HL Deb 11 February 1988 vol 493 cc318-75

3.28 p.m.

Lord Skelmersdale

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Lord Skelmersdale.)

On Question, motion agreed to.

House in Committee accordingly.

[The LORD ABERDARE in the Chair.]

Clause 4 [Income support and child benefit]:

On Question, Whether Clause 4, as amended, shall stand part of the Bill?

Lord Banks

I oppose the Question, That this clause stand part of the Bill and I do so for several reasons. I do so, first, because it turns the YTS into a compulsory scheme and the voluntary nature of the scheme was one of its basic principles. That principle was restated at a meeting of the Youth Training Board as recently as 9th July 1987. Moreover, Sir Bryan Nicholson, the former chairman of the Manpower Services Commission, wrote to Mr. Norman Fowler on behalf of the MSC on 23rd July 1987 in these terms: The Commission's position on this matter is clear. It has been repeated many times, most notably as one of the five principles of the design of the YTS, in our 1985 Report, The Development of the Youth Training Scheme. We have always recommended that this scheme should be one in which participation is voluntary, whether by the employer or the young person. That remains our view". A similar view has been taken by the Institute of Careers Officers. The Confederation of British Industry has repeatedly expressed the view that YTS should be voluntary. The National Union of Students, the British Youth Council and Youth Aid have all taken a similar view that the scheme should be voluntary.

Secondly, the Bill goes much further than the expressed aim of the Government in their manifesto, which was to remove eligibility to benefit from those under 18 who deliberately choose to remain unemployed, in particular those who do not enter YTS. There is no evidence that this is a sizeable number. In recent times government research has shown that 91.1 per cent. of school-leavers would prefer to work than to be on benefit. In addition, regulations already exist to reduce the benefit of young people who unreasonably refuse the offer of a place with YTS or who leave early for no good reason.

On 4th March 1986 Mr. Tony Newton, speaking for the Government in another place, said about those who unreasonably refuse an offer to go on YTS or who leave early for no good reason, that the reduction of benefit was not lightly to be dismissed. At the time he was arguing against the sort of proposal which the Government are now making in the Bill.

At Second Reading I pointed out that between December 1983 and May 1987, 25,697 persons suffered a benefit deduction for voluntary unemployment. Of that number 23,453 were early leavers and only 2,244 had refused the offer of a place on YTS. During that period 1 million young people had entered YTS. In the age group which we are considering there are 1.4 million people.

It was those figures which led me to suggest that the Government were using a sledgehammer to crack a nut. The noble Lord, Lord Boyd-Carpenter, argued that if there were so few, what harm could come from proceeding with the clause. It seems to me that he overlooked the fact that the clause is not only unnecessary but it also made YTS compulsory against the wishes of all the bodies to which I have referred. My case is that the present arrangements are adequate and do not have this undesirable effect. The Youth Task Group Report which set out the framework for YTS in 1982 stressed the importance of the safety net of supplementary benefit for its success.

Thirdly, I am concerned about the position of the 30,00 young people under the age of 18 who are currently studying for O and A-levels or vocational qualifications under the 21-hour and 12-hour rules. Those rules allow them to study for a limited period each week in return for an undertaking to abandon their course immediately and to take up a job if one is offered. It would appear that those arrangements will come to an end.

Fourthly, I am concerned about the complexity which will be a feature of the regulations prescribing the circumstances in which some young people can claim income support. Fifthly, I am unhappy about the definition of severe hardship, which is to be a reason why some young people will receive income support even though not originally entitled to it. I believe that there are bound to be many hard cases, many very difficult decisions and much less satisfaction as a consequence. I regret the absence of any appeal to a social security tribunal against decisions made in this connection.

The noble Lord, Lord Skelmersdale, did not entirely convince me that the arrangements for dealing with the question of severe hardship at the DHSS will not lead to a certain consideration of degree. I feel that his estimate of the time that will be taken was very optimistic.

Sixthly, I regret the effective demotion of young unemployed people aged 16 and 17 to the status of dependants with their income coming entirely through their parents. For all these reasons I oppose the Question that Clause 4 stand part of the Bill.

Baroness Jeger

We support the amendment moved in the name of our noble friend—I hope I can say that—Lord Banks. We are all anxious to save the time of the Committee, so if I appear to be a little cursory it is not because of a lack of concern about this clause but because I believe it is very important, after all the discussion that has taken place, that we should move on and make a quick decision.

Ministers in both places have emphasised that this issue was in the Conservative Party manifesto and that that gives it some righteousness. Masochistic as ever, I have read the manifesto again. I find at page 32: We will take steps to ensure that those under 18 who deliberately choose to remain unemployed are not eligible for benefit. We will of course continue to protect other young peope such as those who suffer from disabilities". Clause 4 goes far beyond that, because it concerns young people who may not have deliberately refused employment. They may be living in a remote area where there is no YTS available; they may have had a job after they left school at 16, worked until they were about 17 or 17½ and subsequently lost their job. There are all kinds of reasons why people under 18 are unemployed. It seems to me totally wrong that the Government should be, as it were, making a segregated section of our population.

Under Section 20 of the 1975 Social Security Act we have a provision whereby people who do not accept jobs can lose benefit. Surely that is the way to go about it. It seems to me that the Government are turning natural justice on its head. Instead of saying that these young people are innocent until they are proved guilty of not taking jobs, they are saying that they are guilty until, because of various factors, they are proved innocent. That is the wrong way to go about it.

The other night a Minister said that he was going to make a list of people who would be excused from this rule. How will he check it? There was a long list of excuses including fear of being abused, fear of homelessness or family problems. But I ask the Minister, who is to police this? If a young person comes to the DHSS, asks for exemption under the rule which applies to the 16 to 18 year-olds and says "My father has remarried and I hate my stepmother who is abusing my little sister", who is going to follow that up? Is there to be a report to the police? Is there to be a reference to the overworked social welfare people in the town hall? How will he work out that long list?

The manifesto referred to disabled people. What degree of disablement is involved? The word "severe" is not used in the manifesto, but it is used in the Bill. Surely we want disabled people to work. We want them to feel able to work. It is not a very positive attitude for the Government to be suggesting that people who suffer through disability should be made to feel different from those without disability. During the International Year of Disabled Persons I was in America where a special stamp was issued which said "Disabled but not unabled". That is a much more positive attitude for the Government to take. We should not make young people feel different because of the circumstances of their families or of their health.

In the High Court last week there was a case about the long delays faced by people applying to the DHSS for supplementary benefit. I am appalled by the thought of the delays there will be if that overworked staff has to sort out all these young people between the ages of 16 and 18 who are on the various grants that the Minister has set out. Will there be the right of appeal? Willl young people be able to say that they ought to be given this special consideration because of their housing position or because of a marital break-up?

It would have been so much better to have done it the other way round by saying that, as has happened since 1946, after the age of 16 people are able to get unemployment benefit, and then invoke Section 20 of the 1975 Act and say, "You will not get it if you keep refusing a job". I have not had an answer from the Government as to why we are not keeping to that arrangement. We are turning the whole thing upside down. It is a departure from the tradition of British justice. These young people are to be told that they are guilty until they prove their innocence. Their innocence has to be proved within a set of regulations which the Government refuse to put into the Bill.

I said to the Minister the other night that if he was so anxious to make things easier, he should put these matters into the Bill so that young people have statutory rights to unemployment benefit. I gather that that has been refused by the Government. We are left with a clause which does not reflect the Conservative manifesto in detail, and does not provide for the difficult circumstances of many young people between the ages of 16 and 18 who may have very many reasons for being out of work, for being homeless or for being in trouble. Therefore, because no amendment has been accepted by the Government, my noble friends and I must oppose the whole of the clause.

3.45 p.m.

Lord Boyd-Carpenter

The noble Lord, Lord Banks, was right when he said that the great majority of young people will not be affected by this clause because they will have the good sense to accept the possibilities and opportunities offered to them by the YTS, and will not choose voluntary unemployment. However, he went on to argue that because it would only be a minority of young people who if left to themselves would choose voluntary unemployment and financial support at the public expense, we should not legislate. I do not follow that argument.

The noble Lord will be aware that most legislation is designed to deal with the problems or the misdoings of quite small minorities. The whole of our criminal law deals with a limited number of people who seek to commit crimes. The vast majority of law abiding people are not affected by the criminal law. If one looks through the statute book, one sees that a great deal of our modern legislation is designed to deal with relatively small minorities. Therefore the fact that the numbers are fairly small—so we hope and believe—is no argument against the clause. Indeed, it seems to me to be an argument for it.

The noble Baroness, Lady Jeger, referred to all the young people who would have to have their cases sorted out. She was plainly suggesting that there would be a great many of them. I hope therefore that the sponsors of the Motion that the clause should not stand part of the Bill will try to come to some reconciliation with each other. Are we talking, as the noble Lord, Lord Banks, suggests, of so small a number that it is not worth legislating for? Or are we, as the noble Baroness seems to suggest, dealing with very large numbers in respect of which the administration of the clause will give rise to great problems? The sponsors of the amendment cannot have it both ways. Either we are talking about a great many people, or we are talking of very few.

Surely the principle of the clause—this is the main issue when we are discussing whether the clause should stand part of the Bill—is a simple one. Does one believe that in the case of young people it should be open to them deliberately to choose to remain unemployed and draw benefit at the public expense?

Noble Lords


Lord Boyd-Carpenter

That is what the clause is designed to deal with. I am glad to hear noble Lords opposite saying no. Very few of us would feel that it was right to leave that so, both on the general principle and also because when one is young few things can be more demoralising than unemployment; and voluntary unemployment is perhaps one degree worse. Indeed, noble Lords opposite, when they thought they were on to a good thing on the issue of unemployment, were often full of the most eloquent speeches about the damaging effect, particularly on young people, of unemployment. Here is a measure designed to prevent voluntary unemployment among young people.

I should have thought that public opinion generally and the opinion of the party opposite should surely be that this is the right thing to do. When your Lordships remember that the allowances paid under the YTS are higher than the benefit which would be obtained were young people to remain unemployed, it is quite wrong to suggest that these young people are being treated badly. They are being offered not only training for a career, which must be important to them, but a higher rate of allowance than they would get if they stayed unemployed and relied on benefit. That is an important aspect of the matter.

I very much hope that the Committee will feel that Clause 4 should stand part of the Bill. I am bound to say that the words "Clause 4" must have a somewhat nostalgic ring to noble Lords opposite, particularly to the more senior of them, recalling the days when the late Mr. Gaitskell made his gallant if unsuccessful attempt to drag the Labour Party into the 20th century.

Baroness Jeger

Before the noble Lord sits down, as both sides of the Committee agree that we do not want to encourage young people to lay about, can he, with his long experience, which we all respect, say why that section of the 1975 Act is not adequate to deal with those who insist on being voluntarily unemployed?

Lord Boyd-Carpenter

I can answer that question easily. If one uses the 1975 Act, one has to show that the person concerned has refused several offers of employment. Therefore, the matter will drag on for a long time. The person concerned will say, "Oh, I did not like that job, but hope another one will turn up" and so on, and will shilly-shally in that way. Furthermore, while the matter is dragging on, he will be drawing benefit. It is to prevent such a situation that the clause is necessary; in other words, the 1975 Act is no answer, quite apart from the administrative complications of which the noble Baroness spoke, that would be involved in following up case after case of refusals of employment with all the arguments that can be adduced as to why any particular employment was not attractive to the person concerned.

Lord Pitt of Hampstead

I am afraid that the clause does a lot more than that. If the clause merely prevented people from choosing voluntarily to be unemployed, I should not oppose it; but the clause has failed to take two important matters into account: the degree to which 16 year-olds and 17 year-olds are estranged from their parents and the homelessness that results therefrom. It is because the Bill has failed to take those factors into account that we must ask the Government to look again at Clause 4 and to close that particular loophole. I support the noble Lord, Lord Banks, because, if the Government are not prepared to look again at the clause, then we must force them to do so.

I shall not take up too much of the Committee's time, but I feel that I ought to read a few paragraphs from a letter which I have received from a woman working in one of the hostels that look after such youngsters in Livingston. I shall read the parts that I consider relevant to this matter. She says: For homeless kids the employment requirement is the stumbling block. Can you imagine attending an interview for work, when you can give no permanent address?—when your bed may the floor in the house of a series of friends whose hospitality is overcrowded, uncomfortable and a little whimsical—where you may be 'chucked-out' at any moment because of an argument or because they're fed up of you and have no real responsibility for your welfare. Children make and break friendships more easily and quickly, more passionately than grown-ups. It may be that you don't even have that precarious comfort. Your bed may be a collection of cardboard boxes in a culvert". Referring to the training, she says: Even if the authorities 'guarantee' a job or training-scheme to all these children—and such a 'guarantee' defies definition—there will always be some who, because of their emotionally-straitened circumstances, will be unable to sustain those jobs, or training places. How can they, when they are homeless, and are they to be further punished'? She then writes about what the noble Lord, Lord Boyd-Carpenter, described when he mentioned young people so gallantly giving up jobs and training places. She describes the children in her hostel and continues: I can honestly think of none who has left home lightly or cavalierly and they have all desperately wanted a job or training scheme. There is absolutely no sense in which our project"— she is talking about her project— has 'encouraged' these children to leave home. Indeed, the two years in which I have worked there have humbled me, in the face of their courage, perseverence and fragile resilience. Their circumstances immediately before being referred, or referring themselves to the hostel, as revealed in their interviews with staff, during their stay, would strike terror into your hearts. Some have suffered mental and physical cruelty, and a number sexual abuse. Most have experienced massive neglect and have certainly received none of the parental care and support which you or I would demand and take for granted. Many have been thrown-out by step parents. I am perplexed at the growing number of these seriously disadvantaged youngsters and can only explain it by my own personal observations of the increased incidence of divorce and second-marriage, combined with widespread poverty and unemployment and overcrowding, owing to the housing shortage. All of those factors experienced in a society where one of the few legitimate aspirations now appears to be material wealth and conspicuous consumption, must I suppose make for an explosive cocktail—especially in a household where a teenager is naturally flexing his or her adult muscles … If this Bill is not amended, we may have to turn away these children, because they have been deprived of the state income to pay for their hostel place. Where will they go? How many of them will be forced into prostitution to pay for a roof over their heads? How many rent-boys will be created? Many are 'qualified' for nothing else and there are many people in Edinburgh and Glasgow, not to mention London, who are ready to exploit them financially or sexually. The really perplexing aspect of this moral conundrum is that our emergency accommodation project was set up in response to local public demand. The property is provided by Livingston Development Corporation, and we are funded through the local District and Regional Councils by taxpayers and ratepayers, precisely to protect these vulnerable young citizens. They themselves are not told enough to vote and are therefore captives of our sense of responsibility". It is because the clause has not taken such matters into account that I ask the Committee to reject it. I believe the Government can easily sit down and produce a better clause which will not have those loopholes.

