Social Security Bill (Hansard, 30 June 1986)

HL Deb 30 June 1986 vol 477 cc672-703 672

§ 8.42 p.m.

§ House again in Committee on Clause 32.

§ Lord Banks moved Amendment No. 92A: Page 42, line 9, at end insert— ("( ) The Social Security Advisory Committee shall monitor the operation of the social fund and shall receive from the Secretary of State such specified payments as may be necessary to ensure the proper exercise of this function.").

§ The noble Lord said: The social fund is a new concept and, as we saw earlier, a very controversial one. There is a great deal of apprehension about how it will work out in practice. It would seem to be essential that it should be subject to independent monitoring. It seems that the best way of achieving this is for the Social Security Advisory Committee to have a duty to monitor the fund. In order to do so, it will need to have sufficient resources to carry out research. The Government have pointed out that the Social Security Advisory Committee will be able to comment if it so wishes. We do not believe that this goes far enough. The Social Security Advisory Committee is 673 already hard pressed to fulfil its existing duties. We feel that unless it is placed under a specific duty to monitor the fund and given adequate resources with which to do so, the fund will not be properly monitored. I beg to move.

§ Baroness Trumpington
The Committee will be aware that the Social Security Advisory Committee was set up under Section 9 of the Social Security Act 1980. It has several functions under Sections 9 and 10 of that Act. It has the important duty of considering and reporting on regulations made under social security legislation. It also has the duty to give advice and assistance to the Secretary of State. This duty applies whether a matter is referred to it or whether the committee selects a subject of its own accord. Your Lorships will notice that this role is advisory. It is reflected in the name of the committee. I do not think that we should lightly alter that role to a formal monitoring duty. This would have considerable implications for the wider relationship between the committee and the department.
The main thrust of the amendment is already catered for in legislation. There is no need to write this provision into the Bill. I hope that the noble Lord will not seek to press the amendment.

§ Lord Ennals
I want to support strongly the amendment moved by the noble Lord, Lord Banks. After all, the Social Security Advisory Committee is an extremely responsible body. It is appointed by the Government. Therefore, it is a body in which the Government have confidence. It seems to me that in a new venture such as has been outlined, the social fund, it is vital that there should be some responsible body able to advise the Government on the progress it has made. The noble Baroness said in an earlier debate that there were issues on which lessons would have to be learned. We were talking then about cash limiting. She was saying, "If it does not work, we will have to change it". The "we" refers to the Government. It seems to me, as it does to the noble Lord, Lord Banks, that someone other than the Government will advise the Government on what should be done. It is not the case that some other body can do this. I remarked earlier that the traditional charities would give their advice but that they cannot give any assistance. So far as I can see none was consulted on how the social fund would affect its work for hardship cases.
The advisory council is a government-established body set up to advise them. The monitoring role has to be done by someone. If the noble Baroness, in reply to the noble Lord, Lord Banks, had said what other body would do this, I might have been a little more interested in her argument. She simply said, "No". I believe that she needs to give some argument that goes further. An argument from Scotland has been mentioned. I have an interesting argument from Welsh Women's Aid which says, in respect of the social fund: We are particularly concerned about its effect upon women leaving refuges". The organisation argues that because of the different problems of the social fund that it had seen, there needed to be some sort of body that could monitor and 674 report to the Government on the effect that the social fund was having, and whether its worst fears were fulfilled or not. If the Government intend to say that the Social Security Advisory Committee shall not monitor and advise, will they kindly say what other body will do it?

§ Lord Kilmarnock
Before the noble Baroness replies, she seemed to suggest that this amendment would alter the relationship of the Social Security Advisory Committee and the Government. It is clear, if she looks at the amendment, that there is no intention to return to the previous system by giving it the same sort of executive powers as the old Supplementary Benefit Commission. I am sure that the noble Baroness would be the first to recognise that the Social Security Advisory Committee has much to do with an increasing mass of regulations on which it comments either on its own initiative or at the request of the Secretary of State. Normally, there is, I understand, a quarantine period of one year before the Social Security Advisory Committee can begin to scrutinise regulations under a new Act of Parliament. This may be appropriate for relatively minor legislation. We are, however, confronted with the introduction of a completely new system—what the noble Lord, Lord Ennals, called a new venture. It seems important, therefore, that there should be no quarantine and that the committee should have the necessary resources to carry out a proper monitoring exercise and report back. This would not in any way distort the relationship between the committee and the Government. I hope that the Government will look on it rather favourably.

§ Baroness Trumpington
I shall gladly expand on my earlier remarks. I mentioned that the committee commented on the changes to the supplementary benefits scheme in 1980 in its annual report. Your Lordships may wish to be aware that in its 1981 report it also devoted a chapter to service to the public. In this, it said: Although the Social Security Advisory Committee does not have any responsibility for the day to day running of social security operations, Ministers have asked it to keep a watch over the quality of social security service to the public". The report then describes the committee's initial observations.
This request has never been withdrawn, and I know that the committee sees this aspect of its work as a continuing task. Again, if it specifically wanted to consider the operation of the social fund, it is able to do so. But this should be left to the committee. It may wish to examine the fund in its early stages and turn to other subjects when the fund is bedded down, so to speak. Alternatively, it may wish to leave it during the early stages of settling in and consider the fund later. I think it is better to leave this matter to the committee to decide.
I hope I have demonstrated that the Social Security Advisory Committee already has adequate powers to carry out its proper statutory role. This has worked well since its formation. I do not think that the introduction of a new type of benefit should lead us to alter radically its role and function. There is no reason 675 for the social fund to lead us to change a perfectly adequate relationship between the committee and the social security scheme. I still cannot support this amendment.

§ Lord Ennals
Before the noble Baroness sits down, may I see whether I understand what she is saying. As I understand it, she is saying that the Government have great confidence in the Social Security Advisory Committee, and that the Social Security Advisory Committee would be perfectly free to study the operation of the social fund and to report to the Government and publicly on its impressions. If I have interpreted the speech of the noble Baroness aright, that seems to me a considerable advance.

§ Baroness Trumpington
Yes.

§ Lord Banks
I am grateful to those who have supported this amendment. It seems to me that the second answer of the noble Baroness was rather different from her first. Her first answer seemed to suggest that the effect of the amendment would be to give an entirely new role to the Social Security Advisory Committee, whereas her second reply seemed to suggest that this was something that it was doing already but that we do not need to put it in the Bill—which is a fairly familiar answer.

§ Baroness Trumpington
I must apologise to the noble Lord, Lord Banks. My first answer was not a good idea, but I was trying to make up for lost time, if the Committee knows what I mean.

§ Lord Banks
I accept the explanation of the noble Baroness and assume that her second answer is the one on which we must place the most reliance. As that was for me the more satisfactory of the two I am rather pleased about that, although I am disappointed that the noble Baroness is not more enthusiastic about the precise proposal in the amendment.
However, I should like to think further about what she said and to read both her replies again. I must point out that there is the question of resources which is important and with which I do not think she dealt. Having pointed that out. I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Clause 32, as amended, agreed to.

§ Clause 33 [Awards etc]:

§ [Amendments Nos. 93 to 95 not moved.]

§ Lord Banks moved Amendment No. 96: Page 42, line 30, leave out ("or for the benefit of).

§ The noble Lord said: I beg to move Amendment No. 96. Under the Bill the Secretary of State may recover an award made from the social fund from the person to whom, or for the benefit of whom, it was made. Where that person is the member of a married or unmarried couple it may be recovered from the other member of the couple.

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§ Arising from this there is concern that women may be pursued for debts incurred by their partners without their consent. Perhaps I may mention a particular case. In this case Mr. R lived for some time with Miss M and they had a child. They obtained a grant for essential furniture. Miss M then left the house because of violence and Miss S and her child later moved in with Mr. R and the furniture. Mr. R subsequently abandoned Miss S, who continued to live in the house. That may seem an unusual case, but it is a case history. Under current legislation no money would be repayable by any of the parties for the furniture. Under the Social Security Bill's proposals if the furniture were obtained using a social fund loan, the Secretary of State may have the power to pursue both Miss M, who lived with Mr. R at the time of the loan, and Miss S, who now has the use of the furniture, but who did not know of the loan. Neither woman would have been required to consent to the loan. Which woman would the Secretary of State pursue for payment?

§ Several other questions arise. For example, who owns the furniture? It was provided originally for Mr. R, Miss M and their child, but is not now used by any of them. Who now is Mr. R's partner in terms of the Social Security Bill? For how long after a separation will a man and woman be considered to constitute a couple? If Mr. R and Miss M are subsequently reconciled, will they become liable for one another's loans obtained during a separation? For example, if a woman leaving a refuge receives a loan, her husband or cohabitee could be made to repay the loan out of his benefit. This could cause very serious problems for the woman, who may be further abused and harassed by the man as a result of being forced to repay the loan.

