MEANING OF "DISCRIMINATION"

HC Deb 31 October 1995 vol 265 cc118-45

Lords amendment: No. 4, in page 3, line 3, leave out from beginning to ("cannot"), in line 4 and insert ("to whom that reason does not or would not apply; and (b) he")

The Parliamentary Under-Secretary of State for Education and Employment (Mr. James Paice)

I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Michael Morris)

With this, it will be convenient to discuss also Lords amendments Nos. 5 to 16, 18, 29 and 31 to 42, Lords amendment No. 43, Government amendment (a) thereto and Lords amendments Nos. 44, 45, 104, 106, 132 and 133.

Mr. Paice

This group of amendments deals with reasonable adjustment to the meaning of discrimination within the Bill.

Under the Bill, disabled people are protected from less favourable treatment which is for a reason relating to the disability and which is not justified. Lords amendments Nos. 4, 32 and 41 change the test of when treatment is "less favourable". As amended, the Bill will regard treatment that is for a reason relating to the disability as being less favourable if it is less favourable than the treatment of people to whom that reason does not apply. For example, where someone does not get a job for a reason connected with his or her disability, that person is less favourably treated than the person who does get that job. The employer would then have to justify that treatment. That seems to us to be the right comparison.

The remaining amendments provide a simpler and clearer test of "justification" for less favourable treatment. The changes were made following concern raised by hon. Members as well as noble Lords in another place that the original test in the Bill placed too much weight on the opinion of employers, and it was too complex. Indeed, that concern was raised both in Committee and on Report. The use of the undefined and broad word "unsuitable" also led to adverse comments.

The amendments to the employment provisions substitute for a fixed list of specific justifications a principle that can be applied much more easily in the wide and varied range of circumstances that can arise in employment. Less favourable treatment of a disabled person would be justified only if the reason for it was material to the circumstances of the particular case and if it was substantial.

In part III of the Bill, the concept of a reasonably held opinion and a fixed list of justifications is retained, although the drafting has been much simplified, as in part II. Government amendment (a) to Lords amendment No. 43 alters the regulation-making power that deals with the question of what is reasonable, in the context of the provisions on premises in part III, to rely on one of the justifications for less favourable treatment. The Government amendment brings the premises provision into line with those relating to service providers in amendment No. 34. We are satisfied that this different approach continues to be right and relevant in the very different context of premises. Service providers often have to take quick and, perhaps, less informed decisions when serving someone, so an opinion-based approach remains appropriate.

In the case of the clauses about employment and provision of services, the amendments also provide that a failure to comply with a duty of reasonable adjustment itself counts as discrimination, unless justified within the relevant provision.

The amendments also make it clear, in new subsection (7), that regulations made under subsection (6) for less favourable treatment may stipulate that additional cost is a valid ground for justification. They also make it clear that regulations can enable uniform rates of contribution to be maintained. I can assure hon. Members that we do not intend that a trivial degree of extra cost should amount to a justification for less favourable treatment. The nature of an assessment makes it very unlikely that the regulations will fix precise figures for the level of extra cost that would amount to justification; instead, they are more likely to set out the considerations that should be taken into account.

We are committed to consultations on the content of regulations that relate to occupational pensions and other regulations under the Bill. My hon. Friend the Minister for Social Security and Disabled People will expand on the provisions relating to occupational pensions when the House considers the next group of amendments. I hope that hon. Members will wait until then to raise issues on that matter.

We believe that, with these amendments, the Bill provides the right balance between ensuring that an employer can recruit the best person for the job and that a provider of services can do so in a sensible way, and preventing unjustifiable discrimination against disabled people.

Amendment No. 8 ensures that the duty of an employer to make reasonable adjustments, where any physical feature of premises causes substantial disadvantage to a disabled person compared with those who are not disabled, refers only to an employer's own premises.

Hon. Members as well as noble Lords and employers expressed concerns that the criteria for reasonableness in making an adjustment should be more clearly established. The Government reflected on those concerns and concluded that it would be helpful to list in the Bill the key factors to which employers shall have regard when making decisions about a "reasonable adjustment". That is now done by Lords amendment No. 10.

As my noble Friend the Minister of State, Department for Education and Employment explained in another place, we believe that a number of principal factors should be taken into account in determining whether it is reasonable for an employer to take a step. The code of practice would, of course, give further examples and guidance on the question of reasonableness. As amended, the Bill would continue to reflect the Government's view that the duty on an employer to make an adjustment should provide a fair balance between what can legitimately be asked of employers, and the needs of disabled people.

Lords amendments Nos. 14, 15 and 16 ensure that, should the need arise, certain adjustments can be clearly prescribed as always or never being reasonable. That can be done, when appropriate, by reference to the cost of taking the step concerned.

Section 7 of the Local Government and Housing Act 1989 enshrines the principle of merit in local authorities' practice. There is an exception relating to the appointment of disabled persons. It currently refers to the quota provisions of the Disabled Persons (Employment) Act 1944, which will be repealed by the Bill. Lords amendments Nos. 132 and 133 make it clear that there is no conflict between the requirement that appointments be made on merit and the duty of reasonable adjustment in the Bill. In other words, an authority will still have to appoint on merit, but it will first have to consider whether a reasonable adjustment could help a disabled person to achieve that state of merit.

Ms Liz Lynne (Rochdale)

Will the pilot priority interview schemes be allowed to go ahead when the amendments are passed?

Mr. Paice

The priority interview scheme is part of what is being repealed, so the answer is no; but there are a number of other ways in which local authorities, in appointing staff, will be able to take positive action to allow disabled people to demonstrate their merit.

Mr. Michael Connarty (Falkirk, East)

Will the Minister give us some examples of what the Government have in mind?

Mr. Paice

There is a range of examples. Local authorities might wish to provide preferential training schemes for disabled people, to encourage them to make the most of their abilities in their employment. They might wish to launch special recruitment drives to encourage applications from disabled people for local authority posts. They might wish to encourage applications from disabled people for individual vacancies as they arose. They might wish to interview all suitable disabled applicants. They could do, or continue to do, all those things.

Let me remind the House of the disability symbol scheme run by the Employment Service. One of the commitments that employers must make if they are to use the symbol is to interview all applicants with a disability who meet the minimum criteria for a job vacancy, and then consider them on the basis of their abilities. The large number of local authorities that use the symbol is a clear indication of their freedom to take such action without falling foul of section 7 of the Local Government and Housing Act. That is just one of the ways in which authorities are currently able to ensure that disabled people have the best possible chance of making the most of the opportunities open to them. All those opportunities will remain when the Bill is enacted.

The remaining amendments are very minor, improving and clarifying parts II and III of the Bill. I commend all the amendments to the House.

4.45 pm

Mr. Gordon McMaster (Paisley, South)

Speaking at this stage in the Bill's passage, I feel a bit of a fraud. Much of the work has already been done by my hon. Friend the Member for Birmingham, Erdington (Mr. Corbett), and has been recognised by disabled people throughout the country.

I wish to concentrate on the powers of local authorities to take positive action to employ disabled people. During my researches this morning, I concluded that the Government had not acted with malice aforethought, but had merely been caught in their own net. Following the Minister's disgraceful speech about the positive action that can be taken, however, I feel that we must have something strong to say.

Only last week, in the other place, did it become clear that local authorities would no longer be able to take positive action. We thought that that was simply because the Local Government and Housing Act 1989 requires councils to appoint on merit; but councils seeking to meet the 3 per cent. quota defined in the Disabled Persons (Employment) Act 1944 have had the power to take positive action. Following the Bill's removal of the quota, that will no longer be possible.

Before reaching his conclusion, did the Minister examine the hundreds of examples of local authorities throughout the country that have taken positive action to give employment to disabled people? Before my election as a Member of Parliament I was leader of a council, and remember being presented with a "fit for work" award by the Department of Employment because the council had achieved a 1 per cent. quota for disabled people. In fact, we secured that award by breaking the law: we had exceeded the requirement by two thirds. The Minister is simply enshrining the removal of the quota in law; rather than ensuring best practice, the Bill will ensure worst practice.

One of the reasons why the quota was so difficult to achieve was that the duty applied only to registered disabled people. There is a disincentive for disabled people to register, as registration can make it more difficult for them to find employment. Many local authorities tried hard to achieve that 3 per cent. quota, but found it extremely difficult to do so because of the registration problem. They were making progress, but now some of the best practice in the country is to be stopped. The Minister shakes his head, but that will be the effect of the Bill. If local authorities can no longer take positive action, there is no doubt that the number of disabled people who are encouraged to work for authorities will fall.

Local authorities seem to be treated differently from other groups. The Bill contains an exclusion for charities, especially those dealing with disability issues in the voluntary sector, and there is evidence of similar good practice in government which local authorities should be encouraged to follow. During the recess, for example, a new Benefits Agency office was opened in my constituency by Lord Mackay of Ardbrecknish, Minister of State, Department of Social Security. Although I could not attend the opening, I visited the office a few days later, and noted that the agency was employing blind telephonists. That is an example of good practice.

