§ 7.58 p.m.
§ Lord WELLS-PESTELL
My Lords, I beg to move that the Social Security Bill be now read a second time. The main feature of this short, but important, Bill is that it provides for an extension in the upper age limits for the receipt and payment of mobility allowance. Otherwise, the Bill is largely technical. It makes improvements in social security appeal procedures, alters the attendance allowance provisions and makes miscellaneous changes, particularly in relation to the new pensions scheme. I do not propose to weary your Lordships by going into a detailed description of all the provisions contained in this Bill. There will be the opportunity to discuss details when the Bill goes into Committee. However, I should like to draw your Lordships' attention today to one or two of the more significant provisions in the Bill.
My Lords, perhaps the Bill's most important provision is contained in Clause 3—the extension of the age for the receipt of mobility allowance, once awarded to 75 for both men and women, instead of 60 for women and 65 for men, as at present.
The Government have wanted to make this extension for some considerable time, and we are pleased to be able to do so now that the necessary resources have become available. Moreover, we have been able to bring about this important improvement before any beneficiary has actually reached the age at which we would have been obliged under the existing law to withdraw the allowance. Furthermore, Clause 3 provides that women will be able to establish entitlement to the allowance up to the age of 65, like men. Women will be phased into the scheme in the same way, and at the same time, as men of a similar age.
925 There has been some alteration to this Bill since it was first presented in another place, and I intend to refer later to some of the changes which have been made. However, it is appropriate for me to mention now that the Government have accepted the spirit of two Amendments made in Standing Committee in another place which also relate to the mobility allowance. Clause 3 of the Bill now provides that the Secretary of State, when he is considering the rate of the allowance which he is by statute required to do annually, should take into account any changes in taxation which directly affect the cost of motoring for persons in receipt of mobility allowance.
The phasing out of vehicle excise duty and the consequent increase in petrol taxation is clearly one such change; there is, therefore, now a statutory obligation to take this into account in reviewing mobility allowance. However, as my right honourable friend the Minister with special responsibility for the disabled made clear in another place, this cannot mean that the Government will commit themselves to freezing taxation of the disabled motorist at its present level. The Government are committed to the revalorisation of petrol duty. Energy conservation needs may dictate still further increases in petrol duty in the coming years. Mobility allowance is a major contribution—but a contribution only—to the cost of mobility to disabled motorists.
Clause 3 also now provides that the Secretary of State shall lay before Parliament, as soon as is reasonably practicable after he has carried out his review of the rate of mobility allowance, a statement setting out his conclusions and the reasons for them. The Government have deliberately aimed to give the Secretary of State the same flexibility about the timing of this statement as he has regarding increases in the main social security benefits. I thought it right to go into some detail on Clause 3 of the Bill, for I am well aware of the interest which many noble Lords have in the problems of the disabled.
I turn now, however, to some of the other features of the Bill. A large part of the remainder of the Bill is concerned with tidying up the law relating to social security. Though it is to be regretted, it should cause no surprise that a social 926 security scheme which is as comprehensive, and therefore complex, as ours should require running repairs to its legislation from time to time. This is even more the case in a period which has seen the introduction of the new pensions scheme, the first benefits of which become payable from April of this year. The introduction of the new scheme has been achieved at the same time as other major improvements in social security. The November 1978 up-rating took pensions and other long-term benefits to a level some 20 per cent. higher in real terms, despite price increases, than in October 1973; the Child Benefit Scheme is now operative and by April child benefit will have reached £4 for each child, and we have legislated for a range of new benefits for the disabled.
However, work on the preparation for the new scheme revealed areas in which there were some defects in the statutory provisions. It is clearly important that these should be corrected before payments begin to be made in April.
The bulk of the technical provisions in the Bill which relate to pensions legislation fall into this category, including those in Part I of Schedule 1, which provide that some of the improvements introduced by the new scheme should apply only when the relevant event—for example, death or the attainment of pension age—occurs on or after 6th April 1979, when those improvements come into effect, as had always been the intention. These include the payment of a retirement pension to certain widowers on their deceased wives' contributions, the topping-up of a surviving spouse's retirement pension with the deceased spouse's pension and the abolition of the married women's half-test. It was originally intended to achieve this by regulations, but we were legally advised that the Pensions Act did not contain the necessary powers. It is therefore necessary to make appropriate amendments to the relevant provision in the Statutes, and this will be achieved by the amendments set out in Part II of Schedule 1.
