§ 4.26 p.m.
§ House again in Committee on Clause 19.
Lord Banks moved Amendment No. 64:
Page 24, line 15, at end insert—
("and nobody between the ages of 18 and 60 shall be paid a lower rate of benefit than would otherwise be the case solely as a consequence of his or her age;").
§ The noble Lord said: This amendment is based on the premise that adults with the full responsibility for a household, regardless of age, need the basic level of income support. The Government's intention is that single people under 25 without children shall receive £6.60 per week less income support than those who are older. They will receive £24 per week as opposed to £30.60. That will be particularly serious for young single people who live independently.
§ There are some 95,000 single childless claimants under 25 who are currently householders responsible for rent and rates. At the moment those claimants receive the householder's rate of £29.50. They also receive 100 per cent. rate and rent rebate and help with the water rate. Their weekly benefit will go down to £24. That is a loss of £5.50. Under the Bill they will have to pay 20 per cent. of domestic rates and all their water rate. That has been estimated at an average of £3.5 per week. If we add that average to the loss of £5.50, we have a loss of £8,55 per week. That leaves less than £3 per day for food, heating, lighting and clothing.
§ If such people received the same rate of income support as the over 25s, their loss would be reduced from £8.55 to £1.95 per week. That would still be an unwelcome loss, but it would be nothing like so harsh. Would it not be better to retain the householder-non-householder distinction and abandon the age split which gives rise to so anomalous a position?
§ We must recognise the fact that many young single persons have no choice but to live independently. For various reasons they cannot go to their parents. Some, like those coming out of care, have no immediate family. Refugees are similarly placed. To have this age split at 25 is to say that single childless people are not fully adult until they reach age 25. It is not without significance that the age barrier of 25 will hit black people most since a higher proportion of them are under 25 and they are also twice as likely to be unemployed.
§ The Government admitted in the White Paper that there was much criticism of the age split when it was first proposed in the Green Paper. I hope that the noble Baroness will be able to say that the Government are prepared to think again about it. I beg to move.
§ Baroness Trumpington
May I ask the noble Lord, Lord Banks, this? I have it on my papers that Amendment N0.71A will be spoken to at the same time. I am not sure whether he said that when he 32 moved Amendment No. 64. Can he please enlighten me?
§ Lord Banks
The second amendment is not mine. I therefore did not say that it will be spoken to. I have no doubt that it will.
§ Baroness Ewart-Biggs
As my name is down against Amendment No. 71 A, perhaps I may support the noble Lord, Lord Banks, in his amendment and at the same time stress one or two aspects. I should like mainly to stress the concern that is felt about the special needs of young people who are leaving care and who are the most likely to have no option but to take on the full responsibility of a home. This group of claimants will be penalised on many fronts by this Bill; by the proposed lower rate of income support, which would be rectified if this amendment were passed; by the requirement that all claimants pay 20 per cent. of their rates, water rates and all subsidiary housing costs; and by the loss of single payments.
In considering this amendment, the full impact of these changes on young people leaving care needs to be examined very seriously. A substantial number of the 8,000 or so young people leaving care every year have been away from any kind of family support for a significant period. The assumption behind the 25-year age barrier that people below the age of 25 can live with or draw support from their families simply does not apply to this group.
I feel that to penalise them in the way envisaged in this Bill can only render their adjustment into adult life less likely. Indeed I think that the Government should bear in mind the possibility that more of these already very vulnerable young people will turn to crime as a direct response to the financial pressures imposed by this Bill.
I should like also to stress that such large cuts in benefit will inevitably lead young people who live independently into arrears with their rent and rates. This will have most serious consequences for the authorities which house them. It will mean that many young people will face homelessness because of the level of those arrears. I should like to support the noble Lord, Lord Banks, most strongly in his amendment.
§ Baroness Turner of Camden
I too should like to support the amendment moved by the noble Lord, Lord Banks. The 18 to 24 year-olds as a group appear to be targeted for substantial cuts in benefit in this legislation. The Government seem to assume that young single householders have families to go back to, and that it is their choice to live independently. Yet, as the noble Lord, Lord Banks, has said there are many groups of young single people who have no choice but to live separately from their parents; for example, the young people who have just left care; young refugees; young people who have been victims of sexual abuse or violence; and young people whose families either cannot or do not want to have them living at home.
Many young unemployed people come from families where one or both of the adult parents are also unemployed. To force the young person to go back to live at home or to remain living at home will add to the strains already being placed on the family by unemployment and poverty.
33 I should like to reinforce the point made by the noble Lord, Lord Banks. The proposals will impact especially on black people. The ratio of black to white youths who are unemployed is roughly three to one. In some areas the amount of black unemployment among the young is as high as 60 per cent. Frequently they do not have any other source of help. All too often they come from families where there is unemployment. Parents within the black community are all too likely to be unemployed and with a longer period of unemployment on average than their white compatriots or, if employed, they are on low wages. It is cruel to suggest that they should continue to subsidise non-dependent children of 18-plus. If these young people remain at home their parents will suffer hardship to subsidise them. If they are living fully independently the claimants themselves will suffer hardship. Either way it is unacceptable. Do we have to wait until frustration erupts into street violence before we take on board the fact that black unemployed people have considerable problems? What is now proposed here will add to those problems. For those reasons I support the amendment.
I should like very strongly to endorse the views put forward by the noble Lord, Lord Banks, and the noble Baroness, Lady Turner, who has just spoken in the context in particular of ethnic minorities and refugees. Perhaps I may mention in this context that no less than 30 per cent. of the refugees in this country, who are the responsibility of the British Refugee Council, are under the age of 25.
§ Baroness Trumpington
I hope that the noble Viscount, Lord Buckmaster, will forgive me if I leave the immediate question of refugees until we come to the amendment dealing with that. Noble Lords speaking in this debate have made clear their opposition to our plans to have an age split in the income support scheme at the age of 25. The Government has been virtually accused of introducing a new "age of majority". I really feel this misses the point of the Government's intention.
Members of the Committee will recall that in the present supplementary benefit scheme there is a major structural distinction between adults who are non-householders and those who are householders. The latter receives a higher rate of support. This distinction actually had its roots in the pre-war household means test, when it was used as a means of establishing a non-dependant's independent status—and hence ability to contribute to the household.
This distinction has become increasingly out of place. First, it looks odd to have this housing-related distinction at the heart of the supplementary benefit scheme when help with housing costs comes from an entirely different scheme Secondly, as the number of multiple tenancies and various arrangements for accommodation have grown, it has become increasingly difficult to administer and determine who is a householder and who is not. Consequently, we decided to abolish this distinction. We chose in its place a completely different system. We still felt that the system should reasonably reflect a claimant's broad circumstances and responsibilities. And we wanted a system with a readily operable criterion. For 34 these reasons we proposed an age split at the age of 25. It satisfied both our conditions. It was obviously easy to operate and it broadly reflected the existing distinction; 90 per cent. of claimants over 25 (excluding those in hospital or board and lodging) are already householders, while only one in six single claimants under 25 without children are now classed as householders.
It may surprise noble Lords to learn that when we proposed in last year's Green Paper the ending of the current distinction there was some support in principle for this move. To be fair several went on to criticise the age split proposed then at age 25 for single claimants and couples. However, very quickly it became evident that concern centred on the effect of a lower rate of benefit on claimants, especially young couples with children. The point at issue could only concern couples because we made it clear the higher, over-25 rate, would be payable to all adult lone parents even those aged between 18 and 24.
The Government recognised the strength of the arguments advanced about young couples with children in the wake of the Green Paper. Consequently we modified our proposals and in the White Paper published in December we proposed that all couples over the age of 18—with or without children—would receive a single rate of benefit. This means that the age split operates only for single childless claimants. Only a small minority (one in five) have housing costs at present, and those who do will receive help with housing costs from the housing benefit scheme.
Therefore, I think that the Government have demonstrated their desire and ability to respond to concern where it is felt to have grounds. We have nevertheless succeeded in striking the right balance. We have protected those with family responsibilities including young parents whether married or single. We have enabled a higher rate of support to be payable to older single people living in other people's households—people who may themselves be sick or disabled, or supporting elderly parents. I hope that the mover of this amendment will withdraw it.
§ Baroness Jeger
The noble Baroness the Minister has said that the Government think they have struck the right balance, but I have to ask: what is magic about the age of 25? Why not draw the line at the age of 24 or 21? I cannot understand the justification for picking on the age of 25.
From representations which have been made, not only to me but to many noble Lords, I also understand that these single people will receive about £6.60 a week less than people aged 26 who are in similar circumstances. This seems to be absolutely absurd. I should like the noble Baroness the Minister to confirm that that is the correct figure.
I should also like to ask the noble Baroness whether it is the intention that as of now these single under-25-year-olds will receive £6.60 a week less than young people aged 26, or whether this is something for the future. I am trying to ascertain whether there will be a detriment to these people of £6.60 immediately the Bill becomes law, or whether that difficulty will affect people only in the future. How soon will these single people under the age of 25 suddenly find themselves with £6.60 less in their miniscule support? Perhaps 35 the noble Baroness can tell the Committee how much the Government hope to save by this extraordinary discrimination against the young people in our community.
§ Baroness Trumpington
The figure given by the noble Baroness is correct. There is no magic about the age of 25. That seemed to us to be about the right age, and I have spent quite a lot of time explaining why. On the question of costs, I cannot give the noble Baroness an answer offhand, but the cost of giving the higher rate to all those over the age of 18 is some £200 million to £250 million. Most of the money would go to people living in other people's households. If it is applied just to those aged 21 or more, the cost would be about £100 million.
§ Lord Banks
First, I should like to thank all the Members of the Committee who have participated in the debate and who support this amendment. Each of them referred to sections of the community who are under 25 who would be affected by the Government's proposals.
The noble Baroness the Minister argued against a distinction between householders and non-householders, and seemed to suggest that if we did not have that distinction, it would be necessary to have another and that one had to look round for another and, as it were, pick one out of the air. It seems to me that if we are to have a distinction at all, it is more logical to have one between householders and non-householders than between those above the age of 25 and those below. As I understand it, there are some 95,000 claimants who are single, who are childless and who are householders. These are the people who, as I described earlier, will suffer under the proposals which the Government are putting forward. I regret that the noble Baroness did not offer them any hope that their future might be made a little brighter. In those circumstances I should like to test the opinion of the Committee.
§ 4.45 p.m.
§ On Question, Whether the said amendment (No. 64) shall be agreed to?
