HL Deb 29 November 1984 vol 457 cc1025-33

4.15 p.m.

Lord Glenarthur

My Lords, with the leave of the House, I shall now repeat a Statement on board and lodging payments under the supplementary benefit scheme which is now being made in another place by my right honourable friend the Secretary of State for Social Services. The Statement is as follows:

"With permission, Mr. Speaker, I should like to make a statement on changes I am proposing in the system for making board and lodging payments under the supplementary benefit scheme. I have referred these proposals to the Social Security Advisory Committee for them to report their views to me after a process of consultation. Copies of the consultative document are available in the Vote Office.

"Supplementary benefit expenditure on board and lodging is escalating. During 1983 it rose from £205 million a year to £380 million a year. My latest information suggests that unless action is taken, expenditure will grow by a further 50 per cent. each year during 1984 and 1985. No responsible Government can allow expenditure to increase in this way unchecked. As an immediate measure of cost control, I laid before the House on 22nd November regulations which will empower me to impose a temporary freeze on the existing local limits governing board and lodging payments. These regulations will be debated soon. They will be replaced by new arrangements which will come into operation in early 1985 following the consultative process.

"There is particular concern about the growing number of young people receiving board and lodging payments, especially those spending long periods on benefit in seaside resorts. The number of such people aged 25 and under went up by 60 per cent. during 1983. The increasing evidence of abuse makes it essential to move quickly to bring ordinary board and lodging expenditure under control.

"As far as residential homes and nursing homes are concerned, I welcome the contribution which the many good establishments make. However, the present system of paying for such care under the supplementary benefit scheme does not discriminate adequately between homes for different types of resident or patient. Furthermore, it is difficult to see why the charges for residential care homes for the elderly met for supplementary benefit claimants should vary from £51 a week in one part of the country to £215 a week in another. We must move to a system in which there is less variation throughout the country.

"My consultative document proposes several changes. The responsibility for setting the maximum amounts of benefit payable will be transferred to Ministers. For ordinary board and lodging accommodation, the existing locally-determined limits will be replaced by two new limits—one for the Greater London area and another for the rest of the country. I am also proposing limiting the eligibility of 16- and 17-year-olds to claim board and lodging in their own right. We shall also prevent young people setting up unnecessarily in long-term board and lodging accommodation. But we shall safeguard the position of the genuine job searcher.

"In the residential care and nursing home sector I am proposing a new structure of national limits for payments. These new limits will be designed to reflect the varying cost of providing different types of care. There is no question, however, of elderly, handicapped or disabled people being moved out of their existing accommodation, and their position will be protected. At the same time, I am proposing that attendance allowance should be taken into account in assessing claims for supplementary benefit from people in private and voluntary residential care and nursing homes.

"Subject to the process of consultation I have mentioned, I propose bringing regulations before the House in February next year with a view to implementing new arrangements in April 1985. I shall be monitoring the new arrangements closely after implementation and will not hesitate to produce further changes if these seem necesary. I shall also be considering alternative approaches in the light of the current review of the supplementary benefit scheme.

"The supplementary benefit scheme is there to help people in need. The Government are committed to that. We are equally committed to our policy on care in the community. So we shall continue to meet the needs of elderly, handicapped or disabled people. But we are equally determined to make sure that the supplementary benefit scheme is not abused or exploited. I am determined that we should no longer make unjustified board and lodging payments. I therefore give this warning: that if claimants do not need board and lodging accommodation or if the charges are too high, the supplementary benefit scheme will no longer pick up the bill."

My Lords, that completes the Statement.

Baroness Jeger

My Lords, I thank the noble Lord for repeating that long and complicated Statement, which I am sure we shall have to discuss at greater length at some other time. I must say, however, that underlying the Statement there seem to be suggestions that, somehow, too many people are getting too much money out of the system. While not condoning fraud or deceit, I have to say that the real sadness is that much of this syndrome is symptomatic of the malaise and demoralisation of today; especially the despair of continuing unemployment among many young people, who see no hope of ever getting a job. They feel that society does not care for them, so why should they care for society except to get what they can out of it? Therefore, the pity for us all is, first of all, that the skill, the ingenuity and the intelligence which they could contribute to enriching their own and the nation's life is squandered in what some of them call "working the system".

The problems referred to in the Statement cannot be considered separately from the worsening economic situation. We must deplore this, simultaneously with regretting any mischievous deceit. It is a palimpsest, and we must look at both sides of it. Reading through the Statement I see that the Minister suggests that there will be opportunities for further debate. The Statement then goes on to say: These regulations will be debated soon and new arrangements will come into operation in early 1985". Is that not a little presumptuous? It may be that during the debates this House or another place might not agree with what is proposed, so how will arrangements be able to come into operation in early 1985? We might not like them; we might turn them down. What will the Minister have to say about it then?