I should like to say a word about Clause 10, which remedies a number of technical defects in Section 59 of the Social Security Pensions Act 1975. That section is intended to bring the arrangements for increasing official pensions— 927 that is, occupational pensions for former members of the public services and other related groups—into line with those for increasing the earnings-related additional component of the new state pension. The amendments in the Bill are needed to ensure that these new arrangements operate to provide the level of price protection for official pensions that Parliament has always intended.
I turn now to the improvements in appeal procedures which are encompassed in the Bill. I need not dwell on the minor changes in National Insurance adjudication arrangements which are provided in Clauses 6, 7 and 8. However, Clause 5 provides for two significant improvements to the Supplementary Benefit Appeals Tribunal system. It is intended that, in future, there will be a second tier appeal, on a point of law, to a National Insurance Commissioner. This will avoid the present somewhat cumbersome, and certainly expensive, arrangement whereby a claimant who wishes to take his case further than the Supplementary Benefit Appeal Tribunal has recourse only to the High Court. In introducing this second tier appeal, the Government have felt it logical to utilise the system of appeals to the National Insurance Commissioner, which, I think most people will agree, has stood the test of time.
We have also made provision for the introduction of a small number of legally-qualified senior chairmen into supplementary benefits adjudication. These senior chairmen will participate in the training of tribunal chairmen and members and in monitoring the performance of the tribunals in their areas. This is an entirely new feature in social security adjudication and I feel sure that it will be welcomed by your Lordships.
We have also met a criticism made by both Government supporters and the Opposition in another place, that clerks to supplementary benefit appeal tribunals were not always seen to be independent of the Secretary of State. We are providing that in future they shall be assigned only after consultation between the Secretary of State and the appropriate senior chairman (who will himself be appointed by the Lord Chancellor) and that the Secretary of State will consider 928 representations from senior chairmen about the desirability of terminating a clerk's assignment.
At the beginning of this speech I mentioned that the Bill makes certain changes in the provisions for attendance allowance. These are contained in Clause 2. The first change will ensure that the generality of kidney patients undergoing home dialysis should receive the allowance, thus restoring the position to what it was before the Attendance Allowance Board, in the light of developments in connection with home dialysis, revised its guidance relating to the application of the existing law in 1977. The second change will remedy an unintentional effect of the present law, whereby people who are undergoing hospital dialysis as out-patients get the allowance, even though their attendance needs are met by the hospital staff. Finally, we wish to take enabling powers so that the six-month qualifying period for attendance allowance can be waived when someone loses the allowance because of an improvement in his health, but shortly afterwards suffers a relapse.
At the Report stage in another place, an Amendment was tabled which was designed to enable those who were described as "common-law husbands" to qualify for the invalid care allowance. As many of your Lordships will know, this is an allowance which is payable to those who give up work to look after certain classes or relatives who are seriously disabled. The Amendment was withdrawn after my right honourable friend had undertaken to consider seeking the advice of the National Insurance Advisory Committee on the matter. He has announced today that it has been decided to refer the matter to the committee.
It is perhaps appropriate at this point for me to give notice to your Lordships that the Government, in fulfilment of an undertaking which we gave in another place, intend to introduce an Amendment to facilitate the procedure for phasing out the earnings rule for retirement pensioners, as and when resources permit. Your Lordships will be aware that the Government are committed to the abolition of this rule when resources allow. We therefore propose to table a new clause for consideration by your Lordships at Committee stage, which will enable the Government, by means of orders subject 929 to Affirmative Resolution, to phase out the retirement pensioners' earnings rule by steadily reducing the period over which it applies, as a step towards complete abolition. In so doing, the Government are simply taking power to make changes. The question of using that power would need to be considered in the light of the economic situation prevailing at the time. I am sure your Lordships will understand, however, that resources do not permit any move at present. Any future decision to exercise this power would be subject to the Government's views on priorities in assessing the many competing claims for Government expenditure on scarce resources at that time.