§ Their Lordships divided: Contents, 105; Not-Contents, 106.26
|DIVISION NO. 1|
|Airedale, L.||Cledwyn of Penrhos, L.|
|Allen of Abbeydale, L.||Darcy (de Knayth), B.|
|Amherst, E.||Darwen, L.|
|Ampthill, L.||David, B.|
|Ardwick, L.||Davies of Penrhys, L.|
|Attlee, E.||Dean of Beswick, L.|
|Auckland, L.||Diamond, L.|
|Aylestone, L.||Donaldson of Kingsbridge, L.|
|Banks, L.||Durham, Bp.|
|Bath and Wells, Bp.||Ellenborough, L.|
|Beaumont of Whitley, L.||Elwyn-Jones, L.|
|Birk, B.||Ennals, L.|
|Blease, L.||Ewart-Biggs, B.|
|Blyton, L.||Ezra, L.|
|Boston of Faversham, L.||Faithfull, B. [Teller.]|
|Bottomley, L.||Falkland, V.|
|Brockway, L.||Fisher of Rednal, B.|
|Buckmaster, V.||Fitt, L.|
|Burton of Coventry, B.||Flowers, L.|
|Carmichael of Kelvingrove, L.||Gallacher, L.|
|Cathcart, E.||Graham of Edmonton, L.|
|Greenway, L.||Nicol, B.|
|Grimond, L.||Ogmore, L.|
|Hampton, L.||Oram, L.|
|Hanworth, V.||Phillips, B.|
|Harris of Greenwich, L.||Plant, L.|
|Hatch of Lusby, L.||Ponsonby of Shulbrede, L.|
|Hayter, L.||Renton, L.|
|Henderson of Brompton, L.||Ritchie of Dundee, L.|
|Heycock, L.||Sainsbury, L.|
|Hooson, L.||St. Albans, Bp.|
|Hughes, L.||Saint Brides, L.|
|Hunt, L.||Seebohm, L.|
|Hunter of Newington, L.||Serota, B.|
|Ilchester, E.||Shackleton, L.|
|Ingleby, V.||Shaughnessy, L.|
|Jeger, B.||Shepherd, L.|
|Jenkins of Putney, L.||Silkin of Dulwich, L.|
|John-Mackie, L.||Somers, L.|
|Kaldor, L.||Stallard, L.|
|Kennet, L.||Stamp, L.|
|Kilbracken, L.||Stoddart of Swindon, L.|
|Kilmarnock, L.||Strabolgi, L.|
|Kinloss, Ly.||Strauss, L.|
|Lauderdale, E.||Taylor of Blackburn, L.|
|Leatherland, L.||Taylor of Mansfield, L.|
|Listowel, E.||Tordoff, L.|
|Llewelyn-Davies of Hastoe, B.||Turner of Camden, B.|
|Lloyd of Kilgerran, L.||Underhill, L.|
|Lockwood, B.||Vaux of Harrowden, L.|
|McNair, L.||Walston, L.|
|Masham of Ilton, B.||Westbury, L.|
|Mayhew, L.||Wigoder, L.|
|Morris of Kenwood, L.||Williams of Elvel, L.|
|Morton of Shuna, L.||Wilson of Rievaulx, L.|
|Mountevans, L.||Winchilsea and Nottingham,|
|Murray of Epping Forest, L.||Ypres, E.|
|Alexander of Tunis, E.||Kaberry of Adel, L.|
|Allenby of Megiddo, V.||Kemsley, V.|
|Belhaven and Stenton, L.||King of Wartnaby, L.|
|Beloff, L.||Kinnaird, L.|
|Belstead, L.||Lane-Fox, B.|
|Bessborough, E.||Layton, L.|
|Biddulph, L.||Long, V.|
|Blake, L.||Lucas of Chilworth, L.|
|Boyd-Carpenter, L.||Luke, L.|
|Brabazon of Tara, L.||Lurgan, L.|
|Brookeborough, V.||McAlpine of Moffat, L.|
|Brougham and Vaux, L.||McFadzean, L.|
|Caccia, L.||Macleod of Borve, B.|
|Caithness, E.||Mancroft, L.|
|Campbell of Alloway, L.||Manton, L.|
|Coleraine, L.||Massereene and Ferrard, V.|
|Constantine of Stanmore, L.||Maude of Stratford-upon-|
|Cottesloe, L.||Avon, L.|
|Cowley, E.||Merrivale, L.|
|Cox, B.||Mersey, V.|
|Cullen of Ashbourne, L.||Monk Bretton, L.|
|Davidson, V.||Morris, L.|
|De Freyne, L.||Nugent of Guildford, L.|
|Denham, L. [Teller.]||Onslow, E.|
|Drumalbyn, L.||Pender, L.|
|Dundee, E.||Peyton of Yeovil, L.|
|Effingham, E.||Porritt, L.|
|Ferrers, E.||Portland, D.|
|Foley, L.||Romney, E.|
|Fraser of Kilmorack, L.||St. Davids, V.|
|Gainford, L.||Sandford, L.|
|Gardner of Parkes, B.||Sempill, Ly.|
|Glanusk, L.||Skelmersdale, L.|
|Glenarthur, L.||Strathcarron, L.|
|Gridley, L.||Strathcona and Mount Royal,|
|Hailsham of Saint||L.|
|Marylebone, L.||Strathspey, L.|
|Harmar-Nicholls, L.||Swansea, L.|
|Holderness, L.||Swinton, E. [Teller.]|
|Hooper, B.||Teviot, L.|
|Hylton-Foster, B.||Tranmire, L.|
|Trefgarne, L.||Wise, L.|
|Trumpington, B.||Wolfson, L.|
|Vivian, L.||Wynford, L.|
|Whitelaw, V.||Young, B.|
Moved accordingly, and, on Question, Motion agreed to.
|DIVISION NO. 2|
|Airedale, L.||Caradon, L.|
|Amherst, E.||Carmichael of Kelvingrove, L.|
|Ardwick, L.||Cledwyn of Penrhos, L.|
|Attlee, E.||Crawshaw of Aintree, L.|
|Aylestone, L.||Darcy (de Knayth), B.|
|Banks, L.||Darwen, L.|
|Beaumont of Whitley, L.||David, B.|
|Birk, B.||Davies of Penrhys, L.|
|Blease, L.||Dean of Beswick, L.|
|Blyton, L.||Denington, B.|
|Boston of Faversham, L.||Diamond, L.|
|Bottomley, L.||Donaldson of Kingsbridge, L.|
|Briginshaw, L.||Donoughue, L.|
|Brockway, L.||Durham, Bp.|
|Bruce of Donington, L.||Elwyn-Jones, L.|
|Buckmaster, V.||Ennals, L.|
|Burton of Coventry, B.||Ewart-Biggs, B.|
|Ezra, L.||Mulley, L.|
|Falkender, B.||Murray of Epping Forest, L.|
|Falkland, V.||Nicol, B. [Teller.]|
|Fisher of Rednal, B.||Ogmore, L.|
|Fitt, L.||O'Neill of the Maine, L.|
|Flowers, L.||Oram, L.|
|Gallacher, L.||Ponsonby of Shulbrede, L.|
|Graham of Edmonton, L.||Rea, L.|
|Grimond, L.||Rhodes, L.|
|Hampton, L.||Ritchie of Dundee, L.|
|Hanworth, V.||Rochester, L.|
|Harris of Greenwich, L.||Sainsbury, L.|
|Hatch of Lusby, L.||St. Albans, Bp.|
|Henderson of Brompton, L.||Seebohm, L.|
|Heycock, L.||Serota, B.|
|Hooson, L.||Shackleton, L.|
|Houghton of Sowerby, L.||Shepherd, L.|
|Hughes, L.||Silkin of Dulwich, L.|
|Hunt, L.||Somers, L.|
|Jeger, B.||Southwark, Bp.|
|John-Mackie, L.||Stallard, L.|
|Kaldor, L.||Stamp, L.|
|Kennet, L.||Stoddart of Swindon, L.|
|Kilbracken, L.||Strabolgi, L.|
|Kilmarnock, L.||Taylor of Blackburn, L.|
|Kinloss, Ly.||Taylor of Mansfield, L.|
|Leatherland, L.||Tordoff, L.|
|Listowel, E.||Turner of Camden, B.|
|Lloyd of Kilgerran, L.||Underhill, L.|
|Lockwood, B.||Walston, L.|
|Lovell-Davis, L.||Wigoder, L.|
|McNair, L. [Teller.]||Williams of Elvel, L.|
|Mayhew, L.||Wilson of Rievaulx, L.|
|Mishcon, L.||Winchilsea and Nottingham,|
|Morris of Kenwood, L.||E.|
|Morton of Shuna, L.||Ypres, E.|
|Airey of Abingdon, B.||Harmar-Nicholls, L.|
|Alexander of Tunis, E.||Holderness, L.|
|Allenby of Megiddo, V.||Hood, V.|
|Ampthill, L.||Hooper, B.|
|Auckland, L.||Hunter of Newington, L.|
|Belhaven and Stenton, L.||Hylton-Foster, B.|
|Beloff, L.||Ilchester, E.|
|Belstead, L.||Kaberry of Adel, L.|
|Bessborough, E.||Kemsley, V.|
|Biddulph, L.||Killearn, L.|
|Blake, L.||King of Wartnaby, L,|
|Boyd-Carpenter, L.||Kinnaird, L.|
|Brabazon of Tara, L.||Lane-Fox, B.|
|Brougham and Vaux, L.||Lauderdale, E.|
|Caithness, E.||Layton, L.|
|Campbell of Alloway, L.||Long, V.|
|Carnock, L.||Lucas of Chilworth, L.|
|Cathcart, E.||Lurgan, L.|
|Coleraine, L.||Lyell, L.|
|Constantine of Stanmore, L.||McAlpine of Moffat, L.|
|Cowley, E.||Mancroft, L.|
|Cox, B.||Manton, L.|
|Craigavon, V.||Marley, L.|
|Cross, V.||Massereene and Ferrard, V.|
|Cullen of Ashbourne, L.||Maude of Stratford-upon-|
|Davidson, V.||Avon, L.|
|De Freyne, L.||Merrivale, L.|
|Denham, L. [Teller.]||Mersey, V.|
|Denning, L.||Monk Bretton, L.|
|Drumalbyn, L.||Morris, L.|
|Dundee, E.||Mountevans, L.|
|Ellenborough, L.||Norfolk, D.|
|Elton, L.||Nugent of Guildford, L.|
|Foley, L.||Onslow, E.|
|Fortescue, E.||Orr-Ewing, L.|
|Fraser of Kilmorack, L.||Pender, L.|
|Gardner of Parkes, B.||Peyton of Yeovil, L.|
|Glanusk, L.||Porritt, L.|
|Glenarthur, L.||Portland, D.|
|Greenway, L.||Renton, L.|
|Hailsham of Saint||Romney, E.|
|Marylebone, L.||St. Davids, V.|
|Halsbury, E.||Sandford, L.|
|Sempill, Ly.||Teynham, L.|
|Shannon, E.||Tranmire, L.|
|Sharpies, B.||Trefgarne, L.|
|Skelmersdale, L.||Trumpington, B.|
|Strathcarron, L.||Vaux of Harrowden, L|
|Strathcona and Mount Royal,||Vickers, B.|
|Strathspey, L.||Whitelaw, V.|
|Swansea, L.||Wise, L.|
|Swinfen, L.||Wolfson, L.|
|Swinton, E. [Teller]||Wynford, L.|
§ 4.54 p.m.
§ [Amendment Nos. 65 and 66 had been withdrawn from the Marshalled List.]
§ Baroness Ewart-Biggs moved Amendment No. 66A:
§ Page 25, line 6, at end insert—
("( ) An award of family credit shall entitle the children of the family to receive free school meals.").
§ The noble Baroness said: I rise to move Amendment No. 66A, which stands in my name and the names of the noble Lords, Lord Kilmarnock and Lord Seebohm. I am also grateful to the right reverend Prelate the Bishop of London, who, although he is unable to be here today, has indicated his support for this amendment. This is an important amendment among a lot of other important amendments. This concerns the health of the country's children, and there can be nothing of greater importance than that.
§ May I remind the Committee of the situation regarding school meals—which concerns health—as it stands at the moment? Children of supplementary benefit and family income supplement claimants are entitled to both free school meals and free milk. In addition local education authorities have a discretion to provide free school meals for children in other low income families, as well as operating a system of differential charges which largely benefit handicapped children in special schools. The total of children currently receiving free school meals is estimated by the DHSS as 1.4 million.
§ The proposed change under this Bill would mean that only the children of claimants of income support, replacing supplementary benefit, will be eligible for those meals and milk. This would mean that as many as 545,000 children currently in receipt of these would lose their entitlement. The purpose of our amendment is to seek to entitle children whose parents will be in receipt of family credit to free school meals, and this would affect an estimated number of 600,000 children.
§ This amendment does not go so far as re-establishing the present position, which also includes children benefiting from local authority discretionary schemes; schemes which affect approximately 340,000 children. However, this objective is covered by my Amendment 125 to Clause 73, which I shall move at a later stage. In the meantime, in view of the limited objectives of this amendment, and the arguments that we shall be putting forward, I hope that the Committee will find it possible to support the amendment and that the Government will be able to accept it.38
§ Before speaking about the vital nutritional significance of a mid-day meal for the children of low income families, may I first explain what the Government intend to do by way of compensation? Arguing that cash is preferable to provision in kind, the new family credit will include a notional sum for free meals at a level of £2.20 a week over the whole year. Superficially this may seem an attractive proposition, and we would all agree that cash has the advantage of allowing families a degree of choice. But on closer examination several disadvantages are uncovered, and I should like to mention some of these.
§ First, there is the objection that the amount of £2.20 is likely to be inadequate given the much higher cost of school meals in some areas than the average of 60p a day, which is the sum allocated. Moreover, it is clear that the prices of school meals are rising all the time. Already this year 20 local authorities have raised prices to over 60p for primary children. The Government's compensation scheme looks as though it is already inadequate.
§ My second criticism concerns the effect of the new benefit on claimants who also receive housing benefit. The Minister conceded at Committee stage in another place that this would affect approximately a quarter of those expected to take up family credit; approximately 150,000 children. The clawback against housing benefit would leave such families with only 44p per week per child to pay for the school meals.
§ The very fact that they will be the families claiming both on rent and on rates is proof that they are the families most in need. Therefore, if it is those children who will lose out on their school meals, then such a swings and roundabouts situation will affect the most needy children of all.
§ My last criticism concerns the manner of payment of family credit. The Government have still not made clear their intentions as to how this will be paid. More importantly, we do not know to whom it will be paid. There is no doubt that if family credit is paid through the father's pay packet, which is at present proposed, then the proportion allotted for school meals has to pass from his hands to the mother, who is, after all, usually the parent in charge of the nutrition of the children. In a perfect world this would happen and the parents would decide how the contents of the pay packet would be spent.
§ But the Child Poverty Action Group did a survey of 50 mothers of children on free meals and fewer than one in five expected their husbands to pass on the cash compensation. Although it would be a great improvement if family credit went straight to the mother, can one be sure that even then the required amount will translate itself into a meal for the child, as the mother may be under very hard pressure to pay some bills at home.
Finally, even if all that I have said goes according to plan and money goes with the child in its pocket to school, who can say that some of those children would not prefer to spend that money on chips or Coke rather than the meal which has so much nutritional significance? The chairman of the Women's Institute put this very well when she said in one of the many letters I received about school meals,
It is feared that the type of child most dependent on meals at school is the very child who will not be given the requisite cash to pay for their lunch, and who will suffer most".
