HL Deb 12 March 1987 vol 485 cc1201-4

Lord Hesketh rose to move, That the draft order laid before the House on 4th February be approved. [10th report from the Joint Committee].

The noble Lord said: My Lords, I beg to move that the regulations be approved.

These regulations were originally laid before Parliament on 17th December last as a negative instrument. However, it was subsequently realised that, because the contents of one part of the regulations related to powers in Part II of the Social Security Act 1986, the whole of the regulations should have been laid by the affirmative procedure. In relaying this instrument we have taken the opportunity to make one or two minor improvements to the wording. I should perhaps say at the outset that the negative instrument was on sale for only four days before being withdrawn. Anyone who bought a copy will be entitled to receive a copy of the final instrument without further charge.

Much of what is in these regulations is familiar to those who deal with social security matters on a day-to-day basis. In a social security system which has evolved over some 40 years, there has been the tendency for each benefit to have its own set of regulations with its own rules relating to matters such as how to deal with overpayments.

This immediately creates two problems for those who need to understand and operate the rules: first, where to find them. This can involve a time-consuming hunt through a multiplicity of instruments. For this reason our aim has been to put the rules on the recovery of overpayments for all benefits in one instrument so that anyone seeking the detail of an overpayment question will in future go to the present instrument no matter which benefit is involved.

A glance at Part I of the schedule to this instrument shows how many varied and scattered regulations we have brought together. I am sure that this will be a move which will be widely welcomed as a simplification in an area which we all recognise has been in need of simplification for some time.

The second problem which our patchwork of benefits creates for the user is that over the years slightly different rules have been applied to different benefits but often with the same objective in view. Our second objective has been to remove these differences where we have felt it is practicable and right to do so, creating a common approach for the future.

The prime example in these regulations is the new single test which decides whether an overpayment is recoverable. Hitherto there have been broadly two tests. For contributory and related benefits the test has been whether the claimant exercised due care and diligence in obtaining a payment; whereas for supplementary benefit the test has been whether the claimant has, fraudulently or otherwise, misrepresented or failed to disclose a material fact and so been overpaid.

The case for a single test was overwhelming. We chose that currently used for supplementary benefit, for several reasons. First, it is a less subjective test and easier to understand and operate. Secondly, it is far more commonly used. There are eight times as many supplementary benefit overpayments dealt with by our local offices as there are for other benefits. Finally, the test will provide some small savings from additional benefit recovered—I emphasise that they are small—and rather more by way of staff time and administrative costs. By contrast, the general adoption of the due care and diligence test would result in less benefit being recovered and substantial additional costs in staff time and administrative expense.

The issue of the single test has of course been widely debated during the passage of the Social Security Act 1986 and these regulations merely put into effect the powers in Section 53 of that Act. I should make it clear that although we have adopted the single test of misrepresentation or failure to disclose a material fact, there are no other changes to the way we deal with overpayments. Appeal rights remain exactly the same as they are at present, as does the discretion of my right honourable friend the Secretary of State for Social Services to consider sympathetically the extent to which recovery should be pursued. He will continue to take account of the age and health of the individual and the general financial circumstances of the family.

For the most part we have brought together a number of other regulations into one single instrument without any changes. So far as concerns the single test for recoverability, the debates on the Social Security Act 1986 resulted in the principle being accepted and these regulations merely give effect to the provisions of that Act. I commend these regulations to your Lordships' House for approval.

Moved, That the draft order laid before the House on 4th February be approved. [10th Report from the Joint Committee.]—(Lord Hesketh.)

Baroness Jeger

My Lords, I am sure that your Lordships will be glad to know that I do not propose to go in detail through these regulations, which I think are very confusing and unhelpful. The whole problem which they bring to mind is that the Social Security Act of last year was very dependent on regulations. Now we have regulations here which replace those laid by the negative instrument on 17th December. It is just another example of how the Government are trying to rule by regulation and not by law. I understood, though I did not believe it, that the 1986 Act was supposed to streamline and simplify the social security regulations. Instead the regulations have confused and brought delay and have introduced into this House and the other place government by regulations which are not amendable.

