|151 Coventry, West
|152 Derby, Becket Street
|153 Derby, Heritage Gate
|154 Derby, London Road
|155 Dudley, North
|156 Dudley, South
|162 Leicester, Burleys Way
|163 Leicester, Lower Hill Street
|164 Leicester, Norton Street
|165 Leicester, Yeoman Street
|167 Lincoln, Newland
|168 Lincoln, Orchard Street
|171 Newcastle (Staffordshire)
|173 Nottingham, Castle Gate
|174 Nottingham, David Lane
|175 Nottingham, Shakespare Street
|176 Nottingham, Station Street
|184 Stoke, North
|185 Stoke, South
|188 Walsall, East
|189 Walsall, West
|191 West Bromwich
|192 Wolverhampton, North
|193 Wolverhampton, South