§ Besides the health aspect for the child, I do not think one can overestimate the importance to mothers. One cannot overestimate the relief all mothers, even those who can afford to pay for their children's lunch, feel that their children are getting a square meal at lunch time. This will make up for the breakfast that more and more children are not eating, even in the best of homes. Children seem to have given up this idea of eating breakfast so that the midday meal is taking on a greater and greater significance. It is a relief to all mothers to feel that their children are getting that meal at lunch time. For that reason many of us feel that the school meal should be an integral part of the school service. We cannot see any reason why it should be whittled away in such a manner.
My last point concerns the importance of a school meal purely from a nutritional point of view. Since the 1980 Act, which removed the requirement from local authorities that a school meal should conform to certain nutritional standards, an enormous amount of thought and research has gone into the value of a balanced mid-day meal for the children of poorer families. A DHSS report entitled Diet of British Schoolchildren was brought out only in April this year; it stated:
The free school meal is an important factor in the welfare of children from families receiving state benefits. It appeared to be at least partly responsible for keeping the energy intakes, particularly of older children from these families up to the levels of the rest of the schoolchild population".
A recent report published by the British Dietetic Association in May this year and called Can I afford the Diet? detailed the association's concern about the eating patterns of people on low incomes. It said:
Not only are [the poorer groups] unable to afford the dietary modifications necessary for health, but in some circumstances they simply do not have enough money for food".
§ The other comment that the report made was that free school meals are available for children of low income families and that the association would be very worried if the provision were to be further reduced. There is no doubt that the loss of a free school meal may have serious consequences on the health and well-being of such children. I believe I have proved from the research that has been made that the school meal has become of greater and greater importance in upholding the health of children in low income families.
§ We are entitled to ask why these changes have been made. The Government stated in another place in the debate that there was no net saving of public expenditure expected from that proposal, so we wonder why they want to make this change. Again, there is no complaint that school meals are bad or provide an inadequate service. Indeed, the takeup of free meals is rising and has been rising since 1981. This surely points to a demonstrable need. The Government believe that they can provide more cash help, but this claim is based on estimates of takeup that can only be speculative. There are too many uncertainties in these proposals of the Government that have not been resolved.
§ I hope I have demonstrated the important issue, which is to ensure the supply of proper food for our poorest children when their physical development is at 40 the most critical stage. They surely should be our prime concern and we should surely resist any propositions which threaten their well-being. I beg to move.
§ Baroness Trumpington
I should be grateful if the noble Lord would allow me to speak next because what I have to say might have a bearing on what other noble Lords have to say following me. I hope the noble Lord will allow me to speak.
This amendment seeks to provide that children in family credit families will be entitled to free school meals. The Government's proposals are to build into the child rates in family credit a cash element in place of free school meals.
As the point concerning family credit has been raised, it might be more convenient if I were to deal straightaway with the way in which family credit is to be paid. I hope your Lordships will find it helpful if I take the opportunity now rather than spend too much time on the amendments to Clause 27 to announce the outcome of our reconsideration of how family credit will be paid.
As Members of the Committee know, in the light of the strongly felt concerns my right honourable friend undertook to reconsider the mechanism by which family credit would be paid. As part of that reconsideration, further discussions have been held with the CBI, the National Federation of Self-Employed and Small Businesses, the Equal Opportunities Commission and the Women's National Commission. In addition, we have taken full account of the other representations which have been made during the debates on the Bill, including those made by your Lordships.
We have made it clear since last year's Green Paper that a central objective behind the proposal to pay family credit with wages was to align the tax and benefit systems more closely. For many years it has been argued—from all sides of the political spectrum, and including many on this side of the House—that the two systems are too separate and should be more closely aligned or even fully integrated.
The family credit proposals represent an important advance in the broad direction of closer alignment between the tax and benefit systems. In particular, if the credit were paid with wages it would operate, in effect, as an offset to payments of tax and contributions, with any residual balance being paid on top of gross pay. Nevertheless, it has always been clear that although family credit paid in this way would become an integral part of an individual's take home pay, effectively reducing his income tax and national insurance contribution payments, it would not operate like this for the employer. In particular, he would receive his instruction as a separate notification from DHSS, in addition to the PAYE coding instructions which he would receive from the Inland Revenue. And he would be required to perform a further calculation after the normal tax and contribution procedures had been completed.
It is this which has caused particular worry for the employers who would have to operate the system. If the credit could be integrated with the tax system the 41 situation would be significantly different. We have made it clear, in the Green Paper on the reform of personal taxation, that we intend to consider carefully the possibility of fuller integration of the assessment of tax and family credit, taking account of the responses to the Green Paper and in the light of eventual decisions OB the long-term shape of the tax system. Something which is certain, however, is that complete integration of the two systems, however theoretically attractive, simply could not be introduced in the type of time scale envisaged for the social security reforms included in the Bill. The case for closer alignment of the tax and benefit systems has been strongly advanced by many on all sides of the Chamber. That is one important reason why we have proposed the principle of payment with wages and why it remains an objective by which we stand.
The Government will continue to consider the longer-term possibility of closer alignment between family credit and tax, particularly in the light of responses to the Green Paper, on the reform of personal taxation. But it would not be right to impose a change of this sort, particularly if the immediate cost was undue additional work for employers, particularly small employers, who have to operate the system. Accordingly, and having listened very carefully to the representations, particularly from many who support the main purposes of family credit, the Government propose that when family credit is introduced in 1988 it should be paid direct to recipients, and that the longer-term possibilities for integrating the credit more closely with the tax system itself should be assessed in the light of the responses to the Green Paper and as computerisation makes the objective more readily available.
I am sure that this decision will be welcomed in many quarters, including those who have argued for payment to the caring parent as well as those who have expressed views on behalf of employers. I shall be introducing amendments to the Bill at Report stage to give effect to the change. The detail of the new payment arrangements will be set out in the regulations; but we envisage that the wife should normally receive the payment, with the husband as the alternative payee, in much the same way that FIS is paid at present. However, we envisage that automated credit transfer, which is not currently available for FIS, should be offered as an alternative for those who wish it when family credit is introduced.
This change in the payment mechanism does not affect the central purposes of family credit: the need to improve the help targeted on low-income working families with children and to improve work incentives. Those objectives stand and the Government remain committed to them. We should be clear what family credit is all about. Family credit represents one of the central elements of the reform of social security and of this Bill. It demonstrates our commitment to provide more generous and better-targetted help for low-income families with children. We estimate that around twice as many families—over 400,000—will benefit from family credit compared with FIS, and we shall be broadly doubling the resources devoted to this group. I am sure that all will agree that the Government deserve the approbation of the whole Committee on this matter. We have listened to the 42 representations which have been made, and we have taken account of the fact that integration with tax is not feasible for 1988. Accordingly, and until such time as fuller integration becomes more practical, we shall pay the credit direct.
At the end of that very important announcement, I now return—and the Committee will forgive the length of my speech but I am sure that that will help future speakers—to the amendment moved by the noble Baroness, Lady Ewart-Biggs. The amendment on its own would not achieve the intended purpose. It would also be necessary to amend Clause 73, the clause specifying dealing with the changes in school meal provision and which, in turn, amends the legislation in the Education Act governing free school meals. The noble Lords, Lord Kilmarnock and Lord Banks, have put down the necessary amendment to Clause 73.
This has been a trailer for the main discussion which we shall no doubt have on school meals when we come to Clause 73 of the Bill. Having said that, the Committee will still expect me to respond on the principle behind the amendment. At present, children in family income supplement families are entitled to free school meals. The Government propose to replace FIS with family credit, but it has been made clear from the outset that we did not intend to carry forward the free meals entitlement into the new scheme. Right from the Green Paper last summer, we set out as part of our proposals that as a general proposition we preferred that assistance should be provided, where possible, by means of cash rather than benefits in kind. We said that, accordingly, those entitled to the new family credit would not be passported to free school meals—or free welfare milk—and that the rates of benefit would be higher so as to provide cash help instead. At the same time, the discretionary power of local authorities would be ended. In the White Paper we reaffirmed our intention to make these changes, and they were incorporated into the Bill.
I shall remind the Committee briefly of the reason why we concluded that family credit families should receive cash rather than free school meals. As I have said, we believe that help should be provided in cash rather than in kind wherever possible, particularly for people who are in work. We thereby seek to ensure that low-paid working families, like other working families, have sufficient income from the pay packet to meet their needs. This removes a distinction between lower-income working families and those on higher incomes. Because family credit will be more generous than FIS, and reach more families, it would have been a significant extension of benefits in kind if we had perpetuated free school meals in the new context. All the more reason therefore to make the change when the new benefit is introduced.
Cash compensation avoids the worst of the poverty-trap effects which can occur at present. A small increase in wages can mean that family entitled to only a modest amount of FIS can lose both that benefit and their free school meals. Even where the LEA runs a discretionary scheme, free school meals can be lost as a result of a small increase in income. In a family with several children the loss can occur in stages but still very sharply on each occasion as entitlement to each of the free meals is lost. The effect is a series of steps, and 43 very steep ones at that. With cash compensation included in family credit, the effect is a gradual tapering away of benefit, and the possibility of an increase in income producing a marginal tax rate of more than 100 per cent., because of the loss of the free meals, is avoided.
All children in family credit families, not just those who bother to take up the free meals which are available to them, will get the cash help. The take up of free meals is estimated to be something like 70 per cent. at present, so that the remaining 30 per cent. of families will see a substantial benefit from the changes. And the help—and this is very important—will be spread throughout the year, not just provided on school days.
The Committee should consider carefully the uncomfortable implications of continuing with provision in kind rather than cash for working families. It would mean reducing family credit entitlement for every family, on the illustrative figures, by £2.20 for each child; as a result, reducing significantly the number of families actually receiving the credit. On the illustrative figures, the numbers getting the credit would fall by up to a fifth—from around 410,000 to around 330,000—with net losses for some families, compared with their position under the Government's proposals.
In particular, families with children below school age, families with school-age children who do not actually take advantage of their free school meal and families no longer entitled to the credit and living in localities without discretionary schemes, would tend to suffer. Only a minority would get some offsetting increase in their housing benefit entitlement.
All children in family credit families, and not just those who bother to take up the free meals which are available to them, will get the cash help. The take-up of free meals is estimated to be something like 70 per cent. at present, so the remaining 30 per cent. of families will receive substantial benefit from the changes; and the change and the help will spread through the year.
Your Lordships will wish to bear in mind what I have just said about family credit. This means that the money for children's school meals will invariably be paid to the mother. I have answers to the noble Baroness's questions, but I think that I have already spoken for a very long time because of my other remarks and perhaps if there are any further questions I will answer them at the end. However, I hope your Lordships will have taken due note of the Government's new plan for paying family credit.
§ Baroness Jeger
I rise only to express the warm thanks of my noble friends and myself for the statement which the noble Baroness has made. I shall not make a speech about school meals, but I think the "conversion on the road to Damascus" is welcome to us all. I hope it is a harbinger of other conversions which the Government Benches might undergo before this Bill reaches the statute book.
We do appreciate that Ministers and Members of the Committee have received many representations which made' a great deal of sense from many 44 concerned people with very different interests. We are very glad that the Government have taken note of that fact, and have made this change. We look forward to many more changes very soon.
§ Lord Kilmarnock
Perhaps I may say a word here, because I think the noble Baroness the Minister has put us in a bit of a quandary. She has made a welcome announcement concerning the method of payment of family credit, and it is indeed the case, arising from her statement, that the Secretary of State has honoured the undertaking he gave at Report stage in another place to look at the method of payment again; that is to say, whether it could go straight to the mother, for which there was a great deal of support. Obviously we welcome that, and we are delighted that the noble Baroness will be introducing an amendment to that effect later in the Bill. That is one thing, but at the same time we want to be clear that that of itself does not address the concern expressed in this amendment about the provision of free school meals. That is a slightly different point.
The announcement made by the noble Baroness concerning the method of payment does not change the method of calculation of the compensation which is offered for the withdrawal of free school meals from people on family credit, which presumably still remains whether that money goes to the father or comes to the mother, as is now proposed. It does not alter the amount of money involved, and that is the important consideration to which we must address ourselves before giving ourselves entirely up to euphoria over the noble Baroness's announcement about the method of payment.
The difficulty, so far as I can see, is that the Government argue that it is preferable to give families cash rather than free school meals. The family which is in receipt of family credit will receive £2.20 per child, which is intended to be for the purchase of school meals. However, the compensation is largely illusory because, even though the money may now be going to the mother and not to the father, the figures are exactly the same. The amount of £2.20 will be inadequate, given the much higher than average cost of school meals in some areas. From September 1986 a school meal will cost more than 60p a day in 48 local authority areas for primary schools and in 56 local authority areas for secondary schools. In 16 local authority areas the price will be over 70p. The value of compensation, be it 44p or 60p, depending on whether the calculation is based on the whole year or only on the school year, is thus already inadequate. There is also a great variation between local authority charges for school meals. They can vary by as much as 50p per day between different areas, and yet we are offered a constant flat figure.