In some circumstances, there will be nothing to prevent similar action in the future. Local authorities, however, should have the power to state after receiving application forms that they will guarantee an interview and that—all else being equal, and if the applicant meets the minimum or essential criteria—that applicant will be given the advantage of a job. It will seem a bit hollow for the many local authorities that now use the "positive about disabled people" symbol in their letterheads to be told by the Government to be less positive about disabled people. Some local authorities may not want to do that because it would be a backward step. I am disappointed that the Minister has taken that position and I have a few important questions for him.

Will the Minister clarify the exact powers of local authorities to operate guaranteed interview schemes? What powers will local authorities have to operate any other type of positive action to encourage disabled people to enter into their employment? How does the Minister define merit and how will disputes be settled? "Merit" cannot be scientifically defined and, of course, there could be some disputes. Will local authorities be able to earmark particular jobs for disabled people—for example, in the field of equal opportunities units? I hope that the Minister will be more positive in reply to my questions.

Ms Lynne

I was disappointed by the Minister's reply to my intervention. Local authorities that are taking positive measures should be congratulated. We must address the problem of under-representation in the work force of local authorities and what the Minister suggests will not take us far enough on that road. It is wrong that progressive local authorities such as the one in Rochdale will be blocked from taking these positive measures. Rochdale has a priority interview scheme in social services and, although we cannot totally assess it at the moment, according to the local government information unit there is benefit from it in, for instance, educating managers in how to judge a disabled candidate's ability to do a job rather than judging the perceived disadvantages, a practice that has often occurred in the past.

We have to tackle under-representation in local authorities. For decades, they have been as guilty of discrimination as other employers. The Disabled Persons (Employment) Act 1944 set a target of 3 per cent., but it has been missed by a long way. Only 1 per cent. of employees of London authorities are disabled people and the average is worse for county councils. Borough and district councils are slightly better, but it is vital to allow local authorities to tackle this problem.

I should like more clarification from the Minister on what he means by positive measures and whether he thinks they will meet the target. Under the Bill, the target is to go. Will the Minister's positive measures get more disabled people into the work force of local authorities? Priority interview schemes should be allowed to continue. The Bill repeals parts of the 1944 Act and changes to the Local Government and Housing Act 1989 will prevent local authorities from pursuing such schemes. The Government must give a firm commitment on what will replace them.

Some positive measures are reinforced by the Bill. Clause 10 deals with charities and supported employment being able to take positive action. Why not local authorities? They should be able to take the same action as other employers and should have the freedom to tackle the under-representation of disabled people in the work force. I should be glad to hear the Minister spell that out in more detail because I am extremely worried about it.

Mr. Alfred Morris

Can the Minister guarantee that the powers to make regulations in Lords amendments Nos. 14, 15 and 16 will not be used to undermine the assistance given to disabled people under the access to work scheme? In the view of the Royal National Institute for the Blind, the Government are already putting undue pressure on a whole range of employers to volunteer to pay a contribution to access to work. Would the hon. Gentleman agree that any weakening of access to work would run completely contrary to the intentions set out in the Bill to tackle discrimination against disabled people in employment?

I am delighted to follow in the debate my hon. Friend the Member for Paisley, South (Mr. McMaster). He is as true a friend of disabled people as one will find anywhere in this country. He worked with disabled people before he came here and has shown constancy of the highest order in their service since the moment he arrived at Westminster. I count him among my most honoured parliamentary colleagues and wish him all success in what I am sure will be a deservedly long and distinguished Front-Bench career.

The Minister said that it was an important purpose of this part of the Bill to ensure that an employer could appoint the best person for any vacant post. Hon. Members will appreciate that, having legislated so extensively on disability over the past 25 years, I receive a national post from disabled people and their organisations. I am told by disabled people in all parts of Britain that they are refused access to jobs for which they are well qualified due to misconceptions on the part of employers.

I recall the case of a very capable woman who, in keen competition, won a senior post in a big police authority. Having taken the job, she was told that, because of a disability that in no way affected her job, she would be excluded from the superannuation scheme. That was a most important consideration as far as she was concerned. I recall the Royal Association for Disability and Rehabilitation contacting me about that particular case. The Minister's predecessors are aware of case after case where I have been asked to do everything possible to ensure that disabled people who have proved their fitness for jobs are not disbarred by actions taken by unreasonable employers. It is that sort of gratuitous extra handicap that so upsets disabled people. In that particular case, the woman had to decide whether to carry on in the job that she had won in open competition or to look for something else. That cannot be right. We are not absolutely certain yet that there will be fewer opportunities to exploit people in that kind of difficulty if the Bill as drafted becomes law.

I am very glad that my hon. Friend the Member for Paisley, South talked about the 3 per cent. quota. The quota has not been implemented through legal action since the 1970s. It has many critics. The fact that is very important today for disabled people is that a Bill that seeks to increase the rights of disabled people takes a right away from them that they regard as still very important. They say, "You must not do away with an existing form of protection without introducing something stronger." My hon. Friend the Member for Paisley, South knew, from the work that he did among disabled people before he entered Parliament, how important the 3 per cent. quota was in terms of local government employment. He mentioned it today and I hope that the Minister will respond positively on that issue.

Let no one speak in accents of serene satisfaction about what is now proposed. That is not how disabled people see what we are doing today. They want full and enforceable civil rights and they want them without any further delay.

5 pm

Mr. Connarty

When I stand to speak in the debate, I am aware that I follow people who have ploughed a deep and clear furrow in the cause of fighting for people with disabilities, but I wish to support the points made by my hon. Friend the Member for Paisley, South (Mr. McMaster) and to congratulate him on his first Front-Bench appointment. I look forward to seeing him on those Front Benches for many years to come.

My hon. Friend the Member for Paisley, South made the important point that some serious concerns must exist as to the purpose of the Government's removal of the 3 per cent. quota, which was not just a protection, but the only piece of positive and affirmative action contained in the law for disabled persons.

As some people have said, in many respects it had fallen into disuse. Sixteen years of recession since the Government came to power meant that many corners were cut. That is the reality at the sharp cutting edge. People had to choose between an employee who might have had to be cosseted or protected slightly more, or whose productivity was slightly less than others. In the economic environment created by the Government, employers did not choose those people where they did in the past.

It was local authorities, in the majority of cases Labour and other non-Conservative local authorities, that took seriously the 3 per cent. quota. As my hon. Friend the Member for Paisley, South said, the "Fit for Work" award was often given when the local authority or other employers had not reached the 3 per cent. quota, but were seen to taking affirmative action, not just not to discriminate against disabled persons, but to discriminate in their favour.

Some people would say that the 3 per cent. quota had fallen into misuse. It was clear that employers and often local authorities, I am sorry to say, encouraged people in employment who had a minor injury or minor disability to register as a disabled person to obtain a green card for a broken limb, thumb or finger, but that was not the purpose of the original Act.

I was also a Scottish local authority leader for 10 years. We were proud to receive the "Fit for Work" award, but we did not reach the 3 per cent. target, although we tried hard to do so—not by trying to get people to register for the green card, but by seeking people who would fit that bill and then positively discriminating towards them under the 3 per cent. rule. That power has been removed by the Government in schedule 4: they are removing the positive discrimination and saying that posts must be awarded on merit.

In an intervention, I asked the Minister what the Government would do and he mentioned preferential training schemes, special recruitment drives to encourage disabled people to apply for a vacancy, and interviews of all suitable disabled people for potential vacancies. In reality, however, he is saying that those people should queue up and then be chopped down on the basis of merit.

Someone will be able to say, "I deserve that job on merit, a disabled person does not deserve it on merit, and therefore he has no complaint under the Government's Bill." That is not the spirit that, in my experience, made local authorities use the 3 per cent. quota.

I wish to give an example to the House. When I was leader of Stirling district council, we had a vacancy for someone to operate the switchboard and to work on reception. We were offered many people with minor ailments and disabilities, but the position was so accessible to someone with severe disability that we wanted the disablement officer to find us someone who had the ability but major problems of mobility. The council's attention was brought to a young woman called Jean—I shall not mention her second name, but I am sure that she would be proud to be mentioned. She has also been featured in many articles.

Jean was a seriously disabled person because thalidomide had been taken by her mother; she had foreshortened limbs. She had some trepidation about coming into a job, especially that of a receptionist working on a switchboard and facing the public, but she had a bold character. We made all the amendments necessary to give that young person access to the council.

Within a couple of years, Jean blossomed. She is still working with the local authority in reception, and in an upfront role. She takes the other receptionists to work in her disabled-amended car. She has a pilot's licence for gliding, and in the workplace has taken on board all the skills necessary. She has developed not only the personality for working in the reception and the technical skills, but everything required of her.