I have dealt only with the more significant clauses in this rather technical Bill. I hope noble Lords will agree that its contents are neither likely to be controversial, nor a matter for Party politics. I recommend the Bill to the House and beg to move that it be read a second time.
§ Moved, That the Bill be now read 2a.—(Lord Wells-Pest ell.)
§ Lord SANDYS
My Lords, noble Lords will be glad to have heard about the Bill from the noble Lord, Lord Wells-Pestell. In brief, economical terms, the noble Lord dealt with it in the space of 15 minutes. I hope I shall be very much shorter than that, but the shortness of my remarks will not conceal any churlish feeling towards the Bill. Certainly it is to be welcomed, as the noble Lord, Lord Wells-Pestell anticipated. Indeed, there is much to be welcomed in the Bill, although there is one matter which I must mention to the noble Lord before we go very much further.
While we welcomed the fact that the noble Lord sent to us the notes on clauses, we have found this Bill to be very difficult to deal with in one particular respect. On a subject which the noble Lord rightly referred to earlier as one of great complication, one carries a small library. Usually I equip myself with the Social Security Act 1973, the Social Security Act 1975, the Social Security Pensions Act 1975, the Supplementary Benefits Act 1976 and the Social Security (Miscellaneous Provisions) Act 1977. But that is only part of the library. There is a whole host of orders which are ancillary 930 to and supplementary to the other legislation.
We have encountered one particular problem relating to the mobility allowance clause, Clause 3. May I draw the attention of the noble Lord, Lord Wells-Pestell, to the fact that reference is there made to Section 37A of the principal Act. Despite that reference to the principal Act, one will not find Section 37A in the principal Act. It is contained in Section 22 of the Social Security Pensions Act 1975. This illustrates one of the central problems relating to social security; namely, the maze of clauses and other amendments which have been added over the years. We on this side of the House can claim to have added to the complication.
Even at this late hour it is worth mentioning a point on the drafting of legislation. I refer to the Renton Committee. The noble Lord has heard me speak before on this subject. However, may I quote the words of a former Sovereign, King Edward VI, who said, and I quote his words from the Renton Report:I would wish that … the superfluous and tedious statutes were brought into one sum together and made more plain and short and to the intent that men might better understand them".Those wise words of a former Sovereign could indeed be applied to the social security provisions.
We suggest that this may be done by the application of a Keeling Schedule. The noble Lord will be aware that my noble friends have referred previously to this problem. It was referred to at Second Reading in another place. We submit that there are limited, special occasions when a Keeling Schedule can be a valuable asset. I understand that the noble and learned Lord, Lord Gardiner, has suggested that it would be useful in particular cases, and I quote again from the Renton Report at page 83. The words here are:Lord Gardiner, in his evidence to us, complained of the inconvenience of not being able to see at a glance from the Schedule what was to be left out and suggested that material to be omitted should be printed in distinguishing typeI think this is a matter of great complication in an area where there is so much legislation, but I will leave it at that for the time being.
There is much to be commended in the present Bill. We are glad that the noble 931 Lord has introduced it in felicitous terms. The background to it, however, is less felicitous. I refer to Clause 2. The noble Lord will be aware that my honourable friend the Member of Ealing, Acton in another place, Sir George Young, introduced last Session in another place a Private Member's Bill which was going to remedy the case referred to, which resulted from a decision by the Attendance I Allowance Board. This was the celebrated and important case of a certain Mrs. Broomfield, who had her attendance allowance stopped in September 1977. We welcome the fact that at last the Government, who were not willing last year to give a fair wind to the Private Member's Bill, have incorporated Clause 2 in the Bill now before us and have permitted home dialysis patients who are dialysing for two periods a week to be permitted to retain the allowance. We also agree with the waiving of the six months qualifying period where a patient suffers a relapse, having previously lost the allowance owing to a recovery. That is another welcome change.
We agree with the noble Lord that the mobility allowance is welcome, but we think that some of the logic is misplaced here, for although it may be very welcome to extend the mobility allowance for ten years, how is it that at the age of 75 such allowance is no longer required? We agree with the Government that the pressure of economic circumstances is such that at the present time it would be difficult to cast an eye to the future, but I was interested in what was said by the noble Lord, Lord Wells-Pestell, because he made specific reference to the fact that funds are now available. If the funds are foreseen to be available for ten years ahead, we wonder how he is able to see as far as that in present circumstances while, when referring to other parts of the Bill, he is less certain of his ground. We believe that there is a case for examining the position on the mobility allowance on Clause 3 and we shall look at it with considerable care.