§ In future a man will be able to take on loans from the social fund without his partner's consent, the repayments of which will have the effect of reducing her benefit entitlement, as well as his own, and making her liable to proceedings to recover the loan should the man fail to pay out.

§ I should like to speak also to Amendment No. 97. The two amendments together would remove the problems which I have been outlining. High street shops and banks do not have this power to pursue partners who have not been party in writing to the debt or loan in the first place. It is most unjust that one person can be turned into a debtor without his knowledge or consent. I beg to move.

§ Baroness Trumpington
The present wording of Clause 33(8)(a) enables recovery of a social fund payment from two types of people: first, the person to whom the award was made or, secondly, the person for whose benefit the award was made. I agree that this might carry connotations which we did not intend. If one accepts the principle of recovery, obviously the payment should be recovered from the person to whom it was made. There will be no doubt about that, and the first part of Clause 33(8)(a) achieves that.
We intend to achieve the same effect by the second part of Clause 33(8)(a) also, but we wish to provide for the different circumstances which might exist. Members of the Committee will see that in the clause we provide that an application might be made on behalf of someone. Let us assume that an award is 677 made and that it is recoverable. If a person is making a claim on someone's behalf, circumstances might demand the payment also to be made to that person. But there would be no question of recovering the payment from that person. Recovery would be from the person on whose behalf the application was made and the payment made.
This is the intention of the second part of Clause 33(8)(a), but I accept that the wrong impression could be given. It could look more draconian than, for example, recovery from a child because the payment was intended for a pair of shoes for him. I need hardly tell the Committee that we would not to do this. But for the reasons I have outlined we do need the second part of Clause 33(8)(a) in some form. This is why I cannot accept the amendment at the moment. But I can promise to consider the points that have been made and to come forward with a clearer definition of the intentions at a later date. I hope that on that amendment that the noble Lord will find this acceptable.
On Amendment No. 97 I recognise the importance that Members of the Committee attach to the whole question of recovery of social fund payments, but I fear that in this issue there is unlikely to be a meeting of minds.
Clause 33(8)(b) is concerned with the recovery from either partner of a married or unmarried couple. In cases where recovery from the person seeking help is not a practical proposition, I would suggest that it is perfectly fair and reasonable to consider recovery from their partner. There will indeed be occasions where these arrangements will be of benefit to the person seeking help. For example, a claimant may be working part-time and receiving insufficient income support for a social fund loan to be payable. It will be to his advantage in those circumstances if the social fund officer has the power to make payment and recover it from his partner's social security benefit.
Clause 33(8)(b) provides for the recovery of a social fund payment for an item of furniture being made to the wife or husband during what turns out to be a temporary separation. It would be more than curious to prevent a recovery from the partner on his return to the household, particularly where he or she resumed a joint claim for both partners. I can assure the Committee that this provision will not be used to recover a social fund payment from the partner following a permanent separation.

§ 9 p.m.

§ Lord Banks
I am most grateful to the noble Baroness for that reply because she seemed to be moving some way towards meeting the objections which have given rise to this amendment, and I am grateful for that. However, I should like to read very carefully what the noble Baroness has said; and perhaps she, too, may like to read what I said, and we can possibly consider the matter again. In the meantime, I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ [Amendment No. 97 not moved.]

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§ Baroness Trumpington moved Amendment No. 97A: Page 42, line 34, leave out from ("person") to end of line 36 and insert ("who is liable to maintain the person by or on behalf of whom the application for the award was made or any person in relation to whose needs the award was made. (8A) Subsections (3) to (6) of section 25 above have effect for the purposes of subsection (8)(c) above as they have effect for the purposes of sections 23 to 25 above.").

§ The noble Baroness said: I beg to move Amendment No. 97A. The purpose of this amendment is to remedy a defect in the clause which if left unaltered would not reflect the principle that it should be possible to make, in the appropriate circumstances, a recovery from a liable relative. This subsection deals with the recovery from a liable relative of payments made from the social fund. Let me explain that the term "liable relative" is generally used in the context of supplementary benefit to denote a person who has a liability to maintain another person—for example, husbands and wives have a liability to maintain each other and parents have a liability to maintain their children.

§ The provision for recovery of benefit from liable relatives has been accepted by successive governments. There is an acceptance that there should be a means of recovery of a social fund payment from a "liable relative", in the same way as there is now for supplementary benefit, as there will be for income support. The subsection, as drafted, allows recovery only in the very limited circumstances when the social fund beneficiary is receiving income support and, in addition, a court order for maintenance has been made against the liable relative. The intention is to allow for the recovery of a social fund payment in a wider range of circumstances.

§ On Question, amendment agreed to.

§ Lord Banks moved Amendment No. 98: Page 43, line 3, leave out paragraph (c) and insert— ("(c) whether it is reasonable to expect that some other person or body may wholly or partly meet it.").

§ The noble Lord said: When considering the possibility of making an award, an officer must have regard to the possibility that some other person or body may wholly or partly meet the need. The possibility, which may exist only in the mind of the social fund officer, that various local charities or relatives of applicants may be able to provide money or items requested from the social fund, could result in applicants being required to seek help from a whole list of individuals and organisations. Quite apart from the delay in considering an application, it would be demoralising for the individual concerned to have to face a series of humiliating requests and refusals. No indication is given of how the social fund officer is to determine what possibilities may exist. Will the social fund officer accept the word of the applicant or, at the other extreme, will official letters of refusal from charities and relatives be required?

§ The amendment will remove some of those uncertainties and put the onus on the social fund officer to show that the applicant's need can be met fully in some other way than by a social fund payment. I beg to move.

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§ Lord Ennals
I should very much like to support the noble Lord, Lord Banks. Indeed, I touched upon this matter in relation to an earlier amendment. I was perhaps out of order in doing so; but one occasionally strays from the terms of amendments if one feels very strongly about something.
The purpose of the amendment has been very well explained by the noble Lord, Lord Banks. I find it appalling that a social fund officer, faced with a person who has represented some very great problems in relation to a single payment for furniture, clothing or whatever else it may be, has to ask himself: "Is it possible that someone else would pay? May be the parents have some money? What about Auntie Flo? Perhaps we should find out whether Auntie Flo can pay? She has a brother who may be able to pay". How does he dig into the possibility that some other person or body may be wholly or partly able to meet the payment?
If it cannot be a member of the family, the officer in question may say, "This fellow is a Mason. Will the Mason's pay?" He may be an Elk or a member of some other society. He may be a member of the North Beddington Rugby Club and perhaps they will pay. If not, the officer may say, "Perhaps we could persuade some charity to pay. Maybe the local authority will pay? Yes, the local authority". How will he handle this situation? Will he telephone Auntie Flo, the local government offices, the family welfare association and all these other bodies? That seems to me to impose an intolerable burden upon a social fund officer. Moreover, it puts the person who is applying in an invidious position because he or she knows that they will find out whether some other member of the family or some relative can possibly find the money to pay. I find that so obnoxious. As Members of the Committee will understand, I feel deeply about the matter. I hope that the Minister can see her way clear to taking this nasty paragraph (c) out of the Bill.

§ Baroness Trumpington
The Bill includes some of the considerations to which the social fund officer might have regard in reaching his decision. These are in Clause 33(9). One of these considerations is the subject of this amendment. This simply builds on current practice, although to hear some people you would not believe it. The Committee will wish to bear in mind that Regulation 6(2) of the present single payments regulations contains a long list of items for which a single payment cannot be made. Some of these are because it has not been felt that the social security scheme should meet the cost of a television or a holiday. But others are clearly included because we should ensure that the cash benefit system is not used to pay for items or services which are properly the responsibility of other bodies. Thus we do not pay removal charges where someone is rehoused following a compulsory purchase order on their property or for repairs to local authority property. This kind of provision must be carried forward.
Similar rules operate in the current provisions for urgent cases. There are additional rules for these reflecting the different nature of these cases; for example, that they are payable to people not normally 680 entitled. So in urgent cases our local office staff have to pay regard to whether help is available from other sources. The S Manual gives guidance on this. At present it points out that the local officer must not assume other means are available. But it does point out that help may be available from other sources which could help in cases of urgent need. These vary from friends and relatives, through banks, to charities and organisations. So we are simply ensuring that the social fund officer has the same ability and flexibility as an officer has at present. We are not introducing a new principle which need be routinely considered in all cases.