That was positive discrimination by the local authority, but it is clear that, under this Bill, no matter how one advertised the post, one would have great difficulty not discriminating positively—in other words, breaking the law—to give someone such as Jean the sort of job that she requires. A local authority, public employer or a large employer deserves a "Fit for Work" award when they positively discriminate, because that is what persons with disabilities are looking for. To receive such an award, it is important that an authority or large employer should be able to hold their head up among people who suffer from severe disablement.

The Minister mentioned the word gung-ho in referring to the Opposition's pleasure at the Government's climbdown on a number of issues in the Lords. Over the past 18 months, we have recognised, from the way that persons with disabilities have come to the House and lobbied, that they have acquired a new, louder voice. Talk about gung-ho—we will see some gung-ho action on this Bill, because those people will fight for every chance to prove that they need more from the Government. They will batter down the doors of the House until they are given equal rights and a positive discrimination framework that gives them access to true employment, which they deserve and which they will undertake with honour.

Mr. Alan Howarth

Amendment No. 4 deals with the comparative for assessing whether an employer's treatment of an individual is less favourable. That is but one instance of a problem that we will have to reflect on and on which the Government owe the House some guidance this afternoon. We are dealing with an extremely complex piece of primary legislation, with further extensive and no doubt complex secondary legislation to follow.

The Government have not made it clear how an employer, a provider of goods and services or a disabled person is to understand what the nature of their obligations is. How is an employer to make his assessment of whether his treatment is, under the terms of the legislation, less favourable or not? The Minister sought to explain the Government's case on that, but did not cast all the light on it that may be needed.

The Minister with responsibility for disabled people told us in a debate the week before last that he had it in mind that there should be a fairly extensive system for provision of information and advice, but I do not think that the details have been made clear. This debate would provide an opportunity for the Government to make more clear to hon. Members and—very important—to the field that they have in mind.

Most of what we know so far is what the Government have ruled out. We know that there is not to be a disability rights commission which would have responsibilities for briefing and education, analogous to those of the Equal Opportunities Commission or the Commission for Racial Equality. We also know that the National Disability Council is not to be involved—certainly it is not to have a role in advising in particular cases and circumstances.

We have been advised that there is to be a central helpline, perhaps located in the Department of Social Security, and we have also been told that there will be some sort of second tier and network around the country whereby advice will be made available. This is an urgent and important point. In all the complexities of this legislation, we will need advice that is clear, consistent and accessible and that is provided on a cost-effective basis, in relation both to the providers and to the seekers of the advice.

It is important that whatever advice is on offer should be readily accessible. It would be helpful, therefore, if the Minister told us a little more about the helpline. For example, will it be a freephone? If somebody seeking to use it is held in a queue of callers, will the courtesy of a return call be offered, or will he or she have to wait, fuming and increasingly impatient and frustrated, in the queue?

What will people find in the local telephone directory when they seek to discover how to take advantage of the service that the Government intend to make available? If they manage to get through and to consult someone, what guidance will be on offer?

Mr. Alfred Morris

I am grateful to my hon. Friend for giving way. He has spent a very great deal of time over recent years assisting people with special learning difficulties. He will be aware of the work of People First, and in particular of Simone Aspis of that organisation. She has asked that this debate should take account of young people with special learning difficulties, who will find it very hard to get the information they need about their rights.

She gives the example of a young person who is refused access to a social club, a youth club, because of having Down's syndrome. A person with special learning difficulties trying to find out her rights under this legislation will have no easy task. I know that my hon. Friend is as seized of the importance of that as are many others on this side of the House.

Mr. Howarth

My right hon. Friend provides an excellent example of the need that I have sought to describe. It is a happy circumstance that the Minister present comes from the newly combined Department for Education and Employment, which has particular responsibility for young people, including those whom People First exists to represent and support. The Minister's Department has responsibility for the youth service—or what remains of it.

Certainly the needs of disabled young people, and the needs of the youth service that seeks to serve young people, represent an important example of an area in which there will be a demand for advice.

I should be grateful if the Minister would tell the House what guidance he and other Ministers intend to give to Whitehall, to Government agencies, to non-departmental public bodies, to quangos and to the rest of our increasingly fragmented system of government, as well as to local authorities.

At present, there is great uncertainty. The CBI suggests that the range of services to he provided will be so extensive that it may include a mediation service. I cannot see how that could be so, but it would be encouraging if it were.

What will be the nature and extent of the advice available? Where will it come from, and what can people expect to be advised upon? Will they be told the nature of their obligations under the various elements of the legislation? Will they be given guidance, for example, on the practical meaning of "reasonableness" in a particular set of circumstances? Will they be advised as to what is "best practice", and about the developing body of case law resulting from tribunal hearings? Will they be told where to go for further advice on technical and specialised matters?

May we be told today about the funding of the system? What resources will be available for a system that must go well beyond the present PACTs—placement, assessment and counselling teams—and CEDPs—committees for the employment of disabled people? I am sure that the citizens advice bureaux will want to play what part they can in the system, and what they can do is invariably most helpful, but traditionally they have not been able to shoulder responsibilities of the sort suggested. If the Government seek to enlist them for the purpose, what will they do to help them? What resources will be provided for them?

There is already a pretty tangled and impenetrable cat's cradle of services, bodies and organisations, so it is vital that everyone concerned should know what they can expect in the way of information and advice.

When my hon. Friend the Member for Paisley, South (Mr. McMaster), whom I warmly congratulate on his appointment to the Front Bench, said to the Minister that the Bill as amended would prevent local authorities from taking the positive action that many of them have so valuably undertaken to promote better employment opportunities for disabled people, the Minister shook his head. It is therefore important that, if he has the leave of the House to respond to the debate, the Minister makes it clear what diminution the Government intend in the scope of local authorities to support the employment of disabled people through positive action—or whether he considers that the status quo will be preserved.

5.15 pm

I put it to the Government that public authorities should set the best standards in employment, and should have every assistance and support from the Government in doing so—not only because they are major employers, but because they are public authorities, and it is right that they should set a model.

Too many public authorities do not set a good example. The hon. Member for Bolton, North-East (Mr. Thurnham) has over the years tabled a series of questions and elicited much information about the disappointing performance of Whitehall Departments and other publicly funded bodies in the employment of disabled people, and the manner in which they have all too often ignored the quota by which the Disabled Persons (Employment) Act 1944 bound them.

However, many local authorities do set a high standard and provide a good model in that respect, with their positive disposition and the positive action that they have been willing to take. The Bill should at least safeguard local authorities so that they are not in a weaker position than private employers if they wish to act positively towards disabled people in their employment practices. After all, local authorities are expressive of their communities, and should take the lead within those communities in supporting those who are disadvantaged and in demonstrating best practice.

Such legislation is enormously important, not only for what it specifically provides but for its more broadly ranging declaratory effect. I mean not words without substance but legislation that articulates the values that we as a society should uphold and seek to realise in practice. Such legislation has an important educative role, and there should be nothing in it that seeks to discourage or restrain employers from best practice in the employment of disabled people.

As it is, there are too many equivocations, omissions and vaguenesses in the Bill. As has been said, it is sad that the Government are not willing to embrace the universal principle set out in the Civil Rights (Disabled Persons) Bill. We should not at this stage countenance any amendment of the Bill before us that would take us backwards rather than forwards towards the realisation of what should be the objective of all of us—an end to discrimination against disabled people in employment and in the provision of goods and services.

Mr. John Heppell (Nottingham, East)

I shall not speak long, but I start by congratulating those who served on the Committee, who have achieved the almost impossible in turning a sow's ear into a silk purse. I say "almost impossible", because there are still omissions from the Bill that I would like to put right. One of those is the absence of a commission, because—

Mr. Deputy Speaker (Mr. Michael Morris)

Order. We cannot at this stage debate omissions from the Bill. We have plenty to debate as it is.

Mr. Heppell

Thank you for your guidance, Mr. Deputy Speaker. I was leading on towards the more relevant subject of the clauses concerned. First, I shall say something about the 3 per cent. quota that has disappeared. Like many other hon. Members, I have been a councillor, and I had the responsibility of being a chair of equal opportunities and the chair of a disability sub-committee. We were able to do things on that disability sub-committee that we could not do in committees on race or gender. I would like the same laws to apply in all areas, and I would like there to be a commission for disability, as is the case for both gender and race.

The 3 per cent. quota is not just a mechanism, and by removing it, the Minister is also removing something from councils. The quota gives a target and a perspective to councils. My council did not have its solicitors in the background on the subject of disability, saying, "We are not sure that the council has the power to do this," in the same way as it did on the subjects of race and gender, but that is what will happen in the future. We can see already that there some things that we can do in terms of positive action, but there are other things that we cannot do. I cannot seen any reason why the 3 per cent. quota could not have co-existed with the provisions of the Bill.

I wish to ask the Minister about Lords Amendment No. 31 which plans to insert the words Except in such circumstances as may be prescribed". Will the Minister confirm my suspicion that part III of the Bill will not apply to clubs or societies in relation to the provision of services for their members?