At Report stage in another place Her Majesty's Government made two very imporant commitments which have already been referred to by the noble Lord. The first was the phasing out of the earnings rule. This has been a matter of great controversey over a long period, and from 932 this side of the House we can certainly give three cheers and look forward to the publication of the clause before the Committee stage.
I believe that I can set aside a large number of pages of my speech because I feel that it will be in the interests of the House to do so, particularly as we are sitting very late on a Thursday night and still have a further item of business before us. But before I sit down I think it is important to mention the financial effects. In the Explanatory amp; Financial Memorandum there is a statement which says:The Bill will increase expenditure on mobility allowance by £5½ million in 1979 and 1980 and the increase will rise to £20 million in a year after four years".Other provisions of the Bill make further commitments which were envisaged in the principal Act, but, as we understand it from the present analysis given by the Government, there will be little saving. We had previously understood that there were to be savings under the earnings rule, but I have examined with care and interest the correspondence between some of my honourable friends in another place and I understand now that what was previously foreseen as a saving is in fact not a saving. However, I am glad that the Government recognise this and have published this fact in the Explanatory and Financial Memorandum. I have spoken long enough on this Bill. We shall be addressing to your Lordships' House a number of Amendments on, certainly, three clauses, namely, those concerned with the attendance allowance, mobility allowance and the earnings rule.
§ 8.26 p.m.
§ Lord BANKS
My Lords I should like to join in thanking the noble Lord, Lord Wells-Pestell, for his careful explanation of the provisions of this Bill. As he indicated, it is a modest and uncontroversial measure. He made it plain that it is principally concerned with four matters: the mobility allowance, the attendance allowance for kidney failure patients, supplementary benefit appeals procedure and the rectification of defects in the Pensions Act. I should like to make a brief comment about each and then add a further comment about Clause 12.
933 As the noble Lord said, the alterations to the mobility allowance constitute the principal feature of the Bill. I certainly welcome the removal of the pensionable age limits of 65 for men and 60 for women and the extension of the mobility allowance to age 75 for all who are entitled to it at age 65. I welcome also the equal treatment for men and women which this change involves and to which the noble Lord has referred.
I should like to raise four questions. The first is one that has been touched on by the noble Lord, Lord Sandys: is it right to limit it to age 75? In the discussions in another place the Government spokesman took the line that it was not possible at this stage to say what the provisions for the disabled might be in 1989, which would be when the first person benefiting from the change would reach the age of 75, but it seemed to me that that was not a very good argument because if a better scheme is to be found, a change could quite easily be made. I therefore want to ask whether the real problem is one of expense. One can understand that this may well be what is concerning the Government. A figure of £50 million was mentioned in the discussions in another place but I do not know how firm that figure was. It was the figure given for extending the age to life, and that would compare with an estimate of the ultimate cost through the proposals which are envisaged of between £35 and £65 million. That was rather a wide range given by the Government spokesman but I suppose we might be talking in terms of doubling the expense if that first figure is right. I wonder whether that is the problem that is worrying the Government.
My second question is this: Can it be right to exclude those who have become disabled over age 65? Again, is the only objection here one of cost? A figure of £200 million was mentioned if they were included and one can see that it is a large figure to contemplate at the present time, but do the Government hold that immobility due to old age should not be catered for and are they afraid that if they did extend it to people who become disabled over age 65 it would be difficult to distinguish between disablement due to old age and disablement caused in other ways? Personally I hope that they 934 are not making a distinction of that kind. I think it would be invidious.
The third question is this: should the mobility allowance be taxed? I raise this, although it is not dealt with directly in the Bill, because of a hint—at least I took it to be a hint—given in another place by the Under-Secretary of State for the Disabled during the Second Reading debate. He seemed to suggest that it was likely that the two-pronged system advocated by the Disablement income Group of an allowance for the disabled which would meet the specific expenses which disabled people have, coupled with an income where this was required to replace loss of earnings, would eventually be the pattern that would be adopted. If that is so, presumably that allowance would not be taxed and presumably it would include the mobility allowance. One can understand that the income would be taxed but the mobility allowance would not, although in the tax credits scheme which we on these Benches are putting forward both these means of assistance, the allowance and the replacement of earnings, would be untaxed credits set along with other credits against the tax on every pound which that scheme would involve.
