HL Deb 23 June 1986 vol 477 cc109-43

9.30 p.m.

House again in Committee.

Clause 21 [Calculation]:

Lord Kilmarnock moved Amendment No. 71: Page 27, line 34, at end insert ("and shall include an amount which shall be the whole of any mortgage interest for which a member of the family is liable on the home of the family.").

The noble Lord said: Before we broke for dinner the noble Lord, Lord Houghton of Sowerby, said that he felt we should be extremely cautious about Amendment No. 71, which I am now moving. He said that income support should be the foundation of social security. But as my noble friend Lady Seear pointed out, we are dealing not with some ideal world with a properly unified tax benefit system but with the Bill now before us and the hardships that will arise under it. Those are the matters to which we have to address ourselves.

The amendment seeks to ensure that the payment of mortgage interest continues to be made by the DHSS for home owners during the first six months that they claim benefit, after which period an unemployed person is entitled to full supplementary benefit and mortgage relief; which is the present position. Therefore, the amendment does not seek to do anything which is not actually being done.

Widespread alarm has been caused by the Government's proposals to cut by 50 per cent. the payment of mortgage interest during these crucial six months. These proposals, which were sent to the Social Security Advisory Committee back in May, would affect some 90,000 people. Those most affected are precisely the people the Government encouraged to buy council houses under the right-to-buy policy. Quite a number of people who recently availed themselves of the right to buy their own homes have now found themselves out of work. If they cannot keep up their payments over the six-month period, they will be made homeless and will have to be housed in rented accommodation at far greater public expense. It seems to be quite unfair that new home owners should not have the equivalent support which is given to tenants with their rents. It is particularly unfair that even a relatively short period of unemployment might lead to the loss of the home.

It is unlikely that the building societies will be able to renegotiate mortgage payments for people in that situation, as the Minister for Social Security, Mr. Newton, suggested in another place, without the present guarantee. The reason is that the number of properties repossessed for non-payment trebled between 1982 and 1985 and doubled as a percentage of the total number of building society mortgages. I do not refer to bank mortgages because they are smaller in number, but there have been adverse experiences in that area, too. I have the figures. Out of a total number of mortgages in 1982 of 5,664,000, the number of that area, too. I have the figures. Out of a total number of mortgages in 1982 of 5,664,000, the number of properties repossessed for non-payment was 5,950. However, in 1985 out of 6,636,000 mortgages there were 16,590, repossessions. Likewise, the loans in arrears for six to 12 months have more than doubled and loans in arrears over 12 months have trebled. Therefore, on those figures it would not appear that the building societies are likely to be able to take on that responsibility themselves.

There is also a geographical factor. The number of loans in arrears and property repossessions are greater in the North than in the South-East. The building societies have been more ready to lend to those with marginal job and income security in the knowledge that mortgage interest relief was available as a last resort. That is important in regions such as the North of England where the type and range of jobs is often determined by cyclical factors. Moreover, the building societies argue that they have been encouraged to increase lending against the Government's guarantee in order to boost the Government's home ownership policy.

Frankly, it is not much comfort, as the Minister claimed in another place, that the proposal was set out in the Government's Green Paper, paragraph 2.92, and repeated in the White Paper, paragraph 3.41. These references simply do not mean that this is a good proposal.

The cost of the current relief for home owners in this unfortunate situation is in the region of £60 million; the saving aimed at by the Government in halving that relief is in the region of £30 million. These are indeed quite large sums of money, but when they are set against the £4 billion of mortgage income tax relief, a good deal of which goes to people on high and even on very high incomes, it would seem to be quite immoral to remove 50 per cent. of the support in order to make a current saving of £30 million pounds.

I very much hope that the noble Baroness will tell me that the Government have thought again and have no such intention, in which case not a small number of new home owners, who have been encouraged to buy their homes by the Government, will breathe again. If the Government cannot give me that assurance, I think it becomes particularly relevant to know the result of the consultations with the building societies and other interested bodies that were referred to in the Green Paper, and also to know the views of the Social Security Advisory Committee, to which, as I have already said, these proposals were put out in the middle of May. I do not think it is necessary for me to say anything more at this stage. I shall be very interested to hear what the noble Baroness will say, and I beg leave to move the amendment.

Lord Houghton of Sowerby

I should like to say a few words on this amendment. In fact, I almost threatened the Committee with doing so, but I shall not get as worked up over this amendment as I did over the last one. Last time it was the provocation of the right reverend Prelate the Bishop of Durham that started me off, and I apologise to him if I was too harsh.

Last Friday this Chamber was full of building society men. They came to Parliament in order to obtain a new charter for their activities and to emphasise the great benefits that they bring to the community in the form of home ownership and a sense of security and so on, which they do. It seems to me that we ought to hear what the building societies have to say on this point. I do not think that we should regard this question as wholly a matter in which state aid should come to the rescue of people who are in debt.

The building societies claim to be an industry. I never used the word "industry" in respect of building societies until they began to use it themselves. I called them "a movement". However, they say they are an industry and so I shall say that building societies are mortgage brokers, who are in business under very favourable conditions and under the protection afforded by the law that is applicable to building societies. As the noble Lord, Lord Kilmarnock, pointed out a few moments ago, those who take out a loan for a mortgage to buy their own house have the benefit of exceedingly generous tax reliefs. There is a debt on the part of the borrower to the lender of the money on security of the house. So in one respect the borrower is in the same relationship to the building society as is a debtor to a creditor.

In those circumstances, I think we should look at the content of that relationship. Since the first step that is taken by a borrower who is in difficulty is, if possible, to go to his building society in order that some payment arrangements may be made, there is the acknowledgement of that relationship right from the outset. Building societies will usually allow the repayments of the capital sum to be deferred on condition that the borrower continues to pay the interest.

That is the normal arrangement when borrowers get into difficulties and want to reduce their outgoings immediately. That postpones the completion of the repayments of the capital and it puts off the day when the house is clear of mortgage. That is a disadvantage, but it does not present any immediate financial problem to the borrower.

However, the payment of interest may do so. We shall have to ignore the fact that the interest is heavily discounted by the amount of tax relief that has been given so long as the borrower is a taxpayer. We have to look at the net outgoings that arise on the mortgage outstanding and see what bearing they have on the financial position of the borrower. The question then is what the state should do in relation to that net obligation that the building societies usually require for some arrangement regarding financial difficulties.

It is not the relationship between a tenant and a landlord; it is the relationship between a person who has borrowed money and an organisation which has lent money. But the risk for the borrower when he is in difficulties is the risk of foreclosure. Unhappily, that may become an increasing problem with which the building societies have to contend.

The building societies, with their enormous resources and the social obligations that they have over the wide field of home ownership—and they are the principal bodies in it—ought to consider their own position. There is a Bill before us which has already had its Second Reading and is to go into its Committee stage one day soon. It seems to me that this is a matter which we ought to debate on that Bill and see what the response of the building societies is. After all, they are in close consultation with the Government all the time on that Bill. I am not complaining about that. It is right and proper that they should be. But we want to know a bit more about the building societies' angle on the matter.

The first suggestion that I make is that it would probably be more appropriate if we came back to the subject when we know what the building societies have to say about it. After all, if citizens are in debt to other organisations, the state does not necessarily come in and say that it will help them pay it off. The grocer does not come to social security to be paid off with the threat that he will not supply it any more.

The building societies are in a special position. Even a landlord cannot just push a tenant out. He has to go through the process of obtaining an order for possession. The building societies are in a much stronger position to get possession of a house than a landlord in trying to get possession of his property. That is important.

I believe that I am right in saying that the matter which has given rise to this amendment is being debated in another place this week. I understood that there was to be some debate in another place on the proposal of the Government which has been referred to. That may be another reason. I put it no higher than that. I do not feel that necessarily the interest payable on a mortgage should be wholly a charge on the state in certain circumstances or be insisted upon by the lender. There are all sorts of problems and aspects as between lenders and borrowers. That is not the only field in which people lend money. Hire purchase and other debts are incurred. Other money is borrowed. If one goes to the moneylender one probably does not receive the same consideration. I do not know.

I must not say any more. I must not give any comfort to the Benches opposite, because when I do, they are defeated. That is not good for them. Could we not try and look at this matter from the point of view of the building societies' responsibilities? They after all are the lenders. They are the people to whom the money is owed. I do not think they should remain silent on this problem.

9.45 p.m.

Baroness Trumpington

The noble Lord, Lord Houghton, knows that he is my flavour of the month, whatever happens in the vote. The purpose of Clause 21 is to provide a framework for the calculation of income-related benefits. Regulations will set out the details, including the calculation of the amount of mortgage interest for income support purposes. While that is a matter for secondary legislation, I should make it clear that the Government do not accept that the income support scheme should meet the full amount of the mortgage interest payments which are due.

The Green and White Papers on social security reform reflected our concern at the effect of the guarantee of mortgage interest for all supplementary benefit claimants. The present arrangements under the supplementary benefits scheme for providing help with mortgage interest payments—arrangements which the noble Lord's amendment seeks to perpetuate under the income support scheme—mean that there is a 100 per cent. guarantee of immediate state help for people out of work who are buying their homes when others in work on comparable incomes have a much greater burden to carry for themselves.

In our view, that is unfair. We have therefore referred to the Social Security Advisory Committee draft regulations introducing changes in the arrangements for meeting mortgage interest payments. The regulations provide that the amount of mortgage interest payable will be limited to 50 per cent. for the first six months for all people under 60. The advisory committee has invited comments from the public and interested organisations, which will include the building societies, and its report will be submitted to the Secretary of State in due course. Final decisions will then be taken in the light of that report and of all the other considerations which apply.

In reply to the noble Lord, Lord Kilmarnock, we propose to limit to 50 per cent. the amount included in the assessment for mortgage interest for the first six months of the claim. Thus only people coming on to benefit will be affected. We intend to carry forward into the income support scheme the changes in help with mortgage interest which are introduced in the supplementary benefits scheme.