§ Lord Wigoder
Could the noble Baroness give us a simple example of a set of circumstances in which there is never the possibility that the person or body might wholly or partly meet the payment?

§ Lord Ennals
And how would he find out?

§ Baroness Trumpington
The current paragraph in the S Manual states: refer a claimant to a charity or benevolent fund only if:—

(a) an appropriate organisation is known to exist in the area and it is likely that he would be eligible for help;

(b) it is known that help is likely to be received in time to meet the need; and

(c) the urgent need is for items which are known to be available"

§ Baroness Seear
Could the noble Baroness not look at the wording of this again even if she will not remove it? The way it reads at the moment, as the noble Lord, Lord Ennals, has said, is that the officer shall have regard to, the possibility that some other person …". That is extremely wide. It is not really in accord with what the noble Baroness has told us is the S practice. After all, the S practice is not in the Bill.

§ Baroness Trumpington
May I remind the noble Baroness, Lady Seear, that we are simply ensuring that the social fund officer has the same ability and flexibility as an officer has at present. We are not introducing a new principle which need be routinely considered in all cases.

§ Lord Banks
Does the noble Baroness argue that the amendment would not leave the officer with that flexibility? The noble Baroness is not answering that question.

§ Baroness Trumpington
I am very sensitive of time. We shall be ensuring, if this is helpful to the noble Lord, that training and published guidance indicate how the consideration should be applied.

§ Lord Ennals
In view of the representations that have been made, including by the Leader of the Liberal Party in this House, would the noble Baroness not agree to at least take it away and think again about 681 it? Obviously, she was a little reluctant to answer before. I know that it was in order to save time; but actually it delayed things. Would she not agree to take it away and have a look at it again?

§ Baroness Trumpington
The noble Lord, Lord Ennals, is being at his most persuasive, but I regret that he has not worked his magic on me.

§ Lord Banks
I regret that the noble Baroness has not agreed to think about it again. After all, I should have 682 thought that the amendment on the Marshalled List that he must consider: whether it is reasonable to expect that some other person or body may wholly or partly meet it would have left the flexibility, and left the noble Baroness with all the power that she feels it is essential for the officer to have, and all the guidance. However, the noble Baroness thinks otherwise. I do not intend to pursue it tonight, but perhaps we can come back to this point. In the meantime, I beg leave to withdraw the amendment.

§ Amendment, by leave withdrawn.

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§ 9.15 p.m.

§ Lord Banks moved Amendment No. 99: Page 43, line 5, leave out paragraph (d).

§ The noble Lord said: When determining whether to make an award, the officer must have regard, where the payment is repayable, to the likelihood of repayment. Before the social fund officer reaches the stage of deciding the likelihood of repayment, he will presumably have satisfied himself that the applicant has a need, has no resources from which to meet the need and that no other person or body can meet the need. Is the applicant then, having shown that he has no resources, to be refused a loan on the ground that he has no resources to repay it? I beg to move.

§ Baroness Trumpington
The noble Lord has once again touched on an important point in moving this amendment. He has echoed reservations which have been expressed before during debates in another place. Clause 33(9) sets out a number of the factors which a social fund officer should take into account when making a decision. The particular consideration with which the amendment is concerned is one which we believe quite reasonably refers to a feature which must be taken into account when considering a loan.
I accept that we are not likely to reach unanimity today on our policy of recoverable loans from the social fund. But as payments will be recoverable, I would suggest that it makes sense that when a social fund officer reaches decisions about whether to award a payment, or what the value of the recovery could be, he should pay regard to the effect on the person receiving help. Primarily the payment will be aimed at meeting the need of the individual. But there is a balance to be struck between this and ensuring that either too great a strain is not put on the person concerned or that the repayments extend indefinitely. Similarly, in deciding payments, some regard must be paid to whether recovery is likely at all. I ask the noble Lord to withdraw his amendment.

§ Lord Banks
I am not sure that the answer, for which I am grateful, was entirely satisfactory. I do not think the noble Baroness answered my question, when I asked if the applicant, having shown that he had no resources, was to be refused a loan on the ground that he had no resources to repay it. But I shall not pursue it further tonight. I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Lord Banks moved Amendment No. 100: Page 43, line 7, leave out paragraph (e).

§ The noble Lord said: The amendment would remove the requirement on the social fund officers to consider the amount of money in the social fund when deciding whether or not to make an award. If we may take a particular case: Mrs. M. is a single parent with two daughters. She receives £57.70 per week in supplementary benefit and child benefit. She has no other income. Her electric cooker, purchased second-hand five years ago, is now beyond repair. The cost of a replacement will be £90. Under the present regulations Mrs. M. will receive a grant. Under the proposed scheme, if the social fund is running low in 684 a particular area—we touched on this earlier and if this is an incorrect interpretation perhaps the noble Baroness would explain to me why—an application in, say, February, would result, it would seem, in Mrs. M. and her daughters having no home-cooked meals until April when a fresh injection of cash is made into the social fund.

§ It is difficult for any person on any income to save an amount equivalent to 1½ weeks' income. But for someone on supplementary benefit this feat is, to all intents and purposes, impossible since the amount is calculated to provide only the basic necessities of life—that is to say, fuel, food and clothing. There is no justice in the idea that Mrs. M's claim should be decided not on its merits but according to how many other people had made similar claims in the same financial year or on how many births or deaths there had been that year.

§ It is clear from the Bill that the officer has to take allocations to the fund into account. Perhaps the noble Baroness would explain why that is so if it does not mean that in certain circumstances the condition of the fund will determine whether a loan or payment is made.

§ Baroness Trumpington
May I say in reply to the noble Lord, Lord Banks, that the matters to which he has been referring are matters that we shall want to consider as we decide how to respond to the vote earlier today.

§ Lord Ennals
That really is no reply to a question that absolutely strikes at the heart of the whole of this new social fund. In earlier debates we have said it is quite wrong that the social fund should be cash limited. If you cash limit a social fund, you are saying that regardless of the personal need of any applicant during a particular year, unless there is some supple-mentary estimate—and there rarely is—the social fund officer is going to have to take note of the amount of money that is available. In other words, he must take note not of the need of the person involved, but of the amount of money that is available.
That strikes at the whole root and it is, I believe, the cancer in the social fund. It puts aside the principle of a welfare state which gives according to needs, not according to the ability of the Government, in a cash limited exercise, to be able to pay. If the social fund officer has to do as he is asked, before he looks at any need at all, he has to ask, "How much money have we got left for the rest of this week or this month? Can we afford to pay this old lady or this crippled person?" And the answer may be, "I am afraid not, because we had to spend all that money last week."
Surely the essence of any welfare state system must be based on the needs of the persons who apply to it. The judgment ought to be based on their needs and not on the financial situation of a cash limited fund at any given time. The noble Baroness really must answer the question that was put to her by the noble Lord, Lord Banks.

§ Baroness Trumpington
I have never heard such a fuss. I said perfectly plainly that this was a matter we would have to consider in the light of the vote this afternoon. I have also explained at some length why 685 the fear that money would run low in February is totally exaggerated. We will of course monitor the expansion and the expenditure and take appropriate action. We have made it perfectly clear that maternity and funeral payments would not be subject to the budget. We shall also always want to pay special attention, whatever the time of year, to absolute financial crises. This is the purpose of Clause 33(9)(e), and in the overall framework of the fund it is a useful purpose. I suggest to the Committee that it makes sense to retain it.

§ Baroness Seear
Do I understand that maternity and funeral benefits are safeguarded, but other things are not?

§ Baroness Trumpington
No; the noble Baroness will know that funeral and maternity payments are grants. Other things may be grants, but they may also be loans.

§ Baroness Seear
Then why did the noble Baroness mention maternity and funeral benefits, if they come under a different heading?

Baroness Tumpington
In order to make sure that it was understood by the Committee that these were perfectly safe and not included in the budget.

§ Lord Ennals
I did not quite understand what the noble Baroness was really saying. She was trying to reassure me and was saying that I was making a fuss about nothing. Was she saying that if there is a claim which has to be dealt with at a particular time by a social fund officer and if that officer is running short of money he will, by some means, be able to get some extra money from the Government? If that is so, it is interesting news; but it is not cash limiting it. The noble Baroness knows as well as I do that cash limiting means imposing upon an authority a limitation above which it is not allowed to go. That is how the health service operates. When the noble Baroness made her comparison with the health service she put her foot in it absolutely, because there it means waiting lists or ward closures. In this case it means refusals. However, if she is now saying that that is not really so and that steps will be taken by the Government to ensure that the money will be available, then I should be absolutely delighted. If she would simply say to the Committee that the Government will think again about this in the light of earlier decisions, we should all be happy.