The final question about the mobility allowance is, is an allowance of £10 adequate? I know we always come back to this and I know we always come to discuss means when that point is raised. I am thinking particularly of people attempting to purchase a vehicle with their £10, and I realise that for many of them the other costs, the costs of maintenance and running the car, would be prohibitive; the whole of the £10 having to go to pay for the purchase or leasing of the car. I say that without in any way playing down the excellent work that is being done by Motability.
Turning to the attendance allowance for kidney failure patients, I join with the noble Lord, Lord Sandys, in welcoming the fact that the allowance is to be returned to certain patients who dialyse at home and who lost the allowance through the change in interpretation. I think it quite understandable that the allowance will not be paid to most of those who dialyse in hospitals and do not have any home attendance costs. I am glad the Government will waive the six months' qualifying 935 period for the allowance where there has been an improvement and then this is followed by a relapse. I am glad also that a means of paying back amounts to those who had their allowance withdrawn has been found.
Turning to the supplementary benefits appeals, I welcome the two-tier appellate system—the appeal which the noble Lord described from the tribunal to the National Insurance Commissioner. I do not think the question of legal aid was satisfactorily resolved when these matters were discussed in another place, and perhaps we shall be able to return to that during our discussion of the Bill. I think perhaps it is going to be a problem when an appeal is made to the National Insurance Commissioner, legal aid not being available at the present time. I was interested in what the noble Lord had to say about means of making the tribunals to a certain extent independent of the Department of Health and Social Security. I wonder whether that can be taken further and whether it might be satisfactory to have them appointed entirely independently of the Department of Health and Social Security, possibly by the Lord Chancellor's office. I am glad to hear about the appointment of the senior chairman, and I am glad to read in the Bill about the extension of those who qualify to be National Insurance Commissioners to include solicitors with ten years' experience in addition to barristers and advocates with that amount of experience.
All proposals dealing with supplementary benefits at the present time have to be seen against the background of the supplementary benefits review document, Social Assistance, and if there is going to be much more reliance, as that document suggests, on a more detailed Act of Parliament and less discretion on the part of those applying the benefits, then the appeals system is perhaps going to be even more important than it is now. That document, Social Assistance, did make it clear that one in 10 of our population depend to a degree on social assistance. I feel that the terms of reference of that review were too narrow and that if we were to reorganise the whole system along the lines of the tax credits system we could retain the discretion that it is now 936 proposed to remove for a much reduced supplementary benefit.
Turning to the rectification of defects in the Pensions Act, these are largely what has been described as running repairs, but I do not intend to examine them in detail tonight. I note that the Public Service Pensioners Council are still in dispute with the Government over the use of the phrase "complete months" to cover an incomplete month with 16 days or more. This arises in particular—it arises in other ways, of course—in connection with the decision to increase public service index-linked pensions on 11th November 1979 instead of 1st December. Eleven days in November will not count for the calculation. The Public Service Pensioners Council say that they would prefer to use the phrase "days" instead, believing that to be simpler and fairer. I am wondering whether the Government have had any second thoughts on that and whether their objection to the use of "days" is purely administrative.
Turning to Clause 12, which deals with the maternity grant and the death grant, this, of course, is a matter which we debated, certainly as far as the death grant is concerned, when I asked an Unstarred Question fairly recently, and the noble Lord, Lord Wells-Pestell, replied. There is now in the Bill this clause which places an obligation on the Secretary of State to review the death grant and maternity grant to see if they have retained their value in relation to the general level of earnings and prices obtaining in Great Britain. I am glad to see that in, but I regret that the Government do not intend to act on it; that is to say, they will conduct the review but will not, if the review shows a decline in value, take steps to put it right. The noble Lord said when I asked a direct question a few weeks ago that it was the Government's intention to allow the death grant to decline further in value. I wonder if he still holds to that or whether he has had the opportunity to think further about it. At any rate, we shall no doubt discuss that during the Committee stage.
