HC Deb 18 December 2000 vol 360 cc7-8
6. Mr. Peter L. Pike (Burnley)

What percentage of the social fund is spent on administration costs. [141806]

The Parliamentary Under-Secretary of State for Social Security (Angela Eagle)

In 1998–99, social fund payments and recoveries amounting to £1,114 million were made at an administrative cost of £215 million. That cost represents 19.3 per cent. of both expenditure and recoveries.

Mr. Pike

Although those figures show a massive improvement in the administrative costs of the social fund from those under the previous Conservative Government, does my hon. Friend agree that, as the Labour Government's priority is to help the poorest section of the community and as the social fund is aimed at that group, the fund and loans through it remain too expensive administratively? Is it not time that we introduced a better and fairer system to help the people who are most in need?

Angela Eagle

We keep the system under review. Clearly, we need to drive down administrative costs as much as possible, although any system that entails us making detailed inquiries into individual circumstances will, by its nature, cost more than a more automatic scheme, such as child benefit. The Conservatives have said that they would take £90 million from the social fund; that would make it increasingly harder to give money to the poorest and most vulnerable.

Mr. Julian Brazier (Canterbury)

Will the Minister confirm that there was a 9 per cent. rise in a single year—last year—in applications to the social fund? What are the implications of that for the Government's progress in tackling poverty?

Angela Eagle

The rise, I suspect, has something to do with the changes to the budgeting loan system, which we introduced last year and which enabled more people to apply. There has been a 9 per cent. increase in the number of grants given; that is because extra people became eligible after the changes to the budgeting loan system.

That system and the social fund can only be the fund of last resort. We are trying to tackle child poverty and other forms of poverty at their source. That includes introducing programmes such as the working families tax credit and enabling tone parents to go out to work to support themselves and their children by setting up child care and by allowing them to have access to initiatives such as the new deal for lone parents—which the Conservatives would scrap. We believe in dealing with the causes of poverty as well as its symptoms.

Ann Clwyd (Cynon Valley)

Will my hon. Friend confirm that the overall administration costs of the DSS may have increased because of its extra responsibilities of dealing with the miners compensation scheme? Is there a case either for scrapping that clawback altogether, or for increasing the number of administrators at the DSS to speed up the average of 28 days taken to deal with those claims?

Angela Eagle

I can reassure my hon. Friend that the miners compensation scheme does not feature at all in the administrative costs of the social fund. I know that my colleagues at the Department of Trade and Industry are doing all that they can to speed up payments and to ensure that the oldest and most ill people are the first to receive the payments that they deserve.