HL Deb 22 July 1969 vol 304 cc785-93

3.39 p.m.


My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—(Baroness Phillips.)

On Question, Motion agreed to.

House in Committee accordingly.

[The Earl of Listowel in the Chair.]

Clauses 1 to 3 agreed to.

Clause 4 [Death grant]:

Lord DRUMALBYN moved Amendment No. 1: Page 4, line 41, after ("deceased's") insert ("uncle, aunt,")

The noble Lord said: With those short words from the Lord Chairman, we have disposed of the great bulk of the Bill. But we now come to a very small matter in terms of money; although it could be important in certain circumstances. We have dealt with the £430 million and we now come down to something that could amount in any one year to an extra expenditure of, at most, a few thousand pounds. Even so, it could in certain circumstances be important to those concerned. The point is that here we are dealing with an increase in death grant, in partciular the extension of death grant in respect of a person over 19 years of age who has been, to quote the Bill by reason of illness or disability of mind or body incapacitated for regular employment … and who then dies. The point of the Amendment is to extend the list of those entitled to death grant in respect of that person.

The Bill as drafted limits those to the deceased's parents and remoter issues; that is, grandparents and to any one of these with whom the child or person may have been living: the deceased's stepfather, stepmother, stepchild; the deceased's brother, sister, half brother, half sister, step brother or step sister. The point of this Amendment is simply to add "uncle or aunt". I have known of a case, and I have heard of others, where a child has been passed at an early age to an aunt or uncle to look after. The aunt or uncle has borne the full brunt of looking after the child. Sometimes these are very difficult cases. Sometimes the children grow to an abnormal size and are difficult to handle; and all too often in their early twenties they die quite suddenly. I should have thought that in such cases those who had been looking after the children all those years and above all, were taking the financial responsibility should also be included in the list. The parents may be dead or may be abroad; or they may have abandoned the child. This is a simple Amendment. I do not think I need say more about it. I beg to move.


I thank the noble Lord, Lord Drumalbyn, for moving this Amendment. I would remind the Committee that the categories of relatives specified in the Bill are in fact those already included in the Unemployment and Sickness Benefit Regulations which set out those relatives for whom increases of unemployment and sickness benefit in respect of adult dependants may be paid. The proposed list is therefore one which has for long been in use in the insurance scheme. If one steps outside these categories there is no obvious limiting criterion. It is important to be clear about what is being attempted in Clause 4. The problem of death grant for handicapped adults who have never been able to work and pay contributions has been a point of concern and criticism since 1949 when the grant was first paid. Despite very sympathetic consideration by all concerned, it was not thought possible to provide an insurance benefit accruing to someone who had never been insured. Lord Drumalbyn himself was one of those who examined this problem when he was a distinguished Minister of Pensions and National Insurance. A solution is feasible only through a different approach based on the view that it is not the handicapped person himself who needs an insurance cover towards meeting the cost of burial but the relatives who must bear the expense, since in these cases it cannot normally be met by taking out a private insurance policy or from assets acquired in life by the deceased. The Government are therefore extending the cover in this way.

Wherever the line is drawn, it will be possible to think of a potentially hard case. I do not doubt the facts that the noble Lord has given to-day are those of a hard case. The noble Lord cited cases of parents who went abroad and left the child. Clearly, in such cases the parents were responsible. It is their insurance and not the aunt's which is appropriate. It may be that circumstances would enable the adjudicating authorities to regard this as a temporary absence which could be ignored in determining whether the deceased was residing with his parents. If it was a long-term situation, the authorities would have to consider whether the deceased would have been residing with the parents if not living at school, hospital, or recognised home. While having every sympathy with the case that the noble Lord has given, I ask the Committee to consider that wherever the line is drawn there will be hard cases. I would therefore ask the noble Lord to withdraw his Amendment.


I know how difficult it is to depart from a recognised rule in these matters. But in this clause we are departing from a recognised rule: indeed, the whole point of the Clause is to depart from a recognised rule. I thought it might be possible to make a special concession in the list in this way. It seems to me that the child in these circumstances is more likely to be dependent on an uncle or an aunt than in the generality of circumstances covered already by the Act. Obviously, it would be absurd to press this. I have an inkling that sooner or later there will be a concession on this point—one rarely gets it the first time. In the circumstances, I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Clause 4 agreed to.

Clauses 5 to 7 agreed to.

Clause 8 [Decimalisation]:

On Question, Whether Clause 8 shall stand part of the Bill?