Baroness Lane-Fox

I support Clause 4 for the reasons given by my noble friend Lord Boyd- Carpenter. However, there are a few people about whom I should like to speak. That is largely due to a letter which I have received from the Director of the National Bureau for Handicapped Students. I think that we have had enough reading of letters this afternoon, so I shall not read it out. However, the director is worried that a number of his students are not ready for youth training at school-leaving age. They have usually managed to stay until they are 20 or 21, when they can be absorbed into a new life. Now however, they will often have to be described as "extremely mentally handicapped" in order to obtain the funds that will be needed. This will shake their confidence quite unduly. For that reason I felt I must bring it to the attention of the Minister.

4 p.m.

Baroness Carnegy of Lour

Perhaps I may go back to what the noble Lord, Lord Pitt, was saying when he read that moving and I am sure absolutely truthful letter from the lady in Livingston. That referred to the problems there and in Edinburgh and Glasgow, not to mention London. In looking at this clause it is extremely important to realise that as my noble friend Lord Boyd-Carpenter said, it is likely to affect only a limited number of the young people who might claim benefit but who would not be able to do so.

However, it is very much more important than that. This clause is now moving towards saying to young people in the country "Until you are 18 we're going to help you to be positive and realistic about life in this world. After you are 18 you are adult and you have another option of unemployment benefit. But you are not going to have it until you are 18". That will have a very considerable effect on the way young people look at life.

Many young people who have no intention of becoming unemployed will see life differently because of this. Those who are more disadvantaged, who come from homes where they do not get a lot of support, who come from broken homes and who are perhaps living in the kind of hostel in Livingston which the noble Lord, Lord Pitt, was describing will find it a very important message indeed.

The message will be, "When you get to 16, boys and girls, you have a decision to make. You can decide to stay on in full-time education, to stay at school, to go to a full-time course in college, to go on to university, if you are that kind of person. You can decide that you will try and get a job. But for goodness' sake, if you do that, find one which gives you a training at the beginning, because it may be a dead-end job. If you cannot find a job with training at the beginning of it, perhaps you want to get into a job in the hope that you will get something better from there. Or you can decide—" and this is not the third best at all nowadays—"to go on the YTS for two years. Every young person in this country has the right to a place on the YTS now. You can do that, and if you stick at it you will come out at the end with a broad-based training which will enable you to enter skills training, if you have the ability for it, in a variety of jobs. Or at any rate it will give you a track record and a reference".

The positive answer to that lady in Livingston is that the real trouble for the people about whom she cares so much is that they have not begun to get a track record. She virtually said that in her letter. They have not begun to get a track record which they can hand to employers when they apply for a job, however humble a job at the beginning. They have nothing which will convince employers at the beginning that they will be good and enthusiastic and keen.

What this clause is now doing is flying a new flag to young people. I said when we were discussing one of the amendments on the Bill that the Manpower Services Commission considered this at the beginning. They always thought—and the noble Lord, Lord Banks, is quite right—that they have always said from the beginning that they wanted the YTS to be voluntary. There was a fear at the beginning when the YTS was not understood and had not been properly developed that people would feel that they were being compelled to do something which was not of any use. They need not feel that any more. The YTS is voluntary in that you do not have to go on it. But what you cannot get is public money to do nothing until you are 18. That is the flag we are flying.

I think that it is right for every young person in this country now; it is the best thing of all for the least privileged young people because, despite the rottenness of the way in which they have been brought up, despite their parents misleading them or ignoring them or being thoroughly unhelpful to them, they can begin life with a track record with somebody for whom they are working, with friends with whom they are working. That will help to get them going. I hope this clause will stay in the Bill because I think it is very important indeed.

Lord Parry

As the noble Baroness sits down, perhaps I may draw the attention of the Committee very quickly to the fact that all the relevant research over the past 20 years into our educational system has proved that something like 34 per cent. of the children coming out of our schools are not in a position to take advantage of the very schemes which are put forward. They are already disadvantaged, many of them are alienated from society, and the words which my noble friend Lord Pitt read out to the Committee are therefore extremely relevant. There is a very large section of society which will fall below the provision anyway.

Whilst that was a caring speech and a caring response by the noble Baroness, it fails to understand the magnitude of the problem facing us. Therefore this is a penal clause as it affects those young people.

Baroness Phillips

I felt very sad when I listened to this debate, particularly after the comments of my noble friend—if I may so address her—as we are part of a minority group in this House, being female. When I was very young I used to act—rather badly, I think. I appeared in a play called Love on the Dole which was a story of an ordinary family. One of the situations which was the most poignant and telling was that the young people left home so that they could collect separate benefit and not be a burden on their parents. There is a subsection in this Bill which will definitely lead to that, If it appears to the Secretary of State that severe hardship will result to that person unless income support is paid to him". That is a direct invitation to the young person to leave home in order to benefit from this.

We have heard so much of the YTS, I wonder whether those who are advocating it have seen it in operation. Like most of my noble friends on this side, I have met these young people who very often feel they are being used as cheap labour. This is the first thing they feel. But when they leave the scheme, precious few of them can be certain of a job. If you are training, you want to be sure that at the end of it you are training for something.

If this is such a small number, why legislate for it? As the noble Lord suggested, we often legislate on criminal cases which are a minority; that is quite right. I prefer to think that laws should be for one of two reasons: first, to make life better for people; secondly, to protect them. I do not think that this clause qualifies under either heading. It will take us back to the 'thirties. It is not the only thing taking us back; more and more we shall be paying for our hospitals; we shall have to pay for our education, and all kinds of things and it is very, very sad. The right reverend Prelate said yesterday that we are living in a very materialist and unpleasant society. I am afraid that the Government must accept part of the blame for that. For heaven's sake! If it is a small number, why legislate?

Baroness Elliot of Harwood

I do not want to make a long speech, but I want to ask a question. I am not in any way opposed to the principles of the Bill and the clause. However, I was visited this morning by the general secretary of the National Association of Youth Clubs, the biggest of the youth organisations in this country. It is supported, so she tells me, by many other voluntary organisations. Their query is this. They agree that training is excellent; that people should be given every opportunity. But there are those for whom this cannot be done. The noble Lord, Lord Pitt, has instanced one or two cases and so has the noble Baroness, Lady Lane-Fox.

Would it not be possible, in the course of the progress of this Bill, to put in some provision which would be perfectly legitimate for people who are unable—not because they do not want to but because they cannot—to avail themselves of the training opportunites which will arise? We should not condemn them to having grants stopped but simply say that because they have those conditions (which of course they must prove), those conditions make it impossible to take up all the opportunities. They would then be given other chances and also money to be able to live, very often in extremely difficult conditions.

Baroness Fisher of Rednal

It is with pleasure that I follow the noble Baroness, Lady Elliot; we all know about the extremely good work she does in many social fields. I know particularly of the projects for the disabled that she has in the Birmingham area.

In our debate this afternoon it has been implied that there are jobs lined up for people to take; that for everybody who wants a job there is one available.

That may be so in the areas about which the noble Lord, Lord Boyd-Carpenter, knows, but in many others there are young people unemployed through no fault of their own because there are no jobs available. However good may be the careers' masters or mistresses, if there are no jobs for young people, what are they to do at the age of 16?

The remarks of the noble Baroness, Lady Carnegy, were interesting. She spoke about making a choice at 16 to go to a polytechnic or to a university. We are not all cast in that same mould; we cannot all be university graduates. There are some people who, unfortunately, were not at the front of the queue when the good Lord passed out the brains. We call them educationally low attainers, but that is not to say they are mentally handicapped; it does not mean to say that at all. Indeed, in terms of mass production they were the people who kept the factories, the forges and the mines going—not the people with academic records. They did that at 14 in those days, but now they must stay at school until they are 16.

If one observes a YTS interview, the first question that a boss or personnel officer may ask is, "How many certificates do you have?" If the applicant answers that he did not get any but that he was very good at a particular subject, he will receive the reply, "But I have 20 other applicants who do have certificates". So although a person may be intelligent and capable of doing a particular job of work, because he does not have a certificate then his chances of joining the YTS are more limited.

I know from experience that most low attainers have to join community programmes instead, and a certain number of them are from our ethnic minorities. So we are penalising those young people in the 16 to 18 age group who, although they are intelligent enough to do certain jobs, find that no such jobs are available for them. I plead with noble Lords opposite to visit those areas of the country where there is high unemployment and to talk to the jobless there. They should ask those people for how many jobs they have applied and how many times they have walked the streets trying to find work—often while their parents also remain unemployed. Let us think of those people and not concentrate on the others.

Mention has also been made of people who, it is claimed, deliberately remain unemployed. I suggest noble Lords make that accusation to the young people I know—

Lord Boyd-Carpenter

Before the noble Baroness sits down, she seems to have missed the point that the YTS for those aged between 16 and 18 is to be universal.

Baroness Fisher of Rednal

That does not apply in all parts of the country, and people who cannot join a YTS must go on a community programme instead, which offers a different form of training altogether.

4.15 p.m.

Baroness Carnegy of Lour

The noble Baroness is always very well-informed, but she presumes that those of us on this side of the Committee do not know what we are talking about. In fact, some of us are involved in these matters. The noble Baroness will know that the community programme is for people over the age of 18 and we are here concerned with those under 18.

The noble Baroness says that there are no jobs. We know the situation is still difficult but unemployment has fallen by 500,000 over the past 12 months. The number of 16 year-old school-leavers is falling very fast because of demographic change, which means that things are getting easier for them. The noble Baroness also knows that a place is guaranteed on the YTS for every young person in this country who wants one and that it is no longer correct to make the comments she has. I beg the noble Baroness to take account of what has happened. It probably would not have been right to enact a clause such as this two or three years ago, but this is the time when we can do so. We should talk to the people of this country, particularly the young, in an up-to-date way and give them the real facts as I have just given them.

Baroness Fisher of Rednal

The facts I gave are as up-to-date as I know them to be.

Lord Pitt of Hampstead

The noble Baroness opposite made mention of my earlier comments, when quoting from a lady's letter. My question to the noble Baroness is this: what answer must that lady give when homeless young people go to her in September?

Baroness Gardner of Parkes

I know that my noble friend has the answer to that question and so perhaps I should let her give it first.

Baroness Faithfull

I must give my own Front Bench a fearful shock and say that I do not support the Motion against this clause. Indeed, I was so worried about this part of the Bill that I spent a whole day at a Jobcentre, watching as young people entered and left it. Of those young people who came in and studied the jobs on the boards, a proportion of them said, "Not for us". I asked them how they felt about the YTS. They said that they knew all about it but would much rather draw their benefits.

I say to the noble Lord, Lord Pitt, that I have been responsible for boys' hostels of the poorest kind, for boys from the poorest kind of backgrounds. They were unemployed but the answer was counselling. Not one of the boys in our hostels was out of work. They may not have had the jobs they really wanted, and at first they may not even have had the jobs that completely suited them. But as a result of social workers helping and counselling those boys, they were always in work. I add that they were all boys in care, so they did not even have a home behind them.

We must set standards for our young people. If the Bill did not have exceptions, then I would be voting with the other side of the Committee. But it does have exceptions and it is right that it should. I believe that a balance has been struck, and therefore I must say to noble Lords opposite—and to the noble Lord, Lord Banks, who always makes such a very good case— that I cannot support their Motion.

Lord Pitt of Hampstead

My Lords, I must ask my question again as it still has not been answered. The noble Baroness has been in the kind of situation I am talking about. What will she say to a 16 or 17 year-old kid who comes to her in those circumstances next September? We must remember that there is in fact no guarantee of income supplement. The only way that such a person can get that benefit is for the Secretary of State to declare that he is in hardship. What does one say to such a person when he approaches one for assistance?

Lord Parry

My Lords, before the noble Baroness rises to answer that question, will she please accept that the lads who can read the notice board and the notice of jobs available are themselves higher up the echelon than the people I am talking about?

Baroness Gardner of Parkes

My Lords, I shall answer that question for my noble friend. As I understand it, there will be a YTS place guaranteed for everyone between the ages of 16 and 18. I have taken on board all the points about those who are slow developers or who have not attained a certain standard of academic education but, if there is a place guaranteed for everyone, that must mean that the Youth Training Scheme will cover people of all abilities. In what other way could it guarantee a place to everyone? There must be an encouragement for every young person to develop his maximum potential. We all appreciate the difference in potential that different young people have. I pay great tribute to the speech made by my noble friend Lady Carnegy of Lour. She was flying the flag for the highest standards and the best possible achievement. That is what we should like to see of our young people in this country. But we all know, too, the young people, desperately underprivileged, who have lived under appalling conditions or under neglected conditions. If we can get those young people also to develop their best potential through a Youth Training Scheme suited to their abilities and their background, so much the better.

The noble Lord, Lord Pitt of Hampstead, read out a very emotive and emotional letter. The sad thing about that letter was that the boys he mentioned had nothing to look forward to, nothing to hope for and no background even to fall back on. Surely all those boys would be better off with some degree of youth training rather than just sitting there in that hostel? Many of the Members of the Committee were not present the other night when I talked about the overemployment in London, the great number of jobs that were available and the impossibility of getting young people to fill them. My noble friend Lady Faithfull mentioned many young people popping in and out of Jobcentres looking at notices and saying that they were not going to bother with the jobs. She did not make the point that a teacher working in a poor part of London made to me. The teacher made the point that the dole card is extremely valuable to somebody as a free entry to everything. It is so valuable that people do not want to give it up. It is a tragic situation when people look on a dole card as a desirable thing. The phrase that the teacher used was a "passport to everything". That is not a good thing.

Another point which has not come out so far in the debate, although it was just touched upon by my noble friend Lady Carnegy, is the future situation in this country. We have an ageing population. It will only be a very small number of years before there will only be seven school-leavers for every 10 school-leavers we have today. That means that it is most essential that our young people should return to the work ethic which has been the backbone of Britain throughout the centuries.

I received a visit from an Australian Minister who told me that the situation in Australia had been assessed and it had been found that if people remained unemployed and received unemployment benefit for more than three months immediately after leaving school they lost interest in doing anything else. They discovered an easy option and they did not bother to do anything else. I consider it very unfair to the young people who are working and working hard for five days a week or taking a training scheme if they live in an area where there is no work—I accept that there is a very big difference between regions—to know that their friends are lying at home in bed every day and going out dancing every night. I am not talking about an unreal situation. I have many patients who have been out of work for three years. When I tell them that there are notices about jobs even in the waiting room they say, "Oh, I don't want those jobs. I like my life the way it is".

That is not good enough. It is terribly important for the future of this country that people should be interested in employment and should go on to train or to work. Under this clause the Youth Training Scheme is guaranteed to all.

Like my noble friend Lady Faithfull, I consider it essential that part of this clause should enable discretion and flexibility to be exercised, because one cannot legislate on paper for every mental or physical state of people's health. But I believe that subsection (4)(A) covers those points. That kind of consideration and the fact that each case has to be considered carefully is an essential protection to all the young people who do want to work.

As the noble Baroness, Lady Jeger, said, there are very good reasons for many people being out of work. That is true and those people will have the opportunity to prove that there are good reasons and to justify why they are out of work. In that case they will be supported. If people are really incapable of pursuing a YTS course on obtaining employment, there is cover for them in this clause.