The Committee will have an opportunity for a full discussion of those changes when the regulations come before this place. I therefore ask the mover of the amendment to withdraw it.

Baroness Jeger

There are one or two important questions. If it is the Government's intention that for the first six months there should be payments of mortgage interest from the social fund, then at the end of the six months if a person obtains a job, I presume that that help will cease. After the six months, if that person loses his job will he lose any help?

I understand that the idea is that if someone is unemployed or on social security for six months and then obtains a job, that person's benefit in this connection ceases. That will be very unfair for people who obtain a job for a short time. It will be an incentive for people to stay out of work for over six months so that they will continue to have their mortgage interest paid. If they obtain a job and work for an interim period then they will lose that payment.

I hope that the noble Baroness can help us on this matter. I shall not go into all the general questions about the building societies' attitude to the problems that will arise from this. There will be many more defaults. Already 10 per cent. of homeless families are in that position. They have been turned out because of mortgage payment failures. I believe that the present Government's ideas will only increase the number of families thrown out of their homes because of mortgage default. I do not think that the Government want that to happen. I hope that we look again at this six-months rule and decide that it is not fair when compared with the assistance that the Government give to well-off mortgage payers.

Baroness Trumpington

I always listen with enormous interest to what the noble Baroness, Lady Jeger, says, but I think that in this case she has the social fund muddled up with income support. The help will be available from income support, not the social fund. If one is in work, one cannot now get supplementary benefit. Similarly one will not get income support. The noble Baroness, Lady Jeger, raised questions of linking arrangements for people who have two spells of benefit with only a short time in work. I shall consider this along with other matters.

Lord Kilmarnock

I am grateful to those who have spoken in this short debate. The noble Lord, Lord Houghton of Sowerby, has mentioned the Building Societies Bill and that might indeed be the proper vehicle under which some new arrangement can be devised. Perhaps the noble Baroness will tell us whether the Government are considering making any provision in that regard in coming to some new arrangement with the building societies in return for the new privileges which are being granted under that Bill.

The noble Lord also mentioned that tax relief is given when the borrower is a taxpayer and is still in work. That does not help him when he has no income other than unemployment benefit. If citizens are in debt in other areas, as the noble Lord, Lord Houghton, said, the state does not step in. But the roof over one's head is a little different from any other commercial debt, and that is particularly the case when there has been a great government-sponsored campaign in favour of increased home ownership. People who have paid attention to that campaign have, I think, some right to be considered when they suddenly, and perhaps unexpectedly, fall on hard times.

The noble Baroness, Lady Trumpington, said she does not accept that the payment of help should be at the rate of 100 per cent. under the income support scheme. But why have the Government accepted so far that such interest shall be paid after the first six months? What is the difference in principle? That seems to me to be an extraordinary lacuna. It is rather like throwing a lifebelt to someone so far ahead that he is not likely to be able to reach it.

The noble Baroness said that the Social Security Advisory Committee has invited comments from the public and various bodies, including the building societies. Obviously it will be of interest to know what views it receives. I hope that we shall know them very soon. It has also been mentioned that the subject will be tackled in another place next week. Therefore I do not think that we should push our luck any further today. I believe that we should consider what we want to do about this before the next stage of the Bill. I have no doubt that we ought to come back to it, but perhaps we need a little more information, and I think we want to know what representations have been made to the Social Security Advisory Committee.

I thought I heard the noble Baroness say that only new entrants to unemployment would be 0affected. If she did say that, it does not strike me as being particuarly fair. On all those grounds I do not think that this is the moment to press this amendment to a Division. I shall read the debate and try to obtain some more views on this matter. I can almost certainly promise the Minister that we shall be reverting to this matter at the next stage of the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 71A not moved.]

Baroness Fisher of Rednal moved Amendment No. 72: Page 27, line 34, at end insert— (" ( ) Regulations shall provide that the prescribed amount shall include amounts for partially sighted people").

The noble Baroness said: I beg to move the amendment standing in my name and the names of the noble Lady, Lady Kinloss, and the noble Lord, Lord Kilmarnock. As many Members of the Committee are aware, for quite a number of years I have been involved with the needs of blind persons as children, as they reach middle age and as they grow old. It is because of that interest in the needs of the blind that I tabled this amendment.

The Royal National Institute for the Blind, the National Federation of the Blind of the UK, and the National League of the Blind are all very concerned and have urged me to make representations on their behalf regarding the partially sighted, and their claims should not be ignored in the Bill. At one time partially-sighted people used to be called "partially blind persons", but the definition has been changed to "partially sighted". However, they are exactly the same people. They are defined as those who are substantially and permanently handicapped by congenitally defective vision or in whose case illness or injury has caused defective vision of a substantial and permanent handicapping character. In other words, many of them have very serious handicaps and very defective vision, almost bordering on being registered blind.

At present the rules for severe disablement allowance recognise partially-sighted people as being among those who are 80 per cent. disabled. They are normally accepted as passing the 80 per cent. test without having to produce any further medical evidence. Thus, part of the social security system as we have it now recognises the disability of partial sight.

I know that partially-sighted claimants would not automatically receive disablement premiums, as is the case in the Bill before us. I understand that some would benefit but that it is not automatic. The proposals for the housing benefit changes in the Bill would affect many partially-sighted people. At present partially-sighted people are able to claim housing benefit and any extra needs in respect of the higher needs allowance. This would no longer be so under the Government's plans in the Bill.

The proposed income support and disablement premium would replace the present supplementary system under which additional requirements are payable for particular needs in addition to the basic benefit. Many partially-sighted claimants currently receive additional requirements in this way. For example, the diet addition, which is worth £3.70 a week, is paid to people with diabetes, and in many persons who have diabetes that is associated with loss of sight. Partially-sighted people would lose such payments without any replacement if they could not get the disablement premium.

It is because of these anomalies regarding the partially sighted that I ask the Minister to be considerate, and that they should be included among the blind to enable them to have automatic access to premiums on grounds of disablement. I am aware that the matter was raised in the other place in Committee on 11th March. The Minister replying gave an assurance when he said:

"I do not wish to give an undertaking to include partially-sighted people at present, but I do not rule out giving the matter further consideration."

I hope that the noble Baroness; when she replies, will be able to say that some further consideration has been given. I beg to move.

Baroness Trumpington

May I ask the noble Baroness whether she is moving Amendment No. 72 and speaking to Amendments Nos. 72A, 72B and 72C?

Baroness Fisher of Rednal

I am speaking only to No. 72.

10 p.m.

Lady Kinloss

In supporting this amendment I hope that the Government will consider the plight of the partially sighted with sympathy. The noble Baroness, Lady Fisher, in moving this amendment has covered so many of the points of worry concerning the partially sighted that there is only one matter I should like to mention. It is that partially-sighted claimants would not automatically receive the disablement premium, although some would receive it. For example, claimants who are classified as incapable of work would receive the disablement premium, while those who are unemployed would not. But surely a partially-sighted claimant is clearly disabled in either case, and would have needs which should equally be recognised.

Baroness Trumpington

Forgive me if I return to the noble Baroness for a moment. In the groupings I have, which I think all Front Bench speakers have, they were all grouped together. I hope the noble Baroness will forgive me. I shall now speak only to No. 72.

Lord Ennals

Perhaps it would be helpful if I were to say a few words about Amendment 72B, which is part of the group.

Baroness Trumpington

We have to get it straight, because the noble Baroness, Lady Fisher, may wish to speak separately to the others. As I understood it, the grouping was as I said. Unless the noble Baroness, as the mover, agrees, I do not see that we can suddenly start speaking to No. 72B.

Baroness Fisher of Rednal

It appears that the usual channels have broken down. I did not know anything about it. I spoke to No. 72.

Baroness Trumpington

The usual channels have been repaired, and I am now going to speak to the grouping, if that is agreeable. Before I turn to the specific amendments in this grouping I should like to make some general comments. The structure of income support is one which enables help to be directed towards particular groups by means of premiums. This is a sensible approach. It is not different from the current scheme, which also attempts to give additional help in particular ways.

But although the approach is different it is a much more practical structure. This is because we are moving from the current system of additional requirements. Few people I have come across are friends of these particular elements of supplementary benefit. The result is a mass of regulations, often extremely complicated. That results in confusion and uncertainty among claimants about their rights. This simply cannot be right; but if we agree that this is not the correct approach, then I am worried by the kind of amendments we are now discussing.

These amendments seek to reintroduce exactly the kind of complication which has bedevilled the supplementary benefit scheme. Here we are attempting to bring about a system of income support which will benefit claimants considerably, yet we continue to seek to add bits here and there to deal with specific matters. If we carry on down this road we shall undermine the important reform we are seeking to bring about. The difficulties become evident as we turn to the specific amendments.

I must stress a further point: one of our main objectives is closer alignment between the income-related benefits, income support, housing benefit and family credit. That is, people on low incomes should receive help on the same broad basis not set primarily be separate rules or the particular benefit they have claimed. It is inconsistent with this objective, which has been widely welcomed, if we retain for one group of claimants a whole further set of additional payments. Such an approach would immediately rule out any serious prospects of a tax benefit solution which some Members of the Committee advocate. In the present structure that simply implies the re-invention of housing benefit supplement.

We must beware of criticising the present scheme, arguing for change and then resisting any particular proposal which is part of a different and, we believe, more coherent approach. That is simply to argue for never making any change.

Turning to Amendment No. 72, this is a slightly different amendment from most of the others we are discussing in this part of the Bill. Most of these seek to insert into the Bill a provision which the person moving the amendment feels that our proposals are removing from the scheme, but which the noble Baroness thinks should be retained. This amendment seeks to write into the income support scheme a provision which has never existed in the supplementary benefit scheme.