§ Baroness Trumpington
I feel that the noble Lord, Lord Ennals, simply has not listened to what I said earlier about flexibility in the early years of the budget to ensure that money does not run out. I accept that I shall not take noble Lords opposite with me on the question of the need for budgetary control. But, having decided to adopt such a system, I suggest that it is only sensible to provide that social fund officers should have regard to their budget allocation when making decisions. Otherwise the effects of the greater financial control that we are seeking will be lost.
If I may just return to those maternity and funeral payments, if the conditions we set are met, a payment will be made. In the Bill as drafted the Secretary of 686 State has power to pay into the fund certain amounts. He can then allocate amounts for different purposes. This means that he can separate out and identify the elements directed for maternity and funeral needs. I hope that that gives a fuller answer to the noble Baroness.

§ Baroness Seear
I am very sorry to come back to this. I do not want to be contentious about it. but I think the noble Baroness does not quite understand the reason for the anxiety on this side. We are dealing in the social fund with people who are at the very bottom of the pile and in the greatest need. Of course, we appreciate that over a whole range of matters there have to be cash limits, but is the noble Baroness telling us that there can be people in the position outlined by my noble friend Lord Banks, who are desperate to have a new cooker because otherwise they cannot cook, and where it could arise that the answer would have to be "No", because of cash limits? It is to that that we want an answer, because we are dealing with the most necessitous cases in the country. We are not trying to plague the noble Baroness. We are trying to establish that there is a fundamental principle of meeting the wants of people in real need.

§ Baroness Trumpington
Yes. I fully understand why the noble Baroness is expressing those fears, but I must tell her that they are totally misplaced. This brings us back to the budget that we discussed earlier. We aim to set up quick and effective mechanisms for monitoring the fund, but we intend to do more than that. We will develop budget profiles, so that local offices can tailor their expenditure according to the seasonal patterns of demand. We aim to be in a position where, as well as knowing what is happening to the budget, we can reasonably gauge why it is happening, so that we can make an appropriate response.
It is the need to respond flexibly and appropriately to pressures on the budget which explains the importance we attach to budget monitoring. We may need to be able to move resources from offices which are lightly loaded to offices which are under pressure. I have said all this before—I am not sure whether the noble Baroness was in the Committee when I said it—but we shall always make sure in financial crises that they are the first call.
I do not think I have anything else to say. I am totally convinced that the Government have got it right, that we are not going to run out of money—how could we propose anything like that?—and that we shall have the needs of the very poorest as our first attention. We are, on the whole, talking about exceptions when we talk about people who will not get a grant immediately. If you are talking about people who are going to have to wait and appeal to the social fund officer if the decision is against them, that is one thing. But money we are not going to run out of and I really do not think this argument can go on.

§ Lord Ennals
In which case, how can it be said to be cash limited if the noble Baroness says, "We are not going to run out of money"? She cannot have it both ways.

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§ The Countess of Mar
I support the noble Lord, Lord Banks. From my own experience under the Chronically Sick and Disabled Persons (Scotland) Act 1972, local authorities were empowered to provide telephones for chronically sick and disabled people. Many noble Lords will know that I worked for British Telecom for a number of years. Every January, people used to apply to us for telephones and then, when they had been advised that perhaps the local authority could help them, the local authority would come back to us and say, "We are very sorry but we cannot help this person, because we have run out of money. Come back to us in April." This happened only after the Conservative Government at that time, which was the late 1970s-early 1980s, had imposed cash limits on the local authorities. I know from my own experience what happens when there are cash limits.

§ 9.30 p.m.

§ Baroness Trumpington
I have given our side of the case. I have given assurances over and over again that the social fund will not run out of money. I am afraid that I have no more to say.

§ Lord Banks
This position is very unsatisfactory. It is clear that the officer must have regard to what is in the kitty. That is written into the Bill. The amendment would have taken it out. The noble Baroness opposes the amendment. She must feel it is necessary for some reason that the officer should continue to look in the kitty, although she says that there is no possibility of it running out of money. The two things seem to be at odds. We shall certainly want to come back to this issue, but, in the meantime, I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Lord Wigoder moved Amendment No. 101: Page 43, line 9, leave out ("general directions issued") and insert ("regulations made")

§ The noble Lord said: This amendment is consequential on Amendment No. 88. I beg to move.

§ On Question, amendment agreed to.

§ Lord Wigoder moved Amendment No. 102: Page 43, line 13, at end insert— ("(11 A) A person applying for a social fund payment may appeal to a social security appeal tribunal constituted in accordance with section 97(2) to (2E) of the Social Security Act 1975 against any determination or direction of a social fund officer with respect to the application. (11B) On an appeal under subsection (11A) above the appeal tribunal may—

(a) confirm the determination or direction appealed against;
(b) substitute for that determination or direction any other determination or direction which a social fund officer could have made; or
(c) if the appeal is against a direction, set aside that direction.")

§ The noble Lord said: This amendment was grouped with Amendment No. 88 and was considered when that was agreed. I therefore formally beg to move.

§ On Question, amendment agreed to.

§ [Amendment No. 103 not moved. ]

688

§ Clause 33, as amended, agreed to.

§ Clause 34 agreed to.

§ [Amendment No. 104 not moved.]

§ Clause 35 [Widowhood]:

§ Baroness Macleod of Borve moved Amendment No. 104ZA: Page 44, line 32, leave out from ("4") to end of line 33.

§ The noble Baroness said: I hope to be brief in moving Amendment No. 104ZA, which seeks to take out one short line: she survives him by at least seven days".

§ We are talking of the new £1,000 tax-free amount that the Government have decided shall be given to widows when they are widowed. As the Bill is drafted, the widow will have to wait for seven days before she can claim the £1,000; this is just in case she survives her husband by less than seven days. That presupposes that the two of them are in a motor-car accident; that one is in hospital and the other dies. Perhaps the widow dies three or four days after the husband; in other words, within seven days.

§ I hope that the Government in their wisdom will agree to this amendment because it seems to us that, although the £1,000 is tax free, the widow needs it there and then. There are bills to be paid, and we all know the high cost of dying these days. The widow would have to pay for the funeral, and very few widows, unless they are in exceptional circumstances, have enough small change in the kitty to pay. Therefore, this plan will work if the widow is able to get the £1,000 within a short time, which I am sure is what the Government intended when they brought it forward, but it will not work if we leave in these few words. Having said that, I beg to move.

§ Baroness Trumpington
On reconsideration we think that this is a useful simplification of the provisions which I am happy to accept. I am grateful to my noble friend for drawing our attention to it.

§ Baroness Macleod of Borve
I am most grateful to my noble friend the Minister—more grateful than I can say at this late hour.

§ On Question, amendment agreed to.

§ The Deputy Chairman of Committees (Lord Strabolgi)
I have to inform the Committee that if Amendment No. 104A is agreed to, then I cannot call Amendment No. 104B.

§ Baroness Jeger moved Amendment No. 104A: Page 45, line 4, leave out subsection (3).

§ The noble Baroness said: This amendment challenges the alterations in the ages affecting widows' payments. In sub-paragraph (a) the age will be increased from 40 to 45, and in sub-paragraph (b) the age will be increased from 50 to 55. I and my noble friends would prefer the Bill to revert to the existing age limits of 40 and 50, instead of having a five-year increase to 45 and 55.

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§ We do so because it is very difficult at those ages for many women who have spent a long time at home bringing up their children to find jobs and get out to work. They need the remuneration that they can receive at the existing age limits, whereas many women at 45 and 55 years of age have to rely on part-time jobs that are not always very well paid. It seems harsh to us that there should be a five-year increase in the qualifying ages. We hope that the Government will examine that point again.

§ On June 3rd, at col. 686 of Hansard, the Minister told me that as a result of changes in widows' payments on page 45 of the Bill 15,000 widows would suffer some cash loss. I hope that those 15,000 widows will remember that on polling day. I beg to move.