The tragedy of the loss of family support and the estrangement of children from parents as referred to by the noble Lord, Lord Pitt, is a very sad matter with disastrous consequences socially. Let us hope that we may see something which will help to change that family structure and bring back a more unified family. Nevertheless, as my noble friend Lady Carnegy said, the wide range of opportunities that are available is encouraging. Another encouraging fact is that the YTS is not limited. It is guaranteed to all. The protections which are built into the clause for the exceptional cases lead me strongly to support it.

Lord Skelmersdale

This clause implements our manifesto commitment, which was that those under 18 who choose to remain unemployed should not be eligible for benefit. It links up with our guarantee of a place on the Youth Training Scheme to every school-leaver under 18 who does not go into a job.

This has been a very spirited debate and I must say that I am not surprised that we are refighting part of the election campaign across the Chamber today. I wish straight away to make the point that this guarantee extends to young people wherever they may live and applies to any and every young person, whatever his educational ability.

I myself have seen the teaching of simple mathematics and reading and writing being conducted in connection with a YTS course. I am sure that my noble friend Lady Carnegy will confirm that that is by no means unusual.

As I think every one of my noble friends has said in this debate, we are quite determined that the youth of this country do not as a rule see dependence on state benefits as being the natural next step after school. Those points were made particularly by my noble friends Lady Carnegy and Lady Gardner of Parkes on Tuesday. I certainly agree with the very strong speech that my noble friend Lady Carnegy has made today on the subject of getting the message across to young people. She is absolutely right in that. The YTS is a real opportunity for making a sound start in adult life for those who leave school without having found a job and who have decided not to continue with education. I take the point of the noble Lord, Lord Parry, that some of those young people may not be mentally equipped to carry on with education.

The rate of training allowance, £28.50 a week in the first year and £35 a week in the second year, is considerably higher than the benefit rate for that age group. The current rate of supplementary benefit for a person aged 16 to 17 is £18.75. The income support rate will be £19.40.

The great majority of young people will not be affected by this clause. That point has been widely agreed upon. But as my noble friend Lord Boyd-Carpenter said, that is absolutely no reason not to legislate. However, like the noble Baroness, Lady Jeger, the noble Lord, Lord Pitt, and my noble friend Lady Elliot of Harwood, we are only too well aware that some 16 and 17 year-olds, mainly due to unfortunate circumstances, require benefit protection. The clause therefore also enables regulations to be made which will specify circumstances in which young persons of or over the age of 16 will still be entitled to benefit. Young people will therefore not be written off the legal framework of social security in Britain, as the noble Lord, Lord Pitt, suggested during our debates on Tuesday. We shall consider the regulations most carefully. In reply to my noble friend Lord Selkirk on Tuesday I leaked, as it were, some of the matters which will be in the regulations. I am happy to give in advance as full an account of those regulations as I possibly can. I give that commitment today. The Committee will see the final regulations when the necessary order is laid.

On Tuesday, in answer to an amendment moved by the noble Lord, Lord Pitt, we discussed the likelihood of homelessness and its effect on the provisions for severe hardship. In terms of protection we have in mind the severely disabled, the registered blind, the 16 or 17 year-old with a child and those who are necessarily living independently—the orphan, the youngster who has recently been in care and those young people who cannot live at home because of the risk of physical or sexual abuse. There will be others and we shall ensure that in framing the regulations the claims of all disadvantaged groups to a continuing entitlement to benefit will be closely examined. The Committee was particularly interested in that aspect of our intentions and I am grateful to my noble friend Lord Selkirk for giving me the opportunity to spell out what those intentions are.

The amendment to the Act will be effective from September—a point made in a telling intervention by the noble Lord, Lord Pitt. Summer school-leavers aged 16 and 17 will, unless they are in one of the specified groups, not be entitled to benefit. Instead, if they are registering at a careers office or a Jobcentre for work or a YTS course, their parents will be able to claim an extension of child benefit in respect of them, together with dependency additions, as appropriate, for a limited period. Of course severe hardship provisions will apply to those who are not in that position.

The power to extend the child benefit period is given in the Bill, which by amending Section 2 of the Child Benefit Act 1975 enables young people under the age of 18 who are not receiving full-time education to continue to be treated as children for child benefit purposes. That is a new clause.

We intend to extend the child benefit period in respect of summer school-leavers to the end of the calendar year. Thereafter the child benefit period in respect of Christmas and Easter leavers will be extended by three months. The effect will be to treat a person as dependant on his parents in the period before the YTS guarantee can be implemented unless the income support regulations enable him to receive benefit in his own right.

We intend extension periods to be the opportunity for the young person to give consideration to his future and to explore the opportunities open to him. If this period of at least three months is added to the period since the child left school, he has what we consider to be an ample opportunity to make firm plans for the future. However, if a child chooses not to get a job or take advantage of the YTS guarantee, then no child benefit or dependency addition will be payable in respect of him once the extension period has ended.

The noble Baroness, Lady Jeger, asked: "Why not bring Section 20 of the 1975 Act into play?". My noble friend Lord Boyd-Carpenter answered that point very powerfully. I only add that the Government consider that it is far better to introduce young people to the work ethic at a very early age rather than allowing them to draw income support and become dependent on state support even for a limited period. It is our intention that Section 20 will be needed only in the circumstances in which a person who is one of a young couple with a child or children refuses to take a suitable job or voluntarily gives up such a job.

I am sure that parents will ensure that the YTS guarantee opportunity is not rejected by their offspring. They will recognise the logic of our intentions and the financial advantage to a family if a YTS place is taken up.

As I have already said, we intend to protect the benefit entitlement of certain groups of 16 and 17 year-olds. We intend that those who have no real prospect of employment in the foreseeable future—the severely disabled, the registered blind or the young person with a child, for instance—will be entitled to benefit for as long as their circumstances remain unaltered. Other young people will, however, be entitled to benefit only during the child benefit extension period.

My noble friend Lady Lane-Fox mentioned a particular problem: what happens if the disabled young person is not fit for YTS? As I said on Tuesday, YTS is open to all young people who are judged to be capable eventually of employment. Moderate and severe learning difficulties are included in the YTS definition of disability, and special funding and aids are available for young people with such difficulties. For example, they can enter YTS up to the end of the academic year in which they reach the age of 21. Up to six months can be added to their course to improve their training or employment prospects.

As my noble friend will be well aware, many disabled young people stay on at school beyond the minimum school-leaving age and, in many instances, up to the age of 19. That facility will remain; there will be no change under the new arrangements.

The Bill enables the Secretary of State to specify in regulations not only the circumstances in which persons aged 16 and 17 may be entitled to benefit but also the periods for which entitlement may last. That is because persons such as orphans or those not living at home because of risk of physical or sexual abuse should be entitled to benefit only up to the end of the extension period or until they obtain a job or start YTS, if that is earlier.

The noble Baroness, Lady Jeger, asked about the possibility of severe hardship and how local offices will cope with that. I agree that that is a very important point. I had a shot at considering it in our debates on Tuesday. In passing, perhaps I may say that I have no doubt that our discussions will continue through further stages of the Bill. The fact that some of the detailed points are unresolved is no reason to disapprove of the clause which we are considering.

In answer to the particular question asked by the noble Baroness, the local officer will examine all the details of a particular case. If there appears to be even a possibility of severe hardship if benefit is not to be paid, details will be passed immediately to headquarters by telephone for the direction of the Secretary of State, as appropriate. In the majority of cases it will be obvious to the local office either that the young person has no entitlement—for instance, because he is living with his parents—or that he has entitlement because he falls into one of the specified groups as contained in the regulations. If there is a possibility of severe hardship, then a very speedy direction will be relayed to the adjudication officer at the local office and he in the final analysis will decide whether benefit is payable. As I said on Tuesday, I would normally expect that that would be done within 24 hours, and I stick to that statement.

The noble Lord, Lord Banks, who started our very spirited debate, was worried in particular about the lack of right of appeal to the Secretary of State. The position is that an officer of the department, acting for the Secretary of State in the normal way, will establish the circumstances of the claim. If it appears to him that the claimant does not fall into one of the prescribed categories, he will consider whether non-payment of income support will result in severe hardship and, as I have just said, will refer the matter to the Secretary of State for a direction if that is the appropriate course. The whole package will then go to the adjudication officer for a decision, with or without a direction of the Secretary of State, whichever is appropriate. The adjudication officer will then exercise his usual responsibilities in determining the case.

Another point raised was the matter of young people who lose a job and register for a YTS place or who have to move from one scheme to another because the first scheme did not prove suitable for them. In such a case they will receive a bridging allowance until placed on a course. It is expected that a place will be offered fairly quickly, within a few weeks; if not, the bridging allowance will have to continue. They will then receive the YTS allowance of £28.50 a week. I shall not deal with the suggestion of the noble Baroness, Lady Phillips, now.

The noble Lord, Lord Pitt, raised the question of young people who are estranged from their parents. Of course there are young people who are estranged and who are at risk of physical or sexual abuse, but they will be entitled to income support during the child benefit extension period. All young people will be guaranteed a place on the scheme.

I understand the worries of the party opposite. No opposition party likes major changes and this measure is a radical departure from current legislation. That is why it was spelled out in our election manifesto. In fulfilling that commitment we decided that the best way to avoid the possibility of youngsters becoming accustomed to state benefit and reliant upon it when there is no need was to remove general entitlement from school-leavers at the outset. That will encourage a sense of responsibility from an early age and I am sure that it will be generally welcomed by the public at large. It is modern nonsense that the mass of young people in the 16-to-18-years age bracket, however small a number it may be, should be able to go straight from school into the benefit culture, with all that is implied. Those young people will have three options: to take a job, to go on to further education or to take up a guaranteed YTS place.

I agree that safety nets are necessary in the particular circumstances which I have outlined at length today. Our aim is to stop youngsters from entering the benefit culture. Instead they should enter jobs or training, which give them a far better opportunity for the future. Moreover, YTS training carries a training allowance which is considerably higher than the benefit rate for this group. We consider that this is a far more efficient and meaningful use of public money than is the case at present.

I believe that on this side of the Committee we stand four-square behind this clause, the underlying tenets of which have been well understood by the electorate.

Lord Banks

The noble Lord, Lord Boyd-Carpenter, observed that I had said that we should not legislate. But I say that we have legislated and imposed a severe penalty on people who deliberately choose to remain unemployed. That penalty has been described by a government Minister as not lightly to be dismissed. I am convinced that the number of 16 to 17 year-olds who remain deliberately unemployed is small. All the statistics bear that out, although there has been some anecdotal evidence to the contrary this afternoon.

We are concerned about all the other young people who will be affected by this legislation, many of whom have been referred to during the course of our debate. The noble Lord, Lord Pitt, mentioned some of them. There are the 30,000 youngsters of 16 or 17 who are studying part-time, under the 21-hour and 12-hour rules and to whom I referred in my opening remarks. There are also 3,000 disabled students in part-time education. That aspect was discussed on Tuesday and referred to by the noble Baroness, Lady Lane-Fox, this afternoon.

There are all the other reasons to which I referred in my opening remarks. First, the clause makes YTS compulsory although as recently as July 1987 the Youth Training Board and the Manpower Services Commission, as well as the Confederation of British Industry and the Institute of Careers Officers said that it should be voluntary. Then there is the complexity of the arrangements for making exceptions for some people, either through prescription or because of severe hardship. There is great difficulty in determining what represents severe hardship, and difficulties are likely to ensue when people who consider that they are suffering severe hardship— and who are considered by others to be suffering hardship—are nevertheless turned down. Then there is the absence of an appeal procedure, which was explained to us a moment or two ago by the noble Lord, Lord Skelmersdale. Running through the whole clause is the demotion of young people to the status of dependants. Those objections all remain and I remain opposed to the clause.

4.45 p.m.

On Question, Whether Clause 4, as amended, shall stand part of the Bill?

Their Lordships divided; Contents, 135; Not-Contents, 88.

Airey of Abingdon, B. Allen of Abbeydale, L.
Aldington, L. Ampthill, L.
Alexander of Tunis, E. Arran, E.
Auckland, L. Kinnaird, L.
Barber, L. Lane-Fox, B.
Beaverbrook, L. Lauderdale, E.
Belhaven and Stenton, L. Layton, L.
Beloff, L. Long, V.
Belstead, L. Lucas of Chilworth, L.
Bessborough, E. Lyell, L.
Birdwood, L. Mackay of Clashfern, L.
Blatch, B. Macleod of Borve, B.
Boyd-Carpenter, L. Margadale, L.
Brabazon of Tara, L. Marley, L.
Brougham and Vaux, L. Merrivale, L.
Broxbourne, L. Mersey, V.
Butterworth, L. Middleton, L.
Caithness, E. Monk Bretton, L.
Cameron of Lochbroom, L. Montagu of Beaulieu, L.
Campbell of Alloway, L. Montgomery of Alamein, V.
Carnegy of Lour, B. Morris, L.
Carnock, L. Mottistone, L.
Coleraine, L. Mowbray and Stourton, L.
Colnbrook, L. Munster, E.
Constantine of Stanmore, L. Murton of Lindisfarne, L.
Cottesloe, L. Nairne, Ly.
Cowley, E. Napier and Ettrick, L.
Cox, B. Nelson, E.
Craigavon, V. Nelson of Stafford, L.
Craigmyle, L. Newall, L.
Croham, L. Nugent of Guildford, L.
Cullen of Ashbourne, L. Onslow, E.
Dacre of Glanton, L. Orkney, E.
Davidson, V. [Teller.] Orr-Ewing, L.
De Freyne, L. Pender, L.
Denham, L. [Teller.] Plummer of St Marylebone, L.
Derwent, L. Porritt, L.
Dickinson, L. Rankeillour, L.
Dundee, E. Renton, L.
Eccles, V. Richardson, L.
Effingham, E. Rodney, L.
Elliot of Harwood, B. Romney, E.
Elton, L. Rugby, L.
Erne, E. St. John of Bletso, L.
Erroll of Hale, L. Saltoun of Abernethy, Ly.
Faithfull, B. Sanderson of Bowden, L.
Ferrers, E. Sandford, L.
Forbes, L. Sandys, L.
Fortescue, E. Skelmersdale, L.
Fraser of Kilmorack, L. Southborough, L.
Gainford, L. Stockton, E.
Gardner of Parkes, B. Strange, B.
Glenarthur, L. Sudeley, L.
Greenway, L. Swansea, L.
Hailsham of Saint Swinfen, L.
Marylebone, L. Terrington, L.
Halsbury, E. Teviot, L.
Havers, L. Teynham, L.
Hayter, L. Thomas of Gwydir, L.
Hesketh, L. Thurlow, L.
Hives, L. Ullswater, V.
Hooper, B. Ward of Witley, V.
Hylton-Foster, B. Westbury, L.
Ilchester, E. Whitelaw, V.
Inglewood, L. Windlesham, L.
Ingrow, L. Wise, L.
Ironside, L. Wolfson, L.
Joseph, L. Young, B.
Killearn, L.
Airedale, L. Carter, L.
Alport, L. Cledwyn of Penrhos, L.
Amherst, E. Cocks of Hartcliffe, L.
Ardwick, L. David, B.
Attlee, E. Dean of Beswick, L.
Aylestone, L. Diamond, L.
Banks, L. [Teller.] Donaldson of Kingsbridge, L.
Blackstone, B. Dormand of Easington, L.
Bonham-Carter, L. Elwyn-Jones, L.
Boston of Faversham, L. Ennals, L.
Bottomley, L. Ewart-Biggs, B.
Callaghan of Cardiff, L. Ezra, L.
Campbell of Eskan, L. Falkender, B.
Carmichael of Kelvingrove, L. Falkland, V.
Fisher of Rednal, B. Northfield, L.
Gallacher, L. Oram, L.
Graham of Edmonton, L. Parry, L.
[Teller.] Perry of Walton, L.
Grimond, L. Peston, L.
Hampton, L. Phillips, B.
Hanworth, V. Pitt of Hampstead, L.
Hatch of Lusby, L. Ponsonby of Shulbrede, L.
Henderson of Brompton, L. Prys-Davies, L.
Hirshfield, L. Rathcreedan, L.
Houghton of Sowerby, L. Rea, L.
Hunt, L. Ritchie of Dundee, L.
Irvine of Lairg, L. Ross of Marnock, L.
Jacques, L. Sefton of Garston, L.
Jay, L. Serota, B.
Jeger, B. Shackleton, L.
Jenkins of Hillhead, L. Simon, V.
John-Mackie, L. Stedman, B.
Kagan, L. Stewart of Fulham, L.
Kilbracken, L. Stoddart of Swindon, L.
Kilmarnock, L. Strabolgi, L.
Listowel, E. Turner of Camden, B.
Llewelyn-Davies of Hastoe, B. Underhill, L.
Lockwood, B. Wallace of Coslany, L.
Longford, E. Wells-Pestell, L
Lovell-Davis, L. White, B.
McNair, L. Wigoder, L.
Mais, L. Williams of Elvel, L.
Meston, L. Winchilsea and Nottingham, E.
Molloy, L.
Mulley, L. Winterbottom, L.