Several features of the present scheme give special recognition to blindness; most notably there is a special weekly addition for blind people. As the noble Baroness (who does a lot of work for the blind) will be aware, special recognition has long been a feature of welfare provision in this country dating back to before the last war. It was institutionalised in the national assistance scheme and carried forward into its successors. This approach is unusual for social security. Generally help is not directed to a particular diagnostic condition but to the effect of a condition on someone; for example, incapacity for work or inability to walk. Provision for blindness is virtually unique. When considering our proposals for the reform of social security, we decided that we should not end this particular help—despite the fact its approach is so different. Consequently, blindness is a qualification for the disablement premium or, in the case of a child, the additional family premium.

I am sure that the Committee approve of this. However, I cannot agree to the proposition implicit in this amendment that we extend this approach and include partially-sighted people in the help we have decided to continue to give blind people. As 1 have indicated, this would be new as there is no provision specifically directed at partial-sightedness in the supplementary benefit scheme at present. We must be careful about widening this fairly circumscribed and unique help. We would begin to encounter particular difficulties which always occur when you are drawing lines and directing help at particular conditions rather than the effect of those conditions. Partial-sightedness can cover a wide range of visual handicap. At one extreme it can be similar to blindness, but at the other extreme it may only be extreme short-sightedness. In assessing which groups should receive extra help, it does not make sense to base help on too wide-ranging a condition.

I can mention that we have accepted that severe disablement allowance will bring entitlement to the disablement premium. Partial-sightedness when linked to incapacity for work makes this benefit payable so help can be directed to these people. But I cannot promise to go further than that.

As regards Amendment No. 72B, we had a very lengthy debate on this issue or on very similar matters in relation to Amendment No. 63 when we discussed a community care addition. I think it is evident that there is considerable overlap between the arguments for a community care addition and those for a domestic assistance addition. The debate on the former reflected that. It became clear that the impetus for a community care addition largely arose from concern about possible losers to people who receive the domestic assistance addition. I explained then that the Government were prepared to make two improvements to their proposals, first, to give better transitional protection for existing cases, and, secondly, to seek new arrangements so that help can be given to support new cases of severely disabled people with similar needs.

Members indicated, however, that the scheme should contain a community care addition to concentrate the Government's mind, I recall. The Government will need to look carefully at this and its implications for our immediate proposals for income support and the wider intention I mentioned to look at this matter. As a result, I hope that the noble Baroness—or, rather I think it will be the noble Lord—will be content if I tell him that I shall carefully note his comments when he makes them. When he has made his comments, we shall take them fully into account, and we shall look at the implication of the amendment for the introduction of a community care addition.

I am actually speaking to all three amendments which were grouped together. Again, on 72C, this is another unusual amendment in one respect. Much of the criticism that we have been facing has been directed at elements that we are supposed to be taking away from claimants. Many of the amendments that I respond to are attempts to retain elements of the existing scheme. This amendment seeks to introduce a new provision altogether because there is no equivalent in the current scheme for an addition to be paid on account of pregnancy.

I am not opposed to new features simply because they are new but we have to consider very carefully the justification for introducing a new provision, especially when it will mean additional resources having to be found. It is difficult to cost this proposal because one would have to decide the rate of the addition, but our preliminary estimates would put it in the range of £10 million to £50 million, depending upon exactly how it would operate.

However, it is not on cost alone that I am not in favour of the proposal, although obviously cost is important when you think of all the other competing priorities. The Committee will already have heard me announce this afternoon improvements in transitional protection for people receiving the domestic assistance addition. I must oppose Amendment No. 72 and the further amendments when they are moved.

Lord Kilmarnock

Before the noble Baroness decides what to do about her Amendment No. 72, it seems extraordinary to hear the noble Baroness the Minister boasting that the Government have retained the blindness addition under the new arrangements when that remains still stuck at £1.25 a week, where it has been, in my recollection, for a great many years. Had it been increased in line with inflation, it would have been eight or ten times—I cannot remember how many times—that amount. So that does not seem to me to be a very good ground for self-congratulation. Neither, in fact, does it meet the point raised by the noble Baroness, Lady Fisher, because the partially sighted do not get it and it does not act as a passport to the disabled person's premium. Also in previous debates we heard that the disabled person's premium would cause considerable losses for a wide range of people; that is to say, it would if it were not for the amendment of the noble Lord, Lord Henderson. So I do not think that the answer given by the noble Baroness, Lady Trumpington, was a very good one.

I should like to say that in a Bill which has been proclaimed as being a new Beveridge and a total overhaul of the social security system it seems absolutely extraordinary that nothing is being done for the blind. They are being left exactly where they have been for I do not know how many years. There is absolutely no improvement in their condition and it looks as though the arrangements for the partially sighted are likely to fall short of even what is done at present. I do not know what course the noble Baroness wants to take this evening, but I am sure that this is a matter to which we ought to return at a later stage.

10.15 p.m.

Baroness Fisher of Rednal

Perhaps I may thank the noble Lady, Lady Kinloss, and the noble Lord, Lord Kilmarnock, for their support. I was extremely disappointed with what the noble Baroness the Minister said, because quite obviously the partially sighted are now recognised for severe disablement allowance under the supplementary benefits scheme. For the noble Baroness to talk as though there are a few things that we do not want to alter is really rather hypocritical because these people are already recognised as having 80 per cent. disability. They have to undergo an examination regarding their shortsightedness. It is not the same as going to an optician and saying, "I cannot see very well at night to read the Standard". It is a very severe test and it is recognised by the Supplementary Benefits Commission. These partially sighted people receive a severe disablement allowance. What the noble Baroness is saying tonight is, "You can forget all about that." I feel sure that she really did not mean that; at least I hope she did not, because otherwise these people will be automatically written off in this new Bill.

I felt rather disappointed with the reply of the noble Baroness. On 1lth March when the Bill was in Standing Committee the Minister was a little more forthcoming. I should like to repeat for the benefit of the noble Baroness, so that she might understand, what he said: I do not wish to give an undertaking to include partially sighted people at the present, but I do not rule out giving the matter further consideration". I did not hear the words "further consideration" from the noble Baroness this evening, and I was extremely disappointed about that. I hope that following my reminder of the assurance that was given by the Minister she will be able to give us a similar reply tonight.

Lord Ennals

Perhaps I may say just a few words in support of my noble friend Lady Fisher. The noble Baroness said that she would take very seriously the arguments I was going to put forward in regard to Amendment No. 72B. I should not like her to spend her time fruitlessly and so I shall write to her and set out the very powerful arguments. I accept her word that she will look at this very carefully. But the argument that Amendment No. 63 removes the need for what is sought here is one that I certainly do not accept.

Baroness Trumpington

I shall await the noble Lord's letter with interest and I shall certainly reply to him as soon as possible. The noble Baroness, Lady Fisher, talked about recognition in regard to the severe disablement allowance, which is different from supplementary benefit. Blindness entitles a person to the new disablement premium. The blindness addition is not being retained. I can only repeat the reply about further consideration as given by my right honourable friend the Secretary of State for Social Services.

Baroness Fisher of Rednal

May I ask the noble Baroness which is that? Is it the one where he said, "I will give the matter further consideration"?

Baroness Trumpington

Yes.

Lord Kilmarnock

May I ask about the blindness addition? I thought the noble Baroness said earlier that it was being retained. Is that simply part of the transitional arrangements that she was talking about earlier?

Baroness Trumpington

I said we had accepted that severe disablement allowance will bring entitlement to the disablement premium. I do not know whether that is what the noble Lord is referring to.

Baroness Fisher of Rednal

We are in a little difficulty. Is the Deputy Chairman asking me what I am going to do about Amendment No. 72? In view of what the noble Baroness has said, I shall not press the amendment to a Division tonight, though I am very tempted to do so. I hope, as she said that further consideration will be given to this, that that will leave me free to raise the matter at a later stage. I beg leave to withdraw the amendment.

The Deputy Chairman of Committees (Lord Ampthill)

Is it your Lordships' pleasure that this amendment be withdrawn?

Baroness Trumpington

No.

10.21 p.m.

On Question, Whether the said amendment (No. 72) shall be agreed to?

Their Lordships divided: Contents, 33: Not-Contents, 55.

DIVISION NO. 5
CONTENTS
Airedale, L. Kinloss, Ly.
Banks, L. McNair, L.
Blease, L. Masham of Ilton, B.
Boston of Faversham, L. Ponsonby of Shulbrede, L.
Buckmaster, V. [Teller.]
Crawshaw of Aintree, L. Rea, L.
Darcy (de Knayth), B. Robson of Kiddington, B.
Dean of Beswick, L [Teller.] Rochester, L.
Durham, Bp. Seear, B.
Ennals, L. Stallard, L.
Ewart-Biggs, B. Stoddart of Swindon, L.
Fisher of Rednal, B. Taylor of Blackburn, L.
Gallacher, L. Tordoff, L.
Halsbury, E. Turner of Camden, B.
Houghton of Sowerby, L. Underhill, L.
Jeger, B. Whaddon, L.
Kilmarnock, L. Wigoder, L.
NOT-CONTENTS
Ampthill, L. Elliott of Morpeth, L.
Belstead, L. Elton, L.
Biddulph, L. Faithfull, B.
Boyd-Carpenter, L. Ferrier, L.
Brabazon of Tara, L. Gardner of Parkes, B.
Bridgeman, V. Glanusk, L.
Brougham and Vaux, L. Glenarthur, L.
Bruce-Gardyne, L. Gormanston, V.
Caithness, E. Holderness, L.
Cameron of Lochbroom, L. Hooper, B.
Carnegy of Lour, B. Killearn, L.
Carnock, L. Kimball, L.
Colwyn, L. King of Wartnaby, L.
Craigmyle, L. Layton, L.
Davidson, V. Long, V.
Denham, L. [Teller.] Lyell, L.
Dilhorne, V. Macleod of Borve, B.
Elliot of Harwood, B. Marchwood, V.
Marshall of Leeds, L. Skelmersdale, L.
Monk Bretton, L. Swinton, E. [Teller]
Montgomery of Alamein, V. Trefgarne, L.
Mottistone, L. Trumpington, B.
Mountevans, L. Vaux of Harrowden, L.
Onslow, E. Vickers, B.
Orkney, E. Wynford, L.
Renton, L. Young, B.
Sanderson of Bowden, L. Young of Graffham, L.
Seebohm, L.