§ Baroness Trumpington
The raising of the age range for age-related widow's pension is a modest proposal in the Bill which seeks to relate national insurance protection for widows a little more closely to present and future social trends. The Committee will, I am sure, accept that the national insurance scheme has to change with the times if it is to serve any useful function. I hope the Committee will accept also that we have to re-think benefits designed to protect against financial difficulty if the danger of financial difficulty recedes. Social change has nowhere been more marked than in the economic position of married women. Over 60 per cent. of married women now work, and nearly all women with children now return to work after the birth, often quite quickly. That enormous social change means we must look again at the rationale behind our widow's benefit structure, which is based on the presumption that women will have been dependent on the husband's earnings and that they will have difficulty in supporting themselves after the husband's death.
The present age-related taper from 40 to 49 was introduced only in 1971. With hindsight, it was a provision that was moving against social trends even then. Between 1948 and 1971 benefit was not paid to widows below the age of 50 unless they had children. That was in itself an advance on Beveridge's proposals. He had said: There is no reason why a childless widow should get a pension for life; if she is able to work she should work". And had gone on to say that: The principle that any person physically fit for work should be entitled to retire from work upon pension before reaching the minimum pension age of 60 for women or 65 for men cannot without grave danger be admitted in any scheme for social insurance". Our proposals continue to recognise that older widows are less likely to have been in the workforce and to be able to support themselves than are other groups. But we believe that to set the minimum age for receipt of widow's pension by a childless widow at 45 rather than 40 is a change that is demanded by changing circumstances. For that reason, we cannot accept the amendment.

§ Baroness Jeger
The noble Baroness quoted Beveridge, but I remind her that the Beveridge Report came out in the context of full employment. The noble Baroness says that these women are entitled to work, 690 but she did not tell us whether they can get work. It is in the context of increasing unemployment that we have to look at these facts and figures. It is absolutely unacceptable that the Government should tell women of 45 or 55 that they should go out and get a job. There is such unemployment in the country as a result of deliberate Government policies that that is quite unreal. It is a difficulty which affects many older women. I very much regret that the noble Baroness has replied in that way, and I assure her that it is a subject to which we shall return. In the meantime, I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Baroness Jeger moved Amendment No. 104B: Page 45, line 9. at end insert— (" ( ) In the case of a widow whose husband died before the commencement of subsection (3) above, section 26 of the Social Security Act 1975 shall apply as if it had not been amended by that subsection.")

§ The noble Baroness said: This amendment affects very many widows in the country where the Government appear to be unsympathetic. So far as I can understand the position, and perhaps the noble Baroness can assist me, it appears that if a widow is under 50 when her youngest child leaves school she will not be able to receive the widowed mother's allowance at the personal rate at that time.

§ Many widows have calculated and budgeted that after their widowed mother's allowance ends they will go on to the standard pension. It seems cruel to change that anticipation. We now have a situation where the pension is to be reduced if they are under 55 and there will be no pension if they are under 45.

§ So far as I can make out from this complicated Bill it appears that in future it will be necessary for a woman to give birth at the age of 39 or over in order to qualify for a standard pension if her husband dies when she is under 55 and the child leaves school at 16. I am sorry if that sounds complicated but it sounds even more complicated to the many widows who have written to me and who I know have been in touch with the Minister on this subject. It is unfair and puts a serious burden on older widows. I cannot understand why a woman has to give birth at 39 years of age or over in order to maintain her benefits. I beg to move.

§ Baroness Trumpington
I must make it clear at the outset that all existing beneficiaries will remain on any benefit they are already receiving when the new age groups come into effect; and if that is what the noble Baroness is seeking to achieve her amendment is unnecessary.
Where, however, a widow moves from one category of widow's benefit to a succeeding benefit after the change then the new rules will apply. Thus, a widow who ceases to be entitled to widow's allowance or widowed mother's allowance after the new age limits come into force would be considered on the basis of the new rules. This is perfectly justifiable and, quite apart from the administrative difficulties in doing so, we see no reason to perpetuate transitional arrange-ments which would lead, perhaps many years later, to different provisions being applied to widows in ideal circumstances (for example, on cessation of the widowed mother's allowance).
691 In view of the assurance that no one will lose the category of widow's benefit already in payment, I hope the noble Baroness will withdraw the amendment.

§ Baroness Jeger
Before I decide what to do about the amendment, the noble Baroness has not answered her own sentence on 3rd June—reported in col. 686 of the Official Report—that 15,000 will suffer some cash loss. Can the noble Baroness explain that to the Committee before I decide what to do about this amendment?

§ Baroness Trumpington
Returning to the widowed mother's allowance, which is not covered in this Bill, the provision is covered in regulations but it is proposed to withdraw the widowed mother's allowance from widows without dependent children. Whatever be the figure that the noble Baroness quoted to me from a speech that was made some time ago, I must tell her that 55,000 widows will gain.

§ Baroness Jeger
We shall have to come back to this point again because obviously there is some unfairness in the proposals but for this evening I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Clause 35, as amended, agreed to.

§ Clauses 36 and 37 agreed to.

§ Schedule 3 [Industrial injuries and diseases.]

§ 9.45 p.m.

§ Baroness Turner of Camden moved Amendment No. 105: Page 99, line 13, after ("shall") insert ("not").

§ The noble Baroness said: I beg to move Amendment No. 105 standing in my name on the Marshalled List. At a very late stage in Committee in the other place an amendment was introduced which takes away from workers injured at work who have a less than 14 per cent. disablement the right to any disablement benefit at all.

§ Disablement benefit, which has existed since the industrial injuries scheme was introduced in 1948, compensates for the severity of physical or mental injury suffered from an accident or disease, the associated pain, suffering and disfigurement, and the effects upon the individual's ability as compared with another person of the same age and sex who has not had an accident. Its introduction was a major step forward since, until 1948, workmen's compensation had only compensated for loss of earnings. I understand that a similar benefit operates in the war pensions scheme and no equivalent cut-off is proposed so far as that scheme is concerned. I hasten to say, of course, that I am not advocating that it should be proposed.

§ The abolition of the benefit for victims who are assessed as being less than 14 per cent. disabled would mean that a very large number of work accident and disease victims would receive no compensation at all for their injuries. The large majority of current disablement awards are below the 14 per cent. figure, so it would affect most accident sufferers and sufferers of the common prescribed diseases such as industrial 692 dermatitis, occupational asthma, and vibration white finger.

§ There has been a steady decline in the number of new claims for disablement benefit from a peak of over 200,000 per year in the mid-1960s to around 120,000 currently. This means that the cost of the benefit should be falling. The decline has been partly due to improved health and safety standards but also, I regret to say, to the contraction of the more dangerous heavy industries as a result of industrial decline. However, there are some working environments that are inherently more dangerous than others and which are likely to remain so despite efforts to improve health and safety.

§ The amounts of money involved for individual victims are quite substantial so far as they are concerned. A life gratuity for a 13 per cent. disablement is currently worth £2,905; for a 10 per cent. disablement it is nearly £2,300; and for a 5 per cent. disablement it is £1,245. I have with me some examples of actual cases of people injured at work. In the case of one individual there was a scaffolding which fell on to his neck and spinal column, causing injury to neck, shoulder and back. The assessment was 4 per cent. for life and the amount of the award was £1,037. In another case in which a bus braked sharply and the conductress was thrown against a hand rail, the injury to chest and neck was assessed at 7 per cent. for life and the amount received was £1,600.

§ The loss of a whole middle finger is assessed at 12 per cent., and the award for that is £2,697. The loss of a whole ring or middle finger is a 7 per cent. assessment nowadays, and that is £1,660. The loss of four toes on one foot is 9 per cent., at £2,075. All those are awards paid under the current industrial injuries scheme. Under the proposals contained in the Bill none of these people, if they sustained the injuries after the passage of the Bill, would get anything at all.

§ It will be argued that the individuals concerned will still have their rights at common law; they will still be able to sue their employers if the injuries come about as a result of employer negligence. All too often, however, that is difficult to establish. Indeed, seeking to do so can be a costly process. Often the injury is not due to employer negligence but is simply an accident; an unfortunate occurrence for the individual.

§ The industrial injuries scheme, which was introduced in 1948, was the first attempt that we had in this country to provide for compensation on a no-fault basis. Many countries have no-fault systems of compensation, and that is the nearest that we have to such a system. It applies whether or not earnings are affected. An injured worker may still suffer from his disability or disfigurement even if he or she is able to work with undiminished earnings.

§ The industrial injuries scheme accepted that we had a public responsibility to those injured in the production of goods and services and that those goods and services were worked on for the rest of us. We should not turn back on that responsibility now. I know that it will be argued that there are other gains to be made; I believe that the Government intend to improve allowances for people who suffer from diminished earnings. However, overall I am told that the gains that the Government hope to make as a 693 result of the scheme will in total amount to some £40 million. There will be losses overall, even though some people may gain. It is unacceptable to have a situation in which people who have those injuries have no compensation whatsoever. I therefore beg to move.