Resolved in the affirmative, and clause agreed to accordingly.

4.54 p.m.

Baroness Jeger moved Amendment No. 40: After Clause 4, insert the following new clause:

("Housing benefit.

The following shall be substituted for subsection 29(3) of the Social Security Act 1986

"(3) Regulations shall make provision for reviews of determinations relating to housing benefit and shall specify and make provision for a right of appeal against reviews and determinations to a Social Security Appeal Tribunal in accordance with the procedure laid down in sections 100,101 and 104 of the Social Security Act 1975 and section 15 of the Social Security Act 1980. Any reference to adjudication officer in those sections shall be construed as including reference to the appropriate authority responsible for administering housing benefit under section 28 of this Act."").

The noble Baroness said: I am sure that Members of the Committee on all sides will join with me in expressing great regret that my noble friend Lord Stallard cannot be with us this afternoon. He is undergoing surgery in Westminster Hospital—which I hope is an added reason why the Government should not close that hospital.

Lord Skelmersdale

I shall not get involved in that debate. But I interrupt the noble Baroness to say that we on this side of the Chamber certainly share the sentiments expressed by her with regard to the noble Lord.

Baroness Jeger

I thank the Minister. The concern of my noble friend is about the need for a right of appeal from adjudications on housing benefit. We are all agreed that housing benefit has got into an uncontrollable muddle over the last few years and the provisions in the Bill certainly do not help to clear matters up. That is another reason why there should be some provision for appeal.

I do not know why the Government are so adverse to independent appeals on matters that are so important to individual citizens. However, the position seems to be—I am sure that the Minister will put me right—that under the present provisions there is no independent appeal. That is the point that my noble friend asked me to put to the Minister. I beg to move.

Lord Skelmersdale

We have a considerable amount of sympathy with the argument that adjudication arrangements for housing benefit should be brought into line with those for other social security benefits. But this is not only a very important issue; it is a very complicated one too, involving difficult questions concerning the relationship between local authorities, their staff acting as adjudication officers, appeal tribunals and so on. Major administrative changes may also be involved—and all this, it has to be said again, as it has been several times over the last few years, against the background that we have no clear evidence that the present review arrangements, whatever their deficiencies in principle, are not generally working in practice.

It would be ill-judged in those circumstances to make a commitment now to change housing benefit adjudication arrangements from April 1988 in the way suggested by the new clause. We would need detailed discussions with all the interested parties and cannot foresee at this stage what changes would be involved, or even feasible, and over what sort of timescale they could be introduced. Commitment to a specific timetable without that basic information would be reckless indeed, especially as authorities are already likely to be fully stretched implementing the structural reforms.

Due to the pressure of work on producing the housing benefit regulations in time for local authorities implementation planning, we have not been able to concentrate on this particular issue until now. However, we are now looking at the possibility of carrying out some research into this matter. It is hoped that that will enable us to see just exactly what, if anything, needs to be done to improve the existing housing benefit review procedures. I should point out to the Committee that the new housing benefit information system which is to be introduced along with the reformed scheme in April will provide much more helpful information on various aspects of the running of the scheme, including review boards. Having heard that, perhaps the noble Baroness will consider withdrawing the amendment.

Lord Graham of Edmonton

I am amazed at the defence that the Government have put forward for their unwillingness and inability to accept this amendment. It boils down to this. By virtue of a timescale that they set themselves they have been unable to deal with the objectives of the new clause, with which I believe the Minister expressed sympathy. We are not talking about people with a lot of money. We are not talking about people who have alternative sources of housing, of benefits or of largesse. We are talking about people at the desperate end of the scale who feel that they have been badly done by.

I sensed that the Minister felt the provision for a right of appeal was a fair point. But he stated that one of the reasons the Government have been unable to follow it through has been that they are very sensitive to the burdens they are placing on local authorities. He could have fooled me, and the local authorities! It is nonsense for him to say at this late stage of the game that this Government are concerned at the burdens that they are placing on local authorities.

The Minister is saying this to the Committee. We have our mandate. We have our imperatives. We have decided to put them into effect. There will be enormous burdens on council offices, council officers and councillors. With regard to the people who could be affected—there may not be many of them and we sympathise with them—we are in the process of trying to sort out a fair means of handling this.

We are talking about tiny people, people the Minister may say do not amount to very much. These are people who feel they have a grievance and they want to pursue to the maximum extent their right to get an extra pound or two. They want to have the law understood and applied to their circumstances as generously and fairly as possible.

I think that the Minister has given a very poor response. I wait with interest to see what my noble friend intends to do with the amendment.

5 p.m.

Lord Skelmersdale

As I repeated earlier, we have said all along that we intend to review housing benefit adjudication. The noble Lord, Lord Graham, referred to these people as tiny people, which I accept, although I should put them up a grade and describe them as little people. They are the people who need the benefits that they are receiving and all the support that we can give them. I certainly agree with that.

I have given a clear commitment today. I know that the noble Lord thought it was a little late for me to consider local authorities, but we do consider local authorities, and in this case we should have to consult local authorities. There is no time for that consultation between now and April. That is an inescapable fact.

Baroness Jeger

Whether these people are tiny or little, they are real people. I appreciate that the Minister has undertaken to look further into the complicated question of housing benefit, which involves local authorities. Some of us who have been on local authorities know what a conflicting factor that is. In view of what the Minister has said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 [Contribution conditions for short-term benefits]:

Baroness Turner of Camden moved Amendment No. 40A: Page 6, line 29, at end insert— ("( )Schedule 3 of the 1975 Act shall not be amended as in subsection (3) below in respect of any categories of persons prescribed by the Secretary of State.").

The noble Baroness said: Clause 5, as I understand it, intends to provide much stricter conditions for building up entitlement to national insurance benefits. As regards employment benefit, it will rule out entitlement for those who have not paid sufficient contributions in the two most recent contribution years; for example, through sickness, maternity, being out of the labour force for caring reasons or on any other basis irrespective— I emphasise this—of the claimant's previous contribution record.

There is also a tightening up in regard to other national insurance benefit claims. I understand that if this goes through the DHSS will require a full contribution record to have been paid or credited in each of the two contribution years preceding the claim instead of just the preceding year, as under the current laws. In other words, it will be twice as difficult to build up an adequate contribution record.

I understand that there are expected to be savings of around £70 million if this goes through. It has been estimated that approximately 350,000 will lose unemployment benefit if the clause stands unamended. Not all claimants will be able to fall back on means-tested income support. In any event, as I said on Second Reading, it does not seem a very suitable policy to have people forced on to means-tested income support rather than benefiting under insurance schemes for which they have paid contributions.

The amendment does not seek to alter the clause drastically but rather to provide an arrangement under which it will be possible for certain categories of people to be prescribed by the Secretary of State as falling outside these provisions.

I am particularly concerned with the situation of women who have been acting as carers. I have received a letter from the Spastics Society, which has a great deal of experience in these matters. The society points out that, if the clause stands unamended, no one who has been a carer for more than two years would be able to qualify for benefit in future. Carers already face great difficulties in obtaining jobs when they have been out of the labour market. This measure would discriminate against those who give up a great portion of their working lives to look after a relative or a friend. If the amendment is accepted, the Secretary of State will be able to prescribe certain categories of persons such as carers who could be exempt from these provisions.

There is some concern also on the part of the Equal Opportunities Commission, because it is women who in general have somewhat interrupted work patterns. Women are far more likely than males to be disadvantaged under the clause if it is not amended. For those reasons, I commend the amendment to the Committee. I hope that it finds favour and that the Minister will be able to say that the Government are prepared to consider it with some concern. I beg to move.

Baroness Lane-Fox

I should like to speak also to my Amendment No. 41. I hope that my noble friend the Minister can reassure me that my interpretation of the Bill is wrong. I fear that the Bill threatens invalid carers with loss of benefit much as the noble Baroness, Lady Turner of Camden, has said. When the subject of the caring dies or moves away, the carer returns to the labour market. These people deserve all the back-up that they can get. It would be very wrong if after that onerous job they were not to be given full benefit. Those of us who know how difficult it is to get people to fill the job of carer believe that they should be rewarded properly and that their work should be highly prized.

I have just heard the splendid news about the DHSS liaison with DIG for administering the £5 million for the severely disabled who claim after next April and need extra help over and above what is provided through social security. I am greatly encouraged by that and I hope that the Minister will be able to help me on this amendment.

Lord Skelmersdale

I am grateful that the two amendments are grouped.

Perhaps I may speak to the amendment of the noble Baroness, Lady Turner of Camden, first. This amendment would give Secretary of State power to exempt unnamed groups of people from the abolition of the aggregation rule for unemployment benefit and sickness benefit. This rule allows contributions paid in more than one tax year to be aggregated for the satisfaction of the first contribution condition in the early years of contribution. It is contained in paragraph 5(3) of Schedule 3 to the 1975 Social Security Act.

The first contribution condition will require a record of contributions paid on earnings of 25 times lower earnings limit in one of the two recent tax years on which the claim is based. This change reflects and reinforces the original purpose of unemployment benefit. Ever since Beveridge—indeed, ever since the days of friendly societies paying benefit—the benefit has always been intended to provide a measure of compensation for people who normally work for an employer and then experience short periods of unemployment. No government have ever sought to change this. After careful consideration, we have concluded that the position of former carers is not analogous to that of a person who has recently been in employment and dependent upon the income from that employment for maintenance.

We do not believe that it would be right on grounds of equity to treat those who have been in receipt of invalid care allowance differently from others who have for some reason not been in the employment field in recent years. To make exceptions for one group would be unfair to others who could advance substantially the same arguments. For these reasons we do not believe that a special concession for former carers is appropriate.

My noble friend Lady Lane-Fox suggested that under the new contribution conditions many former carers will fail to qualify for unemployment benefit. However, it will still be possible for people to qualify for unemployment benefit up to three-and-a-half years after they last paid contributions. The average length of award of invalid care allowance is between 18 and 24 months and therefore it seems likely that many former carers will continue to qualify for unemployment benefit when payment of invalid care allowance ceases. I realise that this point concerns both noble Baronesses and I shall look at the matter again.

Baroness Turner of Camden

I should like to thank the Minister for that reply and in those circumstances I shall not press the amendment. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Lane-Fox had given notice of her intention to move Amendment No. 41: Page 6, line 36, after ("years") insert (", or one of the last two years in which he did not receive an invalid care allowance,").

The noble Baroness said: I too am grateful to the Minister for his undertaking to look at the matter again. In those circumstances I do not move the amendment.

[Amendment No. 41 not moved.]

Clause 5 agreed to.

Baroness Faithfull moved Amendment No. 42: After Clause 5, insert the following new clause:

("Repeal of s. 18(4) of 1975 Act.

From the date of passing of this Act section 18(4) of the Social Security Act 1975 shall cease to have effect.").

The noble Baroness said: I tabled this amendment in order to gain information because I am not sure that I understand the position with regard to Section 18(4) of the Social Security Act 1975. It has been suggested to me that in some cases men hear of a better job than the one that they already have and wish to leave in order to move to the better job, which may be in another town. Section 18(4) was inserted into the Social Security Act in 1975 but has not yet been implemented. Do I understand that if it is implemented in its present form the voluntary employment period will be lessened, giving men a much shorter time in which to draw their full benefit?

I apologise for not having given notice of the question but I shall be pleased if the Minister can answer it. Quite a number of men wish to change their jobs voluntarily. In that circumstance, will the time during which they can draw full benefit be cut? I beg to move.

Lord Skelmersdale

Having been present in your Lordships' Chamber during recent weeks and months I thought that a probing amendment had gone out of fashion. It is nice to meet one again and I am grateful to my noble friend for giving me the opportunity to respond. I am advised that the voluntary employment period will not be lessened; the provision will make no difference.

The purpose of the Section 18(4) of the Social Security Act 1975 is to prevent abuse of the unemployment benefit system. Without these powers it would be possible for a person to manipulate the system in order to obtain more than the maximum entitlement of 312 days' unemployment benefit. It would be possible for people to break their unemployment benefit claims when close to exhausting benefit. By reclaiming after more than eight weeks have elapsed, they could establish a fresh claim and with that a fresh entitlement to 312 days' benefit. Clearly that would be wrong and Section 18(4) exists to prevent exploitation of that loophole. I hope that that reply is of assistance to my noble friend.

Baroness Faithfull

I am grateful to the Minister for that explanation. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 6 [Unemployment benefit and occupational pension]:

Baroness Turner of Camden moved Amendment No. 43: Page 7, line 8, at end insert ("provided the person has indicated that he is not seeking other employment and regards himself as having permanently retired from work").

The noble Baroness said: The Bill seeks to extend to those aged 55 or over the provisions first introduced in 1981 under which an unemployed person with an occupational pension suffers a reduction in his unemployment benefit. The reduction is 10p for every 10p of his pension over £35 per week. At current rates it means that unemployment benefit is completely lost if a single person has a pension of more than £66.50 per week and if a couple have pension of more than £86 per week.

I believe that to be an unfair extension. It was bad enough when the provision at 60 was introduced, because the occupational pension is a private arrangement to which the employee and employer have contributed. Normally when people leave work before the usual retirement age they cannot expect and do not receive a full occupational pension. It is reduced because the person concerned has not worked for the full period.

There exists the situation where people are often forced to leave work early at the age of 55 or a little older as a result of redundancy. At that age they do not normally regard themselves as being retired. Perhaps as a result of a redundancy agreement they may have reached an arrangement under which they receive an early pension because they are regarded as being early retired.