Your Lordships will see that there is an italics Amendment in my name to leave out Clause 8. I have written to the noble Baroness to explain my reason, and I will briefly give it now for the Record. It is concerned with the need for employers to be able to express every social security contribution in terms of decimals at an earlier date than D-Day for decimalisation (which is in February, 1971). Many of them need, for good reason, I think, to be able to decimalise their pay slips by the beginning of the financial year 1970-71; that is, by April 6, 1970. Therefore it is important that in respect of the deductions for social security the Government should give the lead in expressing those contributions in terms of two places of decimals as from that date.

As some noble Lords will know, my particular interest in this matter is in respect of the distributive trades. Traders generally, and retailers in particular, want to take a lead in this matter by printing their pay slips in decimals from April 6, 1970, although they will continue to pay in sterling. The reason for doing so is obvious; for they, with the banks, transport and other service industries, have to take the lead in educating the public in handling decimal currency. It is their staffs, the employees of the distributive trades, who must first become familiar with decimalisation. Certainly in my opinion much benefit may be obtained by imposing on those staffs the painful necessity of reading their pay slips in decimal terms, even though, as I say, they are paid in sterling. It will give them at least ten months before D-Day to become, in one sense, familiar with this problem.

I should like to say, because I think it is worth saying, that any paymaster, any personnel manager—any employer for that matter—in any industry will gain by adopting the same policy and will thereby avoid the many anomalies which can arise from a change in pay systems during the tax year. If they do not change at the beginning of 1970 they will be, practically speaking, forced to change in the middle of the financial year.

Most entries on a pay slip can be adjusted for adaptation to the decimal system by administrative action within a company, but these changes have to be put in hand now—changes in overtime rates, in discounts, in bonus rates, in subscriptions to sports clubs and so forth. All these have to be brought into line so that they may be expressed in the terms of a decimal equivalent. One has to start on that now, so that by April next year one is ready to convert all these factors into the new form.

The most complicated and, one might say, the most haphazard deductions of all are those arising from social security, and help from the Government in this matter is urgently needed. In part, the Government have been forthcoming. In another place it was clearly stated. In Standing Committee E on July 8, reported in column 151, the Minister said … it is intended that the National Insurance (Assessment of Graduated Contribution) Regulations"— and so forth— should be amended with effect from 6th April, 1970. That is very helpful so far as it goes, but we are concerned with the rest of the contributions. In a letter to me, dated only a week or two ago, the Chancellor of the Exchequer said—I will read one paragraph: The Department of Health and Social Security will, of course, do all that they can to assist employers with the transition— to decimalisation— and during the course of the legislation for the new rates of social security benefits and contributions the decimal equivalents or near equivalents of the new contributions will be announced so that employers will know, when they alter their pay rolls for the new £s. d. rates, what the decimal rate will be. That is encouraging. As this is the last stage of this Bill, I hope that the noble Baroness is armed with these answers.

I was not so encouraged by a previous comment in the Newsletter of the Decimal Currency Board which, in respect of flat-rate contributions, said, in the February, 1969, issue: Planning is on the basis that from D-Day there will be a fresh range of flat-rate rational insurance contributions expressed in £p … That did not seem to anticipate that we should have information about the equivalent from the beginning of next year. I hope that the noble Baroness will be able to tell me that the issue of that document is now out of date. Having put this matter as clearly and as briefly as I can, I now hope to have a favourable and informative answer from the Government Front Bench.

3.55 p.m.


I would say, in reply to the noble Lord, Lord Redmayne, that I am very relieved by the fact that at one stage I taught mathematics. I cannot imagine more of a nightmare than trying to talk about contributions to social security expressed in decimal currency. I take the point made by the noble Lord about the advantage for employers of setting out in decimal currency the amount of flat-rate contribution in advance of February 15, 1971. The regulations to enable flat-rate contributions to be expressed in decimal currency as from February, 1971, will of course be made well in advance. They will be published by this autumn. But there are difficulties in sanctioning too soon the deduction from wages of flat-rats contributions in decimal form. It would mean, for example, that slightly different rates would be payable by employees, depending solely on whether the employers were maintaining records in decimals or pounds, shillings and pence in the period before Decimal (D) Day.