§ Lord Stallard
I support the amendment, which seeks to remove the provision that the cut-off for entitlement to industrial injury benefit should be a 14 per cent. instead of a 1 per cent. degree of disability. It is a remarkable coincidence, as the Government confirmed at the Committee stage in another place, that the proposal will mean that about 90 per cent. of the people who now have awards under the industrial injuries scheme will no longer receive an award of any kind. From my years in the engineering industry I know of the injuries to workers and the effects on their future employment prospects; and most of those would be affected by the provisions in the Bill. The Government have said that they want to simplify disablement schemes. Unfortunately, whenever they propose any simplification it invariably results in worsening the existing position.
My noble friend gave examples. It is worth noting some further examples that were recently given in the Guardian. A 49 year-old bus driver sustained severe hand injuries after intervening to protect a passenger from being attacked in Regent Street. After going to the social security commissioners he won compensation of £1,245 from London Regional Transport Board, but under these proposals his award would be abolished. A lady succeeded in claiming compensation for occupational asthma, but her award of £1,867 is not due until the autumn. She is afraid that she may lose that award. A drayman, injured while unloading beer casks, is not due to receive his final award of £1,452 until next May. He also expects to lose under the proposals in the Bill. There are many other similar examples. At the same time as that is happening, appeals to the social security commissioners on points of fact will be abolished, making it even more difficult for people injured at work to claim the remaining benefits.
I understand that in Great Britain there are about 400,000 industrial accidents every year, leading to nearly 200,000 claims. The new rules will exclude 180,000 of those claims. As my noble friend said when she moved the amendment, in another place the Government explained that the expected total savings will be between £46 million and £56 million and that net of any improvements it would be between £40 million and £50 million. It seems to be a squalid way to save that amount of money. The Government are removing a benefit to which people have contributed, which has been negotiated, fought for through the courts on appeal, and won after considerable difficulty. Workers have always derived no little comfort from the fact that they have an insurance contract which means that if they are injured they at least receive some compensation. That will no longer apply under this Bill.
Workers are still entitled to as much protection, in whatever circumstances they work, as we can possibly give them. I deplore this further attack on the basic principles of the social and welfare schemes. I support the amendment.

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§ Baroness Trumpington
While I sympathise with the aim of the noble Baroness, Lady Turner, I cannot recommend the amendment to the Committee. The Government have to take into account the much lower levels of benefit paid to people disabled outside the workplace, especially when that disablement results in a loss of work. We all know that disablement is difficult to bear, but how much harder that burden is when combined with a low income. That is why we propose to devote substantial additional resources to the less well off sick and disabled, chiefly with the disability premium to be paid with income support.
It is against that background that I ask the Committee to view the Government's proposal. Of course we should have preferred to bring other disabled people up to the level of benefit paid to the industrially injured but that is impracticable. The estimated cost is about £4 billion. I also ask the Committee to bear in mind that the average lump sum payable for disablement below 14 per cent. is less than £400, although I accept that some payments are higher than that, as the noble Baroness, Lady Turner, said.
A further important change to be set against this proposal is the planned improvement to reduce the earnings allowance which will enable it to be paid to the most severely disabled. They will gain up to £25 a week extra as a result. Moreover, the allowance will continue to be paid even at levels of disablement below 14 per cent. That will ensure that those who lose earnings as a result of minor injuries will still receive compensation for that loss.
The noble Lord, Lord Stallard, suggested that people awaiting finalisation of claims may lose under the Government's proposals. I am pleased to be able to reassure him that those claims will not be affected. They will be settled under the scheme's present rules.
The Government's aims are twofold: to strike a fairer balance between help for those injured at work and other disabled people, and to focus the industrial injuries scheme more clearly on the more severely disabled. I ask the Committee to support those aims and reject the amendment.

§ Baroness Turner of Camden
The Committee will not be surprised to learn that I am disappointed at the response from the noble Baroness. I repeat what I said when I moved the amendment: the industrial injuries scheme was introduced in 1948 because it was accepted then, and it has been accepted by governments since, until this one, that if one goes out to work, particularly if one works in a hazardous environment—and the environment of many manufacturing industries is hazardous no matter what one does about it—there is a case for a special industrial injuries scheme.
With this Government we have seen the gradual whittling away of that industrial injuries scheme, firstly with the disappearance of injury benefit and now of course with the disappearance of disablement gratuities for people with 14 per cent. or less disability.
It has been said that the Government want to concentrate benefit on compensation for loss of earnings, but in fact no attempt has been made to remove the cash ceiling which exists on the special hardship allowance at the moment. Overall, 90 per 695 cent. of special hardship awards are currently at the maximum rate, which suggests to me that many victims will suffer a drop in earnings in excess of the current cash limit. I do not think it is acceptable to say, as the noble Baroness has said, that we want to treat everybody who is injured alike. Not everybody is at the same risk and it is because people are not at the same risk and because they have to work in hazardous environments about which very little can be done that we have an industrial injury scheme at all. I am not intending to press the amendment at this time but I intend to come back at Report stage because I regard the response of the noble Baroness as entirely unsatisfactory.

§ Amendment, by leave, withdrawn.

§ 10 p.m.

§ Baroness Turner of Camden moved Amendment No. 106: Page 103, line 20, at end insert— ("8A. Where an employed earner dies as a result of personal injury by accident arising out of or in the course of the employed earner's employment or any prescribed disease or injury, which occurred or developed after July 4 1948, there shall be payable to their widow or widower a lump sum death benefit at a level to be fixed annually by the Secretary of State as being equivalent to half average annual earnings ")

§ The noble Baroness said: The purpose of this amendment is to attempt to write back into the Bill provision for compensation for the families of people who are killed at work. The abolition of industrial death benefit would mean the end of special benefits for widows and families of people killed by work accident and diseases.

§ It can and probably will be claimed that there is provision and that it is possible for widows, widowers and families or people who are killed in industrial accidents to claim at common law. However, the fact remains that common law claims are very difficult to pursue and they do depend, as we all know, on establishing that such accidents have arisen because of negligence on the part of the employer. Sometimes that is very difficult to establish. A man could be killed at work at a relatively young age, leaving young children, and the normal widow's pension is expected to make up for the loss of the victim's income and family support from it over a period lasting many, many years. Therefore, nothing at all would be payable for the fact that a person's life has been lost in the production of goods and services which the country needs. We believe that there is a strong case for compensation on a no-fault basis for the families of those who die as a result of industrial disease or injury. I beg to move.

§ Baroness Trumpington
Successive Governments have left the main preference paid to industrial widows unchanged at 55p per week. We propose to end the nonsense of maintaining a separate scheme to pay such paltry sums. While we all sympathise with the tragic loss faced by a widow who loses her husband in an industrial accident, we must remember that the tragedy is just as great for other widows, whatever the cause of their husband's death. For these reasons the Government propose to treat industrial widows no differently from national insurance widows.
696 We will ensure, however, that no industrial widow is denied national insurance widow's benefit for want of sufficient national insurance contributions. That will make them automatically eligible for the new tax-free £1,000 lump sum payable on bereavement, provided they meet the other conditions of entitlement.
The noble Baroness also proposes that industrial widowers should receive a lump sum payment. That would be an attractive step in the direction of greater equality between the sexes in the social security scheme. Unfortunately, it would be too costly to extend the lump sum to all widowers and, for the reasons I have given, we would not wish to restrict the payment to industrial widowers. I therefore cannot recommend this amendment to your Lordships.

§ Baroness Turner of Camden
In view of the noble Baroness's response to the previous amendment, I am not really surprised at her response to this one, and she will not be surprised to learn that I am not at all happy about it. I repeat what I said earlier. In my view, there is a case for an industrial injuries scheme for those who go to work and who are involved especially in hazardous circumstances. Many countries have an industrial injuries scheme with a no-fault basis. If there is no continuation of a separate scheme with benefits for people injured at work, or their families, we shall see an increase in the number of cases that eventually come before the courts as people try to get some compensation on a common law basis.
It is a great pity that we cannot have a proper industrial injuries scheme on a no-fault basis. I hear what the noble Baroness says. I shall not press my amendment at this point. I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Baroness Hooper moved Amendment No. 106A: Page 104, line 30, leave out ("of this Act").

§ The noble Baroness said: In moving this amendment on behalf of my noble friend, I propose to take with it a number of other amendments; namely, Amendments Nos. 111G, 111H, 118H, 130D, 130M to Y inclusive, 131ZC, 131ZD and 131ZE. The Committee may be relieved to know that these are technical amendments consequential upon the changes to the industrial injuries scheme in the Bill. They amend or replace existing references to provisions altered by Schedule 3. They do not alter the provisions in the Bill. I beg to move.

§ On Question, amendment agreed to.

§ Schedule 3, as amended, agreed to.

§ Clause 38 agreed to.