However, if possible they would wish to be employed and it is unfortunate that, if the Bill becomes an Act, they will be given the impression that after the age of 55 they will no longer be on the employment scene. Many of those people would wish to work if work were available. They have paid for their occupational pension and they have also made a contribution through their national insurance payments to their unemployment pay. It seems inequitable that individuals who would wish to work if work were available and who could comply with the availability for work requirements of Section 20 of the 1975 Act should have their entitlement to unemployment benefit reduced in this way. Further, if they are in receipt of the amounts that I have specified, the benefit will be extinguished.

I move this amendment, which I consider to be reasonable, because the provision will take effect only if the person has indicated that he is not seeking other employment and regards himself as having permanently retired from work. However, if he is still on the employment scene and available for work, and therefore able to comply with the availability requirements, I believe that he should be entitled to his unemployment pay because he has made a contribution towards it just as he has contributed towards his occupational pension. I beg to move.

Lord Banks

I should like to support this amendment, which has the same effect as my Amendment No. 44. However, I support this in preference to my own. When the abatement was first imposed at the age of 60, it was argued that those over 60 years with an occupational scheme had retired and were not genuinely seeking work. As I said at Second Reading, bank managers were much cited in that connection.

As the noble Baroness, Lady Turner, pointed out, many people who are made redundant at the age of 55 have not retired and hope to take up new employment if they can find it. They take an early retirement pension because in the current situation they cannot be certain of finding that employment and they must have something to live on. They have paid their national insurance contributions and while they look for work they are entitled to receive 12 months' unemployment benefit.

Unemployment benefit is a payment as of right provided that they are available for work. The lower the point at which abatement operates the more genuine employment seekers one will catch in the net. I am against turning national insurance benefits into means-tested benefits. The amendment will ensure that only those who have retired from regular employment will be affected. I support Amendment No. 43.

Lord Skelmersdale

In answer to these amendments I should like to repeat that it is government policy to concentrate available resources on the areas of greatest need. We do not believe that it would be right to increase expenditure on that group of people who already enjoy the support which a substantial occupational pension provides. With the limit at its present level, unemployment benefit is not finally extinguished until substantial amounts of occupational pension are in payment.

Currently benefit remains payable up to the point where an occupational pension exceeds £85.90 per week for a person with a dependent adult and £66.50 per week for a single person. We believe that an occupational pension of £85.90 is still a substantial figure. We do not believe that to pay unemployment benefit when occupational pensions at even higher levels are being paid would be a wise use of resources. I believe that that comes under the heading of a remark made by my noble friend Lord Boyd-Carpenter at Second Reading when he said that there was a philosophical divide across the table on this matter.

On Amendment No. 43, as we know, this clause refers to unemployment benefit and its partial or total abatement when the person concerned is in receipt of an occupational pension. Section 17 of the Social Security Act 1975 provides that unemployment benefit is payable only for days when a person is capable of and available for work. It is therefore not an appropriate benefit for someone who has retired from regular employment. Unemployment benefit was designed to help people who, during the course of their normal working lives, find themselves involuntarily—and generally unpredictably—without work, and often suddenly much worse off than when working. Retirement at the end of a pensionable career has never constituted "unemployment" in the sense in which that term is used in the national insurance scheme. If we accept that these people have retired because they have expected and planned to retire early, they are no longer genuinely available for or actively seeking further work. On this definition, they are clearly not entitled to unemployment benefit.

Amendment No. 44A to which we are also speaking would actually exempt from the abatement provision those people who had been compulsorily retired regardless of the level of their occupational pension, which in many cases could be substantial, and regardless of whether they were genuinely available for and seeking further employment.

There can be no doubt that some of these people who have retired have no real intention of seeking further work and are no longer genuinely available. Clearly they are not entitled to unemployment benefit. However, we can accept that others, particularly those who have been compulsorily retired, may be seeking further employment. But we cannot ignore the fact that many of them would be receiving substantial amounts by way of occupational pensions and we believe it would not be a wise use of resources to pay unemployment benefit in full to such people. It is on this that we rest our belief that the time is now right to extend the abatement provision to those aged 55 and over.

Lord Banks

Can the noble Lord say, in view of his remarks about the wise use of resources, why he distinguishes between an occupational pension exceeding £35 per week and an investment income exceeding £35 per week?

Lord Skelmersdale

The noble Lord has much wider experience of these matters than I. However, I suspect that people with an investment income of over £35 a week seldom fall into the benefit categories in any case.

Lord Banks

It seems to me that under the noble Lord's proposals somebody could be entitled to unemployment benefit even if he had an investment income exceeding £35 per week, even though he is over 55. Is that not so?

Lord Skelmersdale

The noble Lord is absolutely right.

Baroness Turner of Camden

I am disappointed by the Minister's response because I do not think that he has dealt with the point that I made, that the individual concerned will have made a contribution through his national insurance contributions and will have made a contribution to his pension. Therefore, this is in no way any form of charity or means-tested benefit but is a benefit for which contributions have been paid, and it is an entitlement.

As I said at Second Reading, I believe that if an insurance company offering cover reneged on contribution conditions in this way, there would be a lot of fuss made about that. I am not at all happy with the response. I believe that there is an entitlement here and that people who have made a contribution should be entitled to receive the benefit when they need it. Individuals at the age of 55 very rarely regard themselves as having left the labour market and the availability for work conditions are already sufficient to deal with applications for unemployment benefit if people are not genuinely available for work, particularly since those availability rules, as I understand it, have recently been tightened up and instructions issued to the relevant officers accordingly. Therefore I intend to press the amendment.

5.25 p.m.

On Question, Whether the said amendment (No. 43) shall be agreed to?

Their Lordships divided: Contents, 72; Not-Contents, 108.

Airedale, L. John-Mackie, L.
Ardwick, L. Kilbracken, L.
Attlee, E. Kilmarnock, L.
Aylestone, L. Llewelyn-Davies of Hastoe, B.
Banks, L. Lloyd of Hampstead, L.
Blackstone, B. Lockwood, B.
Bonham-Carter, L. Longford, E.
Boston of Faversham, L. Lovell-Davis, L.
Carmichael of Kelvingrove, L. McGregor of Durris, L.
Carter, L. McIntosh of Haringey, L.
Cledwyn of Penrhos, L. Molloy, L.
Cocks of Hartcliffe, L. Mulley, L.
David, B. Nicol, B.
Dean of Beswick, L. Phillips, B.
Diamond, L. Pitt of Hampstead, L.
Donaldson of Kingsbridge, L. Ponsonby of Shulbrede, L.
Dormand of Easington, L. [Teller.]
Elwyn-Jones, L. Prys-Davies, L.
Ennals, L. Richardson, L.
Ewart-Biggs, B. Ritchie of Dundee, L.
Ezra, L. Ross of Marnock, L.
Falkland, V. Serota, B.
Fisher of Rednal, B. Shackleton, L.
Gallacher, L. Simon, V.
Graham of Edmonton, L. Stewart of Fulham, L.
[Teller.] Stoddart of Swindon, L.
Grimond, L. Strabolgi, L.
Hanworth, V. Swann, L.
Harris of Greenwich, L. Turner of Camden, B.
Hayter, L. Underhill, L.
Henderson of Brompton, L. Wallace of Coslany, L.
Houghton of Sowerby, L. Wells-Pestell, L.
Hylton-Foster, B. White, B.
Irvine of Lairg, L. Williams of Elvel, L.
Jacques, L. Winchilsea and Nottingham, E.
Jay, L.
Jeger, B. Winterbottom, L.
Jenkins of Hillhead, L.
Airey of Abingdon, B. Boyd-Carpenter, L.
Ampthill, L. Brabazon of Tara, L.
Arran, E. Brougham and Vaux, L.
Barber, L. Butterworth, L.
Beaverbrook, L. Caithness, E.
Belhaven and Stenton, L. Cameron of Lochbroom, L.
Beloff, L. Campbell of Alloway, L.
Belstead, L. Campbell of Croy, L.
Birdwood, L. Carnegy of Lour, B.
Blatch, B. Carnock, L.
Blyth, L. Coleraine, L.
Colnbrook, L. Marley, L.
Constantine of Stanmore, L. Merrivale, L.
Cottesloe, L. Mersey, V.
Cowley, E. Milverton, L.
Cox, B. Monk Bretton, L.
Craigavon, V. Montagu of Beaulieu, L.
Cullen of Ashbourne, L. Montgomery of Alamein, V.
Dacre of Glanton, L. Morris, L.
Davidson, V. [Teller.] Mottistone, L.
Denham, L. Mowbray and Stourton, L.
Derwent, L. Munster, E.
Dundee, E. Murton of Lindisfarne, L.
Effingham, E. Nelson, E.
Elliot of Harwood, B. Nelson of Stafford, L.
Elton, L. Newall, L.
Erne, E. Nugent of Guildford, L.
Faithfull, B. Orkney, E.
Ferrers, E. Orr-Ewing, L.
Forbes, L. Pender, L.
Fortescue, E. Plummer of St Marylebone, L.
Fraser of Kilmorack, L. Rankeillour, L.
Gardner of Parkes, B. Rees, L.
Glenarthur, L. Renton, L.
Greenway, L. Rodney, L.
Hailsham of Saint Rugby, L.
Marylebone, L. Saltoun of Abernethy, Ly.
Halsbury, E. Sanderson of Bowden, L.
Havers, L. Sandford, L.
Hesketh, L. Selborne, E.
Hives, L. Skelmersdale, L.
Hooper, B. Southborough, L.
Inglewood, L. Sudeley, L.
Ingrow, L. Swinfen, L.
Ironside, L. Terrington, L.
Killearn, L. Teviot, L.
Lane-Fox, B. Teynham, L.
Lauderdale, E. Thomas of Gwydir, L.
Layton, L. Ullswater, V.
Long, V. [Teller.] Westbury, L.
Lucas of Chilworth, L. Windlesham, L.
Lyell, L. Wise, L.
Mackay of Clashfern, L. Wolfson, L.
Macleod of Borve, B. Young, B.
Margadale, L.

Resolved in the negative, and amendment disagreed to accordingly.

5.33 p.m.

[Amendments Nos. 44 and 44A not moved.]

Lord Swann moved Amendment No. 45: Page 7, line 12, at end insert ("; and (c) the following words shall be added at the end of subsection (1)— in each tax year up to and including 1988–89 and in each subsequent tax year it shall mean an amount equal to the lower earnings lime.").

The noble Lord said: This little amendment is intended to clear up an injustice—not a serious injustice but an injustice nonetheless—on people at a time when they are transferring from employment to retirement.

It has been explained already—and I need not repeat it—that a considerable time ago it was agreed that in the first year of retirement under the age of 65 a person was eligible for, but did not necessarily get, income benefit. In the Social Security (No. 2) Act 1980 the age limit of 60 was brought in and a figure of £35 (said by the government of the day to be a substantial figure) above which, if one's pension income exceeded it, one's unemployment benefit was reduced pound for pound. From 1980 until now the figure has remained at £35. I doubt whether it was substantial then, and it certainly is not substantial now.

There are a variety of ways in which this little injustice can be put right, and some of the subsequent amendments deal with just that. I support them, though they adopt a different rationale and a slightly more expensive way of achieving that than the way I have suggested. I suggest that the £35 should be brought into line with what is known as the lower earnings limit; that is, the level of income below which employees are not expected to make any contribution towards national insurance benefits. At the moment the figure is £39 for the lower earnings limit, and next year it will be £41 a week.

As the Government said in 1980 that they wanted to withhold unemployment benefit from those with a substantial occupational pension, surely it is reasonable that a substantial pension cannot be smaller than the level at which people are deemed to have too small an income to pay national insurance contributions. That is the genesis and the rationale of this little amendment. I beg to move.

Lord Banks

I should like to support this amendment. Amendments Nos. 45, 46 and 47A all seek, on an ascending scale, to index link the amount of occupational pension which may be enjoyed by someone over the age of 55 without suffering abatement.

Amendment No. 45 is the most modest. As the noble Lord, Lord Swann, explained, it would raise the £35 limit to the lower earnings limit of £39 and as the lower earnings limit is raised to take account of inflation the figure of £39 would rise with it. Amendment No. 46 would increase the limit to £50 to take into account inflation since the figure of £35 was first fixed. From then on the figure of £50 would be linked to increases in prices.

Amendment No. 46A would increase the limit to £50 in exactly the same way as Amendment No. 46 but it would then tie it to average earnings. In present circumstances that would be the most generous since earnings are increasing faster than prices, but I think it would be the most logical. Amendment No. 46 is the minimum which I think the Government ought to accept because they would then be taking account of inflation since the figure of £35 was first fixed; but even Amendment No. 45 would be welcomed and would be a considerable improvement on the present situation. I should be happy to see any one of the three amendments adopted by the Government and I await eagerly to learn which one they have chosen.

Lord Skelmersdale

Hope springs eternal! These amendments would reduce the impact of the abatement provisions for all occupational pensioners aged 55 and over by two means: first, by increasing the threshold at which it takes effect; and, secondly, by committing the Government to an annual adjustment of the threshold in line either with the lower earnings limit, as the noble Lord, Lord Swann, explained, the RPI or average earnings.

I do not want to repeat what I said on the previous amendment, but I emphasise that we do not believe that to pay unemployment benefit when occupational pensions at even higher levels are in payment would be a wise use of resources. These amendments would also commit the Government to an annual uprating of the threshhold. The Government are committed to an annual uprating for certain benefits so that they maintain their purchasing power, but to commit ourselves to the uprating principle here would tie the Government's hands in an important area in an undesirable way.

It would be difficult in advance to estimate the cost. It is much more sensible for the Government to be able to judge the cost year by year. I accept that we have not uprated the figure since the principle was introduced—a point made by both noble Lords— but it must be weighed each year against other competing demands on the social security budget.

In the context of these abatement provisions, we have been looking at the position of personal pensions which, at present, are not included in the definition of, payments by way of occupational pension to quote Section 5 of the Social Security (No. 2) Act 1980.

We intend that personal pensions should have the same effect on benefits as do occupational pensions. For most people the new arrangements to facilitate their taking up personal pensions or to enable them to transfer from occupational pensions to personal pensions will not come into effect until July this year and it will be some time thereafter before any significant effects are felt. This is because it will not be possible to transfer where the occupational pension has been put into payment.

Secondly, a person has no right to transfer his occupational pension entitlement to a personal pension where he leaves his employment or drops out of his occupational pension scheme within 12 months of that scheme's pensionable age. Thirdly, a person who remains with his employer but opts out of the occupational pension scheme cannot require the scheme's trustees to transfer benefits which accrued before April 1988, until he leaves that employment.

Finally, the administrative costs of transferring limited benefit rights accruing from April 1988 will be disproportionate to the benefit transferred. We do not think therefore that there will be many people rushing to transfer to personal pension schemes to avoid the abatement provision, but we shall be introducing the necessary amendments to legislation in due course.

