HL Deb 19 February 1970 vol 307 cc1288-91

3.25 p.m.


My Lords, I beg to move that the Draft Rate Rebates (Limits of Income) (Scotland) Order 1970 be approved. The Draft Order, which relates to Scotland only, has already been approved by the other place. Its purpose is straightforward and non-controversial, and it has been generally welcomed. Under the scheme initiated by the Rating Act 1966, rebates are available to ratepayers whose income does not exceed a certain amount. The limits laid down for the maximum rebate stand at present at £9 a week for a single person and £11 for a married couple, with an additional allowance of £2 for each child. The effect of this Order is to raise the limits by £1 per week in the case of a single person and by £1 5s. in the case of a married couple.

The Order is needed now because of an increase in the State retirement pension last November. That means that pensioners, who comprise a high proportion of those who come within the field of the rate rebate scheme, will be assessed for the purposes of rebate on a higher income, and some of them might find the benefit of the pension increase whittled away by a consequential reduction in the rebate. That would be very undesirable, so the Rating Act provides for increases in the income limits to be made by order as necessary. This was done on the occasion of an earlier pensions increase in 1967, and this Order seeks to repeat the process.

This is a purely Scottish Order. That does not mean that Scotland is getting preference over England. An Order for England and Wales will be introduced at a later date. The Scottish Order is needed first because of the different rating years in the two countries, which affects the period over which payment of rebate is made and also the prior period over which income is assessed. If the Order were not to come into operation now but were delayed until later on, some Scottish pensioners, whose income assessment is already taking account of the pension increase last November, might find themselves dropping out of benefit temporarily. This is why we need the Scottish Order now. In England and Wales the effect of the pension increase will not be felt until next October, and so a later Order is appropriate there.

My Lords, the rate rebate scheme is not an ambitious social security measure: it is simply a way of tempering the rigour of the rating system for those who are least able to bear it. We believe that it succeeds in this minor objective quite well. At a total cost of under £2 million, it relieves between 90,000 and 100,000 households in Scotland of rate burdens now averaging out at about £20 a year. It is a worthwhile scheme and deserves to be kept in good working order until such time as the whole rating system can be thoroughly overhauled. The Order before the House does not seek to impose an additional charge on the Exchequer or on local rates. It is not concerned with the amount of benefit but is concerned with the conditions of qualifying for benefit; and it does not aim at widening the category of those who qualify but simply at maintaining the present position. If the Order were not passed, we could expect a saving of up to £200,000 a year, but against that 10,000 householders, mainly pensioners, would be losing a benefit which Parliament intended that they should get. My Lords, I beg to move.

Moved, That the Draft Rate Rebates (Limits of Income) (Scotland) Order 1970, laid before the House on 4th February, be approved.—(Lord Hughes.)


My Lords, I thank the noble Lord, Lord Hughes, for his explanation of this Order. I say at once that I am sure it has the full support of your Lordships—certainly it has the support of those who sit on this side of the House. The noble Lord has, I think, answered in advance all the questions I was going to ask. But may I put one question to him to make quite certain that we have correctly understood what he said? He said, I think—I tried to note his words—that but for this Order some pensioners might find themselves dropping out temporarily; that is to say, that they would lose part or the whole of their rebate because of the increase in the National Insurance pension last November. Is it quite certain that none will drop out temporarily? Is this Order, so to speak, retrospective? Does it cover those who will be getting an increased income between the time when the increased National Insurance benefit came into effect last November and March 16 when this Order is expressed to come into effect? Will none of them lose temporarily in respect of the current rate half-year? That is the only question I want to put to the noble Lord because I should like to be quite certain about it.


My Lords, may I put one question to the noble Lord? I wonder how he reaches the figure of £318 0s. 10d.? It is rather a curious figure. In the Explanatory Note it say £313 0s. 10d., that is, £12 5s. 0d. a week. That is not so. I wonder whether the noble Lord would clarify the relationship of those two figures.


My Lords, it is not £318 0s. 10d., it is £318 10s.—I wondered why we got down to coppers. It is a misreading. I must agree that £318 10s. 0d. is not £12 10s. 0d. a week, as stated. I do not know what the answer is. Is the answer coming from the Official Box? No, it is the answer to the previous question asked by the noble Lord, Lord Drumalbyn. But it may turn up. If I break my intention, and keep this discussion going on long enough, the answer may emerge!

At the moment I will confirm the correctness of the noble Earl's arithmetic, although as I have not found the second figure I do not know whether he is making a mistake in reading it as he made a slight mistake in reading the first one. If I may go on to answer the first question, I think that the noble Lord, Lord Drumalbyn, misunderstood what I was saying. I was attempting to convey that, because of the difference in the rating years, if we were to wait until the time that is appropriate for the English Order, some people in fact would have dropped out temporarily; but, by bringing in the Order at the present time, we prevent this from happening. None, in fact, will drop out if the Order is passed at the present time. There is a 7½ month gap between the income assessment periods, so that the noble Lord can be assured that what he wants us to do by this Order is in fact what we shall be able to do. I am afraid that my friends at the Official Box are taking a little longer to write out the answer than I expected, but it now seems to have arrived.


My Lords, is not the answer that it is for a six-month period and not for a twelve-month period?


My Lords, the noble Earl has anticipated the answer. I have it here almost as a piece of algebra—"26 weeks x £12 5s. = £318 10s."

On Question, Motion agreed to.