The consultative document which was placed in the Printed Paper Office today, and which I do not think many noble Lords have had time to read, states: Young people can receive £80 to £90 a week as boarders. This far exceeds what many of them could earn". But where can they earn anything? We are talking about young people who do not have a job and do not earn anything; so that seems to be a most irrevelant remark. Moreover, who gets that £80 or £90? We are talking about the enormous and increasing sums which are being paid to boarding house keepers and private hostel owners. That money is going to the landlords. It is the biggest growth industry in the country. The private landlord can charge £110 per week for a room for a homeless family. That money does not go to the occupier, it goes to the owner. We know that there are fortunes being made by people crawling out of the woodwork in their substandard boarding houses and so-called hostels and hotels and picking up this money from the Department of Health and Social Security. That is where the department should be looking.

The emphasis in the Statement, although it refers obliquely to those boarding house keepers, does not seem to take on board sufficiently the fact that the people who are living in that kind of accommodation are often impoverished and are putting up with the most substandard accommodation where even the fire regulations are not observed, where there are no facilities for children to play, and no proper provision for cooking or for dealing with the ordinary necessities of life. Therefore, I regret that the whole tone of the Statement seems to be correcting those who are suffering from the situation rather than those who are profiteering from it.

The Minister made reference in the Statement (and I shall quote, because I always want to be fair) to the fact that, The system allows proprietors of low-quality establishments to inflate their charges". But the Statement does not go on to say what is to be done about it, or why it has gone on for so long. That is a serious omission.

I must also ask the noble Lord another question. I assure him that I am leaving out a few of the questions I should like to ask because I hope there will be further opportunities to raise them. The Statement refers to "board and lodging". What is the position of a lodger without board? This applies to many people who are in hostels which provide a bed for the night. Many of the voluntary hostels which are doing a very important job among the homeless and the down-and-outs in our big city make some accommodation available for the night, but if they are able to give a cup of soup I do not call that board. I want to know whether the proposals will make life harder and more impoverished for such people.

Will the Minister also bear in mind (and I have to put this in the form of a question) the problem of people who are in hostels for all sorts of reasons—perhaps drug addicts who are recovering, alcoholics or battered wives? I know that the consultative document refers to people in that situation, but it seems to me—and I say this without being too tendentious—that there are some things which do not marry up between the Statement and the consultative document. For instance, the Minister says in his Statement that payments in that situation are to be frozen. If they are to be frozen, and take no account of inflation, surely there will be difficulties for many of the voluntary organisations which are doing such good work among homeless people and those in need. How is that gap between the Minister's "freezing" and the inflation which we all know is going to get worse (even the price of tea and coffee is, I understand, going up) to be met in the case of this very real need?

This is a Statement and not a debate, but I feel I have put to the Minister some of the anxieties which many of us on this side feel. I hope that the Government will recognise that the difficulties which arise in the social security field are a direct product of their economic policies, and that that is where the reform needs to begin.

4.28 p.m.

Lord Kilmarnock

My Lords, we on these Benches would also like to thank the noble Lord for repeating this important Statement, which has been made necessary by the mushrooming of private residential accommodation for the elderly and the increase in board and lodging for young people. The consultative document, we learn from the Statement, had been referred to the Social Security Advisory Committee. Will the Government pay due attention to the advisory committee's recommendations? Can the noble Lord tell me how long the consultation process will last? It does not look very long. If the matter is coming back to us early in 1985, is that long enough?

Can the noble Lord tell me how other interested bodies—that is to say, Age Concern and those concerned with the problems of the elderly and of the young—will be able to feed into the consultative processing? Will they feed their comments through the Social Security Advisory Committee or direct to the department? This is an important matter, particularly if the process is to be rather telescoped.

I think that is rather naive of the Statement to say that it is hard to understand why, the charges for residential care homes for the elderly met for supplementary benefit claimants should vary from £51 a week in one part of the country of £215 a week in another". The answer is given in the consultative document, where we are told: The local limit system simply reflects local patterns of charges determined by proprietors without any checks on unreasonable increases. It facilitates cartel-type activities by groups of proprietors". A little lower down we learn that: There is particular criticism of young people spending long periods in seaside resorts and of proprietors advertising for DHSS clientele". So far as young people are concerned, it is clear that one reason why they are flocking to seaside towns is high youth unemployment. That is something the Government might like to reflect on.