The basic problem is not so much that they reduce the savings achievable by the abatement provision by between £6 and £12 but that they commit the Government to annual adjustments. The national insurance scheme is a statutory scheme and not a contractual one on commercial insurance lines. It is because it is a public scheme and because we feel that we are moving with the times as regards people's expectations—a point I made on the last amendment—that I cannot advise the Committee to accept any of these amendments.

Lord Boyd-Carpenter

Can my noble friend go a little further than this? He accepts that the £35 has been steadily eroded. Thanks to the good economic policy of the Government it has not been eroded recently very fast, but all the same it has been eroded. As my noble friend said that there will be future legislation to bring in personal pensions, that would be an opportunity for legislation to adjust the £35 figure one way or another.

It seems a little unfortunate if the figure is steadily to go down without any compensating action. I should be very grateful if my noble friend would tell the Committee that when the legislation he has forecast comes forward the Government will be considering some adjustment of this figure. If he can give some such indication it would make it a little easier for some of us to support him.

Lord Skelmersdale

In the future legislation to which I have referred the Government will take account of the current £35 limit. I believe that what I said as regards the last amendment stands for the moment: that with the current very low level of inflation, for which my noble friend has very generously given credit to the Government, the fact that the benefit remains payable up to the point where an occupational pension exceeds £85.90 a week for a person with a dependent adult, and so on, means that it is a substantial figure and one that should not be lightly disregarded.

5.45 p.m.

Baroness Turner of Camden

Is it not a fact that the £35 is now worth about £48 and therefore the difference is quite substantial at the present time?

Lord Skelmersdale

I am afraid I have not with me my ready reckoner of inflation proofing or real money. I am afraid that I cannot answer that question.

Lord Boyd-Carpenter

Nonetheless, can my noble friend answer my question? I am not quite sure what he said in reply to my question as to whether in bringing forward the legislation he has forecast, serious consideration will be given to adjusting the £35 figure.

Lord Skelmersdale

I had intended to give that very commitment. We will seriously consider this matter when we consider the whole realm of future legislation.

Lord Swann

The Minister said that hope springs eternal. It did, and thanks to the noble Lord, Lord Boyd-Carpenter, it still does. I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

[Amendment No. 46 not moved.]

Baroness Turner of Camden moved Amendment No. 46A: Page 7 line 12, at end insert ("( ) In section 5(1) of the Social Security (No. 2) Act 1980 for "such sum not less than £35 as is prescribed" there shall be substituted "for 1988–89 the sum of £50 and for succeeding years such amount exceeding £50 as may be prescribed to take account of the increase in average earnings since 1988–89."").

The noble Baroness said: I do not intend to press this amendment in the light of the statement made by the Minister this afternoon. If he can, I should like the Minister to give some indication when we may expect legislation on both the private personal pensions concept which is contained in Amendment No. 47 and also on the possible uprating of the £35.

Lord Skelmersdale

It seems a little strange at this time of year to be saying to the Committee that I cannot prejudge or leak the contents of the Queen's Speech, but I am afraid that is very much the position.

Amendment, by leave, withdrawn.

[Amendment No. 47 not moved.]

Clause 6 agreed to.

Lord Henderson of Brompton moved Amendment No. 48: After Clause 6, insert the following new clause:

("Income support.

In regulation 22 of the Income Support (General) Regulations 1987—

  1. (a) in paragraph (1), the words 'or (5)' shall cease to have effect;
  2. (b) paragraphs (5) and (6)(d) shall cease to have effect.").

The noble Lord said: This amendment is about an anomaly, or perhaps a mistake, in the income support regulations. Regulation 22 is concerned with voluntary unemployment deductions and so far as I can see the rule is the same as it was before. Paragraph 5 of the regulations is new and is the subject of this amendment and also of some concern. It is paragraph 5 that applies the 40 per cent. deduction to, a claimant who is not required to be available for employment".

I can categorise that as a person who, first, has appealed against a decision based upon the opinion of a medical officer of the DHSS that he is capable of work; secondly, is still considered incapable of work by his own doctor; and, thirdly, is not available for work. The effect of this—suffering a reduction of income support by 40 per cent.—is that a claimant who appeals has his benefit cut by 40 per cent. while a claimant who does not appeal and who makes himself available for work contrary to the advice of a general practitioner will get the full rate of income support.

There is a possibility that he may lose disability premium if he is eligible for that. There will be a strong incentive to sign on as unemployed against the advice of the doctor, whether it be a DHSS doctor or his own doctor. I do not think that it can be right to do that rather than appeal and have his benefit reduced for several weeks, or something of that order, pending the hearing of the appeal.

I ask whether this is deliberate or a mistake. If it is deliberate, surely it should be rectified. Draft regulations were published on 1st July 1987 and Regulation 22(5) is the same as the draft. That regulation refers to two other regulations and they differ from the draft in that the draft said that the availability requirement "may" be waived, while the final version says "shall" be waived. According to the final version, the 40 per cent. deduction applies automatically even if the person makes himself available for work pending the appeal. That is not right. It would have been right if the draft regulation had been followed. If it is not right, can it be put right in the way I suggest? Perhaps it is a mistake. It is for that reason that I move the amendment. I beg to move.

Lord Skelmersdale

I ought to confirm straight away to the noble Lord, Lord Henderson, that in the paragraphs of the Bill which he asks shall cease to have effect we are maintaining the status quo. We are not introducing something new. It already exists under the supplementary benefit regulations.

The noble Lord argued that it would be a strong incentive to sign on possibly against the advice of a sick person's doctor. I accept that there is a reduced level of benefit while the appeal is being heard, but I should point out that if the appeal confirms the original decision, supplementary benefit, or under the new scheme income support, is lost altogether. However, the reduced level is not reclaimed from the beneficiary as a result. If the appeal turns down the original decision, the reduced supplementary benefit which he has received during the appeal period will be made up to the full amount. I hope that that will help the noble Lord.

Lord Henderson of Brompton

It certainly does. I should like to consider what the noble Lord has said. Meanwhile, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ennals moved Amendment No. 49: After Clause 6, insert the following new clause:

("Rehabilitation for employment.

In the Income Support (General) Regulations 1987—

  1. (a) the provisions of regulations 35 and 36 shall apply to a payment made by a charitable or voluntary organization to a person under a contract of participation in a training programme provided by that organization for the purpose of rehabilitating him for remunerative employment, in the same way as to remuneration derived from employment as an employed earner, and any such payment shall be treated as earnings for the purposes of those regulations and Schedule 8;
  2. (b) the provisions of paragraphs 7 and 8 of Schedule 8 shall apply to such a payment in the same way as to earnings from the employments mentioned in sub-paragraph (1) of that paragraph 7.").

The noble Lord said: Perhaps I may explain the problem that the proposal is designed to meet. If this should be the wrong way of seeking to meet it, it may be that the Minister will have a proposal that will help the Committee.

For nearly 20 years I have been involved in the Peter Bedford Project which helps to rehabilitate single homeless people. Some are victims of alcoholism who live in shelters of one kind or another. Some have had psychiatric problems. They are all homeless and rootless. The problem is becoming much more widely known throughout our society. These are people who in a sense have slipped out of the network of our society and are homeless and rootless. It must be the objective of society to try to help these people to live a reasonable and settled life again.

The task of getting them back into employment is not an inconsiderable one and very often if these people are prepared to take a job, they cannot take one initially for more than one or two days a week. It is a gradual process and requires a good deal of support and the building-up of the confidence of the individuals concerned. In the project in which I have been involved it has been encouraging to see how many people have decided virtually to pick themselves up off the streets, having been given some help, and have been able to survive both in work—in this case mainly in office cleaning—and in accommodation. Many are now settled people.

Perhaps I may give another example. It is because of this that I feel impelled to bring this amendment before the Committee. St. Mungo Housing owns and manages hotels for single homeless people across London. Its aim, and the aim of the Peter Bedford Project to which I have referred, is to rehabilitate residents not just by assisting them to find independent housing but also by helping them find employment. St. Mungo's has established an employment training programme supported by central and local government to develop a new initiative for the long-term unemployed who are homeless. As I said, that number is steadily increasing. An increasing number of people who use the services of St. Mungo also suffer from psychological problems and mental illness. Some may be able to progress towards a more independent lifestyle, provided that they are able to develop sufficient self-confidence.

As the Committee will know, there is a system of disregards, whereby DHSS claimants who earn more than £4 a week see a corresponding reduction in benefit £1 for £1. Unfortunately, the current disregard, despite the proposed increase to £5 a week, constitutes an actual disincentive. The Social Security Bill contains provisions for certain groups to have the disregard increased to £15 a week. I want to see this higher disregard extended to those who are attempting to gain employable skills by participating in one or other of these two programmes. It applies to a number of other organisations as well. I am referring to St. Mungo and to the Peter Bedford Project as examples.

I am aware the rehabilitative nature of such participation requires some definition. In practice, training programmes run by voluntary or charitable organisations are time-limited for each participant, and as long as entitlement to the higher disregard is linked to participation we do not see the Government being required to extend an open-ended commitment. That would be too much to expect.

I believe that extending the higher disregard in the way outlined will be of real assistance not only to the organisation but to the people themselves and will eventually help some of them to lead lives independent of the need for state benefits. That is a worthy objective. This proposal is consistent with the declared objective of the Government's policies on care in the community and with their desire to promote personal independence among the long-term unemployed. This is a good example of the Government's policy, which I support, of wanting to help people to stand on their own two feet. If this problem can be dealt with in a way other than by increasing the level of the disregard, I hope that the noble Lord will say so. If there is some other way, I shall be only too pleased to come forward with an amendment at the Report stage.

It would be wrong to reject such an amendment without finding some way to end a problem affecting thousands of people—I am not pretending that it is hundreds of thousands. The projects involved in this work are worthy of our support and the support of Her Majesty's Government.

Lord Skelmersdale

I am grateful to the noble Lord, Lord Ennals, for tabling the amendment because we all agree that it is necessary to help people pick themselves up, as the noble Lord put it. The income support general regulations do just this in providing for the first £5 of any income from a charitable or voluntary organisation to be disregarded. This is an improvement on the £4 currently disregarded in the supplementary benefit scheme. By treating charitable and voluntary payments separately for disregard purposes, trainees who also take up part-time employment can receive the £5 or £15 disregard on their earnings depending on their circumstances. This would not be possible if the charity or the voluntary payments were treated as earnings. Here lies the problem.

It has been the practice of consecutive governments that trainees who are not engaged under a contract of employment should not be treated as receiving earnings. To do otherwise now would make it necessary to consider whether trainees were in remunerative work and therefore disqualified from receiving income support, which I am sure the noble Lord will agree would not be a good thing.

People who are in remunerative work for 24 hours or more a week are not entitled to income support. Moreover, I am afraid that paragraph 7 of Schedule 8 would be inappropriate because that paragraph refers to people such as part-time firemen and coastguards and the disregard recognises the special nature of their work, which of course would be different from that which the noble Lord, Lord Ennals, has in mind.

Training programmes may be run by charitable or voluntary organisations which will also pay training earnings on behalf of the MSC. MSC training allowances do not constitute earnings and therefore trainees are not excluded from receiving income support because of the renumerative-work provisions. Training allowances are taken fully into account, although any reimbursed travelling expenses and certain away-from-home expenses are disregarded. If the MSC training allowances were topped-up by the charitable or voluntary organisations and those additional payments were treated as earnings, we would be back in the same trap.

Furthermore, the current Employment Bill, which received its First Reading in this House it seems just a few minutes ago, provides a power for the treatment of topping-up payments. It would be wrong for such payments to be regarded as earnings. I am sure that the noble Lord would agree with that. I am afraid that, with the best will in the world, I cannot see any way out of the noble Lord's conundrum.

6 p.m.

Lord Ennals

If the Minister cannot see any way out of the problem, then we shall have to have another try. I understand the problem. I do not agree with him that to call a disregard earnings would be wrong. I think that the Minister also recognises the nature of the group of damaged people about whom I am concerned, for whom work has not been a pattern of life often for 10, 15, or 20 years. Those people, as I said before (the Minister repeated me) are being picked up by their own efforts, with the help of society. It is impossible to think that they could qualify for training allowances. They can start by doing the most simple work. Some of the work we have organised has been gardening, cleaning up gardens or cleaning the roads. It is simple work. Office cleaning is perhaps the most sophisticated work that we have arranged. We have cleaned DHSS offices up to a reasonable standard. I shall not press the amendment to a Division. I would not succeed. In his response the Minister seemed to be sympathetic to the problem that I raised but not to have an answer. I have presented the problem but I too have no satisfactory answer. I wonder whether he will say that he is happy that there should be discussions between his department, perhaps the Department of Employment, representatives of the organisations to which I have referred and maybe a number of others to see whether there is a better solution than the one that I have tried to foist upon the Bill.

Lord Skelmersdale

Wearing my mental-illness and mental-handicap hat, I of course see the problem. That is why I have been sympathetic to what the noble Lord said and to the essence (the nut in the middle) of the amendment that he has moved. But, as I say, this is a major problem; it is one thing to recognise a problem but quite another to find a solution—bearing in mind the likely timescale of the Bill—within the context of the Bill. However, I shall certainly be delighted to talk with the officials and the noble Lord's advisers to see whether some solution can eventually be found.

Lord Ennals

I am grateful to the Minister for being so sympathetic. It may be that we shall not find anything that can come into the Bill, although it may go into another Bill. If we find a way of resolving this problem, it will not have been a waste of time to bring the amendment before the Committee. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ennals moved Amendment No. 49A: After Clause 6, insert the following new clause:

Disability premium.

("Recurrent spells of incapacity

In paragraph 12(1) of Schedule 2 to the Income Support (General) Regulations 1987, after sub-paragraph (1)(b), there shall be inserted the following sub-paragraph— (bb) the claimant is treated as being incapable of work for the purposes of one or more of the provisions mentioned in subparagraph (b) and, in the opinion of an adjudication officer, because of the nature of his illness, is likely to be so treated for, on average, at least one week out of four in each year until he dies or reaches pensionable age; or".").

The noble Lord said: Here I am having another try at moving the amendment standing in my name on the Marshalled List. The amendment deals with a different group of people. It is not a group with which our society is accustomed to dealing. It is a new group. There are many Members of the Committee who are deeply concerned not only about the spread of AIDS (as was shown by the debate in this place some eight days ago) but by the sad problems that arise for those who contract the disease. It has of course been brought before us in a very poignant way through the haemophiliacs whose infection could in no way be ascribed to themselves. Haemophiliacs are twice hurt—by the condition itself (haemophilia) and by AIDS resulting from infected blood.

I hope that Britain will become independent with regard to blood supplies and have pure blood, so that there will be no new cases of haemophiliacs attracting HIV infection. The Government have, of course, sought to deal with existing cases with a grant of £10 million to the Haemophilia Society. That grant recognises the special problem of haemophiliacs. But, in no way is the grant a substitute for a benefit which will help all AIDS victims to have some regular income during a time which for them may be a short lifespan. Clearly, the disability premium is the most suitable available benefit.

At present we are not talking about many people. Sadly for them, we are not talking about people who are likely to be disabled for a long time. Sadly, their lifespan is likely to be short. I hope that the Committee will not be satisfied with a ministerial negative based on the argument that the benefit should be based on a particular medical condition. That is of course how one would normally have responded, but the disability premium is not designed for a particular medical condition.