I found myself reading the Green Paper, which was supposed to set out the whole plans of the Government. The Green Paper, which referred to the reform of social security, said that it was intended to make social security legislation much more compact, clear and manageable. I find that is not happening at all and that time after time we are having regulations. We said during the passage of the Social Security Act that the Government were bringing in government by regulation. Here again, we have the example of mistakes which the Government have made. They have to admit that the negative instrument on 17th December was faulty.

There are other examples, but tonight we are discussing only this one particular process. I can tell your Lordships that I could go through these regulations page by page, sentence by sentence, but I do not think that that would be for the convenience of your Lordships' House. I shall merely say that my honourable friends and myself think that government by regulation is not acceptable and that we shall look forward to dealing with this matter at another time.

Lord Kilmarnock

My Lords, we on these Benches should like to thank the noble Lord, Lord Hesketh, for having explained the introduction of these regulations. Once again, this is the result of a government error in that they originally laid them by the negative procedure which was incorrect under the Act which was passed only last year. They have now taken the opportunity to make one or two adjustments, bringing them forward again under the affirmative procedure. I am bound to say that that does not give one very many grounds for confidence that the stated intention in the original Green Paper on the reform of social security to which the noble Baroness referred and which preceded the Act was to make social security legislation much more compact, clear and manageable.

We now find that we have regulations superseded by other regulations, and so on. Therefore, all the complications that we foresaw as resulting from that Act are beginning to come home to roost. Like the noble Baroness, I shall not go through the regulations in any detail. However, I should like to ask the noble Lord one question, if he would be kind enough to answer me. It concerns Regulation No.4 on the recovery of overpaid interim payments. Regulation 4(3)(a)(i) refers to someone who having made a claim, has withdrawn it or is deemed to have withdrawn it". Can the noble Lord tell me in what circumstances a person who has made a claim can be deemed to have withdrawn it? I find that a very obscure passage in the regulations. The noble Baroness said that they were obscure, and that seems to me to be one obscurity. I do not know how to interpret that. It also seems to me rather strange that in any circumstances there should be interim payments against final payments which are likely to be overpaid. Presumably the person making the interim payment would know what the final payment was likely to be and would not make an excessive interim payment in those circumstances. I am bound to say that I found Regulation No.4 very obscure. I think that someone trying to interpret it might also do so.

We are told in the notes that as the Social Security Act has been in effect in force for less than 12 months, these regulations are therefore exempt from automatic reference to the Social Security Advisory Committee, but we must hope that when that year is up the committee will exercise its own discretion and look at them very carefully to see whether there are any more anomalies of the kind that I have pointed out which should be brought to the notice of the Government. However, obviously we do not oppose the regulations.

7.45 p.m.

Lord Hesketh

My Lords, I am grateful for the contributions which your Lordships have made to this debate. As I said at the outset, much of what is in these regulations is time-honoured practice from other regulations which have been put into this instrument. The change to a single test for recoverability of overpayments is a simplification which I am sure will be welcomed. I recognise that a change to a test for misrepresentation and failure to disclose all benefits will not have been universally welcomed, but I have explained the Government's reasons for choosing the single test which is now in the Social Security Act 1986. These regulations simply give effect to the principle of recovery which has already been agreed.

I shall try to answer the two questions raised by the noble Lord, Lord Kilmarnock. The first concerned Regulation 4(3)(a)(i), which the noble Lord described as very obscure as regards the words, "deemed to have withdraw a claim". It is assumed that no response to inquiries, perhaps showing no intention to prosecute a claim, is the case there. The noble Baroness, Lady Jeger, described the regulations as complicated. I hope that we have simplified them. Part I of the schedule demonstrates that regulations from 15 different sets have been brought together in instruments now before this House.

The noble Lord, Lord Kilmarnock, referred also to interim payments in Regulation 4. Regulation 4 caters for overpayments of interim payments where either there is no statutory entitlement or the entitlement is less than the interim payment made. The claimant will already have been notified that he must pay any overpayment—that is Regulation 2(2). Therefore the question of misrepresentation or failure to disclose does not arise. Only that part of the interim payment which is more than the actual entitlement is recoverable. The method of recovery is by deduction from benefits in the same way as any other overpayment. I commend the regulations to your Lordships' House.

On Question, Motion agreed to.