Does that mean that a Bill designed to outlaw discrimination will allow discrimination against people who are members of a pigeon fanciers' society? Does proper access and provision need to be made by a garden centre, but not by a gardening club? It seems to me that there is an anomaly there, and the Minister should tell the House what measures the Bill contains to take action against a service provider which limits its services to members while continuing to discriminate unfairly against people with disabilities.

Can the Minister clarify the position of business, and particularly shareholders? Will it be necessary for a company having its general meeting to make sure that the building is accessible to people with disabilities? Will the information to shareholders be sent in a form of communication that suits people—such as braille, large letters or tapes? If not, people will be discriminated against.

Will copyright matters be considered circumstances "as may be prescribed"? I understand from the Royal National Institute for the Blind that some famous authors will not allow their books to be put on tape or made into braille for blind people, thus denying blind people the right of access to those books. That is serious enough, but the fact that those books may form part of a set text for an exam that a blind person might have to take makes the matter even more serious. If that is a prescribed matter, will the Minister tell us what he proposes to do about it? Will the National Disability Council be allowed to investigate the matter further if it is prescribed?

The Bill is in many ways a milestone in terms of disability discrimination legislation, but it is not the end. There are still many things which need to be done if we are to ensure that people with disabilities enjoy the same civil rights as those of us in the Chamber. After tonight, I hope that people will not say that this is the end of the chapter and that we can now forget disabled people. There is still a long way to go to make people with disabilities free and liberated in society.

Mr. Harry Barnes (Derbyshire, North-East)

I wish to make some brief points on this batch of amendments. The Government have again shown that they do not understand local authorities. As employers, local authorities are not the same as businesses. They are elected authorities, with particularly close links with citizens, whose values are shaped by those citizens. They must seek to shape attitudes within an area.

By not allowing the quota system to operate and not allowing positive discrimination, the Government are seriously affecting local authorities. The Derbyshire Coalition of Disabled People—an activist body working for disabled rights—is based in Clay Cross in north-east Derbyshire. That group undoubtedly has had a great impact upon local authorities throughout Derbyshire, none more than North-East Derbyshire district council.

Programmes such as "Towards Equality", in which disabled people are trained for jobs with a local authority or another organisation, are very important. Such programmes may now be taken away from local authorities because of a spurious argument about level playing fields and about how disabled people generally are to benefit from the provisions of the legislation. Local authorities are special, because the views of local people are reflected back to them, and we should take that seriously into account.

My hon. Friend the Member for Monklands, West (Mr. Clarke) visited the Derbyshire Coalition for Disabled People and the district council, and he understands the close connection between them and the impact that that organisation of disabled people run by disabled people has made. It would be a pity if the organisation now found itself fighting a harder battle with local authorities in areas where it has previously had its greatest response.

My second point arises from points raised during the debate on the first batch of amendments. It was mentioned that a cost assessment of the operation of the Bill would be considered. We have always asked how many people are supposed to be covered by the Disability Discrimination Bill.

We know that a cost assessment of £17 billion was made for the Civil Rights (Disabled Persons) Bill, and that the number of people to which the Bill applied was 6.5 million, or 10 per cent. of the population. The Government have never stated how many people this Bill is designed to apply to. If a cost assessment is likely to be made, the Government must have some idea of the number of people to whom these amendments and others apply. I hope that the Minister will give us those figures when he replies.

5.30 pm

Mr. Paice

First, I welcome the hon. Member for Paisley, South (Mr. McMaster) to his position. I join his hon. Friends in hoping that he will spend many years on the Opposition Front Bench. In a genuine expression of feeling, I join him in thanking the hon. Member for Birmingham, Erdington (Mr. Corbett), for his work; he dealt with the issues throughout Committee stage with his usual humorous, but nevertheless extremely well-meaning and deliberative, intent.

We have heard a lot about quotas. As you will be aware, Mr. Deputy Speaker, provisions for the abolition of the quota and everything that went with it were already a part of the Bill when it left this House. To reopen that debate at this time is hardly appropriate. We debated the quota and the fact that it required registration, and a large number of disabled people did not want to register for personal reasons, some of which were that it stigmatised and categorised them, which they did not like. That is why the priority interview scheme cannot continue. If there is no registration, there can be no scheme as practised.

The hon. Member for Paisley, South and most of his colleagues, as well as the hon. Member for Rochdale (Ms Lynne) have pushed me further about what local authorities can do. They will be able to do virtually anything to encourage and enable disabled people to work for them, as long as they appoint the person who is most suitable for the job after they have made reasonable adjustment.

I must stress that point—it is after they have made the reasonable adjustment. There is no maximum for such adjustment. If the local authority is prepared to invest vast sums of money in making provision so that a disabled person is suitable for a job, that is up to the authority, and it has that privilege. I share the view of a number of hon. Members that local authorities are the ideal organisation to set a good example to employers, but appointing a less suitable person to a job is not a good example to set to anyone.

Mr. Corbett

No one is suggesting that.

Mr. Paice

But that is precisely what has been suggested in Opposition Members' speeches, and what has been practised in a few local authorities. We want every local authority to have the opportunity to do what it democratically decides to do to encourage and enable disabled people to apply, be interviewed and be considered for any vacancies that arise. They can do what they like in the manner of making reasonable adjustment. Ultimately, they must decide on the most suitable person for the job. The one thing that they must not do is to disadvantage someone who is not disabled. They must use the best person, regardless of whether or not he or she is disabled.

Mr. Corbett

I am grateful to the Minister for his kind remarks, and for giving way. May I make this matter as clear as I am able? No one is looking for privileged treatment for people with disabilities. What has been argued today and during earlier stages in the passage of the Bill is that job applicants should be judged by the same criteria for their fitness, and that if the successful applicant happens to have disabilities, that matter should properly be addressed. That is all that was being asked. My colleagues and I might have wanted to go further and ask for positive discrimination, but we did not do so.

Mr. Paice

It is a matter of interpretation. If it is as the hon. Gentleman says, then that is fine. There is no problem with local authorities considering disabled people in the manner that he described and appointing them. I was under the clear impression, however, from a number of the speeches of his hon. Friends, that they wanted to take it much further and to discriminate positively in favour of disabled people at the appointment stage, which would not be permissible under the Bill, for the reasons that I described.

The right hon. Member for Manchester, Wythenshawe (Mr. Morris) referred to employers having misconceptions. Under the Bill, any employer would have to ensure that, if he discriminated against a disabled person, the discrimination was not based on any unreasonable misconception, and he would have to justify it according to the new amendments from the other place in this group, which I support.

Every employer will have to be able to stand up in an industrial tribunal, if the case gets that far, and demonstrate that discrimination was justified and that it was material to the circumstances of the case and the reasons for it were substantial. Those are important points. If he has misconceptions and brands all disabled people in some prejudicial way, it will cause him serious trouble. That is the purpose of the law—to ensure that disabled people who might suffer from such misconceptions are protected.

Mr. Alfred Morris

I am very grateful to the Minister for giving way. The case that I raised was not a hypothetical one. It was a real case, which I referred to one of his then ministerial colleagues, who is no longer in the Government.

What it proved was that even employers in very important organisations, such as major police authorities, were not aware that they were piling handicap on handicap for a woman whose disability was totally irrelevant to the job that she was doing. To say, in her case, "You can't belong to the pension fund," really was highly culpable, yet they thought that they were acting properly.

What the Minister is now saying raises the whole question of legal representation. I am sure that he recognises that many disabled people will feel unable to pursue their own cases. More fortunate people will seek the highest legal advice. That is a very important problem for disabled people who cannot afford to do so. It is not one that I am trying to create, but one that they tell me about day by day as we discuss the Bill.

Mr. Paice

I must emphasise to the right hon. Gentleman that we are certainly not encouraging all cases to go to an industrial tribunal. I hope that he will not interpret my earlier remarks as saying so. As I made clear on Report, we are trying to change employers' attitudes and thereby change their behaviour towards disabled people.

I am sure that the right hon. Gentleman would rightly challenge this, but what are the sanctions if they do not treat disabled people fairly? Ultimately, employers have to be prepared to defend their case in an industrial tribunal. I have no desire to see thousands of cases go to such tribunals. I want disabled people to be given their proper opportunities by employers the length and breadth of the country.

On the case of the lady to whom the right hon. Member for Wythenshawe referred, will he reflect on what I said about pensions? Although we face a slight procedural difficulty in that one of the amendments in this group refers to pensions, the next group predominantly concerns occupational pensions, and my hon. Friend the Minister for Social Security and Disabled People will reply at length to the right hon. Gentleman when we discuss that group.

In that lady's case, in which disability was irrelevant to the job at hand, discrimination would normally have been unreasonable. Discrimination because of a disability that is totally irrelevant to a person's suitability for a job would normally be considered unreasonable.

A number of other hon. Members spoke—largely about quotas and whether or not positive discrimination was possible. I remind the hon. Member for Nottingham. East (Mr. Heppell) that positive discrimination is not allowed in race or gender legislation either, and that was enacted under a Labour Government.