Resolved in the negative, and amendment disagreed to accordingly.

10.30 p.m.

Lord Stallard moved Amendment No. 72A:

Page 27, line 34, at end insert— (" ( ) In prescribed circumstances the applicable amount in respect of a householder shall be increased by a prescribed amount if the home is difficult to heat adequately, or by a larger prescribed amount if the home is exceptionally difficult to heat adequately or is part of an estate built with a heating system of which the Secretary of State has in his discretion recognised the running costs to be disproportionately high.")

The noble Lord said: I confess that it is a new experience for me, even with the present Adminis-tration, to be moving an amendment to which the Minister has already replied on the basis that it is something to do with normal channels of which we know nothing. It is somewhat contentious, I feel, and an arrogant use of an inbuilt majority, for the Minister to say before the amendments have been moved: "I have already replied so do not expect me to say any more, and if you do not like it we will vote." That ought not to be the spirit, and it certainly has not been until now. It makes Members of the Committee feel almost guilty in moving what they consider to be reasonably important and constructive amendments.

Fortunately, I did not quite hear the reply to my amendment so I can move it in almost complete innocence of the rejection that was no doubt spelt out by the noble Baroness. However, I heard her refer to one or two of the other amendments to the extent that they would put something into the scheme that did not already exist. This amendment is different in that heating additions are already in existence under the supplementary benefit schemes. Therefore, the amendment seeks to ensure that claimants of income support who live in homes that are more difficult than others to heat will continue to receive extra help with heating costs.

In a study of the possible effects of the Bill's proposals on claimants of income support who are at present on supplementary benefit and receiving heating additions, the National Right to Fuel Campaign concluded that the majority of supplementary benefit claimants receiving a heating addition stand to lose out significantly. The justification for that claim is set out in a series of tables circulated to many Members of the Committee and to the department concerned, but because of the lateness of the hour I shall not read out the figures. It is enough to say it has been proved that it is the claimants in the worst housing, with the most severe heating problems and in the greatest need, who lose out the most.

The White Paper itself said that there had been support for the absorption of heating additions within normal benefit, but it said reservations had related mainly to the level of the premiums, the impact on existing claimants and the possible gaps in provisions. That was in the White Paper. Of course, it is the level of premiums which, when added to basic allowances, will determine whether or not claiming households gain or lose out from income support.

It has been calculated that, at the proposed levels for the components of income support, 1,923,000 claimants will have less income than under supplementary benefit with heating additions. I do not find that particularly amusing, and nor do the claimants. In fact, they think it is a disgrace. It is totally unacceptable that such a situation should exist. The fixed premium rates cannot take into account the extra cost of fuel to those households that are the most difficult to heat. The amendment provides an opportunity to draw attention to the absence of any specific help with heating costs under the income support scheme.

I briefly explained the amendment to the noble Baroness. "Prescribed circumstances" mentioned in my amendment are similar to those under the existing supplementary benefit scheme. This would be where accommodation is difficult to heat for a range of reasons. The "prescribed amount" mentioned in the amendment would be paid at two rates for the prescribed circumstances. These are all familiar terms within the existing schemes. There would be two amounts: first, a lower amount for homes which are difficult to heat due to any one identifiable factor which would be definable in regulations. That is not new, either. These factors would include the age of the property, lack of insulation, disrepair, exposure, damp, large window area, large room volume, high ceilings, and so on. The present lower rate for that kind of circumstance is £2.20 per week.

Secondly there is the higher amount for homes that are exceptionally difficult to heat due to the presence of more than one identifiable factor. This rate should be awarded automatically to unmodernised pre-1919 housing, flats and high-rise blocks above the fifth floor, to housing with well known design defects—for instance, some deck access housing, some system built housing, "no fines" concrete construction and so on—and where there is reliance on expensive sources of fuel like peak electricity, paraffin, bottle gas, underfloor heating, etc. At present there is an allowance for these kinds of circumstances of £5.45 per week.

Hard-to-heat estates are mentioned in my amendment. Again there are two rates. The lower rate for four rooms or less is at present £4.40 per week, and the higher rate for five rooms or more is at present £8.80 per week. At the moment there are approximately 400 estates which have been designated by the Secretary of State as hard to heat. It is estimated that there are 100,000 households on supplementary benefit currently in receipt of this addition.

By proposing to pay exactly the same levels of income to thousands of households within each client group, by implication the Government have assumed that each of the households in the various groups lives in an equally thermally efficient home, that they buy fuel of equal thermal value, use equally efficient appliances and enjoy just the same health. That is just not the case, and so fuel poverty will increase.

This amendment recognises that there are some homes that are more expensive to heat than others. If we do not accept this amendment and put in the additions that I have mentioned—and the noble Baroness still has time to change her mind—we shall simply perpetuate the chaotic state that has been with us for the last few winters and with which we ought to be dealing now before next winter. In this Bill we certainly ought not to be worsening the conditions of the people who live in those houses. I beg to move.

Baroness Trumpington

I apologise to the Committee and must say that I am not surprised that the noble Lord, Lord Stallard, cannot remember what I said, because I did not say anything.

This is an interesting amendment on what is clearly a matter of considerable importance. The whole question of help with heating was debated extensively in Committee in another place at a time of year when it would be fair to say that the matter was more in people's minds than perhaps it is today. While I have listened carefully to the noble Lord, who advanced his case with his customary clarity, I must confess that I am not inclined to accept the approach that he is recommending. I hope that the noble Lord will forgive me if I suggest that the amendment is completely at odds with the approach that we are proposing.

This Bill will replace the current system of supplementary benefit, with its complex system of additional requirements based on the need for detailed questioning to establish individual entitlement, with a new system of income support with additional premiums based on clear-cut, easily identifiable criteria. Just because we do not call such extra payments "heating additions" does not mean that people will not have extra money for their needs, including heating. This amendment reproduces the current provision of heating additions on accommodation grounds and writes them into the new system of income support. In doing so, it highlights some of the more obvious difficulties inherent in the current scheme: How do we determine what is meant by heating a home "adequately"? When does such a home become "exceptionally difficult" to heat adequately? What constitutes a "disproportionately high running cost"?—and so on.

I accept that our offices need to take those decisions, as with the present scheme. However, I should have thought that the current experience of heating would have demonstrated the difficulties of the provision. We have conflicting evidence of the value of heating additions; the existence of one does not necessarily mean that more is spent on heating. Many variables dictate heating, and so on. We must also remember the interaction with the basic benefit as well, which covers heating. We believe that the system of premiums is the best way of directing help to those people who need it. The structure of premiums will cover the special needs of pensioners, disabled people, lone parents and families.

I should also like to point out to the noble Lord two further matters. First, his amendment picks on just one group of heating additions. That would not make for sensible legislation. In the premium structure we are trying to target extra income, including that for heating, on people who are most likely to need extra help. Secondly, his description of the situation highlights only too clearly the complexity of the present scheme. I can assure the Committee that the resources currently spent on heating will be included in the resources allocated to the next scheme.

Lord Stallard

I am grateful to the noble Baroness for that reply; but it fails to meet the point. The complexity of the existing scheme is not a reason for making the situation worse for people who live in homes that are hard to heat. That is the point which the noble Baroness failed to deal with. In the proposals in the Bill there is a one-off figure for everybody in the premium. There will be anomalies. People who live in homes that are especially hard to heat will not be dealt with. That is what the amendment tries to cover.

I recognise what the noble Baroness says. I was tempted to divide the Committee, but I shall not be as foolish as some. I shall reserve my position, having listened to the noble Baroness, and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 72B to 72E not moved.]

10.45 p.m.

Baroness Faithfull moved Amendment No. 73: Page 28, line 9, at end insert ("save that where a claimant or his partner is a child minder, an amount equivalent to two-thirds of income from such child minding shall be disregarded")

The noble Baroness said: This amendment concerns the child-minding service. That service could be called a home industry, and it gives a very good service to mothers and children. Some women in receipt of supplementary benefit prefer to stay at home and look after other people's children. Many of them are single parents. Those who seek their help pay them a certain amount per child. The child-minders register with a local authority, and they are, so to speak, supervised by a local authority or at any rate given help.

Child-minders in receipt of supplementary benefit have only one-third of their income from that activity counted for calculating their or their partner's entitlement to benefit. The remainder is treated as expenses, reflecting the costs incurred by child-minders in providing food, outings and equipment for safety, mobility and play. The Bill proposes that income support should replace supplementary benefit, but it makes no mention of continuing that arrangement. The first £5 of income—£15 for single persons, the disabled and the long-term unemployed —would be ignored, and anything else would be taken into account. There would be no allowance for work expenses.

The effect of that would be to make a substantial cut in the weekly income of child-minders. A child-minder caring for three children, each at £30 a week, with a husband who has been unemployed for one year and who is in receipt of supplementary benefit, will, under income support, be £59 a week worse off. The purpose of the amendment is to allow the continuation of the two-thirds rule for child-minders in receipt of income support to safeguard their weekly income and the quality of the child-minding service.

I am disappointed that the noble Lord, Lord Houghton of Sowerby, is not in his place because I feel sure that he would wonder why it should be any different from any other home industry. The difference is that child-minders cannot charge more than a certain amount in the open market because if they do they will not have people asking them to look after their children. Secondly, child-minders have to spend a proportion of the money that they earn for child-minding on food for the child or children; on a fireguard, for instance, because the local authority demands that proper fire precautions should be taken; and on play equipment. As everyone knows, play equipment has become expensive. If the child-minder is really interested in the child or children, she must spend money on books and so on.