§ Lord Kilmarnock moved Amendment No. 107: After Clause 38, insert the following new clause:

§ ("Death grant

.—(1) A death grant shall be payable in respect of each death which occurs after the commencement of this section on receipt of an application in the prescribed form by the personal representative of the deceased.
(2) A death grant shall be of a prescribed amount intended to cover the basic costs of a funeral and the Secretary of State may prescribe different amounts for different geographical areas.
(3) An amount under subsection (1) may be recovered in its entirety out of the estate of the deceased if that exceeds £10,000.

If the aforesaid estate is less than £10,000 but greater than £5,000, a fraction of the amount may be recovered out of the estate of the deceased which is equal to the fraction by which the estate exceeds £5,000 compared with £5,000 as quotient.

(4) Circumstances may be prescribed in which the value of a house owned by the deceased or part thereof may be disregarded in determining the value of the estate for the purposes of this section.").

§ The noble Lord said: With the lights dimming around us, this is an appropriate moment to move the amendment on the death grant. The Bill proposes to abolish the death grant of £30 and replace it with discretional awards under Clause 32(1)(b) from the social fund. We believe that it is totally wrong to require people to apply for help with funeral costs at the time of bereavement. The noble Baroness has said that funeral grants are protected under the social fund; that is, that they will have priority for funding. Even so, an applicant will have to establish the case for his or her need at a time of severe personal distress. I invite the Committee to imagine the additional distress if death occurs over a weekend or during a long public holiday when the social fund office is closed and there is no certainty anyway of an award. In such circumstances it would be impossible for very poor people to instruct an undertaker pending a decision that might take some days. Natural distress would be further compounded by fear of being forced to accept a pauper's funeral which local authorities still have an obligation to provide for the destitute.

§ Our proposal in the amendment should commend itself to the Government. It is, in effect, a flexible loan/grant proposal, according to circumstances. It says that a death grant shall be payable in respect of each death that occurs after the commencement of the Bill on application in the prescribed form by the personal representative of the deceased. It also provides in subsection (2) that the prescribed amount can vary according to the differing costs in differing areas. We have published a "green paper" including recommendations on this subject in which we mention a sum, in the region, I believe, of £250 to £300. That might vary in different parts of the country, and subsection (2) provides for that.

§ In subsection (3) the new clause provides that the grant can be recovered in its entirety from the estate if that eventually turns out to be more than £10,000. A fraction of the grant may be recovered on a sliding scale on estates between £5,000 and £10,000.

§ In subsection (4) it is set out that, circumstances may be prescribed in which the value of a house owned by the deceased or part thereof may be disregarded in determining the value of the estate for the purposes of this section.

§ That takes care of the obvious circumstance of the widow or widower continuing to live in the home and therefore there being no realisable asset in that respect.

§ I submit that this is a much better system than that proposed by the Government with the hurdle of the social fund to be surmounted before any action can be taken in these extremely distressing circumstances. On our proposal a person may confidently engage the undertaker, and the undertaker may confidently make the necessary arrangements for the burial in the knowledge that an application has been made under this new clause. The motto behind this new clause is "no means test at the time of bereavement". The 698 means test comes later when the decencies of burial have been completed. All civilised societies attach great importance to the proper arrangements for the burial of their dead. This Bill as drafted does not measure up to that standard at present. I beg to move.

§ Lord Stallard
I rise to speak to Amendment No. 107A. I believe that these two amendments are lumped together, although this amendment has a slightly different approach. The death grant was introduced by the National Insurance Act 1946. Contributions under that Act commenced in July 1948 and payment of the death grant commenced one year later. Originally the grant was designed as one of a package of benefits intended to introduce the cradle-to-the-grave security concept inherent in the philosophy of the welfare state. The £20 grant was the amount recommended in the Beveridge Report as a reasonable estimate of the necessary expenses of a decent funeral for an adult, including cemetery fees, and so there is no doubt that it was intended to cover the full cost of a funeral. In 1949, moreover, the National Association of Funeral Directors agreed with the Board of Trade that their members would not charge more than £20 for a simple funeral—that is, a hearse, four bearers and one following car.
Beveridge hoped that the death grant would replace the millions of industrial insurance policies through which most working-class families tried to save for their funerals. These policies were a public scandal because of the large proportion of the premiums that went in commission and expenses, and because most of the policies lapsed before the money became payable. Funeral insurance was clearly something that the state could do more cheaply, more efficiently and more fairly.
Within a few years inflation had raised the cost of even a simple funeral above the level of the death grant. The agreement with the Board of Trade lapsed in 1956 and the last increase in death grant—to its present £30 maximum—was in 1967. Today the death grant is by univeral admission woefully inadequate to meet funeral costs. It covers only about 10 per cent. of the cost of the cheapest cremation and there has been substantial evidence of considerable hardship in cases of tragic bereavement. Old-age pensioners struggle to save up to meet the costs of their own burial, sometimes finding that their savings prevent them from qualifying for other benefits.
The Government now propose to abolish the grant altogether, limiting the state's role in meeting funeral costs to cases where the family is poor enough to qualify for a payment from the social fund. It is not clear—certainly not yet to me—precisely how the new means test for death grant will operate. Will people on income support, family credit, and housing benefit be passported into the scheme? Will the new lump sum widow's allowance count as capital in any means test, or will it count as a resource from which the grant can be recovered? I shall be grateful if the noble Baroness can give some replies to these questions when she winds up.
In failing to increase the death grant all governments have behaved in the way commercial insurance companies behave when they sell without-profits life assurance policies. If the policy turns out to be worth 699 a fraction of its originally expected value, that is too bad: it is what you paid for. The state has no excuse for behaving in this way. National insurance operates on a pay-as-you-go basis. That has the enormous advantage that, as average earnings rise, the scheme's contribution income can rise in line with earnings, and benefit rates can also rise in line with earnings without causing any financial problems.
Recent calculations have shown that, for a national insurance contribution of about 20p per week, the death grant could be increased at once to £380, which is the cost of a simple funeral which certainly two London boroughs have recently arranged for local funeral directors to offer their residents. By raising that very modest weekly contribution in future years as prices rise, the death grant could also be increased so that it remained adequate to meet the cost of a simple funeral.
To abolish the grant altogether is equivalent to the Prudential saying to its policy holders, "You have paid your premiums on this policy regularly for 38 years, without missing a week; but we have now decided that the policy is worth so little, as a result of inflation, that we are going to cancel it. You will get nothing for your premiums—not even a surrender value". Although the sums may be small, the Government are taking away a contributory right from those who pay national insurance. The Government's proposal is therefore yet another erosion of the welfare state. It is a switch from a universal benefit to a means-tested benefit.
When the Government abolished earnings-related supplements to sickness and unemployment benefits a few years ago, there were complaints that they were abolishing an insurance benefit for which people had paid by their contributions. On that occasion, the Government argued that these were short-term benefits, earned by recent contributions. However, the death grant is a benefit for which people have paid contributions throughout their working lives. The fact that payment is subject to minimal contribution conditions does not alter this fact.
Amendment No. 107A would ensure that anyone who has already paid enough contributions before April 1987 would remain entitled to a death grant if he or she died after April 1987. Another purpose of the amendment is to draw attention to the fact that the death grant is an insurance benefit for which people have been paying contributions for 38 years. It is important to emphasise that fact. It is one thing to say that people now entering the workforce should not qualify for it, but it is quite another to abolish a benefit that people have been paying for throughout most of their working lives.
I said that for a national insurance contribution of 20p a week the death grant could be increased to £380 now. I know, from my connections with all the voluntary organisations concerned, especially with youngsters, with the Soldiers', Sailors' and Airmen's Fund, the Council of Churches, Age Concern and the Dignity in Death Alliance, that most people, if asked, would agree to that simple proposition. The Government, in proposing this clause, have completely failed to understand the needs of the people and have totally misjudged the mood of the people in the matter of the death grant. This 700 amendment, therefore, is an attempt to retrieve the dignity and respect of people in those unhappy circumstances. I beg to move.