The second point is that the poorest families in receipt of family credit will find the compensation swallowed up through reduced entitlement to housing benefit, and, as the Social Security Advisory Committee have pointed out, that is because family credit counts as income for housing benefit purposes and therefore a higher family credit payment to take account of the loss of free school meals means a lower housing benefit payment. The families who receive help at present with both rent and rates will find that 45 their £2.20 compensation is reduced to a mere 44p a week, leaving these families only that much better off.
We welcome the fact, as I have already said, that whatever money will be given is to be given to the mother; but that does not in fact change the figures and therefore it does not satisfy our concern about free school meals. The noble Baroness has made the point that they are an absolutely essential ingredient in the nutritional intake of children in lower income families, whether they are "working families" or whether they are not "working families". Surely one should not discriminate between the "worthy" poor (that is, those in work) and the "unworthy" poor (that is, those who are out of work). Because they are the same children and they have the same nutritional needs. So frankly, there do not seem to be any grounds for taking children on family credit, who are by definition from very low income families, out of the free school meal system. I very much hope that your Lordships will bear this in mind during our debate and that perhaps when we come to the end of this discussion the noble Baroness will feel that she may need to write what she is proposing into the Bill at this stage.
§ Lord Boyd-Carpenter
The noble Baroness, Lady Ewart-Biggs, moved an important amendment with which, as she moved it, I am bound to say I felt a measure of sympathy. It has been, as I think the noble Baroness will admit, somewhat overshadowed by the major importance of the announcement which the noble Baroness, Lady Trumpington, has made and which has been welcomed in all quarters of the Committee.
Certainly it seems to me that this is a very sensible decision of the Government, from two separate points of view. First of all, the payment being made to the mother is, I am quite sure, socially right, and it should do a good deal to allay the fears which have been expressed by, among others, the noble Baroness, Lady Ewart-Biggs, as to what might happen to the money so provided. Also, of course, it is a very considerable relief to employers, and particularly to small employers, who are already burdened with having to work for the Inland Revenue by way of PAYE and for the DHSS by way of national insurance contributions, and who were about to be burdened further very considerably by having to hand over family credit with wages. Therefore, although the social advantage is the more important, the advantage to employers, particularly at a time when we are trying to encourage small employers from the point of view of dealing with the problem of unemployment, is enormously to be welcomed.
I quite agree with the noble Lord who has just spoken that that of itself does not completely answer the point of the original amendment; but there are considerations which perhaps weigh against it. One is that, as a general principle of social security administration, benefits in cash, I have always thought, are preferable to benefits in kind. You are treating the recipient of the benefit as a responsible person who will lay out the cash in a responsible way, whereas if you give the benefit in kind you are allocating it solely to a particular purpose, however worthy.
Therefore, as a matter of general principle, I have always been against benefits in kind and in favour of 46 benefits in cash. It is not unimportant, from the aspect of the self-respect of the recipient, that he—and. in this case, she—is being treated as a responsible person who will lay out the money in a responsible way.
I fully agree with the noble Baroness, Lady Ewart-Biggs, that school meals serve a very important part in the nutrition of children from the poorer families. But they are subject to a considerable difficulty; that is, the limitation on the school term. They are not, after all, available in the school holidays, and noble Lords will remember that school holidays have tended to grow in recent years, including the week off at half-term in the middle of, at any rate, two of the terms of the year. During that period the school meals are not available.
As I understand it, the cash from family credit will be available and that is a very important factor in this calculation. During the term, the family whose children are getting school meals free will be quite well looked after. But it suddenly faces a gap—and, presumably, it will face the gap without the £2.20 allowance—when school is shut, whether for the long summer holidays, the Easter holidays, the Christmas holidays or these half-terms which are now so prevalent in our education system. For that reason, as well as for the general reason of principle—that is, that social security payments should, wherever possible, be made in cash and are expected to be responsibly handled by the recipients—I find myself, on balance, against this amendment.
I do not want to be thought to underrate, in any way, the value of school meals. I hope that the money will in many cases be used to buy school meals. The fact that the money goes to the mother—I hope I can say this without getting into trouble with the Equal Opportunities Commission—will I think make it more likely that the money will be spent on school meals than if it were paid through wages to the father. I dare not pursue that argument very much further; but I think the Committee will see that it has a certain amount of force. Therefore, I very much hope that this amendment will not be pressed. It has certainly given the opportunity for a most important announcement, and for an interesting debate. But if it were pressed, I should find it necessary to vote against it.
§ 5.30 p.m.
§ Lord Seebohm
Like everybody else, I am immensely grateful to hear the news of the change in policy of paying cash direct to the wife. This is absolutely splendid. It will save me a lot of emotion in various speeches that I was proposing to make later on. But I am still worried about what happens on the ground. Does the mother give the child £2.20 on Monday morning to take into school for the week's food, or 60p a day, or how is it to be done? Can a young child be relied on to hand it over to the school; will the child buy jelly babies and chips on the way or possibly spend it on some other amusement?
The argument about giving people cash so that they will have a sense of responsibility, which has been put by the noble Lord, Lord Boyd-Carpenter, is a false argument for the very poor. It means budgeting. It means that they have to ignore other things which to them may be of greater urgency on any one day. Budgeting is incredibly difficult on a low income. If a 47 school gives meals, the children are likely to eat them. It may be that there is another way of recovering the money from the parent, possibly by some form of deduction. I may be wrong, but I am still very unhappy about this present arrangement.
§ Baroness Faithfull
Like others, I should like to congratulate my noble friend Lady Trumpington on the announcement she has made concerning the administration of family credit. On the question of school meals, we are in a very real difficulty between what is idealistically right and what is realistically true. In a perfect world, I would absolutely agree with everything the noble Lord, Lord Boyd-Carpenter, said. But it is not a perfect world and there is the problem of the here and now, and there is the problem of the future.
As regards the here and now, as the noble Lord, Lord Seebohm, has said, whether the mother has the money or does not have the money, there will be a proportion who will not give their children meals, either in the holidays or in term time. I speak from personal experience, because when I was a director of social services I used to run holiday centres for children whose mothers either did not, or could not, look after them; and I realised then that there was a problem as regards food.
It seems to me that there needs to be consultation between the Department of Education and the Department of Health and Social Security. We need an educational policy which helps children. They will then grow up to be parents themselves and to understand what is good food for their children, how they should receive it and what should be done. I am president of the National Association of Home Economics Advisers and they could be called upon to mount throughout the country a scheme for assisting parents to help children—who will later be parents themselves—to understand the value of food, not only as food but as an emotional experience where families live and eat together.
Therefore, I am in some difficulty over this amendment. I should like the noble Baroness to withdraw the amendment at this stage, so that there can be further consultations with both the Department of Education and the Department of Health over school meals. But I am bound to say that, however idealistically we may think that parents should give the money to the children—and they have more money under family credit—the realistic fact is that some children will not get meals either in the holidays or in term time, and in any case it would at least be better for them to get meals during term time. I am schizophrenic over this amendment. I should like the noble Baroness to withdraw it so that at the next stage we can have further consultation about how this aspect should be administered.
§ Lord Donaldson of Kingsbridge
I should like to support the previous two speakers. Some years ago, for quite a period I was chairman of the National Executive Committee of the Family Service Units. We dealt, and still deal, exclusively with what are technically known as problem families. There is not the slightest question that if you are dealing with 48 ordinary people the right attitude is that of the noble Lord, Lord Boyd-Carpenter. But if you are dealing with problem families, it simply means that in one case out of probably three the child, sooner or later, does not get a meal. The mother is at her wits' end, she has stacked behind the clock a dozen bills that she dare not even look at, and in the end she simply raids the child's money. It is a fact of life which must be admitted and must be met. On the whole, I am inclined to support the noble Baroness, Lady Faithfull, in believing that this needs looking at again in some detail. My own belief is that the Government have done a good thing in their credit system, but on the whole a bad thing in abolising the meal provided by the school at the school.
§ Baroness Gardner of Parkes
I am concerned by the amendment as it stands because it seems to imply that parents would get both the £2.20 and free school meals. I imagine that if that were the situation it might upset the whole balance of the present calculations, and might mean that there was some reduction in the family credit. I would add my expression of pleasure to that of other members of the Committee about the family credits being paid directly to the applicant, who will normally be the mother. That is an excellent thing and it is good that the mother will have this money in her hand.
At the last sitting of the Committee, when we spoke about the school meals situation, I said that there is a certain social stigma for the children who are receiving free school meals. I am sorry that that feeling exists, but it does, and other children are quite well aware of the children who are getting free school meals I thought that by giving this money to the parents it would take away any degree of embarrassment for the children.
The noble Baroness, Lady Faithfull, made a most interesting point in the suggestion that people should be educated to have family meals together. That is a good thing because in many households now no child ever sits down to the table for any meal at all. Children just wander around with food clutched in their hands and they have no sense of either a family community or, of a family meal. It is a great loss to the family that that is happening.
Those noble Lords who believe that because children are given a meal at school they eat it are equally misguided. The nutritional standards of what children eat out of a school meal are rather disappointing. It may be a case of plenty of calories, but it is not necessarily the correct balance in nutritional terms because so often children reject the things that would be of more good for their health and eat things they like better. All the nutritional surveys have shown this. Chips have been mentioned often here. There is no doubt that chips of the type which have been fried in plenty of fat, and all kinds of things we are told to deplore in terms of our heart conditions later on, are "top of the pops" for teenage and even the youngest children.
This is a very complicated matter. The amendment as it stands has the disadvantage of not being clear on the financial implications. If it was a case of suggesting that the families would have the choice of either money or the meal, that might be one possibility; but 49 that would certainly require consultation. The point made that this money is provided even out of term time is highly significant, because terms take up probably 30 of the 52 weeks in a year, and in that way there would be 22 weeks of the year in which this money would not be available. I should think also that the department would find it possible because if, as has been said, some school meals are going up and that would not be enough to cover it, surely this would be the subject of a review from time to time. All benefits under the department are reviewed; they are not just determined once and once only. If school meal costs increased and this was seen to be a clear national trend, some account would have to be taken of that. I would definitely not support the amendment as it stands.
§ Lord Rea
I am somewhat disappointed that as a dentist the noble Baroness does not support this amendment. As the noble Lord, Lord Seebohm, said and other noble Lords have implied, if the cash gets into the hands of the children they are very likely to buy their own meals and not spend it on school meals. We shall have a chance later, when we are talking about school meals, to look more deeply at the survey which has been mentioned by my noble friend Lady Ewart-Biggs but which other noble Lords have not quoted.
The interim report on the diets of school children in this country showed that the food value of the snacks that children bought was far worse nutritionally than school meals. School meals could certainly be improved; but if the Bill goes through as it stands we will find the take-up of school meals falling considerably. This will be a very great shame, because it offers the chance to provide a health experiment which will improve the health of the whole nation, particularly the children of the lowest paid parents about whom we are talking now.
§ 5.45 p.m.
§ Baroness Trumpington
I hope noble Lords will forgive me if I return to the fray, but I was asked some questions. The noble Baroness, Lady Ewart-Biggs, asked whether the switch from free school meals to extra cash means less healthy eating. That point was also taken up by the noble Lord, Lord Rea. My noble friend Lady Gardner of Parkes made a very valid point, but I think one must remember that the prime responsibility for ensuring adequate child nutrition rests with parents. School meals can play only a secondary role, but better financial support for parents all the year round helps them fulfil these responsibilities. Many of those theoretically eligible for free school meals at present do not get them. Better family credit take-up and the automatic inclusion of the extra cash should mean that around 60,000 more school-age children will be getting the extra cash compared with the numbers now getting free school meals through FIS or discretionary schemes.
The traditional distinction between school meals and others is becoming more blurred with the spread of cafeteria-style provisions in schools, a point several noble Lords have touched on. The way forward is to encourage a more attractive and healthier choice in this environment, and the school meals services of local education authorities are recognising this by 50 improving their menus and marketing them more aggressively.
The noble Baroness, Lady Ewart-Biggs, said that cash compensation will sometimes be inadequate. Here I quite agree with what my noble friend Lady Gardner of Parkes said—that nothing is for ever. It would clearly be impracticable to try to compensate according to the different charges made by individual local authorities. The spread of cafeteria-type systems in any case makes the notion of a single fixed price increasingly unrealistic. Illustrative figures in the technical annex of the White Paper included an addition of £2.20 over 52 weeks, which worked out slightly above the national average weekly cost for fixed price meals based on the labour survey then available in 1984. But the actual amount of cash compensation will not be settled until the benefit rates for April 1988 are announced.
I hate to interrupt what I hope is a feeling of general euphoria about the announcement I made earlier, but I was surprised to see the name of the noble Lord. Lord Kilmarnock, on this amendment. Perhaps 1 may quote from the Liberal Party's response to the Green Paper:We see no justification for discriminating between those in and out of work in the benefit rates to be set to enable free school meal entitlement to be abolished".The SDP said:We support in principle higher cash benefits for those on low incomes rather than payments in kind, and for this reason we have included free school meals as one of the four benefits we would abolish and replace with a much higher cash basic benefit".The noble Lord, Lord Kilmarnock, said that compensation included in family credit would be swallowed up because it would reduce the amount of housing benefit. Families will still get the full family credit cash compensation. They could lose some of their help with housing costs. Because family credit is so much more generous than FIS, it will rule out entitlement to housing benefit in all but a relatively small proportion of families—probably around 25 per cent. But the actual proportion will depend on the eventual benefit rates and amounts of housing costs payable. Even where both housing benefit and family credit are payable, not all of the cash compensation is lost, and it is by no means always the case that only 44p of the £2.20 compensation will remain. All this is an unavoidable consequence if we are to have a proper interrelated set of income-related benefits.