The hon. Member for Nottingham, East asked about clubs and societies. Disabled people will not be covered by part III, because that is addressed to the general public; membership of a closed club or society is not a service to the public. Again, that mirrors the sex discrimination legislation.

I have responded to the principal points that were raised. I commend the amendments to the House.

Lords amendment agreed to.

Lords amendments Nos. 5 to 16 agreed to.

Lords amendment: No. 17, in page 5, line 20, at end insert— ("( ) This section does not apply in relation to any benefit under an occupational pension scheme or any other benefit payable in money or money's worth under a scheme or arrangement for the benefit of employees in respect of—

1. (a) termination of service;
2. (b) retirement, old age or death;
3. (c) accident, injury, sickness or invalidity; or
4. (d) any other prescribed matter.")

Mr. Burt

I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker

With this, it will be convenient to discuss Lords amendments Nos. 27, 28 and 99.

Mr. Burt

Clause 4, in its present form, will cover actions of an employer in providing opportunities to employees for pensions and insurance benefits. These will fall within the existing wording of clause 4(1) and (2). However, the actions of trustees and managers of a pension scheme are not covered, as they are not the employer.

Amendment No. 27 will imply a rule of non-discrimination against disabled people into the rules of occupational schemes. That means that any discriminatory decision taken by trustees will be contrary to the rules of the scheme. A disabled person affected will be able to seek redress through the dispute resolution mechanisms that already exist for pension schemes. The regulation-making powers in sub-paragraphs 3 and 4 of Lords amendment No. 27 modify the existing powers in part II to enable the regulations to make special provisions for trustees of pension schemes.

To go to the meat of the matter, where a disabled applicant has a pre-existing medical condition which is likely to increase the risk of ill health retirement or death in service, it is important that employers should be able to take just as much account of that as they would if the person were not disabled. However, employers will want to ensure that their decisions are based on sound advice, such as actuarial or medical advice. Many disabled people have disabilities that do not affect their life expectancy or likelihood of ill health retirement, and the amendments will make sure that they can no longer be unfairly denied access to an employer's pension scheme.

The amendment to clause 6, Lords amendment No. 17, will disapply the duty of reasonable adjustment for occupational pensions and certain other similar benefits and provides a regulation-making power to prescribe benefits for additional types of risk to be covered by this exclusion. Again, we will consult on the use of that power—for example, as to whether the list of benefits is felt to be complete.

Occupational pension schemes are not the only means whereby employers can make provision for their employees' future. There are also other insurance benefits. Lords amendment No. 28 inserts a new clause on insurance benefits and covers the situation where an employer makes arrangements with an insurance company for insurance benefits such as private health insurance or the opportunity for such benefits to be received by the employer's employees.

The insurance company will act unlawfully against the disabled person under this new clause if it treats that person in a way that would be an act of discrimination under part III if done by the company with regard to a member of the public. A disabled person would be able to take a complaint against the insurance company, and the employer at the same time if necessary, and an industrial tribunal would decide whether there was discrimination by either of them on the basis of a full view of the evidence.

Lords amendment No. 99 provides that the term "occupational pension scheme" is to have the same meaning in the Bill as in the Pension Schemes Act 1993.

The amendments provide the right balance between meeting the needs of disabled people and non-disabled people in occupational pension schemes and placing necessary requirements on employers. I believe that they achieve the Government's objective, and I commend the amendments to the House.

5.45 pm

Mr. McMaster

Now that the Government's Bill is taking its final shape, the United Kingdom's 6.5 million disabled people will judge it against the civil rights legislation that they have wanted so much for so long— the legislation that was offered by my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris), who was responsible for much of its drafting, and by some of my other hon. Friends since.

Despite the fact that the Bill as it stands today has been improved by the Opposition, following concession after concession, climbdown after climbdown and U-turn after U-turn by the Government—I was not on the Committee, but I have studied its proceedings and it is clear that the Opposition have managed to force the Government to change course since the Bill started out on its parliamentary voyage—the Bill is still a pale shadow of what it could and should be.

The measure of the Bill must be whether it makes disabled people full and equal citizens. Against that yardstick, it does not measure up. One of the great holes in the Bill is its failure to give disabled people full or equal rights in the provision of occupational pensions and insurance benefits. The fact that the Government have introduced amendments, albeit at the eleventh hour, that bring such matters into the ambit of the Bill should have been a good thing, but the effect—and I suspect the purpose—of those measures, is to enshrine in law the discrimination that already exists rather than to outlaw it.

On Third Reading in the other place, Lord Mackay of Ardbrecknish, speaking on behalf of the Government, suggested that employers and insurance companies will be able to exclude—or limit the benefits offered to—disabled people considered to be higher risk. He said that the Government were preventing the weighting of risk on grounds of disability but retaining it for health".—[Official Report, House of Lords, 24 October 1995; Vol. 566, c. 1000.] On Report, he had stated that there would be cases where less favourable treatment would be justifiable. By no stretch of the imagination could that be called full and equal citizenship.

Will the Minister tell us exactly what that means in practice? What criteria will he use to determine the distinction between disability and ill health? Disputes and grey areas are inevitable and people will look to the Minister and his Department to sort them out. In the absence of a powerful commission to enforce the legislation, how will the Minister ensure that the measure is applied consistently, fairly and with equity?

The amendments allow for cost to be a justification for discrimination, yet, according to a recent research report by the Minister's own Department, there is no evidence to suggest that disabled people go off work due to sickness more often than do able-bodied people. In fact, the report shows that 44 per cent. of employers said that they found no difference in absence levels and 32 per cent. said that disabled staff were absent less often.

The amendments exclude occupational pensions and other benefits from the requirement on employers to make reasonable adjustments to assist the employment of disabled people. That exclusion is important. The Bill as it stands lists factors that are to be taken into account when deciding if it is reasonable to expect an employer to make adjustments—factors such as the impact, cost and practicality of the adjustment. To exclude pensions and insurance makes the non-discrimination rule in the amendments little more than window dressing. In the name of anti-discrimination legislation, the Government are institutionalising the unfairness that disabled people already face in obtaining equitable pensions and benefits. To enshrine in law existing discrimination against disabled people is unfair and unjustifiable, but to try to peddle it as anti-discrimination legislation is shoddy and shabby.

The amendments will mean that, where a disabled person has been refused access to a scheme that is lawful under the terms of the Bill, there will be no requirement that the employer seek to make any adjustments to the employee's terms and conditions. On Third Reading in the other place, Lord Mackay of Ardbrecknish stated: the employer will not have to consider ways in which his overall remuneration package can be brought up to the level enjoyed by other employees".—[Official Report, House of Lords, 24 October 1995; Vol. 566, c. 1001.] It could not be clearer than that.

The Government's substitute for proper civil rights legislation, which they have trailed as an historic advance in the struggle to give disabled people equal rights, in fact makes provisions for disabled people to be forced into a position where they have to sell their labour more cheaply—and to be less well rewarded—than non-disabled people who do the same job, in the same place, at the same time. That is the effect of what Lord Mackay said. He spelled out the Government's position for all to see. Instead of attempting to integrate disabled people into the work place, the Government are attempting to integrate discrimination into the law.

Why should disabled people be less entitled to pensions and insurance benefits than anyone else? The higher risk argument simply does not stand up to scrutiny. It is neither logical nor fair, and evidence produced by the Minister's Department establishes that. The decision on whether a disabled person is eligible to participate in and contribute to a pension scheme is likely to be based on an estimate of risk, but that eventuality may never arise, which means that future benefits would be reduced because of the mere possibility of something happening at some indefinite time in the future.

The Minister will no doubt attempt to justify that by saying that that is how many pension schemes are assessed, but if it is lawful for schemes to exclude disabled people on the grounds of a higher health risk, he must produce evidence to prove that that is the case, because his Department is producing evidence to show the opposite.

There appear to be strong grounds for believing that the amendments seek not to give disabled people an absolute right to enter or enjoy the full benefits of a scheme and that, where people do not join a scheme on starting work but subsequently apply, trustees could refuse access or offer only limited membership. Will the Minister confirm whether that is his intention?

Why are the Government so set against a requirement that reasonable adjustment be made in respect of occupational pensions and insurance benefits? The problems are not insoluble. The Minister has a reputation for achieving what he wants to achieve, so surely it was not beyond his guile to devise some reasonable adjustments. For example, he could have required employers to make equivalent contributions to a private pension scheme. The Government often say that everyone should provide for his or her retirement. It would not have been an ideal solution, but it would have been better than what is on offer today.

Where no private scheme could be found, or where employer and employee could not reach agreement on a scheme's suitability, the Minister could have required the employer to increase disabled employee's wages or salary by an amount equivalent to the normal contribution, thereby allowing the disabled person to buy into a scheme of his or her choice. Again, it is not an ideal solution, but it is better than what is on offer.

Those would have been reasonable adjustments in the light of the now famous Barber v. Guardian Royal Exchange decision, in which it was determined that occupational pensions should be considered as deferred pay.