Child-minding is a strange service. It is a service to women who want to go out to work part-time. It is a service that helps the women providing it, and yet some of the pay that they receive must be spent on caring for the children. If they do not care properly for the children and do not have the proper equipment, the local authority social services department can forbid them to take in children. They are required to give a good service. It is for that reason that we ask that the one-third should be disregarded in their supplementary benefit. I beg to move.

Baroness Trumpington

I am very sorry, but may I once again tell my noble friend that in the agreed groupings I have this amendment down as being moved with Amendment No. 74 being spoken to. Perhaps the noble Baroness, Lady Ewart-Biggs. will confirm that.

Baroness Faithfull

May I ask my noble friend the Minister for clarification? While the two amendments concern child-minders, they are different. I am sure that the noble Baroness, Lady Ewart-Biggs will be prepared to speak to the other amendment, but they are different. Does my noble friend wish them to be taken together?

Baroness Trumpington

It is not for me to say whether I wish them taken together. It was agreed that they should be taken together.

Baroness Faithfull

By whom?

Baroness Trumpington

It is up to the movers.

Baroness Ewart-Biggs

There is a link between the two amendments in that the child-minding service is at stake in them both. As the noble Baroness, Lady Faithfull, said, the first amendment concerns the child-minder, and the second amendment relates to the mother whose child is being minded. I am prepared to speak to the two together if that would be helpful.

I support what the noble Baroness, Lady Faithfull, said about the importance of protecting the child-minding service. There is no doubt, as she said, that one of the consequences of the first amendment would be that if a child-minder does not have her earnings disregard for child-minding she will not declare her earnings. That will mean not only that she will be on the wrong side of the law but that she may fall foul of the social services by not registering as a child-minder.

This could mean a return to that illegal and back-street child-minding which was rife in the early 1970s when Brian and Sonia Jackson produced a very serious report about the child-minding service. That resulted in an enormous effort between local authorities and local child-minding organisations to get together. It had a huge effect on improving the service. This was to the benefit of those very children that needed caring child-minders to look after them, to have the necessary equipment—as the noble Baroness has said—and to produce a really high quality service.

I think that is for the benefit of so many children that the child-minding service should be given as much support as possible. However, from the point of view of the second amendment, this mainly benefits the single working parent. If the Government do not allow child care costs to be treated as a work expense, as at present, it will affect mainly the many single parents who have only the one viable option, while claiming supplementary benefit, which is to find part-time work.

That is an option only if the parent does not have to bear the cost of child care. To change this, as the Government appear to intend in this Bill, would be a very great disincentive for single parents to work. I think that everybody recognises that it is of enormous importance for a single parent to go out to work, not only from her own point of view, but it is of very great importance for the children. It means that if she stays at home there will be a social isolation. She will be more prone to depression. She will be a less good parent. In this situation she might place her children in cheaper and less satisfactory care. From both points of view it is the children who will suffer!

I hope that, for these reasons, the noble Baroness in reply will look favourably at these two amendments, which will be of assistance to child minders, to single parents and to children.

Baroness Trumpington

With regard to Amendment No. 73 I fear my noble friend Lady Faithfull has not been sufficiently persuasive, in as much as I cannot recommend this amendment to Members of the Committee. This amendment seeks to write into main legislation something which is currently set out in regulations and is a sensible manner of dealing with the matter in question.

The whole question of treatment of resources is a complex one—particularly once you have accepted that, for a variety of reasons, certain easements should be introduced into the treatment of income. Thus, as well as the special disregard for child minding expenses, other types of income are also disregarded in part—for example, war disablement benefits—or in full—for example, attendance allowance, mobility allowance, Victoria Cross and similar gallantry awards. I think that it will be clear from this that it would not be sensible to attempt to cater for this degree of detail in primary legislation. Instead, the Committee will see that Clause 21(8) provides us with the power to make the necessary regulations concern- ing the treatment of resources. My noble friend can be sure that we shall give—in fact we undertake to give—sympathetic consideration to the matter when we come to frame the regulations.

With regard to the further amendment, Amendment No. 74, to which the noble Baroness, Lady Ewart-Biggs, spoke, few would doubt that the present scheme has retreated too far into complexity and obscurity. We think that for three main reasons we should take the opportunity to simplify the present rules on work expenses.

First, neither family income supplement nor housing benefit assess work expenses, whether for child-minding or travel to work separately. These are the basic means-tested benefits for those in work and it is extemely odd that the treatment of part-time work expenses for those out of work is both more complicated and more generous than for those in low paid full-time work. As Members of the Committee will be aware, one of the key themes in the social security reform is the need to develop a common approach to common problems. An important aspect of this is the need to align the rules on the treatment of earnings across the three income-related benefits. Our proposal to assess earnings on a net basis without allowing deductions for work expenses is consistent with this approach.

Secondly, the available evidence suggests that the part-time work expenses, including child-minding expenses, of those on supplementary benefit is relatively low. In the nature of things on supplementary benefit, most part-time work is undertaken locally. The only specific evidence on what average work expenses are comes from a study into the operation of the tapered earnings disregard for lone parents carried out by the social policy research unit of the University of York in 1982. It showed that the average weekly costs of child care and travel to work for the minority of lone parents on supplementary benefit who had part-time work were £0.94 and £1.18 respectively. So we are not talking in the- average case of large sums of money.

Thirdly, our proposals on earnings disregards generally offered substantial improvements over the present arrangements and provide greater incentives to take part-time work. The Government believe that these proposals represent a real improvement in the position of lone parents. The social policy research unit at York, to which I referred earlier, has re-examined its findings to see the effect the proposals would have on the sample of lone parents in its study. It found that almost 80 per cent. of lone parents in part-time work would gain, with an average gain of £2.37.

Of course, there is always a case for going further. I recognise that. But I consider that the Government's proposals are a substantial step in the right direction. We shall, as we have made clear, monitor them carefully and, if necessary, reconsider them in the light of the experience of their operation. I hope that what I have said at some length will permit the noble Baronesses to withdraw their amendments.

Baroness Faithfull

I should like to thank my noble friend the Minister very much for her explanation. Perhaps I could just speak to Amendment No. 73 and then the noble Baroness, Lady Ewart-Biggs, can speak to Amendment No. 74. On Amendment No. 73, I have listened with interest to what the Minister has said and shall read it with care and consider the matter. Therefore, at this moment I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 74 not moved.]

1 1.p.m.

Baroness Ewart-Biggs moved Amendment No. 75: Page 28, line 16, at end insert— (" (8) Payments made to a person in respect of expenses incurred or to be incurred by him in connection with any unremunerative voluntary work undertaken by him shall be disregarded.").

The noble Baroness said: I rise to move Amendment NO.75, which is an extemely important amendment, and I hope that it is a probing amendment because its purpose is to clarify the position with regard to unemployed people drawing expenses to do voluntary work. It is at present widely believed in the voluntary sector that the intention to place a ceiling of £5 on the amount of expenses which can be claimed before affecting the benefits of unemployed people doing some part-time work will catch into its net unemployed volunteers—volunteers doing important work like being involved in hospital car schemes, for which of course expenses are often in excess of £5.

I really cannot tell the Members of the Committee the concern which this possible implication has caused. I receive letters not only from the volunteer centre and the National Association of Volunteer Bureaux but also from very many organisations which use unemployed volunteers. They all tell me of the disastrous consequence for some of their schemes if their fears are true. For example, there is the voluntary car scheme run by the community council of Shropshire which provides transport for those unable to use public transport or when there is no public transport. It provides transport for essential journeys. About 1,000 volunteer drivers are involved, and some of them would fall in the category of unemployed. The chief officer explained how certain hospital trips into Shrewsbury, and so on, can involve a round trip of 40 to 50 miles for which the mileage allowance, though it is as low as 10p a mile, would soon exceed the £5 limit.

There are many other examples, such as projects covering holiday centres for severely physically handicapped adults who rely completely on the help of volunteers in return for their travelling expenses. Many of these would be jeopardised if the volunteers were unemployed and would no longer be able to come. Not only would this particular work suffer, but also it would be a great impediment to unemployed people being drawn back as active members of the community. No doubt many efforts are being made to draw back people who have been unemployed for a long time to play an active part in the community. It seems to be encouraging that so many of them are willing to give their services for nothing, in return for their travelling expenses; even a small expense would be of great importance to the unemployed. I fell sure that there must be some misunderstanding, and I shall be most interested to hear the noble Baroness's answer in the hope that this great fear will be removed from the volunteer centres and the minds of the volunteers. I beg to move.

Baroness Vickers

I should like to support this amendment. I note that in the White Paper on page 26 in paragraph 3.37 it is stipulated that the earnings of unemployed people in excess of £5 per week would be treated as income when considering their entitlement to social security benefit.

I want particularly to speak about the rural areas. Many of the people we are concerned about have no pensions at all. There are still many people in the country who have worked on farms and who simply have to have social security because they have no pension. Many of them are keen to help. They drive their cars, but petrol is expensive, and they do work which I am sure that the noble Lord, Lord Houghton, if he were here, would be pleased to hear about. They are keen to work if they are allowed to. In fact, I have arrangements with some of them to do odd jobs for me, and I have seen the social security people and I am allowed to give them up to £8 a week.

This help is essential in rural areas because distances are great and in many areas there are few buses. Therefore, it is necessary to have some form of help, and I think that £5 may be useful over the week. We should think of the wear and tear on the cars and the work that these people do. I think it would have a devastating effect on voluntary organisations if they were not allowed to pay these people something. After all, they are working for it, and they are doing a good job. It would save a lot of money if these people could have some soupçon, something to help them carry on with their voluntary work.

Baroness Gardner of Parkes

I do not understand this point about payment made for expenses incurred. Surely that would be just a direct reimbursement. I know that in regard to payment of expenses in connection with work in the magistrates' court, or anywhere else where I have served, if it is a reimbursement, it is not considered a remuneration. Therefore surely we automatically disregard it rather than have it built into the amendment.

