HL Deb 18 June 1986 vol 476 cc908-15

6.22 p.m.

Baroness Trumpington

My Lords, with the leave of the House, I shall now repeat a Statement being made in another place by my honourable friend the Minister of State for Social Security. The Statement is as follows:

"With permission, Mr. Speaker, I should like to make a Statement on supplementary benefit arrangements for board and lodging.

"As the House knows, when the main lines of the present system were set in April 1985 the Government undertook to monitor its working carefully and to review the financial limits on maximum payments after a year. Following the subsequent decision to have a general social security uprating in July 1986, it was thought sensible to defer any changes until then but meanwhile, in advance, to make significant increases in the limits for residential care and nursing homes alongside the previous uprating in November 1985.

"I am arranging to place in the Library copies of reports on the extensive monitoring and statistical surveys undertaken by the department since April 1985, together with the full report commissioned from the consultants Ernst and Whinney on residential care and nursing homes. I have placed in the Vote Office copies of Ernst and Whinney's own summary of their report, and of my right honourable friend's response to the Social Security Advisory Committee's comments on last November's amending regulations. In reaching our conclusions we have of course also taken account of the representations we have received from honourable Members and from other individuals and organsiations.

"For ordinary board and lodging, our most recent figures show that expenditure in 1984 rose not to £380 million, as we earlier estimated, but to over £500 million—an increase of no less than 80 per cent. in a year. At the same time, the number of boarders increased from 112,000 to over 160,000. Our monitoring and surveys confirm the existence of an accommodation market unduly influenced by the amount of benefit payable, rather than by normal commercial factors, and of an unacceptable degree of abuse. Many landlords have reduced their charges in response to the restraint imposed, and across the country our studies show average charges for the most part close to average limits.

"In view of this, and of the continued need to ensure firm control in this area, the Government have concluded that no general increase in the financial limits for ordinary board and lodging, or in the associated meals allowances, is at present justified. This is also the case for hostels, where our monitoring showed that average charges in all regions (including London) were below the present limit. We have, however, looked again at the current limit for couples without young children which is 1¾ times the single adult limit. This has been widely represented to us as unrealistic, and we have decided to increase it to twice the single limit, as for couples with young children.

"Mr. Speaker, it will not surprise the House that many of the representations about ordinary boarders have focused not on the financial limits but on the limited time for which many of those under 26 can be paid as boarders at all. The regulations which come into effect on 24th November 1985 provided for those paid as boarders at the time to be exempt from time limits until 28th July 1986. We now propose to extend that exemption indefinitely. New boarders under 26 will, however, continue to be subject to time limits which we do not propose to change, unless they come within the extensive range of exemption categories covering those for whom longer-term boarding is a genuine need.

"I turn now to the limits for residential care and nursing homes. Following the November 1985 increases of £10 a week in the residential care limits and £31.40 in the nursing home limits, the evidence is that in general homes charging at or below the average will fall within the benefit limits—in several categories, well within. While there is therefore no clear case for an all-round increase in July in addition to last November's, we nevertheless think it right to make some further increase where the evidence suggests it is most needed—in the limit for residential care homes for the elderly. We propose that this should go up by £5 to £125 a week, making an increase of £15 a week overall since April 1985.

"In addition, we intend to make five important changes to meet specific problems which we judge to be of greater significance than the limits for particular categories of home.

"First, for those elderly people in residential care homes who are very dependent who are at present limited to £120 a week, we propose an increased limit of £140 a week where they qualify for the higher rate of attendance allowance. Secondly, for blind people over pension age, where the same limitation currently applies, we similarly propose to increase the limit from £120 to £140 a week. Thirdly, for those in residential care or nursing homes in Greater London, we propose to increase the limits by a special extension of up to £17.50 a week.

"Fourthly, for those whose benefit is being paid at a transitionally protected rate in July, we propose an addition of up to £10 above their protected rate. This is a departure from the normal conventions concerning transitional protection, but one which will, I think, be welcomed in all parts of the House. Fifthly, for those who are away from a home for short periods, for example, for a break or to maintain contact with their families, we propose new provisions to meet retaining fees.

"Taken together, the changes I have outlined mean that, for example, the limit for a severely disabled elderly person in a residential care home in Greater London will rise by £37.50 a week. To assist the House, I am arranging for details of the new pattern of limits to be inserted in the Official Report.

"Mr. Speaker, these proposals are an important step towards the more flexible approach, but within a firmly-controlled framework, which is also the aim of the longer-term studies we are conducting with the local authority associations, in consultation with the private and voluntary sectors. Subject to the views of the Social Security Advisory Committee, we intend to embody them in regulations to take effect from 28th July".

My Lords, that concludes the Statement.