The effect of the amendments is that those disabled people who are deemed ineligible to participate in an occupational pension scheme will not have their pay deferred but will simply not receive that element of their pay. That is unfair and discriminatory. It is a back-door way of reducing the pay of disabled people during their lifetime. It is doubly unfair that many disabled people are likely to be excluded not because of a greater risk of ill health but simply because of a perceived risk.

For example, some schemes might take the ill-judged view that someone with diabetes or epilepsy is ineligible because he or she might—just might—develop complications later. Will the Minister clarify the Government's position as it relates to people with diabetes or epilepsy, for instance?

Yet again, disabled people are being singled out for unfair treatment. Under the amendments, it would be unlawful to exclude them because of risk. When I joined the parliamentary pension scheme, on which my right hon. Friend the Member for Wythenshawe does so well in representing all Members of the House, I was not excluded because I am, I am ashamed to say, a smoker. No one asked me whether I was. The Minister no doubt also belongs to that scheme and was not excluded because he is a member of the House of Commons football team, which is also a high risk. Nor was he excluded when he was Minister responsible for setting up the Child Support Agency, which, at the time, must have been the most dangerous job in Britain.

A survey published in 1992 by the Office of Population Censuses and Surveys shows that disabled people are among the least likely to belong to a pension scheme. Some 34 per cent. of those who had a pre-retirement disability before the age of 50 had never belonged to an occupational pension scheme. The study also found that the chances of their ever having joined a scheme or attained rights to one decreased with the increasing severity of disability. The reason is simple: many disabled people simply cannot afford to join. They tend to earn less and must pay the inevitable additional costs of disability. The Bill and the amendments do nothing to change that. Worse, they build that position into the law.

The Minister will be aware that the Disability Alliance and Disablement Income Group have worked hard to produce a cogent, coherent and comprehensive document known as "There May Be Trouble Ahead"—perhaps prophetic words. It shows the inequity that exists in pension schemes and suggests ways of tackling that and other problems. The group is asking for a forum of all the interested parties to be set up. Is the Minister prepared to allow that forum to go ahead?

The Government cannot claim that the Bill is, in any shape or form, a comprehensive piece of anti-discrimination legislation so long as it excludes pensions and benefits. Civil rights mean full and equal citizenship without qualification or exclusion. As the amendments are full of qualifications and exclusions, unless the Minister can convince us otherwise, we shall press them to a Division.

Ms Lynne

I simply wish to make a few comments about the recent research carried out by the Disability Alliance and Disablement Income Group, which shows that disabled people are already less likely to be in occupational pension schemes. More than two thirds of disabled women have not joined such schemes because they could not fulfil the conditions as a result of frequent changes of jobs or interrupted employment. People with pre-retirement disability were less likely to retain any rights to an occupational pension scheme.

On the surface, the Government's amendments look fine, but they do not really deal with the problem. I am extremely worried about amendment No. 17, which, as has already been said, could be the back door to reducing pay for disabled employees. We need reassurance on this matter, although I do not honestly believe that the Minister will give us the reassurance we need.

Mr. Dafydd Wigley (Caernarfon)

I apologise to the Minister for missing part of his opening remarks. If he has covered the point that I want to raise, I apologise doubly.

I am concerned about the amendment that deals with insurance benefits. I realise that this is a fraught area. Although insurance is, by necessity, about the sharing of risks, insurance companies always make it their business to find out as much as they can in order to specify and appreciate the degree of risk in a case. In framing the amendment, have the Government accepted the principle that insurance companies that provide the services described in amendment No. 28(3) can adjust those services in terms of the amount of benefit paid, in line with a known disability or a disability that may occur in the future as a result of, say, a genetic condition?

A new clause moved in the other place does not clarify that. It seems to be possible for an employer, or an insurance company working on behalf of an employer, to discriminate against disabled people, particularly those with a genetic condition, in terms of the insurance benefits that they could receive. If so, they would be discriminated against.

Given the choice between the conflicting interests of getting as much information as possible and the sharing out of risks between all beneficiaries under an insurance scheme, on the balance of fairness and particularly given the ethos of the Bill before us, we should come down on the side of sharing the risks. We should ensure, as far as humanly possible, that insurance schemes are not loaded, either in terms of increased premiums or reduced benefits, against people with a potential disability. I hope that the Minister can offer me some assurance on that.

6 pm

Mr. Burt

With the leave of the House, I shall reply to the debate.

I shall try to do what I can to offer reassurance, but as the hon. Member for Caernarfon (Mr. Wigley) said, this is genuinely a difficult area. I must clear up one thing. We are talking about individuals as opposed to types or groups. An employer may discriminate where there are clear grounds for believing that a person, including a disabled person, but not necessarily, represents a higher risk to the scheme because of his impaired health, and that higher risk could be justified on the grounds of cost. Any non-inclusion in the scheme's benefit provision will only be as a result of that person's health condition and not simply because the individual is disabled. Disabled persons whose propensity to take ill health retirement or die in service is not materially higher than other members would, of course, be entitled to be admitted to the scheme as normal.

That is the ground rule, but we are talking about dealing with individuals. We are trying to create a differential between two individuals who, although both may be described as disabled, may have different conditions which mean that the likelihood of ill health or risk of early retirement is much greater for one than the other. We can all think of such examples. Where an employee is to be excluded, the employer will have to prove that that refusal is based on substantial grounds, not simply on the mere fact of disability.

The most important question is, why should employers be permitted to discriminate on grounds of health? It is right that employers and scheme managers should continue to be able to make certain decisions on health grounds for a number of reasons. Employers have always been able to discriminate on grounds of health for such benefits. If that changed, employers could be faced with an unjustifiably large extra bill. It is estimated that the additional costs could be hundreds of millions of pounds a year. A significant amount of that additional expenditure would fall directly on the taxpayer, because approximately one third of pension scheme members are in public service pension schemes. Much of the balance would have to be passed on in the form of higher prices.

The pension schemes of many employers are too small to accept large potential liabilities for ill health and death benefits, and therefore those employers insure those risks in the commercial insurance market. Insurance companies operate strict underwriting criteria to control the risk which they accept. Those companies would offer policies that admitted individuals with all potential health conditions at truly prohibitive premium rates. It is more likely that they would not admit such individuals, so, effectively, the insurance route would be withdrawn.

As a result of the significant additional burden of costs and the lack of insurance, employers would seriously have to reconsider their options. There would be a real risk that many employers would restructure their employment packages to reduce or remove altogether any incapacity or death benefits. Some employers, if not permitted to take account of health risks, may simply wind up their schemes. Such are the likely changes in employment practice were the Bill not to allow employers to make decisions on the grounds of health

Hon. Members have asked whether it would be possible to unbundle contributions, and whether an individual disabled person's contribution rate could be reduced if he or she is only receiving age retirement benefits. Such a proposal would not only be completely at variance with the manner in which occupational pension schemes with benefits defined in terms of a member's final salary are operated, but would result in significant extra administrative difficulties disproportionate to any gain to the disabled person.

Such a change could be achieved fairly only after taking medical and actuarial advice. Even then, the resulting adjustment would be subjective and open to dispute by the member. A doctor would be required to certify an individual's life expectancy or the probable length of his working life. On the basis of the medical prognosis, an actuary would then have to consider the value of the residual benefits compared with the total package. Overall, such a requirement would be disproportionately expensive and administratively messy.

Salary pension schemes in the United Kingdom are predominantly operated on what is known as a "balance of costs" basis. Employees pay a fixed contribution and the employer meets the rest of the cost on the basis of advice from the scheme actuary. Typically, scheme members pay only one third of the cost of the scheme benefits.

The employer considers the cost of providing the benefits in aggregate and does not try to isolate the costs for each individual member. The cost of the accruing benefits, however, will vary significantly between individuals according to their individual circumstances—for example, age or sex.

All individuals pay the same member contribution even though they may not be entitled to all the benefits. For example, a spouse's benefits are of no use to a single pensioner, and some benefits may be more valuable to certain members than others. For example, a pensioner who lives a long time will get more valuable benefits than someone who died shortly after retirement.

To suggest that a disabled person, who may get less valuable pension benefits from a scheme, should pay a lower contribution rate would therefore rewrite the way in which final salary occupational pension schemes operate. Other groups could make claims for similar treatment. For example, under current sex equality legislation there is no similar requirement that men should pay a lower member contribution rate because they tend to live less long in retirement than women. Such arrangements would lead to additional costs.

It should be remembered that membership of an occupational pension scheme is voluntary. If an individual member feels that he is going to get less valuable benefits out of a scheme than his own contributions, he can opt out. If he chose to take out a personal pension, he would, of course, be protected under part III.

People with a genetic predisposition are not covered by the Bill. That reflects the views of the Select Committee on Science and Technology, which concluded that labelling that group as disabled was not the right way forward. We will consider the Committee's final report when it is available.