§ Lord Kilmarnock
Perhaps I may intervene before the noble Baroness proceeds further. It is quite correct that the ideal policy of the Alliance is what the noble Baroness has stated, but the benefits proposed under our scheme are considerably higher. It certainly does not mean that we support what the Government have done here, which is, in effect, discriminatory as between poor children in households in work and poor children in households out of work; in other words, giving free school meals for one group and cash payments for the other. That seems to us to be discriminatory and illogical. The remarks of the noble Baroness refer only to the implementation of our policy when we are in a position to put it into practice.
§ Baroness Trumpington
I do not think the noble Lord edged his way out of that one very well.
51 The noble Lord, Lord Seebohm, asked whether we could rely on children to hand over the money they have been given for school meals or for mothers to give them that money. I cannot anticipate what mums will do, but the school meals will still be there and surely, with regard to the children giving the money for the school meals, that could be said of any children and not just those in family credit families. There is no reason why they should be trusted any less than any other children.
We believe that the new arrangements in the Bill will be more efficient and better targeted. The real measure of their advantage over the present system is that we expect the cash compensation in family credit will go to over 610,000 children of school age, whereas only about 205,000 FIS children are estimated actually to take up the free school meals to which they are entitled. We estimate that around 340,000 children receive free or reduced price meals under discretionary schemes. By my reckoning that means that over 65,000 children will be better off under the new arrangements. Therefore, I hope the noble Baroness will withdraw her amendment.
§ Baroness Ewart-Biggs
The noble Baroness has indeed put me into a great quandary because although, like other noble Lords, I welcome the very good news she has given about the payment of family credit, it still leaves an awful lot of criticisms, which I made in my initial speech, as to the change in the school meals system. Her reply removes only one of my criticisms. Therefore, I still feel that with cash payments rather than school meals coming in kind there will be a pressure on the mother, even if she does receive the payment. I agree with the noble Lord, Lord Donaldson, that there will always be those bills which are nagging at her conscience and that money will be available for her to use to get rid of one of those worries.
Such a mother is likely to be the member of a family where the children are most in need of the nutritional value provided in a school meal. Those families having trouble with bills at home are those whose children we believe should get the nutritional value of a school meal inside them. I still feel exactly the same about that.
As regards our worries about the amount paid, the noble Lord, Lord Boyd-Carpenter, must understand that, although it sounds very generous, it will be paid over the whole year and will average 60p per day for a school year. As we pointed out, many local authorities are already putting up the price of school meals beyond that. Therefore, with school meals prices rising we still have the worry that 60p per day will not be sufficient.
The noble Baroness, Lady Gardner, has on two occasions brought up the question of stigma. I do not see how that could be removed because children from income supported families will still get free meals and suffer that stigma. I fear that is not being obviated.
Anyone who is a mother and who knows what her children like to eat must accept the responsibility which the noble Lord, Lord Boyd-Carpenter, should like to vest in a child of five, six, seven, eight, nine or 52 10 in spending that money, as he should, on meals that he finds less exciting than those of his own choice in a cafeteria. I do not think that one can vest that responsibility in children.
I fear that a cash payment will have two obstacles: first, that the mother will be forced to use it for something else; and, secondly, that the child will spend it on something which does not have the nutritional benefit of a school meal; and so much work has been put into school meals during the 1980s. In choosing this moment for giving us her good news the noble Baroness has made it very difficult to divide the Committee on this occasion. However, I know the concern there is about this issue in so many groups throughout the country and I will return to it at a later stage. In the meantime I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ Baroness Faithfull moved Amendment No. 67:
§ Page 27, line 4, at end insert—
("( ) Regulations shall prescribe circumstances of urgent need in which weekly payments of income related benefits be made without regard to the procedures, conditions and calculations otherwise applicable.")
§ The noble Baroness said: This is a probing amendment. It will allow provision for weekly urgent need payments through regulations similar to those currently provided under the Supplementary Benefits Act 1976. This amendment applies to those who are not entitled to ordinary supplementary benefit. It is by way of being an income support scheme. It could be said to be the safety net of the supplementary benefit scheme.
I have heard from many people—there are many cases—who simply want money for various things in an emergency. For example, I have here a letter from someone who works in a hospice with terminally ill people. The letter states:
The present system of benefits is particularly unhelpful for people with terminal illness where the condition is deteriorating rapidly; needs are changing week by week; and expenses on bedding, nursing care, prescriptions, heating and substitute care, for example are heavy and increasing".
§ That is an urgent need, and it is not a continuing need.
§ There is also the example of children in hospitals. I have heard from the Great Ormond Street Hospital where doctors are pressing parents to visit the hospital to be with their children. They tell me that those children make better progress than children who are not seen by their parents. However, parents who are on a very low income often cannot afford the fares to visit their children or cannot afford the small items that one might take to a child.
§ Another group of people in great difficulty are those women whose husbands leave them suddenly, and also those women who are cruelly treated and themselves leave home and perhaps go to a family aid centre. I could go on and give many other examples. I remember someone having all her money stolen at Christmas. I recall how very good the supplementary benefit people were in giving a one-off grant to that women. I shall not give a tremendous number of other examples; but as I understand the social fund, it does not appear that under this Bill it can be used to give urgent need payments such as I have suggested. I beg to move.53
§ 6 p.m.
§ Baroness Trumpington
I hesitate to mention the social fund at this stage of the Bill, but I must say to my noble friend that it would give money to urgent cases and in particular cases—I stress that—it would be in the form of a grant; but only in particular cases. Perhaps we may leave that matter until we come to the social fund; but certainly help would be provided in urgent cases.
Returning to this amendment, it contains an interesting proposal and I should like to congratulate the noble Baroness on raising this issue. At present, we do have urgent cases regulations which provide that people can receive benefit on an entitlement basis, even if their circumstances in normal conditions might exclude them from receipt. The noble Baroness is concerned because these will be transferred to the social fund.
There is a general but very important point that I should like to make before responding directly to the noble Baroness. If one looks at the current urgent cases regulations one can see that they cover a wide variety of circumstances—17 in all. They have in common that they are all circumstances where a normal payment of supplementary benefit would not be payable but where the person might have no other resources. I suggest to the Committee that some of them have little else in common; nevertheless, they are covered by the same wide provision and the same procedures.
For instance, one of the provisions relates to payments because a person has lost her purse or his wallet; another relates to a restricted payment in circumstances where an unemployed claimant who should have signed on at an unemployment benefit office in order to be entitled to benefit for some reason has not done so. These seem to be two different types of payment.
The reasons that I mention this point in detail is because I should like to indicate to the Committee and to the noble Baroness that we see some merit in allowing for the treatment of some urgent cases in the income support scheme rather than the social fund; or, to put it more accurately, we should ensure that the social fund deals with genuine financial crises, usually short term, that being more in line with its nature. Income support should deal with weekly benefit, including in some cases in a moderate way some circumstances where it is not possible to institute normal regular weekly payments. We have always made clear that the social fund should deal mainly with one-off payments. The more it accommodates weekly payments, the more we are departing from this principle.
My noble friend Lady Faithfull asked about the urgent need of the terminally ill. I have to tell her that there is no provision in current urgent cases regulations for terminally ill children in hospices or hospitals, etc., which often creates pressures for one-off payments, and the social fund will be able to deal with these sorts of expenses.
I can say to the noble Baroness that the Government are in sympathy with the intention behind her amendment. However, I hope that she will understand when I tell her that I cannot recommend acceptance of 54 it. Given my remarks on a more sensible division of the current urgent cases provisions between income support and the social fund, I think the situation becomes clear. I expect that, in circumstances where someone has lost his money or has suffered a disaster such as fire or flood, he will receive help from the social fund, and that would mean avoiding the approach of setting out all the details in regulations.
Whatever the Committee feel about the approach of the fund in general, I hope it will agree that "urgent ' cases" is the precise area where the more flexible and judgmental nature of the fund is best suited. It is simply nonsense to believe that it is possible to provide in regulations for all alarums and excursions of human life. I suggest that this is the one area where we might all agree that there is a clear case for discretion.
I accept that this leaves those circumstances where the claimant is not facing a sudden, probably short-term crisis and is in a position where he might need several payments of benefit, even though a particular feature of his circumstances might exclude him. However, these circumstances can be accommodated. I do not believe that we should amend the Bill without good cause so I hope that the noble Baroness will accept that we are prepared to meet her concern and that there is no need to press for an amendment.
§ Baroness Faithfull
I thank my noble friend the Minister for that reply. In the first instance I said that this was a probing amendment because I was not at all clear whether these cases could be dealt with by income support or the social fund. Of course, what worries me about the social fund is that it is finite and I am anxious about what happens if, at the end of 10 months, it runs out and there are another two months left. However, I think it would be wrong to embark upon a debate on the social fund at this time because we shall be considering it at a later stage. Therefore, I shall look up the Act and read it very carefully. 1 shall withdraw my amendment and perhaps bring the matter up again at a later stage.
§ Amendment, by leave, withdrawn.
§ [Amendment No. 68 had been withdrawn from the Marshalled List.]
§ Baroness Jeger moved Amendment No. 68A:
§ Page 27, line 4, at end insert—
("( ) Regulations under this section shall not treat any person less favourably by virtue of the fact that he is a student attending a recognised educational establishment or, if the education is recognised by the Secretary of State, elsewhere.").
§ The noble Baroness said: I hope I shall be forgiven for speaking about students in the context of this Bill because in fact students are not mentioned in it. However, more years ago than I care to remember I was the Vice-President of the National Union of Students, and when I was a Member of Parliament most of London University seemed to be in my "diocese", so I have never been able to escape from the problems of students.
§ I feel that to a certain extent we have already dealt with the problems of many students when we were debating the question of the under-25s, who it seems are to be discriminated against as a result of a decision carried by a majority of one vote in this committee. Of course, at the moment there is a very great muddle 55 about student support, and if this were an education debate, I should like to enlarge on the matter. Yet it is quite clear that many people who are most concerned for the universities think that the student support grant should be adequate for maintenance and that students should not have to go to the DHSS for some money and to the DES for other money. That just shows that we do not have a coherent policy on student support—something for which I shall not blame the Minister today. I very much hope that more thought will be given to this question.
§ Meanwhile, I see no reason why anyone should be excluded from the benefits of this Bill—in so far as there are any—because they are students. We know that from other places there have been some threats of changes that will be adverse to the students in this country. I know that there are to be thoughts about the grant, but meanwhile I think it must be borne in mind—and it is relevant to mention it while we are still thinking especially about people under 25—that students are getting an increase of only 2 per cent. in their grants, so far as I understand it.
§ The difficulty for many of them is that the contribution of their parents is assessed according to their means but there are very many parents who do not make that contribution. I know of cases where there have been divorces or separations and arguments have occurred and where a student has been assessed at a fairly low grant because his parents have been deemed to be sufficiently well off to make a large contribution to his support, but in fact the student does not get that support. Only the other day I met a girl student from a well-off family who gave her absolutely no money at all because her father said that she had no business going to college anyhow and she should stay at home and look after her mother.
§ That is just one example of many that I have come across. Therefore, I do not think that we can exclude the need of some of these students for a social security back-up or for some changes in the arrangements made for their grants in special circumstances. There is confusion about students' housing benefits and I understand that there has been some postponement of this matter. However, the whole thing is in a complete muddle and I very much hope that the Government will very soon start work on the examination that they are to undertake of student support. Meanwhile, I hope that the DHSS will be as generous as possible in supporting students who are in real difficulty.
§ Because of the recession, it is getting very difficult for students to work their way through college in the way that many do in the United States. In my day we took jobs as postmen in the Christmas holidays, went harvesting in the summer holidays or washed up in pubs at night. All those opportunities are decreasing. There is a great difficulty. Whichever department we are thinking of, we do not want students dropping out through lack of help. If help has to come through the DHSS pending the review of student grants, so be it.
§ I shall put everyone's mind at rest. I do not intend to press the amendment to a Division. But it is important that this point should be in our minds when we are considering the situation of our students, especially in view of the discrimination against those who are under 25. I beg to move.56
§ Baroness Trumpington
I am most grateful to the noble Baroness for her good intentions. I would submit to the Committee that this is an odd amendment, although I think I understand why it was tabled. But, as to the amendment itself, I do not think that it is sensible to write into main legislation riders of the nature whereby particular groups cannot be affected this way or that. The correct way to proceed surely is for the Government to have powers to pursue certain policies, and if they choose to exert them in a certain way they are answerable to the normal process of law. They present Parliament with proposals and regulations; they have to explain the reasons for the policy and persuade people to accept them. It simply cannot be right to have a rigid "Hands-off' notice put round any particular group in that way.