AIDS is a new and terrible affliction. We must find ways to assist those who have the disease and who are unable, as the law stands at present, to obtain an income which would assist them during the rest of their short lives. The problem was raised by Mrs. Beckett in another place in Standing Committee on 17th December. At that time there was a useful exchange, which in a sense gave the Government a warning that this was a problem with which we would need to deal.

I shall quote from representations that I have received from the Haemophilia Society. It has said: Our primary concern is eligibility for Disability Premium. At present to qualify for the premium an individual has either to be in receipt of one or more non-means tested benefit, such as Attendance or Mobility Allowance, or be incapacitated through illness for six months. The prognosis for acute HIV infection and AIDS is bouts of recurring opportunistic infections which can, more often than not, be controlled. It is unlikely therefore that people are ill for six months at any one stretch. However, the cost of living with AIDS remains consistent or increases. A recent analysis by the Haemophilia Society estimated the weeekly cost of living with AIDS at between £65 and £75 a week. People with AIDS tend to be unable to work. There is therefore a possibility that someone with AIDS will have to survive on Personal Allowance only".

I am sure the Committee will agree that that situation is not satisfactory. In order to prevent that situation arising, it is suggested that individuals, on diagnosis of Persistent Generalised Lymphaclenopathy (PGL) or similar symptoms of developing infection, be automatically awarded Disability Premium"— That is without waiting for the normal six months' qualification, which might be too late.

I should be most grateful if the Minister would look sympathetically at this problem, which will be a growing problem. However, we all hope that it will not be massive in so far as the lifespan of those who have contracted the disease will almost inevitably be a short one. I beg to move.

Lord Skelmersdale

My Lords, the Government sympathise with everyone infected with the AIDS virus, especially those who are terminally ill, and with their families. As far as haemophiliacs are concerned, I am grateful for the appreciation of the noble Lord of the £10 million trust fund. However, he will agree with me that those haemophiliacs infected by contaminated blood products are in a unique position.

Having said that, this amendment goes very much further than AIDS sufferers. It is very widely drawn indeed and would cover any intermittent illness, if that makes sense. The amendment would extend the disability premium to anyone suffering from an incurable condition which is likely to incapacitate him or her for on average at least one week in four for the foreseeable future. The premium would be payable for any period of incapacity from the date of onset of the condition. Again, we have genuine difficulties here. The principal one is a practical one. Entitlement to income support and to the premium structure is based on clear and objective criteria. The disability premium is thus based on receipt of a long-term incapacity benefit, a disability benefit, blindness or proven long-term incapacity for work. These criteria are clear and easily understood and they rest on the facts at the time of the claim.

Before a disability premium could be awarded in accordance with the proposed clause, the adjudication officer would have to make a medical decision as to the likely prognosis for the claimant's condition. Clearly, as the Committee will recognise, this is not an area in which a layman could properly make a decision, so inevitably medical opinion would have to be sought. It seems to me unlikely that it would be possible to judge, in advance and with any certainty, the extent to which a condition, which falls short of being totally incapacitating in effect, would restrict a patient's future ability to work. I am sure that doctors would not wish to risk their patient's morale by making a decision as to the incurable, or terminal nature of a condition in the early stages. Without such advice however it would be impossible to determine entitlement under the proposed clause.

Even if it were possible to obtain the necessary medical advice in every individual case affected, that would not be the end of our difficulties. To claim the extra premium, the claimant would have to know the rule and recognise that his condition fell within the scope of the premium. This very uncertainty about entitlement is one of the major factors which has contributed to the need to reform the present supplementary benefit scheme. The noble Lord might well say "Let the Secretary of State himself identify the appropriate cases". But this would mean a return to intrusive questioning and would affect not just the sick, but the unemployed as well.

The new income support scheme will provide over £60 million extra to sick and disabled people through the disability premium, and a further £8 million will be spent on the severe disability premium. In response to the very real concerns shown by noble Lords, and in another place, we are setting up a trust fund for the very severely disabled who need considerable help to live independently in the community. The Disablement Income Group are helping us with this special task; they have expertise in and knowledge of the cost of disablement. The fund will provide up to £5 million in 1988/89 in a flexible response to the special needs of these people, a fact mentioned and just acclaimed by my noble friend Lady Lane-Fox.

I think that noble Lords will agree that this is a considerable achievement. In the long-term we shall be looking at all the benefits for the disabled, including the income support premium structure, in the light of the OPCS survey. In the meantime I am afraid that we cannot make piecemeal amendments to the income support premiums. That would jeopardise the reform and the position of the vast majority of the sick and disabled under pension age who will benefit from it. These are very real difficulties and I am afraid that I cannot advise the Committee to accept this amendment.

6.15 p.m.

Lord Ennals

I did not expect the Minister to accept the amendment just as it was proposed because I recognise that it is a very difficult one. I have to say to him that many of the people who are in the sort of condition (whether or not it is due to AIDS) where they are faced with the problem of a choice between intrusive questioning and being very broke indeed, would accept intrusive questioning. Of course, they and we would all accept that any such decision would have to be based on a medical assessment. It could not possibly be done by a layman.

We are facing a difficult problem and the Minister and the noble Baroness, Lady Lane-Fox, expressed great satisfaction that agreement had been reached with the Disablement Income Group on the trust fund, or however it is described. But they will recognise that this only happened after representations from a number of other organisations which one might have thought would have had the experience or in this case would be more valuable than the Disablement Income Group. I think this covers MENCAP, the Spastics Society, RADAR, who were very unhappy about the proposals which have been made by the department. The disablement group were the only ones prepared to enter into a deal with the Government. They were worried about some of the principles concerned.

However, that is aside from the issue, although it shows the great difficulties with which we are faced both on this side in putting forward a proposal and by the Minister in deciding whether to accept it. I am of course not going to seek to press this amendment because it is another try-out, hoping that the Minister will say that there is a germ of something here, as he did on the first amendment. However, he has not done so on this one. I think it is a matter on which the various organisations concerned with disabled people and people like the Haemophilia Society may have to come together to decide whether there are other proposals which they can put forward. Those proposals may enable a particular problem which I have tried to outline to be dealt with in a way which relieves hardship.

I am a little disappointed that the Minister, in saying "no", had no helpful way of saying, "Well, maybe, but we shall do it in another way". I shall not press him on this occasion however, and I beg leave to withdraw the amendment.

Amendment, by leave withdrawn.

Clauses 7 and 8 agreed to.

Schedule 2 [Part I Earnings Factors. Part II, Transfer Values]:

Lord Skelmersdale moved Amendment No. 50: Page 16, line 32, before ("in"') insert ("in sub-paragraph (2),")

The noble Lord said: This is a purely technical amendment. I beg to move.

On Question, amendment agreed to.

Schedule 2, as amended, agreed to.

Clauses 9 and 10 agreed to.

Schedule 3 [The Social Fund]:

Lord Banks moved Amendment No. 51: Page 17, line 17, at end insert ("and to meet such other expenses as appear to the Secretary of State should be paid as of right to all persons of the prescribed descriptions in such circumstances.").

The noble Lord said: I beg to move Amendment No. 51. Paragraph 2 of Schedule 3 of the Bill makes provision for the Secretary of State to make payments, in prescribed circumstances, to prescribed descriptions of persons to meet expenses for heating incurred in cold weather. This will enable the Secretary of State in future years to make payments from the social fund, although they are not being cash-limited for a scheme similar to that operating last year and this year. The amendment would broaden the scope of this provision. If, for example, the Secretary of State felt that all those qualifying for the heating payments should also receive a further payment from the social fund to meet other expenses caused by the cold weather, then he could arrange that such payments were made.

Cold weather requires extra clothing, extra blankets, perhaps additional food and certainly additional maintenance and weatherproofing of homes in addition to extra heating expense. The Secretary of State could make a payment towards these or other expenses, if he chose, out of the social fund, if this amendment were carried. I beg to move.

Lord Skelmersdale

As the noble Lord, Lord Banks, has explained, the intention of this amendment is to extend the scope of the social fund's provision for cold weather payments beyond anything yet envisaged. Let us be clear in what we are intending to do by way of extra payments to help vulnerable people in cold weather. We want to be able to provide quick help to make sure that they feel able to keep their homes adequately heated. That is extra help, in addition to the provision already made in the income support rates.

The new income support scheme will continue to give people money to pay for heating, and further help will be directed more effectively through the premiums of those in greatest need: pensioners, the sick, the disabled and families. The money that is spent at present on heating additions under the supplementary benefit scheme has been included in the resources available to the new scheme.

Other practical help is available from other quarters. Under a scheme operated by the Department of the Environment, 90 per cent. of the costs of the loft insulation will be available as a grant to people in receipt of income support, housing benefits, and family credit. Similar criteria will guarantee eligibility for grants covering 90 per cent. of the cost of materials for draught-proofing carried out by the Manpower Services Commission's community programme. I am not sure that I am allowed to advertise but the department has recently produced a pamphlet entitled Keep Warm, Keep Well, which describes how people can help themselves in winter. We do not want to burden the cold weather scheme with all kinds of single payment-type regulations, or to duplicate help available from other sources. I therefore ask the noble Lord not to press his amendment.

Lord Banks

The noble Lord might be slightly more friendly towards this amendment, as it is only enabling and does not compel the Secretary of State to make any payment if he feels, along with the Minister, that to do so would add complications and that there is no need to do so because of the existence of other provisions. However, single payments for items other than insulating or draught-proofing would presumably be cash-limited. This amendment would have been a way of ensuring that anything extra required as a result of severe weather would not be cash-limited. It is clear, however, that the noble Lord is not attracted to the amendment and I do not intend to press it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Banks moved Amendment No. 52: Page 17, line 17, at end insert— ("2B) The following subsection shall be inserted after subsection (7)— (7A) The Secretary of State shall lay an annual report before Parliament listing the number of applications refused for grants and loans under the social fund and summarising the reasons for refusal.'')

The noble Lord said: There is a great deal of apprehension about how the social fund will work in practice. The noble Lord would have to admit that that is so, even if he does not share any of that apprehension. There is concern about the fact that the fund is cash-limited; there is concern that the fund will operate on a discretionary basis; and there is regret that there will be no right of appeal to an independent tribunal.

It has been noted that the Social Security Advisory Committee has said that the arrangements for the social fund are unfair and unenforceable. In all those circumstances it is important that the operation of the fund should be carefully monitored and the results of that monitoring made public. The report required by the amendment would reveal how many applications for grants and loans had been refused during the year under review and would give a summary of the reasons. It would indicate what were the principal reasons and how many refusals were attributable to each. That would help both Parliament and the public judge how far the fund was meeting the need and how restrictive its discretionary policy and cash limits had turned out to he. I beg to move.

Lord Skelmersdale

The noble Lord is proposing that we specify in statute the information that Parliament should receive about the operation of the social fund. It is the Government's clear intention to monitor very closely the operation of the social fund and to collect a good deal of information about it.

In the first year in particular—and I understand the noble Lord's worries about that first year—we shall expect to follow our practice hitherto with the social fund and make information widely available both to your Lordships and to interested observers at intervals. But that information is likely to range much wider than that sought by the amendment, covering payments made and reviewed as well as payments refused, amounts spent on loans and grants, and amounts recovered.

I hope the noble Lord accepts that that will give far more information to the public at large and to Parliament assembled than would the proposals in his amendment.

Baroness Jeger

We support the noble Lord, Lord Banks, because there is widespread anxiety (and it is not limited just to this side of the Committee) about how the social fund will work in practice and what effect it will have on the people who need to use it. It seems to me very modest to ask for an annual report.

I should like to put this question to the Minister: what will be the role of the Social Security Advisory Committee? Will the reports covering the granting of social fund payments and refusals be referred to that committee? I understand that it is not at all happy about the arrangements being made for the operation of the social fund. Although this amendment will not be pressed to a Division, the noble Lord opposite will appreciate that there is widespread concern about how the scheme will work in practice.

Lord Henderson of Brompton

The noble Lord, Lord Banks, has very clearly articulated the main reasons that there is great concern about the operation of the social fund. If the Minister will not accept this amendment, I ask him to say in what form he proposes to make available to the public the rather wider information and statistics that he said the Government will produce.

I should have thought that here was a case for an annual statutory report. The noble Lord, Lord Banks, has made out that case and has been supported from the Opposition Front Bench. If it is not to be statutory, how is Parliament to know the information in question? Will the Government give an undertaking that they will present an annual Cmnd. Paper? I shall be very interested to know the answer.

Baroness Faithfull

I am deeply concerned about the social fund and support the noble Lord, Lord Banks, in that we must know who has been turned down and to whom grants are being given. It also requires a little further research as to what happens to those people who have been refused a grant—otherwise the scheme will not be cost-effective.

I give just one example. One might have the case of a single-parent family living at subsistence level in bed and breakfast accommodation, on supplementary benefit. If that family joyfully received the information that it was to be given a council house or flat, it must be provided with the bare essentials. If it did not have the money to buy a cooker and a few utensils and had to borrow that money, either from the DHSS or from somebody else, then it just could not manage. I speak for the sake of the children, because they would be bound to suffer in that situation.

I was very worried when I was working. I must say that those who administer supplementary benefits have the worst possible time of anybody. I regret to have to say that some of them took the easy way out. If someone asked for a grant, they gave him a grant, and I felt that they very often gave people too much. I know of one family who were given a cooker, a fridge, a television set, a carpet and a suite. I went to the supplementary benefit office and told the staff that I thought that it was quite wrong for people to be given that amount of goods.

Not unnaturally, and understandably, the Government were very worried about the money being spent on grants. I think that they were right to be worried but they have come down on the wrong people. It was the staff in the supplementary benefit offices who were so overgenerous. If they had not been, the grants that were given would not have been so high and the Government would then not feel that they had to set up a fund and ensure that only a certain amount of money was available.

In my authority we were so worried about the situation that the social services department gave me the money to employ a van driver, to advertise weekly in the paper for secondhand furniture and to get a store for it. That meant that anyone moving out of bed-and-breakfast accommodation or who needed something could come to our second-hand store and pay perhaps 50p to £1 for goods.

I understand the Government's point that we were spending the most enormous amount of money, but I believe that we were spending it in the wrong way and now we are taxing the wrong people. If people on supplementary benefit have to pay back what they have received and they are on subsistence level anyway they will be in an impossible situation. I support the idea of the noble Lord, Lord Banks, that we must know who has been turned down and what the effect has been on them in the long-term so that we have an absolutely clear picture of how the social fund is working. I support the amendment.

6.30 p.m.

Baroness Lane-Fox

I am always a little confused when we start to suggest that the income support scheme has a gloomy outlook. I quite understand that parts of a new scheme of this kind will need to be worked out. After all, the income support will replace the supplementary benefit scheme. It is simpler and it includes a disability premium. What is more, it will lead to increased spending of over £60 million for people who are sick and disabled. That fact is very often overlooked.