Can the noble Lord clarify one other point, please, on page 3? The Statement says that the Secretary of State is: proposing that attendance allowance should be taken into account in assessing claims for supplementary benefit from people in private and voluntary residential care and nursing homes". Can he clarify that for me? I understand that attendance allowance is sometimes necessary for people, particularly in residential homes. Is the Statement telling us that that will be withdrawn? If that is the case, it is rather a serious matter.

Finally, the Government commit themselves in the last paragraph I think to their policy on care in the community. But does the noble Lord not think that the Government have brought some at least of the residential problems on their own head? Does he agree that they could have largely been avoided if local authorities had not been squeezed to the point that they cannot expand or even maintain their own residential accommodation; and that if the Government had pledged sufficient funds to make care in the community a reality, many more elderly people would be enabled to stay on in their own homes?

4.33 p.m.

Lord Glenarthur

My Lords, I am grateful to the noble Baroness and to the noble Lord, Lord Kilmarnock, for their comments. I shall endeavour to answer some of the points that they have made. I think that the most important point to make at this juncture is that what we are dealing with here is basically an abuse of the system. That is why it has been necessary for my right honourable friend to take the steps that he has.

The noble Baroness asked me to elaborate on what the Government are going to do to sort out that abuse. As I said when I repeated the Statement, we shall bring payment limits under direct ministerial control. Instead of local limits that simply follow increases in local charges made by landlords, Ministers will determine what is a reasonable maximum amount for supplementary benefit to pay. Our limits will be realistic but they will restrict the scope for the exploitation and profiteering that I mentioned just now. As I said in the Statement, there will be two new limits—one for London and one for the remainder of the country. Areas where the existing limit is below the new figure will retain the lower limit, uprated to allow for inflation for the present. We shall decide on the level of the new limits when the consultation period is over; but at present we are thinking in terms of a maxima of £70 in London and £60 elsewhere. That should lead to reductions in some 75 per cent. of local limits. That is a substantial measure of retrenchment.

The noble Baroness asked what evidence we have of this abuse. She will perhaps have seen in the newspapers some of the examples. For example, there is a wealth of advertisements for Thanet hotels and guest houses, specifying, "High-class DHSS accommodation"; "DHSS fees arranged"; "On DHSS? Living in poor conditions? Why not live by the sea at Margate? Transport to Margate arranged"; all that sort of thing. That is the sort of evidence that we have.

The recent growth in numbers of young people claiming board and lodging payments, to which the noble Baroness referred, far exceeds any growth in unemployment. There were 60 per cent. more boarders in 1983 aged from 16 to 25, when the numbers of unemployed rose by 9 percent. If that does not show that it is not just a question of unemployment but that people are taking advantage of the system, I do not know what does. It seems that youngsters are simply choosing to set themselves up in board and lodging at the expense of supplementary benefit. I do not think anyone can applaud that. I have the figures and I can certainly let the noble Baroness have them.

So far as standards of accommodation are concerned, new guidance is being prepared so that local office staff can draw to the attention of local authorities deficiencies in accommodation attracting ordinary board and lodging payment. The sort of things that I am thinking of are overcrowding, health dangers, fire hazards, and so on. In addition, that will bring to the attention of local authorities and health authorities any doubts about residential care and nursing homes.

As I said, local limits have risen significantly. They rose significantly in 1983. The average ordinary board and lodging limits rose from £47 to £66 a week; and all the indications were that similar increases, far in excess of the rate of inflation, could be expected this November. For example, 80 residential care limits have been further increased in 1984 by an average of £25 a week. It would have been irresponsible to allow that trend to continue. It could well have jeopardised expenditure on other parts of the social security programme. I am sure that that is not something that either the noble Baroness or the noble Lord, Lord Kilmarnock, would like to see.

On the question that the noble Baroness asked about board without lodging—I imagine that hostels cover broadly the class to which she is referring—there will be special arrangements for hostels which will give protection. I do not have the details with me, but perhaps I may let her have them in due course. So far as hostels for the homeless are concerned, a special limit for them, intended to safeguard their position, will be brought forward. On the question of drug and alcohol misusers, a new limit for them will come forward which will meet higher charges than before.

The noble Baroness asked about the freeze. Perhaps I can explain to her that it is the limits that are to be frozen; it is not the actual payments. I hope that that clears her mind. She may like to study the document with a little more time, and I think that it will become clear to her. The point is that at the moment the limits will be frozen. We shall no doubt discuss those arrangements in due course of time in your Lordships' House.

Turning now to the noble Lord, Lord Kilmarnock, he asked about the SSAC consultation, how long it will last and whether other bodies will have a chance to make representations. The committee has been asked to report in January. All interested bodies, such as Age Concern to which he particularly referred, will be invited to put their views to the Social Security Advisory Committee.