I should add that in current primary legislation there is similarly no mention of students. This is because the current approach is more sensible. Entitlement depends upon, among other things, a person not being in employment, nor in full-time education. Regula-tions define these because there may not be a single definitive description of either: we need to cover a variety of circumstances. This is the sensible approach and I cannot commend this amendment which cuts across it.
The failure of parents to pay contributions cannot be right, whatever their difficulties. Individial students may suffer. Other people have claimed to be mothers. I, too, am a mother and have had a student son. I know the difficulties that he went through, such as mucking out monkeys at Madingley in order to get a few bob. One can sympathise with the parents. But it cannot be right for the social security system to provide help which the educational system has decided that parents should provide. The Social Security Advisory Committee strongly supported that principle in its report on the current proposals for students.
I am grateful to the noble Baroness for saying that she will not press the amendment. I hope that I have spoken enough.
§ Baroness Jeger
In view of the time and of the understanding that the noble Baroness has shown of the problem, I would only mention that the Government are treating students differently under the social security legislation as regards housing benefit. There is a clear difference there, and I hope that we shall not lose sight of that. But I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ 6.15 p.m.
§ Lord McNair moved Amendment No. 68B:
§ Page 27, line 4, at end insert—
("( ) Regulations shall provide for treating a person in prescribed circumstances as satisfying the conditions of subsections 3 and 4 above if he is a person who has been recognised by the Home Secretary as a refugee under the 1951 Convention and 1967 Protocol; or he has been granted by the Home Secretary exceptional leave to remain for humanitarian reasons; or he is a person who has submitted an application for refugee status to the Home Office.").
§ The noble Lord said: I owe an apology to my co-signatories to the amendment, to the noble Baroness, Lady Trumpington, and to the Committee in general 57 for having made a muddle with the original amendments which I put down. As was pointed out to me on Friday, they would have had an extremely unfortunate effect, and so we have had to table Amendment No. 68B in substitution at the last minute.
§ The purpose of the amendment is simple. It is to safeguard the rights of refugees and asylum-seekers to receive benefit under the Bill. I shall not make a Second Reading speech about how deserving refugees are, and so on. I think that I may assume that there is nobody in the Committee who does not know what a refugee is, what he is probably fleeing from and what obligations we have towards him, not only obligations of charity but legal obligations under the conventions which we have signed. Let us take all that as read and deal solely with the amendment.
§ At present asylum-seekers receive benefit under the urgent cases regulations. Although those are complicated and in some ways unsatisfactory, they provide a firm legal base for those claims. That legal underwriting has often been useful; for example, in appealing against initial refusals. The amendment would ensure that asylum-seekers will continue to ha have an entitlement to weekly benefit during that long year or more which normally follows their arrival in this country and the eventual decision from the Home Office as to whether to grant them refugee status.
§ It would clearly be unsuitable for that group of claimants, who are currently paid weekly under the urgent cases regulations, to have their needs considered under the social fund. We have been encouraged by statements in both Houses which indicate that the Government's intention is not to have weekly payments considered under the social fund and to the effect that asylum-seekers and others are being looked at in the context of the proposed income support. We had Mr. Tony Newton saying that the Government did not intend regular weekly payments to be made from the social fund; and his colleague Mr. John Major at the Committee stage in another place said that the Government were considering whether weekly payments might be better met under the income support rather than under the social fund.
Far more important, the noble Baroness who is to reply said (at col. 684 of our Second Reading debate):
We made clear in Committee in another place that we accept that some urgent needs payments are different from other one-off payments covered by the single payment machinery, in particular, in respect of people seeking asylum. We are considering whether such cases might indeed be better dealt with in the income support scheme".
§ If these amendments are not accepted we are afraid that refugees, asylum-seekers and their advisers will all suffer a serious handicap and we are afraid that the refugees will have far more difficulty in their extremely difficult task of starting life all over again.
§ In conclusion, I repeat that the purpose is to achieve a clear legal entitlement to benefit as well as the simplification of the procedures under which claims are dealt with. That simplification would be of assistance not only to refugees, asylum-seekers and their advisers but also to the DHSS staff, whereas to leave those people to sink or swim in the muddy waters of the social fund would have implications which, frankly, frighten me. I beg to move.58
§ Lord Ennals
I want to support this amendment as strongly as I can. The noble Lord gives a great deal of time to the problems of refugees and has a great understanding of them.
I am chairman of the Ockenden Venture. I spend almost as much time working for refugees as I do working in the Committee. I reckon that refugees sometimes have greater problems than Members of the Committee. I am not certain that everyone here fully recognises the difficulties with which the amendment is designed to deal. We are talking about asylum seekers and refugees. The new wording of the amendment defines the categories of people exactly:a person who has been recognised by the Home Secretary as a refugee under the 1951 Convention and 1967 Protocol; or he has been granted by the Home Secretary exceptional leave to remain for humanitarian reasons; or he is a person who has submitted an application for refugee status".That is a clear definition.
Those people fall into a category of their own for a different reason. They have fled from oppression. They may be Vietnamese, Iranian or South African. They may come from Eastern Europe and many other parts of the world. They are all escaping from something horrible. They come because they cannot stand the circumstances under which they live. When they come here they have many difficulties over language, culture, jobs and especially a source of income. Asylum seekers who have no other source of income at present receive benefit under the urgent cases regulations. Although complicated and usatisfactory, those regulations have provided a firm legal basis upon which refugees can claim benefit.
I believe that it is necessary that such people should not be dealt with under the social fund. For a period of time, until they have settled down, they should receive an entitlement. At present they are entitled to claim for clothing, furniture and accommodation deposits under the single payment regulations. That is not nearly enough. The proposal to replace those regulations by a social fund raises serious concerns among the refugees and the organisations which work on their behalf.
Newly arrived refugees often have an immediate need for items of clothing and footwear, especially when they have had to flee their country with few belongings. Some refugees also need help in paying accommodation deposits and buying furniture. Above all, for a brief period they need a source of income upon which they can rely. If entitlement to the special payments is removed, resettlement will be made much more difficult. I say that because the Ockenden Venture spends most of its time helping to resettle refugees in Britain. I do not believe that they should be exposed to unnecessary hardships during the first months of their stay in this country.
Refugees and asylum seekers need a clear statutory entitlement to single payments for clothing, accommodation and furniture. I repeat that this is a small, compact group. I do not know exactly what the figure is. It is a small group which can be defined at any stage and for which the Committee should have great compassion.
If the wording of the amendment is wrong, of course we can put it right. I hope that the spirit of the 59 amendment and the requirement it includes can be accepted by the Government.
§ Baroness Faithfull
I support the amendment. I do so having had an extraordinary personal experience when the Ugandan Asians came to this country. As a chief officer of a local authority I was given the duty of finding homes for and rehabilitating 15 families. At that time the local authority said it could not give them council houses. I then went to Oxfam and posed my problem. At the drop of a hat and without any more ado the then director of Oxfam gave me a cheque for £ 10,000. With that I bought a house in which I put one family. I then mortgaged that house to buy a second house. In the end I bought 15 houses with that £10,000. That was all right until it came to putting them in the house—
§ Baroness Faithfull
No, all the Ugandan Asians paid off their mortgages within 10 years. There was the problem of their immediate needs. It would be no good having a discretionary payment from the social fund if one had to argue who should or should not receive it. In the case I have mentioned I knew exactly what they could have. They knew what they could have. It was therefore possible on a minimal basis to rehabilitate those families.
I should like to pay tribute to those Ugandan Asian families. Within 10 years they had all paid off the mortgages and had made a contribution back to the supplementary benefits fund in respect of the money given to them. When suddenly faced with having to rehabilitate and place families who have absolutely nothing, one must have some means of knowing exactly what they can obtain. It is of course possible to raise money, to go to voluntary organisations and perhaps run the usual jumble sale, but it is the immediacy of the help that is essential. Therefore, I support the amendment.
As one who is in touch with several individual refugees I support the amendment most warmly. I endorse what the noble Lord, Lord Ennals, said about the suffering of refugees, but I shall not go into that. When they arrive here, as I have seen, they are confronted with all types of problems. They have to settle into the country, find a landlady, become used to our currency and food, and so on. If, in addition, to those numerous and weighty problems they are uncertain about their financial benefits, the difficulties can at times become almost overwhelming. I therefore fully support the noble Lord, Lord McNair, when he says that such people should have a clear, legal right to benefit.
There is another financial problem which refugees face. Perhaps the Committee will permit me to revert for a minute to Amendment No. 55, to which I spoke on 17th June. I then explained that under the SERPS arrangement refugees are now doomed to lose their pension entitlement during the period, which sometimes amounts to as long as three years, when they are waiting for the grant of asylum status and with it of course their right to work.
60 In that connection perhaps the noble Baroness, Lady Gardner of Parkes—I see that she is no longer in her seat, though she was a minute ago—will allow me to correct her. On 17th June I did not recommend that such persons should have any entitlement to pension rights outside this country; in other words, before they arrived here. On rereading Hansard I think that I made that clear, but I should like to take the opportunity to clear up the matter in case any misunderstanding remains.
§ 6.30 p.m.
§ Baroness Trumpington
I realise the concern which is felt by noble Lords of all parties on this issue, and I share it. It may be helpful however, before I respond directly to the amendment if I clarify the issue. The first two categories mentioned in the amendment— refugees in the internationally recognised sense and people granted leave to stay in the country—were never intended to be affected by the proposals for the reform of the benefits structure and the change to income support. If they satisfy the entitlement conditions for supplementary benefit at present, they receive it. We intend, and have always intended, that the same should apply for income support.
The concern has arisen over the category of people who have applied for leave to stay in this country and have so far not received the Home Office decision. Those asylum seekers are in a half-way stage and consequently cannot satisfy the normal entitlement conditions for supplementary benefit. At present those people are paid under the urgent cases regulations of the supplementary benefit scheme which enable payment to be made in such circumstances; namely, when a person has literally no resources but is unable to satisfy the normal rules of entitlement to benefit.
Under our proposals we have indicated that urgent needs really belong to the social fund and should be covered there rather than by the mainstream benefit—income support. This is the root of the concern, as noble Lords have indicated, because we have made clear that we expect the fund to deal mainly with one-off payments, while many of these people will require benefit to meet their weekly needs for perhaps some little while. However, as my honourable friend the Parliamentary Secretary indicated in Committee in another place in an undertaking which I repeated to Members of the Committee at Second Reading, the Government are aware of the concern felt by many. We were conscious of the arguments expressed that the circumstances of asylum-seekers were such that they required a form of income support. Repeated application for help administered on a judgmental basis and expected to respond to sudden or one-off expenses was not the approach they sought.
We indicated that we acknowledged the arguments put forward and were considering whether this group of claimants should be dealt with in income support rather than the social fund. I am very glad to be able to inform Members of the Committee that we have given the matter thought and our conclusion is that such cases should be dealt with in the income support scheme.
61 It is our intention that they shall be. Just as at present asylum seekers receive supplementary benefit on an urgent case entitlement basis with access to the adjudication machinery if they wish to dispute a decision, so in future they will be entitled in broadly the same way to income support. And, just as there is a slight modification to the supplementary benefit rates to reflect the particular circumstances, so it is likely in future the income support rates for this group will be slightly different.
The noble Lord, Lord Ennals, is quite right. It is a very small group. I do not know the precise figures but I agree with his estimate that it is a small group. Having given all this assurance I hope that the Committee will not be too disappointed if I tell them that I cannot recommend acceptance of this amendment. The Bill, I understand, requires no amendment to achieve this policy objective. Indeed, as I have already explained, two of the categories mentioned in the amendment would have been covered by income support without any fuss. The third—the asylum seekers—will be dealt with under the existing provisions. I am sure that the Committee would agree that it would look odd if we specified among the sub-clauses on entitlement actual categories of claimants. This commitment will be in Hansard and I hope that Members of the Committee will accept my assurance and not press the amendment.
§ Lord Ennals
May I ask the noble Baroness this question before she sits down. I am most grateful to her for the concession that she has made. It is a very important one. It will presumably therefore be recorded only in her own words in this Chamber and in no way in the legislation. Is there not some way in which by regulation it could become quite clear so that the people concerned, and especially the organisations who work on their behalf, can know. A bus might run over the noble Baroness—heaven forbid, but one never knows. May be the bus would stop if it hit the noble Baroness—I do not know. But it would be very nice to have something even more than the strong and cheerful words of the noble Baroness.
§ Baroness Trumpington
I take exception to a bus. Why not a mini?
The noble Lord, Lord Ennals, will have learned almost as quickly as I did that the answer was yes. It can be done in regulations. In the meantime, what is in Hinsard is there for the noble Lord to read at such time as he may wish to.
§ Lord McNair
We seem to be making this Bill up as we go along. We have had three or four very important announcements this afternoon. I certainly must be grateful to the noble Baroness for what she has said. However, I am not very good at taking things in on the wing, as it were. I should very much like time to read under a microscope what the noble Baroness has said. Meanwhile, I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ Clause 19, as amended, agreed to.