Finally, may I welcome what he had to say about the earnings rule. We on these Benches have long been opposed to the earnings rule and although we are not seeing its end as yet it is nice to know that 937 arrangements are being made for its end so that it can come smoothly when it does eventually come. With those few comments and questions, I am content that the Bill should receive a Second Reading from the House.
§ 8.38 p.m.
§ Lord WELLS-PESTELL
My Lords, I do not think I ought to allow myself to be seduced by the noble Lord, Lord Sandys, into going down the two roads of Renton and Keeling, which he invited me to do. Having said that, may I say that we appreciate the problems referred to by the noble Lord. Consideration is given from time to time to the consolidation of social security legislation, and we will bear in mind the points made by the noble Lord in this connection. Similarly, with regard to the Keeling Schedule, which I understand involves the setting out of the relevant provisions as amended in the enactment which amends it, this is a complicated business, but we will give consideration to what the noble Lord has said. I think I could at this stage remind him of the fact that under Section 37A of the principal Act, brought in by Section 22 of the Social Security Pension Act 1975, the law on social security is regularly brought up to date and is published, together with subordinate legislation, as probably the noble Lord knows, in three volumes which are colloquially known as the Brown Books. If he has not seen them, I would advise him to go to the Library and have a look at them.
The noble Lord, together with the noble Lord, Lord Banks, raised the question why a stop at the age of 75. I do not think that there is any point in beating about the bush. It is largely a question of money. When one is planning ahead there is a great deal of merit and virtue in fixing some type of limit when one cannot see clearly what may be needed in 10 years' time. I, like the noble Lord, can remember the introduction of the "trike" . We had great hopes for that continuing, I was about to say, almost indefinitely. Then a whole series of events happened which made it necessary for us to rethink the situation.
We must all face the fact that it may be necessary in the next 10 years to change completely the whole concept of mobility. 938 The very fact that we are prepared to continue it to the age of 75 has already brought with it completely new thinking when we come to realise that one of the original purposes of the mobility scheme was to assist people to get about and to get to work and to do something about their own livelihood. Now we are thinking about the situation in very different terms. We are thinking of the needs of people who are over 65. It does not seem to me—and I am not trying to make a political point—to be unreasonable that we should say: "All right, this is what we shall do until both men and women reach the age of 65" knowing full well that long before we reach that stage, long before the next 10 years is up, we must be thinking in terms of the pattern of mobility allowances in the future. I do not think that I can say anything more about that.
The noble Lord, Lord Banks, asked whether it is right to exclude those who are not disabled before the age of 65. Again, I come back to the original purpose of the mobility allowance which is comparatively new. We must bear in mind that it was given for a specific purpose; namely, to be of some real value to people under pension age who are dependent upon mobility to carry out or do a job. We have changed it and I think that we must go one step at a time. It is no good my pretending that even if we thought otherwise we could do it financially. I do not think that there is a possibility of extending the scheme, in the way that the noble Lord suggests, for people who are unable to claim it before they are 65 years of age, simply because of the amount of money involved.
As regards taxation, it is not that I want to give the noble Lord a dusty answer, but that is a matter for the Chancellor of the Exchequer and I am not in a position at this stage—and nor would any of my friends in the Department be in a position—to make any comment about the taxation of a mobility allowance. Whether the mobility allowance of £10 is enough will depend again on the financial situation, as do so many other matters.
As regards the maternity and death grant, it is perfectly true that when the noble Lord asked a week or two ago whether the present position did not mean that, if nothing was done to increase the death 939 grant, as time went on its real value would become less and less, I said "Yes" because that is so. However, there is an obligation on the Secretary of State to consider the maternity and death grant. The noble Lord suggested that the Secretary of State would not do anything about the matter, but I am saying that under this Bill he is obliged both to look at the maternity and death grant and to give his reasons for doing what he proposes to do, which may be nothing or something.
I am grateful for the comments which both noble Lords have made. I realise that we shall be able to discuss these matters in greater detail during the Committee stage. However, I should like to conclude by saying that, by and large, this is not a political Bill: it is a sincere and sustained attempt on the part of the Government to remedy certain deficiencies and to make more adequate provision in certain respects.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House.