Mr. Wigley

If the report from the Committee on that important matter, which will be published before too long, suggested that the Bill should be changed to avoid discrimination against people on the basis of genetic information gained for insurance purposes, does the Minister have the facility to amend the Bill without having to come back with primary legislation?

Mr. Burt

No, I do not believe there is such a facility. The principle on which the hon. Gentleman will have to rely, and which may emerge from the Committee's report, would operate on an individual basis and the circumstances facing a particular applicant.

As I tried to establish from the start, that principle does not discriminate against disabled people in general. It will not be possible for an employer to exclude someone from a pension scheme just because that person is disabled. The employer will have that right only if the nature of the disability is such that it would cause the sort of problem with the pension or insurance scheme as might affect anyone whether he is disabled or not. It is on those grounds that I put the case to the House. The individual is protected unless he has a marked disability which may cause concern.

Mr. McMaster

With the leave of the House, may I say that the Minister has simply reinforced our concerns, so we will divide the House on the amendment.

Question put, That this House doth agree with the Lords in the said amendment:—

The House divided: Ayes 290, Noes 249.

Division No. 225]	[6.07 pm
AYES
Ainsworth, Peter (East Surrey)	Clifton-Brown, Geoffrey
Aitken, Rt Hon Jonathan	Coe, Sebastian
Alexander, Richard	Colvin, Michael
Alison, Rt Hon Michael (Selby)	Congdon, David
Allason, Rupert (Torbay)	Coombs, Anthony (Wyre For'st)
Amess, David	Coombs, Simon (Swindon)
Arbuthnot, James	Cope, Rt Hon Sir John
Arnold, Jacques (Gravesham)	Cormack, Sir Patrick
Ashby, David	Couchman, James
Atkins, Rt Hon Robert	Cran, James
Atkinson, Peter (Hexham)	Currie, Mrs Edwina (S D'by'ire)
Baker, Rt Hon Kenneth (Mole	Curry, David (Skipton & Ripon)
Valley)	Davis, David (Boothferry)
Baker, Nicholas (North Dorset)	Day, Stephen
Baldry, Tony	Deva, Nirj Joseph
Banks, Matthew (Southport)	Devlin, Tim
Banks, Robert (Harrogate)	Dicks, Terry
Bates, Michael	Dorrell, Rt Hon Stephen
Batiste, Spencer	Douglas-Hamilton, Lord James
Bellingham, Henry	Dover, Den
Bendall, Vivian	Duncan, Alan
Beresford, Sir Paul	Duncan-Smith, Iain
Biffen, Rt Hon John	Dunn, Bob
Bonsor, Sir Nicholas	Durant, Sir Anthony
Booth, Hartley	Dykes, Hugh
Boswell, Tim	Eggar, Rt Hon Tim
Bottomley, Peter (Eltham)	Elletson, Harold
Bottomley, Rt Hon Virginia	Evans, David (Welwyn Hatfield)
Bowden, Sir Andrew	Evans, Jonathan (Brecon)
Bowis, John	Evans, Nigel (Ribble Valley)
Boyson, Rt Hon Sir Rhodes	Evans, Roger (Monmouth)
Brandreth, Gyles	Evennett, David
Brazier, Julian	Faber, David
Bright, Sir Graham	Fabricant, Michael
Brooke, Rt Hon Peter	Fenner, Dame Peggy
Browning, Mrs Angela	Field, Barry (Isle of Wight)
Bruce, Ian (Dorset)	Forman, Nigel
Budgen, Nicholas	Forsyth, Rt Hon Michael (Stirling)
Burns, Simon	Forth, Eric
Burt, Alistair	Fox, Sir Marcus (Shipley)
Butcher, John	Freeman, Rt Hon Roger
Butterfill, John	French, Douglas
Carlisle, John (Luton North)	Fry, Sir Peter
Carlisle, Sir Kenneth (Lincoln)	Gale, Roger
Carttiss, Michael	Gallie, Phil
Cash, William	Gardiner, Sir George
Channon, Rt Hon Paul	Garel-Jones, Rt Hon Tristan
Chapman, Sir Sydney	Garnier, Edward
Churchill, Mr	Gill, Christopher
Clappison, James	Gillan, Cheryl
Clark, Dr Michael (Rochford)	Goodlad, Rt Hon Alastair
Clarke, Rt Hon Kenneth (Ru'clif)	Goodson-Wickes, Dr Charles

Gorst, Sir John	Marland, Paul
Grant, Sir A (SW Cambs)	Marlow, Tony
Greenway, Harry (Ealing N)	Marshall, John (Hendon S)
Griffiths, Peter (Portsmouth, N)	Marshall, Sir Michael (Arundel)
Grylls, Sir Michael	Martin, David (Portsmouth S)
Hague, Rt Hon William	Mates, Michael
Hamilton, Sir Archibald	Mawhinney, Rt Hon Dr Brian
Hamilton, Neil (Tatton)	Merchant, Piers
Hampson, Dr Keith	Mitchell, Andrew (Gedling)
Hanley, Rt Hon Jeremy	Mitchell, Sir David (NW Hants)
Hannam, Sir John	Moate, Sir Roger
Hargreaves, Andrew	Monro, Rt Hon Sir Hector
Harris, David	Montgomery, Sir Fergus
Haselhurst, Sir Alan	Needham, Rt Hon Richard
Hawkins, Nick	Neubert, Sir Michael
Hawksley, Warren	Newton, Rt Hon Tony
Hayes, Jerry	Nicholls, Patrick
Heald, Oliver	Nicholson, David (Taunton)
Heath, Rt Hon Sir Edward	Norris, Steve
Heathcoat-Amory, David	Onslow, Rt Hon Sir Cranley
Hendry, Charles	Ottaway, Richard
Heseltine, Rt Hon Michael	Page, Richard
Hicks, Robert	Paice, James
Higgins, Rt Hon Sir Terence	Patnick, Sir Irvine
Hill, James (Southampton Test)	Patten, Rt Hon John
Hogg, Rt Hon Douglas (G'tham)	Pattie, Rt Hon Sir Geoffrey
Horam, John	Pawsey, James
Hordern, Rt Hon Sir Peter	Peacock, Mrs Elizabeth
Howard, Rt Hon Michael	Pickles, Eric
Howell, Rt Hon David (G'dford)	Porter, Barry (Wirral S)
Howell, Sir Ralph (N Norfolk)	Porter, David (Waveney)
Hughes, Robert G farrow W)	Portillo, Rt Hon Michael
Hunt, Rt Hon David (Wirral W)	Powell, William (Corby)
Hunt, Sir John (Ravensbourne)	Rathbone, Tim
Hunter, Andrew	Redwood, Rt Hon John
Hurd, Rt Hon Douglas	Renton, Rt Hon Tim
Jack, Michael	Richards, Rod
Jackson, Robert (Wantage)	Riddick, Graham
Jenkin, Bernard	Rifkind, Rt Hon Malcolm
Jessel, Toby	Robathan, Andrew
Johnson Smith, Sir Geoffrey	Roberts, Rt Hon Sir Wyn
Jones, Gwilym (Cardiff N)	Robertson, Raymond (Ab'd'n S)
Jones, Robert B (W Hertfdshr)	Robinson, Mark (Somerton)
Jopling, Rt Hon Michael	Roe, Mrs Marion (Broxbourne)
Kellett-Bowman, Dame Elaine	Rowe, Andrew (Mid Kent)
King, Rt Hon Tom	Rumbold, Rt Hon Dame Angela
Kirkhope, Timothy	Ryder, Rt Hon Richard
Knapman, Roger	Sackville, Tom
Knight, Mrs Angela (Erewash)	Sainsbury, Rt Hon Sir Timothy
Knight, Rt Hon Greg (Derby N)	Scott, Rt Hon Sir Nicholas
Knight, Dame Jill (Bir'm E'st'n)	Shaw, David (Dover)
Knox, Sir David	Shaw, Sir Giles (Pudsey)
Kynoch, George (Kincardine)	Shephard, Rt Hon Gillian
Lait, Mrs Jacqui	Shepherd, Richard (Aldridge)
Lamont, Rt Hon Norman	Sims, Roger
Lang, Rt Hon Ian	Smith, Tim (Beaconsfield)
Lawrence, Sir Ivan	Soames, Nicholas
Leigh, Edward	Speed, Sir Keith
Lennox-Boyd, Sir Mark	Spencer, Sir Derek
Lester, Jim (Broxtowe)	Spicer, Sir James (W Dorset)
Lidington, David	Spring, Richard
Lightbown, Sir David	Sproat, Iain
Lilley, Rt Hon Peter	Squire, Robin (Hornchurch)
Lloyd, Rt Hon Sir Peter (Fareham)	Stanley, Rt Hon Sir John
Lord, Michael	Steen, Anthony
Luff, Peter	Stephen, Michael
Lyell, Rt Hon Sir Nicholas	Stern, Michael
MacGregor, Rt Hon John	Stewart, Allan
MacKay, Andrew	Streeter, Gary
Maclean, Rt Hon David	Sumberg, David
McLoughlin, Patrick	Sweeney, Walter
McNair-Wilson, Sir Patrick	Sykes, John
Madel, Sir David	Tapsell, Sir Peter
Maitland, Lady Olga	Taylor, Ian (Esher)
Mabne, Gerald	Taylor, John M (Solihull)
Mans, Keith	Taylor, Sir Teddy (Southend, E)