§ Clause 20 [Amount etc.]:
§ [Amendment No. 69 had been withdrawn from the Marshalled List.]62
§ Clause 21 [Calculation]:
§ Baroness Jeger moved Amendment No. 70:
§ Page 27, line 20, at end insert—
("and shall include the whole of the amount which he is liable to pay by way of rates in respect of his home.")
§ The noble Baroness said: As we seem to be legislating by statement today, I hope that there may be a statement of warm welcome on this amendment. There has been a great deal of discussion and concern in the country among many people about the proposal that people, however poor they are and at whatever level of social security they are being supported, should all pay at least 20 per cent. of their rate bill. I have to ask—I was going to say to the noble Baroness but I see that it is a transvestite noble Lord—what will happen to people who are so poor that they cannot find this 20 per cent. of their rate bill? Are they to be summonsed for debt? Are they to be sent to prison? How is this money to be collected?
§ It seems that the people who are on social security are there because they are poor. They are on the poverty line already or below it. I can foresee terrible difficulties for these families because it will be the worst off people who have to find this money.
§ The other complication is that the Government are supposed to be reviewing the whole of the rating structure. It is very difficult to understand why they should bring in this sudden procedure while they are supposed to be considering a total reform of rates. I have a fear that the proposal to levy a community charge on every individual in the country will subsume this 20 per cent. contribution to the rates. This is bound to penalise people on very low incomes, many of whom at present do not pay any rates at all. I know that this is not strictly a question of social security. It is a question of the Government's rating policy. We do not yet know what that is. We know that the whole of local government finance is in a muddle at the present time. I think that it would have been better if no change had been made in the rating situation until we had the whole picture.
§ It is suggested that if people pay 20 per cent. of their rates that will affect the way they vote at elections. It is supposed to make them more politically responsible. This is not the real world at all. There are lodgers and grown-up children and all kinds of people voting in local elections who at present are not paying rates. To think that their voting intentions would be affected by the fact that they were being "done" for contribution to the rates I suggest is quite wrong.
§ I then have to ask the noble Lord: what is to happen to people on housing benefit? If the person is receiving housing benefit, that again is a measure of his poverty. He then receives a bill for 20 per cent. of the rates. Will his housing benefit compensate him for that contribution which he has to make? It is very difficult to put people in a position where they find themselves in debt to the rating authority, possibly with bailiffs coming around, ending up in court. There would be many procedures for chasing up arrears. The social services departments would have to pick up some of the pieces.
§ These are not problems that I have dreamed up. These are problems that have been put forward by the AMA—people who know what all this will mean at 63 ground level. Take the example of a man unable to find a job but who is trying to keep up the rent and rates on his home. He knows that if he loses his home because of failure to pay the rates and becomes homeless, he has much less chance of finding a job because when one is looking for a job the first question anyone asks is, "What is your address?". It seems to me that anything that will increase homelessness is not only sad for the individual but deleterious for the country. This is bound to distress many old people who will find that, out of their pensions, even with supplement, they are supposed to pay not only 20 per cent. of their rates but the whole of their water rates.
§ These bills will erode any up-ratings which are likely to happen in the near future. The idea that paying this sum will strengthen local accountability is, I believe, absolutely misguided because it is not a reality. The money that people receive from social security they have received because they are hard up, so what is the sense in the Government then taking some of it back? This is something which I cannot understand. I think it means that if claimants are conscientious and try to pay their rate bills they will have to do without other things. They will have to do without heating, food and clothes, and have only the minimal things which the social security payments enable them to have.
§ Therefore, it is really a cut in social security for perhaps millions of people. If the figure is only in thousands, perhaps the Minister will tell me. This is not a way to deal with local government finance. I submit that it will cause more expense to local authorities in chasing these contributions; that it will cause hardship; and that it will give rise to more demands on the social fund and on voluntary organisations for help. Administratively, this is an absolute nonsense. I very much hope that this matter will be taken away. It has no place in a social security Bill. However, our amendment does have a place, considering the present muddle which the Government are in. I beg to move.
§ Lord Kilmarnock
As Amendment No. 85 has, by the usual channels, been grouped with this amendment, perhaps I may be allowed to say a few words about it because, to all intents and purposes, it has exactly the same effect. The amendment stands in my name and that of my noble friend Lord Banks.
The proposal that everyone should pay 20 per cent. of their rates, regardless of their circumstances, is one that has aroused the most widespread condemnation, and perhaps the most widespread condemnation, of any measure in this Bill. It will have a severe effect on millions of the elderly, for whom every few pence of extra income counts. Fifty per cent. of pensioner households will lose more than 1 per cent. of their income under the proposals; and 11 per cent. of pensioner households—that is to say, 700,000 in all—will be more than 5 per cent. worse off. Age Concern has carried out some more accurate calculations. It has calculated that 1,150,000 will lose up o £1 per week; that 1,140,000 will lose up to £2 a week; that 270,000 will lose up to £3 a week; and that 170,000 will lose £3 a week or more, of which 30,000 will lose over £5 a week.
64 This, of course, takes me right back to the criticism I made during the Second Reading of this Bill, namely, that the measures in the Bill, designed to help the poorer families in work, are being introduced at the expense of the poor people out of work. Therefore, the Bill is essentially the poor paying for the poor.
There are two motives behind the Government's proposal. The first is to enable the Secretary of State to show the Chancellor some savings from this Bill, and, as I have just said, he has chosen this route of taking the money in large part from elderly pensioners and very low-paid workers in order to deliver savings of £450 million to the Treasury.
The second motive is in a sense even less savoury, because it is punitive. In effect, the Government set out to make even those with no income other than the old-age pension contribute to the rates in order to enlist their support for the curbing of local authority spending. However, if a sharp political lesson is to be administered, it is hard to see why it should be borne by the elderly poor and the low paid, whose principal concern is probably more with survival than with politics. I could not put it any better than the Social Security Consortium did when it said:It would draw claimants into a feud not of their making. The declared purpose of the proposal—to strengthen 'local account-ability'—in effect means that the Government wishes to deploy the threat of hardship to claimants as a lever in its quarrel with local authorities over levels of rates. It cannot be right to use poor people as political ammunition in this way, whether or not one agrees with the government on the question of rate levels".I could not put it better, and that is why I have quoted it. There are other and better ways of reforming local government finance than by clobbering the poor.
As Members of the Committee will know by now, we favour proportional representation for local government—and Members of the Committee will not expect me not to mention it at this stage—as a means of securing a more balanced and responsible administration in local authorities. We also want to transfer non-domestic rates to central government and replace domestic rates with local income tax, which would mean that all those earning wages, and not just householders, would contribute to local services.
Other noble Lords may have different ideas about improving local government finance. Indeed, there are many proposals in the air at the moment. However, the one thing that is not acceptable to us on these Benches is that these savings should be effected by means of a levy on the very poorest members of the community. This is a most unworthy proposal, and the Government should withdraw it.
§ 6.45 p.m.
§ Lord Boyd-Carpenter
The noble Lord, Lord Kilmarnock, delighted those of us who are keeping a book on the number of occasions that Liberal and Alliance spokesmen introduce the subject of proportional representation on Bills and amendments to which it is wholly irrelevant. As I personally am backing the high field, I am delighted with the noble Lord having introduced this extraordinary idea on this particular Bill.
§ Lord Kilmarnock
If the noble Lord will give way, perhaps I may remind him that in fact your Lordships' 65 House has approved a Bill for optional proportional representation in local government, which was introduced by the noble Lord, Lord Blake, from the noble Lord's Benches.
§ Lord Boyd-Carpenter
It is fascinating to see the noble Lord seeking to introduce the whole reform of local government through an amendment to the Social Security Bill. That itself involves the sort of flexibility which, for example, Mr. David Owen and Mr. David Steel are showing in other respects in the politics of the Alliance.
In moving this amendment, the noble Baroness more or less admitted that it had very little to do with the subject-matter of this Bill and was indeed an attempt to pre-empt government policy on the difficult question of the reform of local government finance. However, the issue is really quite a simple one. Whether 20 per cent. of the rate burden otherwise payable is or is not the right figure, I entirely agree is a matter that is susceptible of argument; but the point of principle—and I believe that the noble Baroness, Lady Jeger, addressed her speech to it—is as to whether people in receipt of these benefits should be wholly immune from liability to pay rates.
I do not want to widen this debate into a general debate on local government, but it is plain at the moment that a basic reason for most of the problems of local government, and in particular for the very high spending of local authorities, is the number of voters in local government elections who can vote for high local government expenditure in the happy knowledge that they will not have to pay a penny towards it. Of course it is very attractive to support candidates who want to provide all sorts of delightful amenities and advantages when you are in the happy knowledge that you are insulated from any risk whatever of having to pay a penny for them.
Therefore, if one wants to introduce (as I am sure do those of us who want to see the health of local government in this country improved) a sense of responsibility into local government, you want to do everything you can to ensure that those who as voters take the decisions for the policies which their local authority is to follow should be conscious of the fact that they have to pay something towards them and that a large financially irresponsible electorate is a standing encouragement to extravagance and over-spending. This amendment is not aimed at whether or not 20 per cent. is the right figure, but at preventing that particular inculcation of responsibility into some section of the local government electorate. For that reason, I hope that my noble friend and the Committee will reject it.
§ The Lord Bishop of Durham
I hope that the amendment will either be pursued or that the Government will undertake to consider the matter seriously. We are in grave danger of being in cloud-cuckoo-land when we talk about principles and responsibilities—even, perhaps, when we talk about proportional representation. We are talking about people.
I feel that one of the difficulties I have so far found in the conventions of this House is that I am not 66 allowed to refer to anybody on any side of the Committee, so far as I can see, as my friend, otherwise I would find myself embarrassing them. But I have close friends on all sides of the Committee, and I am well aware that supporters of the Government are not only friends of mine but people with whom I get on exceedingly well, and for whom I just care a great deal, and I beseech them to consider this matter.
There are these people who are already at the bottom rate of social security, and so on, and they honestly feel that they are being persecuted, persecuted, and persecuted. I am here this evening because I have received a number of letters which include a statement that I support amendments which will remove some of the cruelest features of this Bill.
We may not believe that, and I do not believe that my acquaintances on that side of the Committee feel that they are being cruel; and they believe quite deeply the sort of thing that the noble Lord has just said. But I implore the Committee to consider what it is like to be on the ground. It seems that many of the measures in this Bill are designed to make life more cruel for people already suffering greatly. This suggestion that you will encourage people at the bottom of the heap to be more responsible by taking a 20 per cent. charge of their rents seems to me to be nonsense and to show that if the people are not cruel who are proposing it, it is because they do not understand.
I feel obliged to say that with as much emphasis as I can on behalf of thousands of people in my part of the world. I do not want to go on about it. There is no point in going on about it. The issue is clear, and I therefore feel that either this amendment should be pressed or that the Government should undertake to consider the matter. There is a desperate need, for people in desperate need, to receive some message from the Government that they are not just tidying things up on principle; they are not just targeting, by virtue of a set of rules and calculations; but they understand the messages that are being got through. I can assure the Committee that the message of this is, "We don't care a damn. We are going to take more and more out of the poor".
§ Lord Houghton of Sowerby
I do not think that any right reverend Prelate on the Bishops' Bench should scorn a discussion of principles. That is the last place I would have expected a protest to come from about debating principles. Of course, we are talking about people; but we are talking about human dignity as well as about human need. My approach to this problem all along on social security—and I spent years on it both in Government and out—has been to give the income, and not to reflect the 19th century middle-class expression of the charitable impulse.
These concessions really represent the charitable attitudes of people in the 19th century. "Don't give them money. Give them benefits in kind, or pay for things for them so that they do not misuse their money and spend it on other things". It is income support that we want, and not the proliferation of concessions.
I think also that there is some harm in giving concessions which relieve people of any real idea of the burden of particular items of expenditure inessential for human needs. I shall have something to say on the next amendment about building societies and 67 mortgage interest. I do not think that the state should assume direct responsibility for an increasing area of burdens put upon the people. What we need to get is the income in the hands of the people to bear them reasonably well, and to have a point of view as to whether they are excessive or reasonable.
There is something in the point that if one pays the full amount of anything, then there is a disposition for people to disregard the true cost of it to the community and to other people in it. This is not a hard line at all. What I spent my time on when I was in the Government was to try to get a satisfactory method of automatic income support to take account of the main requirements of human existence in dignity.
There is no dignity to the human being in giving things by way of a kind of charitable impulse. I come from a working-class origin, and I have always been bitter about the patronising attitude of the charitable approach. Indeed, the word "charity" was a word that we hated when I was a boy. We knew what it meant. It meant humiliation. It meant that other people were going to do things for you, and that they thought they knew what you ought to have, and they gave it to you in a way that you could not regard it as a part of your disposable income.
Income support should be the foundation of social security. The rest should follow from that. My difficulty about this and other things in this Bill is that until we know the prescribed amounts, we do not know whether the income support is going to be there. It is that approach on which we ought to insist.