Following is the information referred to in the Statement:

Residential Care Category July Limit £ London Limit £ Present Limit £
Elderly 125 142.50 120
Very Dependent or Blind Elderly 140 157.50 120
Mentally Ill 130 147.50 130
Drug or Alcohol Dependant 130 147.50 130
Mentally Handicapped 150 167.50 150
Physically Disabled:
Disabled under pension age 180 197.50 180
Disabled over pension age 125 142.50 120
Very dependant elderly 140 157.50 120
Others 125 142.50 120
Nursing Home Category July Limit £ London Limit £ Present Limit £
Mentally Ill 180 197.50 180
Drug or Alcohol Dependant 180 197.50 180
Mentally Handicapped 200 217.50 200
Terminal Ill 230 247.50 230
Physically disabled:
Disabled under pension age 230 247.50 230
Disabled over pension age 170 187.50 170
Others (including elderly) 170 187.50 170

6.30 p.m.

Lord Ennals

My Lords, may I once again thank the noble Baroness for repeating the second Statement made by her right honourable friend in another place? Does she accept that this Statement is another step in an extraordinarily sad story of government incompetence? The fact that ordinary board and lodging payments rose after 1984, not to £380 million, as had been estimated, but to over £500 million—an increase of 80 per cent. in just one year—while the number of boarders increased from 112,000 to 160,000 seems to me to be a sign of ineptitude, even by the standards of this Government.

Is it not an appalling admission that there was widespread profiteering by those running private homes and, according to the Statement, there was, an accommodation market unduly influenced by the amount of benefit payable, rather than by normal commercial factors, and of an unacceptable degree of abuse". Those are very hard words to describe what I believe was a scandalous situation at the time when the new levels of payment were introduced. I should like to ask the noble Baroness why those figures were suddenly and dramatically increased, and whether the increase was designed to put money into the pockets of those who were running private homes. Does she recall that this factor was brought to her attention by my noble friend Lady Jeger nearly two years ago?

Secondly, in view of the fact that there had been many complaints about the limited time for which people under 26 can be paid as boarders, and about the unseemly process of moving on genuine cases like refugees, is it not reprehensible that the Statement says: New boarders under 26 will, however, continue to be subject to time limits which we do not propose to change, unless they come within the extensive range of exemption categories covering those for whom longer-term boarding is a genuine need. I do not know what to make of this, because I do not know what are the exemption categories. What I do know is that there has been intolerable damage done to young people who have been forced to be on the move because they are homeless, and for no other reason, and when this has affected particular categories of people it has caused very great hardship. Perhaps the noble Baroness can tell me what is this extensive range of exemption categories, in order that we know what we are talking about; because without it that paragraph is meaningless.

Personally, I have to say that I find it very difficult to comment on the list of increases available in the various categories of benefits until I have seen the details in the Official Report, the report from the SSAC and the consultative studies by Ernst and Whinney. I must say that these days, as I keep on hearing of city accountants who are undertaking what must be well-paid studies on behalf of government departments, I wonder why these studies are not done by the DHSS itself, rather than constantly putting these studies out to profit-making private firms.

The National Council of Voluntary Organisations recently said: The whole system of funding residential care needs a radical rethink and the NCVO, along with other voluntary organisations, will continue to press for changes that both alleviate the current crisis and put funding on a secure foundation for the future. Maybe the actions which have been taken by the noble Baroness have alleviated the current crisis, but certainly they have not put funding on a secure basis for the future.

I hope that the noble Baroness can tell me what are the Government's long-term intentions; whether they are just going to stagger on from problem to problem, increasing by bits, rather than have the kind of long-term survey which has been proposed by the NCVO and which I myself strongly support.

Lord Banks

My Lords, I too should like to thank the noble Baroness for repeating the Statement made in another place. I must confess that I am very surprised that the Government should have concluded that, generally speaking, no uprating is necessary. We shall certainly want to examine most carefully the evidence on which the Government have based this decision. It would appear to conflict with evidence which we have received from other sources.

I am equally surprised and concerned that the Government should feel that no regional variation is necessary, even for London. That goes against the view of most welfare organisations working in the field. I should like to ask the noble Baroness whether the Government have considered the control of prices and conditions of boarding establishments.

I welcome the extension of the exemption from time limits indefinitely beyond 28th July 1986, which is referred to in the Statement, but will this not create a sense of unfairness among other boarders? I also welcome the specific increase for some special categories in residential accommodation. But I note that while the elderly blind limit is raised from £120 to £140 a week, for blind people under pension age the figure is £180 a week and I wonder whether that is just. Elderly people are excluded from local authority topping-up. Is that justified? Would the Minister consider establishing another category for elderly mentally ill—for example, people suffering from dementia—or is the increase for those who are very dependent intended to cover those people?

I am glad that the new proposals are to be presented to the Social Security Advisory Committee for comment. Will the Social Security Advisory Committee have the opportunity to discuss the decision not to have a general uprating and not to introduce any regional variation?