Temple-Morris, Peter	Wardle, Charles (Bexhill)
Thomason, Roy	Waterson, Nigel
Thompson, Patrick (Norwich N)	Watts, John
Thornton, Sir Malcolm	Wells, Bowen
Thurnham, Peter	Whitney, Ray
Townend, John (Bridlington)	Whittingdale, John
Townsend, Cyril D (Bexl'yh'th)	Widdecombe, Ann
Tracey, Richard	Wiggin, Sir Jerry
Tredinnick, David	Wilkinson, John
Trend, Michael	Willetts, David
	Wilshire, David
Trotter, Neville	Winterton, Mrs Ann (Congleton)
Twinn, Dr Ian	Winterton, Nicholas (Macc'f'ld)
Vaughan, Sir Gerard	Wood, Timothy
Viggers, Peter	Yeo, Tim
Waldegrave, Rt Hon William	Young, Rt Hon Sir George
Walden, George
Walker, Bill (N Tayside)	Tellers for the Ayes:
Waller, Gary	Dr. Liam Fox and Mr. Derek Conway.
Ward, John

NOES
Adams, Mrs Irene	Cummings, John
Ainger, Nick	Cunliffe, Lawrence
Ainsworth, Robert (Cov'try NE)	Cunningham, Jim (Covy SE)
Allen, Graham	Cunningham, Roseanna
Alton, David	Dafis, Cynog
Anderson, Donald (Swansea E)	Dalyell, Tam
Anderson, Ms Janet (Ros'dale)	Darling, Alistair
Ashdown, Rt Hon Paddy	Davidson, Ian
Ashton, Joe	Davies, Bryan (Oldham C'tral)
Austin-Walker, John	Davies, Chris (L'Boro & S'worth)
Banks, Tony (Newham NW)	Davies, Rt Hon Denzil (Llanelli)
Barnes, Harry	Davies, Ron (Caerphilly)
Barron, Kevin	Davis, Terry (B'ham, H'dge H'l)
Battle, John	Denham, John
Bayley, Hugh	Dewar, Donald
Beckett, Rt Hon Margaret	Dixon, Don
Beith, Rt Hon A J	Donohoe, Brian H
Bell, Stuart	Dowd, Jim
Bennett, Andrew F	Dunwoody, Mrs Gwyneth
Benton, Joe	Eagle, Ms Angela
Bermingham, Gerald	Eastham, Ken
Berry, Roger	Etherington, Bill
Betts, Clive	Evans, John (St Helens N)
Blair, Rt Hon Tony	Ewing, Mrs Margaret
Blunkett, David	Fatehett, Derek
Boateng, Paul	Fisher, Mark
Bradley, Keith	Flynn, Paul
Brazier, Julian	Forsythe, Clifford (S Antrim)
Brown, Gordon (Dunfermline E)	Foster, Rt Hon Derek
Brown, N (N'c'tle upon Tyne E)	Foster, Don (Bath)
Burden, Richard	Foulkes, George
Byers, Stephen	Fraser, John
Callaghan, Jim	Fyfe, Maria
Campbell, Mrs Anne (C'bridge)	Galbraith, Sam
Campbell, Menzies (Fife NE)	Gapes, Mike
Campbell, Ronnie (Blyth V)	Garrett, John
Campbell-Savours, D N	Gerrard, Neil
Canavan, Dennis	Gilbert, Rt Hon Dr John
Cann, Jamie	Godman, Dr Norman A
Chisholm, Malcolm	Godsiff, Roger
Church, Judith	Golding, Mrs Llin
Clapham, Michael	Gordon, Mildred
Clark, Dr David (South Shields)	Graham, Thomas
Clarke, Tom (Monklands W)	Grant, Bemie (Tottenham)
Ctelland, David	Griffiths, Nigel (Edinburgh S)
Clwyd, Mrs Ann	Griffiths, Win (Bridgend)
Coffey, Ann	Grocott, Bruce
Cohen, Harry	Gunnell, John
Connarty, Michael	Hain, Peter
Corbett, Robin	Hall, Mike
Corbyn, Jeremy	Hanson, David
Corston, Jean	Hardy, Peter
Cousins, Jim	Harman, Ms Harriet
Cox, Tom	Henderson, Doug

Heppell, John	Morley, Elliot
Hill, Keith (Streatham)	Morris, Rt Hon Alfred (Wy'nshawe)
Hinchliffe, David	Morris, Estelle (B'ham Yardley)
Hodge, Margaret	Morris, Rt Hon John (Aberavon)
Hoey, Kate	Mudle, George
Hogg, Norman (Cumbernauld)	Mullin, Chris
Home Robertson, John	Murphy, Paul
Hood, Jimmy	Oakes, Rt Hon Gordon
Hoon, Geoffrey	O'Hara, Edward
Howarth, Alan (Strat'rd-on-A)	Olner, Bill
Howarth, George (Knowsley North)	O'Neill, Martin
Howells, Dr Kim (Pontypridd)	Orme, Rt Hon Stanley
Hoyle, Doug	Pearson, Ian
Hughes, Kevin (DoncasterN)	Pickthall, Colin
Hughes, Robert (Aberdeen N)	Pike, Peter L
Hutton, John	Pope, Greg
Illsley, Eric	Powell, Ray (Ogmore)
Ingram, Adam	Prentice, Bridget (Lewisham East)
Jackson, Helen (Shef'ld, H)	Prentice, Gordon (Pende)
Jamieson, David	Primarolo, Dawn
Janner, Greville	Purchase, Ken
Jones, Barry (Alyn and D'side)	Quin, Ms Joyce
Jones, Ieuan Wyn (Ynys Môn)	Radice, Giles
Jones, Lynne (B'ham S O)	Randall, Stuart
Jones, Martyn (Clwyd, SW)	Reid, Dr John
Jowell, Tessa	Robertson, George (Hamilton)
Kaufman, Rt Hon Gerald	Robinson, Geoffrey (Co'try NW)
Keen, Alan	Roche, Mrs Barbara
Kennedy, Charles (Ross.C&S)	Rogers, Allan
Kennedy, Jane (L'pool Br'dg'n)	Rooker, Jeff
Khabra, PiaraS	Rooney, Terry
Kilfoyle, Peter	Ross, Ernie (Dundee W)
Kirkwood, Archy	Rowlands, Ted
Lestor, Joan (Eccles)	Ruddock, Joan
Lewis, Terry	Salmond, Alex
Liddell, Mrs Helen	Sheerman, Barry
Litherland, Robert	Sheldon, Rt Hon Robert
Livingstone, Ken	Shore, Rt Hon Peter
Lloyd, Tony (Stretford)	Short, Clare
Llwyd, Elfyn	Simpson, Alan
Lynne, Ms Liz	Skinner, Dennis
McAllbn, John	Smith, Andrew (Oxford E)
McAvoy, Thomas	Smith, Llew (Blaenau Gwent)
	Spellar, John
McCartney, Ian	Squire, Rachel
McCrea, The Reverend William
McFall, John	Steinberg, Gerry
	Stevenson, George
McKelvey, William	Stott, Roger
Mackinlay, Andrew	Strang, Dr. Gavin
McLeish, Henry	Straw, Jack
McMaster, Gordon	Sutcliffe, Gerry
MacShane, Denis	Taylor, Mrs Ann (Dewsbury)
McWilliam, John	Taylor Matthew (Truro)
Madden, Max	Timms, Stephen
Maddock, Diana	Turner, Dennis
Mahon, Alice	Walker, Rt Hon Sir Harold
Mandeteon, Peter	Walley, Joan
Marek, Dr John	Warden, Gareth (Gower)
Marshall, David (Shettleston)	Wareing, Robert N
Marshall, Jim (Leicester, S)	Welsh, Andrew
Martin, Michael J (Springburn)	Wicks, Malcolm
Martlew, Eric	Wigley, Dafydd
Maxton, John	Williams, Rt Hon Alan (Sw'n W)
Meacher, Michael	Winnick, David
Meale, Alan	Wise, Audrey
Michael, Alun	Worthington, Tony
Michie, Bill (Sheffield Heeley)	Wray, Jimmy
Michie, Mrs Ray (Argyll & Bute)	Wright, Dr Tony
Milburn, Alan	Young, David (Bolton SE)
Miller, Andrew
Mitchell, Austin (Gt Grimsby)	Tellers for the Noes:
Moonie, Dr Lewis	Mr. Eric Clarke and Mr. Jon Owen Jones.
Morgan, Rhodri

Question accordingly agreed to.

Lords amendment No. 18 agreed to.