Baroness Faithfull

I support this amendment. Perhaps I should say to my noble friend Lady Gardner of Parkes that we are talking of those who are in receipt of supplementary benefit. Perhaps we have it wrong, but as we understand it, if they are reimbursed over £5 it counts against their supplementary benefit. We may be wrong, but that is what we understand; perhaps the Minister would make that clear.

Like the noble Baroness, Lady Ewart-Biggs, and my noble friend Lady Vickers, I have had a great number of letters from various organisations. It is quite worrying how those organisations will suffer. Examples are the Scouts and those who are dealing with and helping discharged prisoners. I shall not keep the Committee at this late hour, but it will be a loss to the country if these people are unable to help the organisations for which they are working and, what is more, doing good work. Therefore it is cost effective to have these volunteers, quite apart from the reaction from the volunteers' point of view. If they do not have a job, at least they feel they are making a contribution to society which they would not be able to make if their supplementary benefit was cut—if they were not reimbursed.

Baroness Carnegy of Lour

I wonder whether the noble Baroness, Lady Ewart-Biggs, would clarify this. I, like my noble friend Lady Gardner, do not understand. Are we talking about voluntary workers who are doing non-remunerative work and get their expenses back, which may be more than £5? Or are we talking about the pay that they receive over £5? If it is expenses that they are getting back there is no question of that being income, because they have already spent it. Will the noble Baroness clarify what her amendment means before we go any further?

Baroness Ewart-Biggs

The noble Baroness, Lady Faithfull, and I have done our very best to pass on the worries that have been expressed to us, which are that it is widely believed in the voluntary sector—we made it quite clear that this may be a misapprehension—that the intention to place a ceiling of £5 on the amount of expenses which can be claimed before affecting the benefits of unemployed people doing part-time work will catch into its net unemployed volunteers doing work such as hospital car schemes, for which the expenses are often in excess of £5. This has been read into this Bill and we are asking the noble Baroness when replying to say that they have misinterpreted this Bill and that they need have no fear. This is as we have understood it.

Lord Banks

Is it not correct that expenses will be treated as income as far as these people are concerned so that if they receive, as has already been said, expenses in excess of the earnings disregard, which is now £5 instead of £4, that that will go against their benefit? That is the point to which objection has been taken, since expenses are often considerably in excess of that amount.

Lord Kilmarnock

To give a concrete instance to the noble Baroness, Lady Carnegy, as I understand it, a volunteer who volunteers four days a week and whose bus fare costs £1.80 a day, spends £7.20 a week. If these new proposals come into force it would appear that the maximum reimbursement of expenses which such a volunteer could receive would be £5 and that he or she would therefore be £2.20 worse off out of pocket in addition to undertaking four days of unpaid work on behalf of the community. That is the position as far as I understand it.

Viscount Buckmaster

I rise to support this amendment. Briefly, I should like to make three points. First, as those members of the Committee who have for a long time been involved in voluntary work will agree, 10 or 15 years ago it was quite easy to get voluntary workers who would come and give their services for nothing. Now, as I have found myself, all such workers insist on having their out-of-pocket expenses, particularly their transport, paid. Secondly, today many of these voluntary workers come from long distances. The third point I should like to make in connection with unemployed people is that many of them take voluntary work, as the noble Baroness, Lady Ewart-Biggs, has said, and do so as a stepping stone to paid employment later.

Baroness Trumpington

There have already been many debates both here and in another place about the level of detail which could be contained in primary legislation. I must say to the noble Baroness that the level of detail contained in this amendment is perhaps better left to the greater flexibility of regulations. Let me reassure the Committee that there is nothing new in this. Regulations currently set out the detailed rules of the treatments of the various kinds of resources under the supplementary benefits scheme. Thus, there is scope for dealing with the treatment of expenses for voluntary work and the new subsection (8) of Clause 21 provides similar flexibility to make regulations for the three income-related benefits. I can assure the Committee that the Government value the important work done by voluntary workers. My honourable friend the Parliamentary Under-Secretary of State made this quite clear in Committee in another place. I understand the concern that people should not be put off volunteering by this change. We have a great deal of sympathy and admiration for the valuable work undertaken by volunteers. Genuine expenses will continue to be disregarded. Therefore, the amendment is unnecessary.

There are two issues here. First, how earnings—that is, the advantage people get from work—are defined; and, secondly, how much regard should be read into such earnings when deciding the amount of benefit. The £5 disregard is to do with the latter. What is at issue here is different: whether certain expenses should count as earnings, as my noble friend Lady Gardner has said. It is on this latter point that we can undertake to give careful and sympathetic consideration when we frame the regulations.

Baroness Ewart-Biggs

I think that the noble Baroness has dimmed the fears. What does the noble Baroness mean when she says, "genuine expenses"? All the examples that we gave were of travelling expenses. Sometimes, we were given different examples of how much was charged per mile when cars were being used; but I should like to know what the noble Baroness meant by "genuine expenses".

Baroness Trumpington

There are cases and cases, and there are expenses and expenses, as everybody knows. I think the examples given are about magistrates or other people of that kind claiming expenses. People who serve on tribunals, I believe, get their expenses. Genuine expenses, is what I said.

Baroness Gardner of Parkes

Perhaps I may intervene here to explain to the Committee that the phrase usually used in connection with reimbursements is "expenses necessarily incurred in connection with" whatever it happens to be.

The Lord Bishop of Durham

That is the problem. It is quite easy if it is concerned with magistrates or recognised things. I can assure the Committee from experience, specially of my wife locally with volunteers who are trying to do jobs which are of value in the community but which would not be "Establishedly" recognised like magistrates, and so on. They have problems with regard to their social security payments if hey are getting almost any sort of payments at all. I am sure that the noble Baroness has given us the type of assurance that we want; but I hope that she will be quite clear that in pursuing this matter it will not only be thought about what you might call "regular expenses" but also expenses for worthwhile but not so easily recognised charitable and voluntary efforts. The Government have produced a document about building businesses and not barriers. I hope they will apply the same principles to building community efforts and not barriers.

11.15 p.m.

Baroness Trumpington

Perhaps I may just follow up what the right reverend Prelate has said by going back to the question of general expenses, which I think he has expressed rather well. I accept that there is a case for disregarding certain types of voluntary payment: for instance, the petrol expenses of volunteers who help housebound people to go shopping, to visit relatives and so on. Those are the kinds of expenses I am talking about, and I am happy to repeat again the undertaking of my honourable friend the Parliamentary Under-Secretary in another place to look sympathetically at this whole area when drawing up the detailed regulations for income support. There will of course be an opportunity for your Lordships fully to debate these regulations before the introduction of the new scheme.

Baroness Ewart-Biggs

The noble Baroness has not actually said anything about whether a driver who incurs petrol costs of more than £5 will be reimbursed—

Lord Trefgarne

Yes, she has.

Baroness Ewart-Biggs

Then in that case I will centainly read carefully what the noble Baroness has said. If we are not content with it, we will bring it back at a later stage. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 21 agreed to.

Clause 22 [Trade disputes]:

Lord Trefgarne moved Amendments Nos. 75A to 75C:

Page 28, line 22, leave out ("he were").

Page 28, line 24, leave out ("him") and insert ("the person").

Page 28, line 26, at end insert ("or to be within the maternity period.

(A) In subsection (1) above "the maternity period" means the per ad commencing at the beginning of the sixth week before the expected week of confinement and ending at the end of the seventh week after the week in which confinement takes place.")

The noble Lord said: On behalf of my noble friend Lady Trumpington, I should like to move Amendments Nos. 75A, 75B and 75C en bloc. The effect of these amendments is to remove the trade dispute disqualification from a pregnant striker for six weeks before her expected week of confinement until seven weeks after confinement. Needless to say these amendments do not apply to men. I beg to move.

On Question, amendments agreed to.

Clause 22, as amended, agreed to.

Clauses 23 and 24 agreed to.

Clause 25 [Failure to maintain—general]:

[Amendments Nos. 75D and 75E not moved.]

Clause 25 agreed to.

Clause 26 [Prevention of duplication of payments]:

Lord Banks moved Amendment No. 76:

Page 34, line 30, leave out ("income support") and insert ("basic income guarantee").

The noble Lord said: I beg to move this amendment. I did not envisage when I set it out that I would be launching on it at this time of night, but I shall attempt to be as brief as I possibly can. I must apologise to the Committee since this amendment was intended to refer to page 24, line 6, and to substitute "basic income guarantee" for "income support" in that line. In other words, I was seeking an alternative title for income support. Somehow—the fault was entirely mine—the substitution has been related to the use of the phrase "income support" in line 30, page 34.

While the amendment is somewhat incongruous in its present context, I believe that my original intention can be served by discussing the amendment as now placed. It is in identical terms to one submitted during the Committee stage in another place by Sir Brandon Rhys Williams. I introduce it here for a similar purpose. The purpose is to raise a question as to how far it is desirable that we should seek to solve the problems of social security by relying on means-tested, income-related benefits. We have reached the position where some 8 million people are dependent on supplementary benefit and presumably will be dependent on income support. There has been a great increase in recent years in the numbers of people so dependent. Increased unemployment has been an important factor. The question is: are we content with this trend and with the present situation, or should we seek to develop our social security system in such a way that the numbers on means-tested benefits are drastically reduced? That is a question raised by Part II of the Bill.

Would it not be better to reduce means-tested benefits by paying everyone a basic income, based on the turning of income tax allowances and social security benefits into positive payments or credits which could be offset against tax? Not only would a tax credit or basic income guarantee system integrate income tax and social security benefits; it would also considerably reduce the need for, and the extent of, means-tested benefits.

If we could reach the ideal situation where the credits could be set at a minimum equivalent to the social security subsistence level, think of the simplification that that would achieve! There would be no need to reduce when unemployed, for example, and there would be no problem about part-time earnings when unemployed. However, I recognise that that would almost certainly require marginal rates of income tax, which would be unacceptable. Therefore, it would continue to be necessary to have higher credits when not in work for whatever reasons, and income support for those on low incomes, but a move away from more reliance on means-tested benefits would be made.