Baroness Trumpington

My Lords, I must say that I am rather disappointed with both noble Lords, because I thought that this was a good news Statement. We have responded to the needs where they were most felt and I think they will certainly be welcomed by some of my friends in residential board and lodging nursing-home establishments, who have been worried about the very elderly. I should have thought that they would welcome this news—

Lord Banks

My Lords, will the noble Baroness allow me to say that I welcomed the Statement where there are advances in particular categories? I made that point, but I had criticisms as well.

Lord Ennals

My Lords, may I also say that I did not comment unfavourably? I said that I wanted to study the figures very carefully before I made comments.

Baroness Trumpington

My Lords, the more we are together, the merrier we shall be. I am delighted to hear that there was a welcome, because it would have been sad, when people were feeling very pressed, if the Statement had not been welcomed.

The noble Lord, Lord Ennals, said that the time limits should be written because they failed to achieve any results except to create further homelessness and rootlessness. Our monitoring does not support any suggestion that the time limits have led to increased homelessness or any significant movement between areas. In fact most people stayed in the same area; often in the same accommodation. Our monitoring also shows that the time limits have had a successful impact on boarder claims while the exemptions have been widely applied; a quarter of cases qualifying for protection. The boarder caseload declined significantly in the light of advance publicity about the April 1985 changes and their introduction. There was also a sharp decline in the number of new and repeat unemployed boarder claims following both the April and November changes compared with an increase in such claims when time limits were withdrawn.

The number of new and repeat unemployed boarder claims in April 1986 was some 4,000 a month lower than in the same period last year before the measures were introduced. I shall gladly let the noble Lord, Lord Ennals, have a list of the extensive exemption categories which apply. We recognise that a number of young people may be in board and lodging for what may be considered good reasons. That is why we have drawn up that extensive exemption provision from time limits, but we do not think it right as a general principle that supplementary benefit should be freely available so as to entice or encourage (or whatever way one wants to put it) young people into expensive board and lodging, perhaps sometimes after a row with their parents. That would be no service to the taxpayer, the family or the young person.

The noble Lord, Lord Ennals, suggested that we had not acted promptly to curb growing abuse and expenditure. We acted promptly as soon as all the signs of growth and abuse were shown. We introduced changes in November 1983 to curb growing expenditure and abuse and took further steps in September 1984 by imposing a freeze on limits before further measures were introduced in April last year. I should clarify one point. The growth in spending about which I spoke was in ordindary board and lodging and not in homes, as suggested by the noble Lord, Lord Ennals.

The noble Lord spoke about the long-term future for funding for residential care homes. We are already in discussion with local authorities to harmonise funding in residential care homes. On increasing the limits at the next uprating, we cannot give any undertaking about particular increases. While we remain firmly committed to continued proper control of expenditure, the limits will be reviewed and changes made when a clear need is shown, just as we have reacted now.

The noble Lord, Lord Banks, spoke about the limits in particular areas being too low and about there being too little accommodation available within the limits in comparison with other areas. He suggested that the limits were too low and that the charges were somewhat above the limits. We looked closely at the limits in all areas, considering carefully available charging information. This included surveys and representations of local groups, although these were not generally fully representative of the range of accommodation available to claimants. However, since an important objective of the 1985 changes was to move away from a system where limits were determined by local charging practices, we looked at a range of other factors such as the operation of the market for claimants. We also loked at changes in adjoining areas and the existence of any special local factors.

I fully recognise that in a broader brush system of locally related limits with limits set at £5 bands, a difference of as much as £5 in adjoining areas may strike a jarring note. But unless the same limit is to apply everywhere boundaries do have to be drawn. However, we are firmly convinced that any increases in the current limits are not justified. What is clear is that to make changes simply because some local landlords fix their charges by reference to the limit but some way above is a recipe for chasing up the limits. This was something the 1985 changes were designed to avoid.

The noble Lord, Lord Banks, asked about changing the rules for all people in homes for the physically handicapped to get the higher limit. It was never intended that the higher limit should apply to people suffering some physical restriction simply because of old age. In order to avoid any ambiguity between those suffering from substantial and permanent disablement and those simply becoming frail with the passage of time, the physical disablement category has been limited to people whose disabling condition arose while they were below pension age. However, some of these elderly people will now get the £140 limit if they are entitled to the higher rate attendance allowance or are blind.

The noble Lord, Lord Banks, asked why the ordinary boarder limits have not been raised, particularly in central London. We considered most carefully the limits in Central London and carried out a good deal of consultation and took account of all the consultations. We concluded, however, that for the greater London board and lodging area as a whole, changes in limits were not justified. I could expand on that, but I have a horrible feeling that a good many people are waiting for the next business and so I shall not gain any Brownie points if I go on. I shall write to any noble Lord who wishes me to do so.

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