§ Baroness Trumpington
I think I am right in saying that the noble Lord, Lord Stallard, cannot move Amendment No. 107A, but can merely speak to it. I shall speak to both amendments, which aim to preserve universal assistance with funeral costs. It is the Government's firm belief that neither can be justified in the 1980s, and that our proposal to abolish death grant and give better and more selective assistance to those who need it most is the right and realistic course. Indeed, £30 does not go far towards the current cost of a funeral, which ranges between £350 and over £600. For the great majority of people, who have no difficulty in coping with funeral costs, the £30 grant makes little difference one way or the other. I say to the noble Lord, Lord Kilmarnock, that I simply cannot think of how one will get the £30 grant over a long weekend or over a long holiday. Indeed, the difference between the number of deaths and the number of death grant claims suggests that about 40,000 people a year do not bother to claim the grant, despite the ease with which the contribution conditions can be satisfied.
We can see no justification for preserving a grant which is not needed by the vast majority but does not give adequate help to those who really do need assistance. For this reason we could not accept Amendment 107A, which would effectively preserve the existing grant for the foreseeable future. The contribution conditions for death grant can be satisfied by the payment, or crediting, of 25 contributions in any year between 1948 and 1975, or its equivalent since then, by either the deceased person, his or her spouse, or a near relative. Consequently, the death of almost anyone who is currently of working age would continue to give rise to a death grant for decades to come. The Committee will understand that I am not thrilled at this perpetuation of what is already a historical relic.
The noble Lord, Lord Stallard, spoke about the death grant as a contributory benefit, and its abolition meaning the removal of an entitlement for those who have already paid for it by their national insurance contributions. At present, payment of contributions provides entitlement to the death grant, but like other national insurance benefits the grant is not a funded benefit, it is a pay-as-you-go benefit and is therefore paid out of current contributions. The reduction in expenditure resulting from the abolition of the grant will be taken into account in setting contribution rates.
Amendment No. 107 does at least attempt to address the twin issues of the inadequacy of the present death grant for any useful purpose and the lack of targeting on those who need help most. The proposed new clause would provide for a non-contributory grant payable at a higher level, but recoverable from those with estates over £5,000 or £ 10,000. May I say at once that I sympathise with what they are getting at, but I cannot agree with it. The effect of this proposal would be to spend considerable amounts of public money—£230 million if we assume a funeral cost of £350, but ranging up to £400 million at a funeral cost of £600—to give interest-free loans to people who do not need help at the moment.
701 The noble Lords may say that people will not bother to claim a recoverable grant if they know that the deceased person's estate is worth more than £10,000. Economics would tell us that if someone is offered a free loan of that size for the length of time it takes to settle the value of an estate, he is likely to take it. I would myself. So I think we have to accept that the gross cost of the noble Lord's proposal could be anything up to £400 million, against about £17 million at present on death grant. The net cost would depend on the number of estates worth more than £5,000 or £10,000. Our best estimates are—and they are rather rough—that the net benefit cost would be of the order of £185 million. The administration cost would be very considerable. If resources of this magnitude were available, I can think of much better uses for them in the social security system. I submit that our existing proposals to give greater help through the social fund and to recover from the deceased's estate will actually achieve the same purpose as the noble Lord's amendment, and I would ask him to withdraw it.

§ Lord Kilmarnock
As the noble Lord, Lord Stallard, said, these two amendments approach the problem of the funding of funerals from two slightly different angles. I agree with him in his comments on the dignity and respect which are vital to proper burial arrangements. The noble Baroness misinterpreted what I said. My amendment is trying to get the security of knowing that assistance is available. That is what is required in order to enable the deceased's relative to go ahead with making the necessary arrangements. Frankly I find it rather difficult to understand why the Government do not like my amendment because it targets on those in need. I find the argument of the noble Baroness on the enormous costs which might result from this new clause to be absolutely extra-ordinary. It is surely most unlikely that people would claim assistance under this clause where there was no real need. I was extremely surprised to hear the noble Baroness say that she would do it herself. I found that most extraordinary. This gives a cynical view of the way people might behave in these circumstances. I do not accept that at all.
Our amendment is a very reasonable way of dealing with people's real needs while ensuring that those who do not have the same financial need are not assisted or, if a payment is made and it eventually turns out that the estate is worth a certain amount of money, the sum can be reclaimed. That is a sensible way of going about matters and so far as I am concerned I shall return to this at a later stage in the Bill, but in the meantime I beg leave to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ Clause 39 [Abolition of death grant]:

§ Lord Stallard moved Amendment No. 107A: Page 46, line 2, at end insert ("except by virtue of contributions paid or credited before the commencement of this section.")

§ The noble Lord said: I have already spoken to Amendment No. 107A. I must confess that I was not satisfied with the reply given by the noble Baroness. She failed even to comment on the alternative proposal I made that it has been calculated that for a 702 20p per week contribution the death grant could be increased to £380 for all deaths from now on, to be upped with the rate of inflation. There are 22.5 million national insurance contributors. If they all paid 20p per week that would bring in £225 million a year. These are different statistics from those that the noble Baroness quoted. If this were divided by 600,000, which is approximately the number of deaths annually in Great Britain, that works out at £375 per funeral.

§ We could also add something for the cost of administration, although I have always argued and failed to see why it costs more to administer a £380 grant than it does to administer a £ 100 grant, or a £50 grant. The costs of administration cannot continue to go up and up. That must be limited. If the noble Baroness were seriously to consider the alternative proposal that I and millions of people in this country support, I think she would come to a more positive and constructive conclusion. However, having heard what she has to say, something which she will no doubt repeat, I too reserve my freedom to come back to this on Report. I beg to withdraw the amendment.

§ Amendment, by leave, withdrawn.

§ On Question, Whether Clause 39 shall stand part of this Bill?

Lord Winstanley
On this Motion, I seize this opportunity to ask the noble Baroness to expand a little on her answer to my noble friend Lord Kilmarnock on the last amendment. Her principal objection to his amendment was on grounds of its greater cost: that its cost would be greater than the Government's own proposal. The Committee would find it helpful if the noble Baroness would tell us precisely what will be the cost of the Government's proposal. The Government have told us that they intend to pay the equivalent of a death grant from the social fund to many people in need. They have not said to how many people such a grant will be paid, nor have they said how much it will be. If the proposal in this clause is to be of greater cost, it would be helpful if we knew how much the Government's proposal would cost. How much is the grant to be and how many people will it go to?

§ 10.30 p.m.

§ Baroness Trumpington
It is quite impossible to say how many people would be involved unless we know how many people died. Most people do not need the death grant. Over 90 per cent. of funerals are paid for by private resources and for those who need help the amount of grant, maximum £30, is totally inadequate when compared with the cost of a simple funeral, which varies widely in the range of £350 to £650. The cost of increasing the grant to its original value would be £140 million. The abolition of the death grant will enable the Government to concentrate resources from the new social fund on more of those who really need help.
I cannot give the precise cost, but I should like to come back to the remark of the noble Lord, Lord Stallard, on the £380. That would cost about £250 million; but even then it would not ensure that the full cost of a funeral would be met. As I said before, costs range between £350 and £650. The other point is that 703 the widow's lump sum of £1,000 will be disregarded in assessing entitlement to social fund payments.

§ Baroness Seear
If the noble Baroness does not know what the cost of the Government's scheme is going to be, how does she know whether it is more or less than the scheme proposed by my noble friend Lord Kilmarnock?

§ Baroness Trumpington
The Government's proposals for payment of funeral costs out of the social fund extend considerably the existing arrangements under which less well-off people are helped. This is because these proposals will enable housing benefit and family credit recipients to make claims as well as those receiving income support. As a result, the number of people who, subject to the capital rule, will have full cover for the cost of a reasonable funeral will be increased from about 4.5 million to about 8 million. I cannot give the precise cost. We estimate that it will mean around 60,000 funeral payments being made each year—roughly 10 per cent. of the number of deaths. This represents about a four-fold increase on the number of single payments made to supplementary benefit claimants for funeral costs at the present time. I hope that reply satisfies the noble Baroness.

§ Clause 39 agreed to. Clause 40 agreed to.

§ Clause 41 [Unemployment benefit—disqualification]:

§ [Amendments Nos. 107B to J07D not moved.]

§ Clauses 41, 42 and 43 agreed to.

§ Baroness Gardner of Parkes had given notice of her intention to move Amendment No. 108: After Clause 43, insert the following new clause:

§ ("Invalid care allowance.

§ . For subsection (3) of section 37 of the Social Security Act 1975 there shall be substituted the following subsection: (3) A person shall not be entitled to an allowance under this section if he is under the age of 16 or receiving full-time education; and a woman shall as from 20th December 1984 be treated as having been entitled to an allowance notwith-standing that she may be married and either residing with her husband or in receipt of maintenance or living together with a man to whom she is not married as husband and wife." ")

§ The noble Baroness said: On behalf of those who have tabled this amendment—the noble Baroness, Lady Lockwood, not being here—I should like to say that in view of the recent Government statement we do not propose to move this amendment at this stage.

§ [Amendment No. 108 not moved.]

§ Lord Seebohm moved Amendment No. 108A: After Clause 43, insert the following new clause:

§ ("Annual uprating of child benefit.