I was sorry to read in the Government's Green Paper on the reform of personal taxation, to which the noble Baroness, Lady Trumpington, referred earlier today, that the Government reject what they call all-embracing, big bang solutions, among which they include the sort of scheme that I have been describing. They say that such a scheme would conflict with the contributory system, although that would not disturb us on these Benches. We want to see a combined rate of income tax replacing present income tax and national insurance contributions, with employers' national insurance contributions becoming a payroll tax.

Secondly, the Government say that such a scheme would imply quite unacceptable increases in public expenditure. If it is combined with a continuing means-tested element, as I have suggested, I do not believe it would. Thirdly, they say that it would involve a great deal of upheaval. I believe it would be better to have one such upheaval and to get it over, rather than to have minor upheavals of the kind that we are experiencing at the moment at regular intervals.

The object of this amendment is to ask: what is the ultimate destiny of the income-related benefits which we are setting up in this part of the Bill? What sort of a social security system are we trying to achieve, and of which they will form a part? I certainly hope that the Green Paper will not be the Government's last word on this issue. I beg to move.

Lord Trefgarne

As the noble Lord will know, the Government have not been without sympathy for some of the objectives to which he has referred. This is not the first occasion that the noble Lord, and those with whom he sits, have raised propositions of this kind. Indeed, I have had the privilege of answering one or two of them in the rather distant past. During the course of his remarks the noble Lord, Lord Banks, recited some of the arguments which the Government have deployed from time to time in answer to the points contained in his proposals. I think the noble Lord forgive me at this time of night if I do not recite them all again.

However, perhaps I may refer to some other steps which the Government have been able to take to achieve a more coherent relationship between the tax and social security systems. We have, for example, effectively brought most of the short-term national insurance benefits into tax. The proposals in this Bill to assess the new family credit and housing benefit on the basis of net income represent for the first time a real alignment of the tax and income related benefit assessment formulae, ensuring that we will stop the absurd position where an increase in gross earnings can actually result in a marginal tax rate of more than 100 per cent., and the transferable allowances proposed in the tax Green Paper would reduce the number of people who are both paying tax and receiving income related benefits. They would therefore reduce the present overlap between the two systems, the very cause of much of the present disquiet.

I could deploy at some length arguments against some of the proposals put forward by the noble Lord, Lord Banks. I hope your Lordships will forgive me if I do not do that at this time of night, but I shall be happy to write to the noble Lord with them. They will, I fear, not be news to him.

Lord Banks

I am grateful to the noble Lord for his reply, and I recognise that at this time of night he perhaps could not go into it in more detail. I think it was important that this aspect of the implications of this Bill should be considered. We are relying more and more on means-tested benefits, and we ought to consider whether this is the way in which we want to see the social security system go.

I welcome most of the moves which the noble Lord mentioned the Government have made, but it still seems from the Green Paper that, welcome though they may be, they are going to be piecemeal moves of a limited character, and that for the moment the Government have set their face against any more widely developed scheme. I hope that they will not do that permanently, that they will not close their minds entirely, and that they will be prepared to consider the future development of the social security system over a long period of years and not just the immediate future and what they must do by 1988.I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 26 agreed to

[Amendment No. 76A not moved.]

Clause 27 [Payment and recovery of family credit]:

The Deputy Chairman of Committees

Before calling Amendment No. 77,I should remind the Committee that if it is agreed to I cannot call Amendments Nos. 78 to 82.

[Amendments Nos. 77 to 84 not moved.]

Clause 27 agreed to.

[Amendment No. 85 not moved.]

Clause 28 [Arrangements for housing benefit]:

Lord Trefgarne moved Amendment No. 85A:

Page 37, line 10, after second ("payments") insert ("by way").

The noble Lord said: With the Committee's permission, I should like to take Amendments Nos. 85A and 85B together. They will clarify the position of private tenants who pay an inclusive rent to their landlords by making clear that part of their payment can be treated as a payment by way of rates and hence eligible for a rate rebate. I beg to move.

On Question, amendment agreed to.

Lord Trefgarne moved Amendment No. 85B:

Page 37, line 14, at end insert— (" (1A) Regulations may provide that in prescribed cases a payment made by a person entitled to a rent allowance shall be treated for the purposes of subsection (l)(a) above as being, to such extent as may be prescribed, a payment by way of rates.")

On Question, amendment agreed to.

Baroness Vickers moved Amendment No. 85C:

Page 37, line 29, leave out from ("authority") to end of line 38 and insert—

  1. ("(a) so as to provide for disregarding, in determining a person's income (whether he is the occupier of a dwelling or any other person whose income falls to be aggregated with that of the occupier of a dwelling), the whole or part of any war disablement pension or war widow's pension payable to that person.
  2. (b) to such extent in other respects as may be prescribed,

The noble Baroness said: I should like to speak to Amendments Nos. 85C and 85D together. As the Committee will know, housing benefit is a national scheme, and most of its provisions are set out in regulations. The local authorities are able to exercise a certain amount of discretion. They can operate local schemes within certain limits in order to give extra benefits to a particular group. Many of them use this power to grant extra benefit to war pensioners, including war widows.

There is specific reference to this group in the current primary legislation, the Social Security and Housing Benefits Act 1982.I hope the noble Lord the Minister will consider the removal of the general power which enables local authorities to operate local schemes and to continue to operate them for war widows and war pensioners. As drafted, it would appear that this Bill does not achieve this objective, because it would still require the Secretary of State to make regulations before local authorities are able to operate local schemes for war pensioners. I hope that the noble Lord the Minister will consider that the discretionary power is best written into primary legislation.

I know that my noble friend the Minister has always been interested in war pensioners. If accepted, this amendment will tidy up the wording and will achieve a certain amount of parity with the present position, with local authorities having the power to exercise discretion in respect of war pensioners when assessing their housing benefit. It will be written into primary legislation and not left to regulations.

The second amendment is consequential on the first and removes a reference to the subsection. If the amendments are accepted, that would be very helpful. I beg to move.

Baroness Gardner of Parkes

I rise simply to add my support to the amendment for the war widows.

11.30 p.m.

Lord Trefgarne

I have listened carefully to my noble friend, and I should like to underline the Government's commitment to war pensioners; a group whom the whole Committee will agree deserves special priority. The Government's intention so far as housing benefit is concerned is that the new scheme should match the arrangements which exist at present. In other words, there will be a statutory partial disregard of a war disablement or war widows pension beyond which local authorities may do more, if they wish, at their discretion. We have decided to keep this power to operate local schemes for war pensioners in spite of the fact that we intend the general power to operate local schemes to be removed on the grounds that it is inconsistent with our wider objective of a national, equitable scheme. This special treatment of war disablement and war widows' pensions is a mark of the priority we attach to this group. I accept the amendments.

Baroness Vickers

May I say thank you to my noble friend the Minister? I am grateful to him and I am sure that the amendments will help many people in future.

On Question, amendment agreed to.

Baroness Vickers moved Amendment No. 85D:

Page 37, line 40, leave out ("(6)") and insert ("(5)(a)")

On Question, amendment agreed to.

Clause 28, as amended, agreed to.

Clause 29 agreed to.

Clause 30 [Housing benefit finance]:

Baroness Faithfull moved Amendment No. 85E:

Page 39, line 1 1 at end insert— ("( ) shall include an amount being not less than 60 per cent. of the cost of administering rebates and allowances.")

The noble Baroness said: I apologise for moving an amendment at this late hour on which I cannot be brief, however much I try. I shall speak also to Amendment No. 85F. These two amendments concern housing benefit subsidy. Amendment No. 85E provides that the amount of specific subsidy for housing benefit administration costs should be not less than 60 per cent., which is the current percentage payable.

The Government propose that housing benefit administration costs should be included in the rate support grant arrangements on the basis that this will encourage greater efficiency on the part of local authorities. But the Association of District Councils considers that the rate support grant is not a suitable mechanism for attracting subsidy to authorities actually incurring the costs. This is because some local authorities do not receive any rate support grant—for example, South Buckinghamshire and Camden—and would effectively receive no subsidy under the revised arrangements.

Rate support grant is itself under review because of its unsatisfactory nature; a fair general formula for distributing subsidy to authorities incurring the costs has yet to be devised and this may prove impossible. By the very nature of the rate support grant some of the money transferred would go to authorities, such as county councils, not administering housing benefit. An exemplification recently produced by the DHSS for discussion with the local authority associations has shown very many local authorities losing as a result of the transfer.

I am informed that repeated assurances were given by the Government to local authorities at the time when the housing benefit scheme was set up that the Government would meet local authorities' additional costs. Individual authorities which will now lose subsidy feel that the Government are reneging on that undertaking, which was only given within the last years. So that is the substance of Amendment No. 85E.

As regards Amendment No. 85F, which is before the Committee, the Association of District Councils considers that a high rate of specific subsidy should be payable for housing benefit. This amendment provides that the subsidy should not be less than 95 per cent. Indeed, ideally, in the view of the Association of District Councils subsidy should be 100 per cent., on the basis that the relief of poverty is a national and not a local responsibility. The rate of subsidy is too important a matter to be left completely at large, as it is in this Bill. The current rate of subsidy is 100.6 per cent. for claimants who are on supplementary benefit and 90 per cent. for others. Thus, 95 per cent. is the approximate current overall level of subsidy.

The Government stated in the Green Paper that they: have it in mind to bring forward proposals to set direct subsidy initially at 80 per cent. The remainder of the costs would have to be met by local authorities and would be taken into account in rate support grant".