My final comment here is that we should be cautious about putting particular benefits of this kind into statute law. We must have regard to what we are doing when we are making the statute law. It is inflexible when it is once put there. It needs an amending Bill to change it. This Bill is an enabling Bill over a wide area of benefits, and it is not until we see what the regulations are going to contain that we know whether or not the income support being given is adequate.
The two things have to be brought together somewhere, and one does not bring them together by putting some of them in the statute law and leaving a large variety of them to judgment and decision by Parliament by way of regulation. I approach this matter—as I shall approach Amendment No. 71 when we come to it—with extreme caution. I do not think that this is the right approach. We are all old fashioned about social security. For heaven's sake, let us get a new outlook about it. Do not let us be afraid of giving people the income. Do not let us be afraid of telling them that they have to spend it to the best advantage, like other people have to do, and arrange their affairs and family life accordingly. Otherwise, it is a handout; it is a concession.
Look at the days gone by when tobacco coupons were given to pensioners as part of their social security. It was absolutely ridiculous. Non-smokers sold them in order to add to their cash income. I would also say that no concessionary fares should be given as a matter of social security. If people like to give concessionary fares in order to get business, if the transport authorities want to get more business by enticing old- 68 age pensioners and other social beneficiaries to travel, then let them do as the cinema proprietors do and offer a concession in order to get the business; but do not let us regard this as part of social security.
What we are talking about in this particular spirit this afternoon is all backward looking. We want to be looking forward. We want to have income. We want to have responsibility. Are we going to shy at the word "responsibility" now? Are the bishops going to shy at the word "responsibility" on the ground that we are dealing with people? People should have responsibility. I was astonished at the speech we heard from the right reverend Prelate. In all the circumstances, I think that this new approach on my part is surely the right one; and let us get it this way.
§ 7 p.m.
§ The Lord Bishop of Durham
May I just say that I am not against responsibility. I am against people who already have satisfactory incomes, if not income support, expecting to exact responsibility from people who already are so battered that they have no chance to be responsible about anything.
§ Baroness Seear
The noble Lord, Lord Houghton, should remember that we are dealing with this particular Bill. We on these Benches in all our pronouncements have said that we want a completely different sort of Bill. We have asked for income support based on a tax credit scheme. We have asked for it for years, but we have not got it. If that was the kind of Bill we were dealing with, we could go along with every word that the noble Lord, Lord Houghton, has said.
This is a miserable Bill that has been put together with totally inadequate consideration, as we can see by the way in which it is being reformed on the hoof, which seems to be the practical phrase—
§ Baroness Seear
On the hoof; I did not invent the phrase. The Bill is being reformed as we go along. But some reform is better than none. We do not like this Bill, but it is the Bill we have in front of us. We on these Benches have said for decades—though we have not had the opportunity for reasons to which the noble Lord, Lord Boyd-Carpenter, referred this afternoon, to put this into practice—that it is right to have the kind of principles that the noble Lord, Lord Houghton, has mentioned. But we have to deal with what we have now and try to improve this miserable Bill and remove its worst defects.
§ Lord Donoughue
I am puzzled because I have a feeling that I may in some ways be representing the 19th century middle classes which on reflection seem to me to have some virtues that are missing in the late 20th century middle classes; but that is an historical argument.
I should like to get back to the clause and to ask two basic questions; one is, what is the purpose of the clause? Is it to raise revenue and to be used as part of the reform of local government finances? I believe that that cannot be the case because nothing that has been said indicates that that is so. Or does the clause have a 69 different intention, a different flavour, concerned more with ideology than with the question of responsibility which the noble Lord, Lord Boyd-Carpenter, mentioned? I have sympathy with what the right reverend Prelate said in terms of the expectations of responsibility among some people. I think it is a delusion to believe that one can impose that through an Act of Parliament. I have some sympathy and understanding with the feeling behind it, being myself, along with other noble friends, a ratepayer in Camden. So we understand those feelings. But in fact I do not think one can impose responsibility, in the sense that is defined, upon the poorest sectors of our community in this way. I wonder whether the basic purpose of this clause is actually to teach some people a lesson. If so, I should like to suggest that that is really not a worthy objective for this Committee.
First, what is the purpose and, secondly, what is the consequence? That is what we must be concerned with. It seems to me that it is quite simple. On the one hand, if the people concerned pay, they will be pushed into greater poverty. These people are already on the subsistence level, and they will be pushed below it. I do not think we want that. Alternatively, if they do not pay, the families will be prosecuted, the families will be broken up, and there will be more homelessness. That seems to me to be an undesirable consequence. So as a clause this seems ideological and punitive. In practice either it will not work or, if it works, the consequences will be undesirable. Having posed those questions and perceived what I believe to be the answers I ask the Committee to pursue and support this amendment.
§ Lord Trefgarne
I have listened very carefully to the arguments put forward in respect of these amendments, but I must tell the Committee that I have not heard anything to persuade me that the Government are not following the correct course. Let me begin by pointing out a side effect of the amendments as drafted. They would provide for the full amount of a person's rates to be covered by housing benefits, but only if the person were on income support. For people above income support levels, or for people in full-time work, the maximum amount of rates built into the housing benefit assessment could still be less than 100 per cent. if the Secretary of State wished. This is just the sort of imbalance which our reforms are designed to correct—and indeed, no one has seriously argued with this aspect of them.
The new structure will treat people the same, whether they are in work or not, or on income support or not. This in turn will enable us to get rid of the highly complex and inefficient part of the system known as housing benefit supplement—and this again has been widely welcomed.
But turning to the substance of the arguments let me restate briefly the Government's case. The Committee should be in no doubt that the Government are committed to the principle of greater local account-ability of local authorities to their electorates. Our White Paper proposed a 20 per cent contribution to domestic rates as part of the process of achieving this. In particular, we are concerned that a scheme based on 100 per cent. of rates would insulate an even greater 70 proportion of the population than at present from the effect of any rise in rates, and hence from their council's spending policies. A scheme based on full rates reimbursement would actually mean that everyone in receipt of a rebate, however small, would get the full value of any rise in rates reflected in increased housing benefit.
But the 20 per cent. contribution to rates is one small part of a much wider package of local government finance reforms which are still at an early stage in the consultation process. We have made it clear on several occasions that the social security structure will have to be developed in the light of discussion on the Green Paper issued earlier by my right honourable friend the Secretary of State for the Environment. In other words, the effects of the proposed contribution to rates cannot be finally determined at this stage. Equally, as we keep stressing, we will not be taking decisions about the level of income support rates until much nearer the date of implementation of the reforms.
It is therefore rather premature to be talking in terms of hardship for pensioners or others. There will be ample opportunity in due course to debate the regulations which will establish the maximum level of housing benefit which is payable. There will then be a further opportunity to discuss the actual rates of benefit to be implemented in 1988; and no doubt there will continue to be discussions within this Chamber and outside about our wider proposals for reforming rates themselves.
Several points have been raised during the course of this discussion. For example, I was asked what would happen if someone could not pay 20 per cent. of the rates. I ought to put that question into perspective by reminding the Committee that 20 per cent. of the rates would represent about £ 1 a week for a household on income support. This is clearly not the sort of sum likely to cause serious difficulties for very many people. I know some other figures were quoted, particularly by the right reverend Prelate, but the average figure is about £ 1 a week and will not I believe cause serious difficulties. It will ultimately be for local authorities to collect the 20 per cent. contribution and to decide what action to take if someone simply says he cannot pay.
But I am not trying to duck this issue, which will also arise when rates are phased out to be replaced by the community charge. We shall be happy to discuss with local authority representatives any ideas they may have for keeping this problem under control. It is one of those areas where we may have to do some more detailed thinking, particularly as our ideas begin to firm up on the wider question on the reform of rates themselves.
The noble Baroness, Lady Jeger, asked me particularly whether the housing benefit would compensate for the 20 per cent. contribution. The 20 per cent. contribution will be built into the housing benefit calculation. At present, 60 per cent. of a person's rates are reflected in the calculation. In future, it will be 80 per cent. so there is no change in principle from the present position.
A number of speakers, including the right reverend Prelate and, I think, the noble Baroness—were 71 concerned that this might lead to some particular hardships—people going without homes or without food. But, as the noble Lord, Lord Houghton, pointed out, the rates of income support have not yet been decided and will be set nearer the time, taking into account all these considerations.
I was grateful for the remarks of my noble friend Lord Boyd-Carpenter. It cannot be right that three million households at present have no interest at all in the affairs of their local councils. A scheme based on 100 per cent. of rates would insulate even more than at present a trend the Government would regard as fundamentally unhealthy, with or without proportional representation. I hope that I have made it clear that the Government see considerable difficulties in the course proposed by the noble Baroness and that she will see fit not to press her amendment.
§ Lord Banks
I wonder whether the noble Lord could explain why it is that the Government are always so pleased when they are able to say that they have raised the tax threshold so that fewer and fewer of the people at the bottom of the scale are caught in the income tax net. Is it not correct that the Prime Minister has said that it is quite wrong that so much should be taken from those at the bottom? The thing is to raise the thresholds. But if the noble Lord's argument is to be followed, surely this means that we are not inculcating that spirit of responsibility as far as national matters are concerned with those people that we are letting out of the income tax net. Yet the noble Lord comes along and says, "We must get people into paying for local government even if they are right at the very bottom of the pile, even if they are the poorest of the poor". But not, apparently, when it comes to national matters. Can the noble Lord explain the difference between those two in the Government's thinking?
§ Lord Trefgarne
I wonder whether the noble Lord was listening to the remarks of my noble friend Lord Boyd-Carpenter. It is the case that many people who find themselves in this position are dependent upon benefits from their local authorities and it is, indeed, the case, sadly, that some local authorities have not been as responsible as we would have wished in setting their levels of expenditure and often for the unnecessary benefit of some people, as some would say. I think my noble friend was right, and I believe the Government are right, to say that the proper thing is to give people a sense of responsibility in this area; and I rest my case on that.
§ Lord Boyd-Carpenter
If my noble friend will allow me, is there not also on the question of national taxation the fact that, even if a person is taken below the income tax level, he still pays a mass of indirect taxation; and he knows that when he comes to vote?
§ Lord Trefgarne
My noble friend is, of course, quite correct in mentioning that. That is another point which I am sure the noble Lord, Lord Banks, will take into account.
§ Baroness Jeger
I think the noble Lord gave himself and the Government away a few seconds ago when he said that, unfortunately, there were some local authorities who did not do exactly—and I wrote it down—"as we wished". When has it been doctrine in this Parliament that local authorities should do exactly as the Government wish? I am sorry. I am an old reporter and I wrote it down; and I hope that Hansard wrote it down as well.
I have to ask the noble Lord, first, whether this proposed change, with the 20 per cent. rule, will come in before the community charges have been brought into legislation. Secondly, we hear too frequently from the Government side that the amounts of income support and the amounts of help have not yet been decided. So we are asked to withhold our criticism. This Bill is full of undecided regulations. That is one of the worst things about it so that both sides of the Committee are really in difficulty; because we hear about 20 per cent. but we do not know of what.
The noble Lord did not answer my question about the enforcement and the penalties and whether the Home Office has done an assessment of the increase in the prison population, the increase in the number of bailiffs who will be needed, and the increased cost to local authorities in following up people who are too poor to meet the demands.
As for my one-time noble friend Lord Houghton, I think that he should change his National Health Service glasses. Obviously, he has not read the amendment. The amendment was to increase income support—which was the very thing which he said it was not doing. What the noble Lord was saying means that he wants to take income away from these poor people by snatching back their 20 per cent. of rate payment; whereas the amendment says that in assessing the amount which they are to get, consideration,shall include the whole of the amount which he is liable to pay by way of rates in respect of his home".He is to get that money. That is his income support. Then he has the responsiblity of paying the rates. I could not follow the noble Lord at all but I know that he may have had his mind on other things.
I feel that there has been no adequate answer. I am sorry about this. I have considered very carefully representations that have been made by local authorities. I cannot find anybody in the AMA and other experienced bodies, the people who have to do this job, who support the proposal. The Minister may say that it has got to be considered in conjunction with the reform of rates generally. I said that. That is why I do not think that this ought to be part of the social security legislation. It is a problem for local government finance and has nothing to do with this Bill. Certainly, this Bill should not be used to put what amounts to an extra tax of a 20 per cent. contribution on people who are so poor that they already qualify for income support. It is taking something away from the poorest people in this country. I think it is absolutely disgraceful and I shall press this to a Division.
§ 7 18 p.m.
§ On Question, Whether the said amendment (No. 70) shall be agreed to?
§ Their Lordships divided: Contents, 89; Not-Contents, 86.74
§ Resolved in the affirmative, and amendment agreed to accordingly.
§ 7.27 p.m.
§ Clause 20, as amended, agreed to.
§ Baroness Hooper
This may be a convenient moment to take a break in the proceedings. In moving that the House do now resume, perhaps I may suggest that we should not reconvene before 8.25 p.m. I beg to move that the House do now resume.
§ Moved accordingly, and, on Question, Motion agreed to.
§ House resumed.