The noble Lord also asked about attendance allowance. Attendance allowance is disregarded in calculating the benefit entitlements of people in private and voluntary homes, even though they normally have the full cost of their care met by supplementary benefit. That is out of line with the position of people in local authority care, and has also attracted considerable criticism from, among others, appointees responsible for handling claimants' money and proprietors of homes. We therefore propose that the allowances should be taken into account in assessing the ability of claimants in residential care and nursing homes to meet their fees. Some people have been drawing attendance allowance to help meet particularly high charges, and I hope the noble Lord will accept that we shall provide generous transitional protection for them.

Basically the most important point (to repeat what I said earlier) is that these arrangements will reduce the scope for exploitation and abuse—which has certainly been going on. I do not think there is any doubt about that. They will also help safeguard public money, and that of course is an important feature.

Lord Stallard

My Lords, perhaps I may from here thank the noble Lord for his Statement this afternoon, though I think neither the Statement nor the consultative document do anything to expose the tremendous scandal that lies behind the figures for abuse. None of us of course would condone the kind of abuse which has been outlined by the Minister or other noble Lords in their speeches this afternoon; we would certainly not want to go along with that.

However, is the Minister aware that the abuse, certainly in London, is a direct result of the shortage of suitable accommodation, or any kind of accommodation, for the many thousands of people who crowd into the metropolis, literally homeless, jobless, and in all sorts of other trouble? I say this from experience, which I know is shared by many noble Lords on both sides of the House. The voluntary organisations like the Simon Community, Age Concern, which has been mentioned, the Spastics and many housing associations are struggling to implement this policy of Care In The Community. But we are beginning to think that the Government are paying lip service to this policy of Care In The Community because they do not supply the resources to go with it. So the abuse arises from the shortage. That is brought about, as I say, by the lack of resources given to local authorities to provide and maintain the accommodation. That is brought about directly by Government policy in restricting these resources by rate capping and so on.

We look forward to a very early debate. The noble Lord may well be aware that at this moment Camden Town Hall is under seige by many people. It is occupied by people who are demanding a serious change in the provision of bed and breakfast accommodation for people in these situations. It is a serious situation. It is far more serious than the Minister outlined in the Statement and certainly far more serious than many people throughout the country understand.

It is not just a question of changing the rates, of freezing the limits. It is a question of tackling the major problems that exist in places like London and other inner city conurbations in order to deal with the biggest problem facing our society at the present moment. So I hope that the Minister will go a bit further than he has done in tackling the causes of these abuses. I certainly look forward to an early debate.

Lord Glenarthur

My Lords, I do not accept all that the noble Lord, Lord Stallard, says, by any stretch of the imagination. The fact is that there are many examples of straight abuse. There are examples even of families arranging for their teenagers to go to other families, doing a sort of swap of teenagers, so that they can claim the necessary charges. That is one of the abuses that this announcement which my right honourable friend has made will bring to an end.

On the more general question of London and the limits so far as access to accommodation is concerned, in setting new limits for ordinary board and lodging the Government are concerned to improve equity between those on supplementary benefit and others on low incomes. This will ensure that high board and lodging payments do not act as a work disincentive—which can happen with the current limits. Supplementary benefit claimants should, like others on low incomes, have to bear in mind their level of income in choosing where to seek accommodation, rather than assume that the supplementary benefits scheme will meet their costs. This may mean that in some expensive places such as central London, claiments will have to accept only basic shared accommodation or look in cheaper areas.

We must live in the real world. The changes which are proposed may in the noble Lord's eyes affect the Community Programme. But I can assure him that the Government are committed to the Care In The Community programme. I deal with this quite regularly so far as the mentally handicapped and the mentally ill are concerned. By no stretch of the imagination is it easy, nor is it going to happen overnight. But it is something to which the Government are committed and I can assure the noble Lord that we will go ahead with it.

Lord Stallard

My Lords, on the point that the noble Lord has mentioned, I am still not satisfied that the Minister has made out a case for freezing the limits and the payments on the basis of one or two abuses. There is ample legislation and there are ample measures at the moment in existence to deal with those abuses. It should not be said that the whole system has collapsed, that everybody is on the fiddle and that they are all scroungers. We know the people who are abusing the system and so does the Minister. We do not need this kind of approach. We need an entirely different approach.

Lord Glenarthur

My Lords, the reason why the freeze has had to be applied is because the amount of money that was being spent has risen from something like £39 million to £102 million in the last year or so. We simply could not sustain that growth. It was quite out of all proportion to the real need that the Government and the taxpayer at large could be expected to meet from that sort of expenditure. That is why it was necessary to do it. However, the noble Lord will have a chance to debate it when the necessary orders are made.