Their objective is to encourage a greater incentive for local authorities to monitor and control expenditure. But the scope of this is extremely limited, given that housing authorities have been under pressure from central government and the Audit Commission to increase rents and that there is the danger of drying up the supply of private rented accommodation. Moreover, the proposed transfer to rate support grant is open to a number of objections, even if the total amount of subsidy were to be maintained. A substantial part of the transferred subsidy would in fact, because of the way in which the rate support grant is distributed, accrue to county councils and residuary bodies which do not administer housing benefit. None of the transferred subsidy could be received by authorities which do not receive rate support grants. Rate support grant is itself under review and is an unstable and unsatisfactory system to join at this stage.

I have cut short one long paragraph that I intended to read. I should, however, say that last week I noticed press reports of the House of Commons Public Accounts Committee dealing with housing benefit administration costs. I have with me a report which I had hoped to read to the Committee, but I shall spare Members at this late hour. The burden of the report is that the staff numbers and costs of local authorities administering the scheme have risen and need to be better controlled. I beg to move.

Lord Trefgarne

Like my noble friend, I shall cut short the remarks that I might otherwise have made in reply to her amendment. Perhaps I may just say to my noble friend that I understand that discussions are now under way with the local authority associations about this matter. I hope that a sensible way forward will be found, and on that basis I hope that my noble friend will feel able to withdraw her amendment.

Baroness Faithfull

I thank the Minister for his reply. As there are discussions taking place, I shall wait to see what happens. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 85F not moved.]

Clause 30 agreed to.

Clause 31 agreed to.

Lord Banks moved Amendment No. 86:

After Clause 31, insert the following new clause:

("Appeals for housing benefit

  1. .— (1) A person who has claimed housing benefit may appeal against any determination of that claim.
  2. (2) Any appeal under subsection (1) above shall be to a social security appeal tribunal under the procedure laid down in sections 100, 101 and 104 of the Social Security Act 1975 and section 15 of the Social Security Act 1980, and any reference to "adjudication officer" in those sections shall be construed as including reference to the appropriate authority responsible for administering housing benefit under section 28 of this Act.
  3. (3) Section 29(3) of this Act shall only be operative insofar as any regulations made under that section comply with the procedure established in subsection (2) above.")

The noble Lord said: This amendment deals with the procedure by which housing benefit is determined and reviewed. It rationalises adjudication by moving the jurisdiction over housing benefit to the social security appeal tribunals. I should like to read to the Committee what the Legal Action Group said in its response to the Green Paper: Housing benefit review boards in their current form show, in our view, some of the disadvantages which will be encountered in a more extreme form by the social fund. We know through our members that a number of judicial review proceedings have been taken in relation to inadequately made decisions by these review boards. We note that in many of the cases which have been taken, the housing benefit review board has accepted, after taking counsel's advice, that it should review its original decision. The reports which we have received from our members indicate that the review boards that they have attended have not in the main been satisfactory. There is a clear difficulty which consistently recurs over the councillor membership of the review board. The councillors often come from the housing committee and frequently feel a responsibility for, and an identity with, the decisions which are before them for review. We regard it as extremely unfortunate that the Government has not been able to see its way to the institution of a genuinely independent appeal process for housing benefit. We find this strangely at odds with the resources that the Government has been prepared to put into the social security appeal tribunal system".

The Government conceded in Committee in the House of Commons the amendment which requires the making of regulations for reviews of determinations relating to housing benefit. But they are only "looking very carefully" (that is the phrase that was used) at the rationalisation of adjudication on benefits, which would mean that all adjudication was carried out by the independent social security appeal tribunals.

In other areas of the Bill relating to the notification of a right of appeal with reasons for the adjudication officer's decision, the Government are pursuing what Mr. Newton described as a "benefit-wide formula" in the quest for the "basic question of harmonisation". However, in the area of adjudication, which is of substantial importance—that is to say, an independent forum for the appeal—harmonisation is not being sought. One wonders whether harmonisation is a good policy only when it is to the benefit of the executive and not when it is to the benefit of the appellant. I beg to move.

Lord Stallard

I support the amendment so ably moved by the noble Lord and outlined by the Legal Action Group. When the new housing benefit system was introducted in 1982–83, one of the features which gave some cause for concern was that there was no independent right of appeal. Under the two separate systems which had preceded the new scheme, the position in that respect had varied. In relation to benefit for rent and rates paid through supplementary benefit there was a right of appeal to an independent tribunal, but there was no such appeal right in relation to rent and rate rebates paid by local authorities.

In bringing together those two systems, the new scheme adopted the least satisfactory of those two approaches.

There is no independent right of appeal within the current housing benefits system when a claimant is unhappy with a decision. There is of course the right to ask the local authority to review its decision, and such a review is relatively structured. After an internal review by officers, the claimant can go on to a review board made up of councillors if he or she is still not satisfied. That review board is supposed to endeavour to act independently, but that is surely unrealistic. However conscientiously the members of the review board may try to forget the fact, they are nevertheless members of the authority which took the decision which is the subject of argument; in fact they may even be members of the housing committee which was even more concerned with that very decision. That is not independence, nor is it natural justice.

Apart from considerations of elementary natural justice, there are other factors to be taken into account. It has sometimes been claimed that local authorities would not favour the introduction of a right of independent appeal. After speaking to a few members of local authorities, mainly in the London area, I must confess my impression is that local authority opinion on that matter is divided. I am sure that many would welcome the opening up of the system.

First, many local authorities are increasingly taking a consumer-conscious approach to administrative matters and are aware of issues relating to consumer rights. Secondly, there would be certain administrative advantages in not having to service the review boards, train councillors and so on when that is merely duplicating an adjudication machinery which already exists within the social security system. I refer of course to the social security appeals tribunals to which we shall probably have to return later.

Thirdly, if a body of case law were to be developed through decisions of the social security commissioners, that would avoid unnecessary recourse to the courts, which is the only option at present, beyond the level of the review board of councillors, where a claimant feels that a decision is wrong in law.

Case law is important for another reason. The housing benefit system is part of the social security system. It is therefore part of a system of citizenship rights and should therefore apply with reasonable consistency across the country. The social security adjudication system incorporates a body of case law designed to achieve just that. Local internal reviews do not and cannot achieve that result.

The proposal is that where a claimant is dissatisfied with a decision he or she could appeal to the local social security appeal tribunal. Of course there would then be a fresh look at the case by a local authority officer, just as happens in the local DHSS office when an appeal notice comes in about a social security benefit. Nobody suggests that every case will shoot straight off to the tribunal without proper reconsideration by administrators. If matters are not resolved, there would then be a right of appeal to an independent body. Justice would be seen to be done. In the minority of cases which might raise a tricky legal question there would be an opportunity for a further appeal by either party to the social security Commissioners so that case law to guide future decisions could be established.

Such an approach would be fair and it would be seen to be fair. It would make use of a social security adjudication system which is tried and tested and designed to do such a job. It has the additional virtue of having no significant extra costs. That must appeal to the noble Baroness the Minister, if she heard it. It would be widely welcomed by claimants and by consumer-minded local authorities. I support the amendment.

Lord Trefgarne

We have said all along that we intended to examine closely housing benefit adjudication. My right honourable friend the Minister of State agreed in another place that there were strong arguments for bringing housing benefit within the purview of social security appeal tribunals and undertook to consider that further. I reaffirm that we are actively pursuing the issue. With that assurance I hope that the noble Lord, Lord Banks, will feel able to withdraw the amendment.

Lord Banks

I should like to re-emphasise that the question of having an independent forum of appeal is extremely important. I am glad to know that the Government are still considering it. I wait with interest to see what is their final decision on the matter. I may well return to the matter at a later stage of the Bill. In the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ennals moved Amendment No. 86A:

After Clause 31, insert the following new clause: ("Fraud investigation. The Secretary of State shall issue directions to his officers for the purpose of ensuring that claimants who are not reasonably suspected of wrongfully claiming benefit under this Part of this Act are not subjected to investigation for the purpose of detecting fraud.")

The noble Lord said: I shall move this amendment briefly. I had hoped that it would not be necessary, but it is. It is clear in what it says: The Secretary of State shall issue directions to his officers for the purpose of ensuring that claimants who are not reasonably suspected of wrongfully claiming benefit under this Part of this Act are not subjected to investigation for the purpose of detecting fraud.

A few days ago the department established in 60 local offices board and lodging control sections which were designed to check on board and lodging centres in their areas to see in how many cases there was fraud. It is clear that they have made inquiries or are available to make inquiries whether or not they have evidence against a particular person. I think that that is absolutely wrong. People are innocent unless they are proved guilty or there is some reason to believe that they are guilty.

I hope that we can have an assurance from the Government that no one will make any assumption that because people are unfortunate enough to be homeless, or unemployed, or poor, or living in lodgings, because they are homeless, they are in some way claiming benefit unjustly. That is why I believe that it is necessary at this stage, in view of the actions taken by the department, that this should be carried through. I beg to move.

Lord Trefgarne

I am bound to say that I think the amendment proposed by the noble Lord is somewhat perverse.

The practical consequence of his clause, were the Committee to accept it, would be to impede significantly the department's ability to combat a serious abuse of the benefits system in relation not only to hotel claims but to wrongful claims to social security benefits generally. Members of the Committee will know that the department has sufficient evidence to confirm in particular that fraudulent claims from people resident in hotels are at an unacceptable level, as recent exercises at some local offices have demonstrated.

Moreover, the codes of practice issued by the Home Office under the Police and Criminal Evidence Act 1984—and to which the department must have regard—entitle the investigating officers, in trying to discover whether, or by whom, an offence has been committed, to question any person from whom they think useful information can be obtained.

The clause of the noble Lord is completely at variance not only with the codes of practice but with the sensible investigative practices adopted by all other organisations and agencies charged with the duty of investigating offences. I am afraid therefore that I cannot accept what is proposed.

Lord Ennals

I am sure that no one will object to the DHSS or any other department taking appropriate action against fraud or against suspected fraud. This was done when I was Secretary of State myself. What I find objectionable are some assumptions of guilt concerning groups in particular areas. It is to that that I object. The noble Lord has given me an assurance that it will not be done. In those circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hooper

I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

House adjourned at seven minutes before midnight.