I did a little calculation to get some sort of example; I am sure that the noble Lord, Lord Redmayne, will have done a large number of these. Taking the normal and most average contribution of an employee at 17s. 8d. I would point out that if this were expressed in decimals it would of course be £0-883. If the employer worked to three decimal places —we are talking about the intervening ten months—he would in fact lose very little on the difference. I appreciate that the noble Lord, Lord Redmayne, will tell me that this is in relation to a very large number of employees and that the fraction is a very small one. May I say to the noble Lord that the Government are anxious to be as helpful as possible to employers, but there are a number of interests to be consulted, and I hope that he will appreciate that the Government are very concerned about making the position as straightforward as possible for employers in the position in which the noble Lord is.

I might help him a little by saying that in the Newsletter to which he referred there is a misprint. The paragraph he mentioned should read: Planning is on the basis that from D-Day there will be a fresh range of flat-rate national insurance contributions expressed in £-p. These will be exact or near equivalents … instead of "There will be exact or near equivalents … "That is some small comfort and it may clear up one small misunderstanding. I hope that the noble Lord will appreciate that the Demical Currency Board and the Department are anxious to smooth this period, and that therefore he will agree to withdraw this Amendment.


Before my noble friend deals with this matter further, may I ask this question? This Clause is couched in a negative form. It says: Regulations shall not be made under this section so as to take effect from a date earlier than the 15th February 1971…. But the regulations could, of course, be laid very much in advance of that date. This, I think, would go a long way to meeting the point made by my noble friend. I think that what he had in mind was to make certain that the regulations are laid in very good time, even though the regulations have to comply with subsection (3) of the clause.


I appreciate the point, and therefore I think it useful for the Record that I should say that these regulations will be dealt with in good time. This, in fact, constitutes something of an assurance.


I do not wish to delay the Committee. I am grateful to the noble Baroness. She is seized, of course, that "in good time" means before April, 1970, and nothing else. When she says that it seems likely that there will be a slight difference between the sterling contribution and the decimal contribution, will she accept that if all paymasters throughout commerce and industry paid in decimal coinage from April 6, 1970, they would be very much better off—not in money, but in terms of coping with quite a large problem? I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 8 agreed to.

Clauses 9 to 11 agreed to.

Schedules 1 and 2 agreed to.

Schedule 3 [Provisions to be substituted in Schedule 4 to National Insurance Act 1965]:

On Question, Whether Schedule 3 shall be agreed to?


I should like to ask one question on Schedule 3. I wonder how long the Government are proposing to retain the subdivision: (d) over the age of 18— (i) if on 5th July, 1948, that person had attained the age of 55 in the case of a man or 50 in the case of a woman, Death grant is to be paid of exactly half as much as the grant "in any other case." I know that the theory here is that because of their age in 1948, they could pay only 10 years' contribution and so are entitled to a smaller death grant, and that the longer this goes on, the thinner it wears because of continuing escalation. This is known to be an irritant, and I hope that at some time or another the Government will make up their minds to abandon it.


I would remind the noble Lord that the grant is not intended to cover the complete cost of a funeral; it is intended to help. But I take the point he has made and I am sure that when further amending legislation comes forward, we will return to this point again.

Schedule 3 agreed to.

Schedules 4 and 5 agreed to.

Schedule 6 [Commencement and transitory provisions]:

On Question, Whether Schedule 6 shall be agreed to?


May I ask one question on Schedule 6? I am sorry that I have not given notice of this question to the noble Baroness, but I think she will be able to answer it easily. Part I of this Schedule deals with the date of commencement of the various provisions of the Bill. Considering that some dates at least are known, I wonder why they have not been put into the Bill. The date of coming into operation for benefits is November 3, and I understand that the date when contributions will come into effect has already been decided. I should be grateful if the noble Baroness would tell the Committee when these provisions are intended to come into effect and to indicate why these dates have not been stated in the Bill.


The noble Lord has said that it would be simple to give a reply to his question, but I am afraid that it is not so simple. The date the noble Lord has given is the date referred to on Second Reading. I hope I am correct in assuming that the time when a Bill is introduced constitutes some statement of intent in relation to dates, and this may be the reason why they are not in the Bill. But I would not give this as other than my own personal opinion in this connection.

Schedule 6 agreed to.

Remaining Schedule agreed to.

House resumed: Bill reported without amendment; Report received.

Then, Standing Order No. 41 having been suspended (pursuant to the Resolution of July 14), Bill read 3a.


My Lords, in moving that this Bill do now pass, I should like to express my appreciation of the courtesy of noble Lords, particularly of the noble Lord, Lord Drumalbyn, which has enabled us to examine the Bill so carefully, and I ask your Lordships to accept the Motion that this Bill do now pass.

Moved, That the Bill do now pass.—(Baroness Phillips.)

On Question, Bill passed.