Lord Ennals

I wish to make a very brief comment so that it is not necessarily assumed that we on this side of the Committee accept part of what the noble Baroness, Lady Faithfull, has said. I absolutely agree with her conclusion and I totally support the proposal made by the noble Lord, Lord Banks. However, certainly my experience of social security offices is not that the staff are likely to be overgenerous. My experience was often that they were not adequate in the payments that they made. Sometimes they were prepared to look at cases again if the person concerned was intelligent enough to see their Member of Parliament. But it should not have been that way.

I am merely saying that there is a great variation in the way in which special payments are administered. Sometimes some benefit office staff may be overgenerous but more often it is the case that they are not as generous as they might be. I greatly regret that the system is being changed, but that is another matter.

Lord Swinfen

I support to a certain extent what the noble Lord, Lord Ennals, has said with regard to the size of grants particularly in regard to disabled people who are leaving some form of institution to live independently. Very often those people are on supplementary benefit and they have absolutely nothing with which to set up home. Physically disabled people particularly could be in danger unless they receive a grant that is sufficiently large to obtain satisfactory equipment. To a certain extent that also applies to mentally disabled people. It is no good giving them equipment which is going to break down because it is not robust enough to do the job.

On the summary of the reasons for refusal of grants and loans, I understand that the applicant must show that he has looked elsewhere for funding. One of the problems that is worrying the voluntary bodies at the moment is the fact that the number of applications which are already being made to them is increasing very rapidly because people are beginning to think that the social fund is already working. I know that my organisation, John Grooms Association for the Disabled, which is not a grant-making body, has for years had the occasional appeal for funds. Those appeals are now coming in regularly and we are not able to help the people concerned.

Can the Minister give some kind of indication as to where the applicants are going to be directed when they have to seek alternative funds? At the moment the voluntary bodies, with the income that they are getting, are already fully loaded with work and they will not be able to take on an additional burden.

Lord Skelmersdale

Before the noble Lord, Lord Banks, responds I shall reply to various points that have been made. My noble friend Lady Faithfull said that it was necessary for Parliament and all the various charitable workers in this field to know who has been given grants and loans and who has been turned down. That is a very balanced view, if I may say so, but the amendment is unbalanced. It just looks at the negative side.

I suggest to the Committee that if the information laid down in the report is as restrictive as the amendment would suggest, it would be to the point of being useless on its own. Although we are still refining and finalising the content of an information package, I give a firm commitment in answer to the noble Lord, Lord Henderson, that we shall make it widely available in due course. We shall put it in the Library of both Houses and there will be absolutely no secretiveness about it at all. It is not in anybody's interest to have secretiveness.

Furthermore, I can give another commitment on behalf of the Government, which is that we shall be commissioning independent research on the social fund from an outside body when it is up and running. We expect that to be in the year 1988–89.

My noble friend Lord Swinfen asked how the social fund would affect voluntary bodies. I answered a parliamentary Question on this subject on 26th January. I can do no better than to repeat what I said (at col. 493 of the Official Report): The advice to people is to go to the social fund officer in the local social security office. He will make a crisis loan payment if appropriate. Only if a suitable charity exists which, as I have said, has the money or service available would he advise the applicant to seek help there; for no other reason". I hope that that helps my noble friend. In due course he will be able to read the rest of the Official Report concerning that Question.

As regards loans being a bad idea, we are an awful way down this route to have second thoughts now. But we believe it is right in principle to make loans from the social fund for three main reasons. The first is that one of the main objectives of the reforms is to give people a sum of money to manage for themselves so that they do not have to keep going to the Government for extras. That will be achieved through income support, which will be simpler than supplementary benefit and will provide additional help to certain groups, especially families, through premiums. The points that my noble friend Lady Lane-Fox made about the progress that the Government have made in this whole area of social security are absolutely right.

Secondly, it is only fair that people on income support should budget for items of expenditure just as others who are living at or not far above the income support level must do. Thirdly, the same amount of money can be used to help more people.

Those were the criteria on which the 1986 Act was passed and they remain firm now.

Baroness Jeger

Before the noble Lord sits down, perhaps I may ask one question. I understand that last year single payments accounted for £350 million. I also understand that the social fund budget for 1988–89 contained loans of £140 million and grants of £60 million. I make that sum to be £200 million. That seems to leave a shortfall of £150 million in expenditure for people in need. How are such people to find £150 million?

Lord Skelmersdale

I do not believe that the noble Baroness has included the money for the community care element in the social fund. I also suspect that there is something else which is missing. However, I shall not swear to that at the moment.

Lord Henderson of Brompton

Perhaps I may thank the Minister for his undertaking as regards publication. Can he confirm that he meant annual publication rather than publication from time to time? Also, will he give consideration to the laying of that information before Parliament and its being properly numbered in the Command series so that it can be laid before Parliament annually rather than simply put in the Libraries of both Houses?

Lord Skelmersdale

I shall certainly consider both those points.

Lord Banks

I greatly welcome the Minister's statement that it is the intention of the Government to make a wide range of information widely available. I also welcome support from all parts of the Committee for the idea that that information should be available. I believe that there is considerable support for the idea of putting a provision in the Bill which will ensure that that is done not only this year and perhaps next year but regularly every year. Perhaps the Minister will undertake to submit for our consideration at the next stage of the Bill an amendment along those lines which is more balanced than he believes this one to be.

Lord Skelmersdale

I shall obviously have to make that decision when I have completed the consideration which I offered to the Committee in response to the intervention by the noble Lord, Lord Henderson.

Lord Banks

I thank the Minister for that reply. I hope that he will see fit to submit an amendment which will cover what he has said the Government intend to do and what so many Members of the Committee hope will be done. I shall also perhaps attempt to put down a more balanced amendment. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Skelmersdale moved Amendment No. 53: Page 18, line 2, at end insert— ("6A. At the end of subsection (1) there shall be added the words "in such form and manner as may be prescribed".").

The noble Lord said: There are a number of amendments to Schedule 3 which have been put forward by the Government for consideration today. Amendment No. 53 comes before us as a result of the same process which identified those which we shall consider later. Perhaps it will be helpful to the Committee if I say a few words on how they came about.

In the Committee stage of the Bill in another place, my honourable friend the Parliamentary Under-Secretary stated that in the preparations for the social fund: we normally expose the directions that we draft to independent counsel for scrutiny". This amendment and the later government amendments are a direct result of that process.

We are advised that it would help clarify the requirements of applications for payments from the discretionary part of the social fund if they were to be laid down in regulations rather than in the social fund manual or elsewhere. This simple amendment provides for such regulations to be laid, and so mirrors the arrangement whereby the requirements for applications for the review of social fund officers' decisions are laid down in regulations. I beg to move.

On Question, amendment agreed to.

6.45 p.m.

Lord Skelmersdale moved Amendment No. 54: Page 18, line 8, at end insert— ("7A. The following subsection shall be inserted after subsection (4)— (4A). An award that is to be repayable shall be repayable upon such terms and conditions as before the award is paid the Secretary of State notifies to the person by or on behalf of whom the application for it was made.").

The noble Lord said: This amendment, which also follows advice from counsel, makes statutory our intention that applicants for payments from the discretionary part of the social fund know in advance of receipt of payment the conditions of acceptance. I beg to move.

On Question, amendment agreed to.

Lord Henderson of Brompton moved Amendment No. 55: Page 18, line 8, at end insert— ("7A. In subsection (5), for the words "Secretary of State" there shall be substituted the words "Adjudication Officer". 7B. In subsection (6), for the words "Secretary of State" there shall be substituted the words "Adjudication Officer". 7C. In subsection (7), for the words "Secretary of State" there shall be substituted the words "Adjudication Officer".").

The noble Lord said: This is an important amendment because it concerns the right of appeal from decisions made by social security officers. If the amendment is accepted, there may be a right of appeal from all decisions made by social fund officers to a social security appeal tribunal. There is also the possibility of a limited further appeal to social security commissioners and ultimately to the courts.

A measure of the importance of this matter is the report, Cmnd. 9722, of the Council on Tribunals, which says that the abolition of the right of appeal would be a highly retrograde step. I agree; and that is the case for the amendment. The amendment concerns what the noble Baroness, Lady Faithfull, described, in speaking to Amendment No. 52, as the bare essentials—a grant for a cooker in a flat, a grant for a bed for a person being rehoused or a loan for basic essentials of that sort. People may be coming out of care, out of hostels or out of publicly provided accommodation and moving into a flat. They may need those basic provisions.

At present, one out of every four appeals to such tribunals concerning single payments is successful. Surely that shows that the quality of decision-making in the department requires an appeal procedure. An appeal system is just as necessary, if not more so, when local decisions are being made on a discretionary basis. It is necessary to have a proper appeal tribunal rather than an administrative review.

I think I have made the case for the amendment very shortly and plainly. I could elaborate at remarkable length. I do not propose to do so because I believe that I have made the case for the retention—if that is the word of a proper appeal. If "retention" is not the proper—word, perhaps I should use the word "institution". I beg to move.

Lord Skelmersdale

Before responding to the amendment of the noble Lord, perhaps I may correct a reply that I gave to the noble Baroness, Lady Jeger. The sum of £203 million proposed for the social fund for the next financial year includes community care. I apologise for misleading her. However, the noble Baroness is only right as far as she goes. In 1986–87, single payments totalled £350 million. The latest evidence suggests that for 1987–88 the figure will be about £200 million for single payments. There is not much to argue about between £200 million and £203 million. However, the first evidence may lead us to change our minds concerning the future.

Lord Ennals

Will the Minister agree that the great reduction was a result of decisions taken by the department to discourage the same size of payment? Single payments were much less and therefore were grossly inadequate.

Lord Skelmersdale

I agree that the rules certainly were tightened up, as the noble Lord will remember far better than I since he was concerned with this matter at that time and I was not.

Lord Ennals

It came up last year.

Lord Skelmersdale

Indeed. The noble Lord was concerned with this subject and I was not.

I was rather surprised that the noble Lord, Lord Henderson, should bring evidence from the Council on Tribunals into play on this amendment. I shall have to study this matter with great care. Suffice it for now to say that I regret that the noble Lord's purpose is not achieved by this amendment. The amendment suggests that the adjudication officer should be responsible for a type of activity which would be quite new to such officers. The present function of the adjudication officer is to take independent decisions about regulated payments.

These decisions are of course appealable to the local Social Security Appeals Tribunal, and ultimately to the social security commissioner. However, this amendment is not suggesting that the adjudication officer take any decision. Rather it is suggesting that the adjudication officer implement a previous decision. This is unusual not least because the adjudication officer is not at present responsible for the implementation even of those decisions which he takes himself.

Moreover, I am afraid that I cannot agree that the Secretary of State should divest himself of the powers or process of recovery of social fund loans. Principally, as the Secretary of State is responsible for paying sums into the social fund, it is logical that he should be responsible for its control and management, as Section 32(5) puts it, including the renewal of the fund from repayments. In more general terms, it is only fair to other applicants for loans from the social fund that we have an effective process of recovery.

I hope that the noble Lord will read what I have said as carefully as I shall read his remarks.

Baroness Faithfull

Before the noble Lord sits down, as a matter of information, if the adjudication officer turns down a claim what right of appeal has the claimant against him?

Lord Skelmersdale

If the adjudication officer turns it down there is a person—I cannot for the moment find the information.

Baroness Faithfull

Perhaps the Minister will write to me.

Lord Skelmersdale

The answer to my noble friend is the Social Security Appeals Tribunal.

Baroness Faithfull

Where does the Social Security Appeals Tribunal sit?

Lord Skelmersdale

I shall have to write to my noble friend.

Lord Henderson of Brompton

I shall read very carefully what the noble Lord has said, and I accept that the purpose of this amendment is not achieved by its wording. For that reason alone I shall withdraw it, but I hope he will understand that there will need to be a monitoring system which is operated by a court of appeal. Otherwise there is no proper check on the discretionary awards by the social security people—the social fund officers.

I acknowledge that the Secretary of State has to have an effective process of recovery, and what I am proposing is in no way meant to run counter to that. I think that the noble Lord should bear in mind that if no appeal is instituted there will be much greater use of judicial review. I am not at all sure that that is satisfactory to the Secretary of State. Having said that, I hope that the noble Lord will take note of what I have said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ennals moved Amendment No. 55A: Page 18, line 8, at end insert— ("7A In subsection 9(c) after "it" there shall be inserted the words "except in the case of community care grants and budgeting loans, where that person or body is a voluntary organisation, friend, relative or other non-statutory body".").

The noble Lord said: I am moving this amendment on behalf of my noble friend Lady Jeger and the very broad spectrum of voluntary organisations and charities. This issue was raised by the noble Lord, Lord Swinfen, in an intervention on a previous amendment.

Many Members of the Committee will have seen the letter in The Times of 11th January from a group of organisations: the Family Welfare Association, Age Concern, Dr. Barnardo's, the Spastics Society, the British Epilepsy Association and the Motor and Cycle Trades Benevolent Fund. The group could have included another 15 or 20 organisations. Certainly I associate myself with that letter, and also, as its chairman, I associate MIND with it. Those organisations expressed their concern in this way: From April people in need will be told to apply first to charities before the State will consider providing financial assistance. That is the date when the system of legal entitlement to supplementary benefit single payments for items like essential household furniture will be replaced by discretionary loans and grants from a cash-limited social fund. In deciding whether to make a loan or grant, the DHSS will take into account whether the need could be met from another source—e.g., a charity or relative. If this scheme goes ahead, hard-pressed charities expect a storm of new applications for help which they will simply be unable to meet". As the noble Lord, Lord Swinfen, said, some of them are already getting applications in this sense. The letter continues: All were concerned, and many outraged, at the consequence this would have on people in need, batted from pillar to post without certainty of ever being helped. Some felt strongly"— that is, the voluntary organisations— that charities were being morally blackmailed into making up the shortfall of at least £150 million a year"— I am grateful that the noble Lord made his correction, because it is such a shortfall — the difference between current expenditure on single payments of £350 million and the social fund budget of £200 million for 1988 –89". I share the view expressed only the day before yesterday by the Spastics Society when it said that disabled people (and I add poor people) need to have as of right an adequate level of financial support if they are to live independently in the community. These measures take away their rights and make them dependent upon discretionary decisions and charities.

The concerns of the voluntary organisations relate to subsection 9(c) of Section 33 of the Social Security Act and the detailed guidance relating to the subsection in the social fund manual which, in case the Committee has not seen it, is an enormous and very heavy document—the result of the simplification of our social security system. The subsection to which I have referred covers the requirement that social fund officers shall consider the possibility that some other person or body may wholly or partly meet an applicant's need when applying for financial support". The answer given by the noble Lord to a question a few days ago—and he has just repeated that answer—was in no way satisfactory.

The wording of the law, "some other person or body", and the manual, "some other person", is so broad that it might include any voluntary, statutory or informal source, whether it is a charity, a local authority, or indeed a friend. I know that the Government have amended the manual to read that this consideration is intended to apply primarily to crisis loan applications. However, social fund officers remain bound by the law also to have regard to that possibility when deciding applications for community care grants and budgeting loans.

I am particularly concerned about the impact which this subsection may have on people with disabilities and on the voluntary sector. I make three points in pressing the case. First, this provision may have the effect of distorting the role of the voluntary sector and the way in which it provides care and support for people with disabilities. I do not consider it to be the role of charities to finance public policies relating to who needs help and how that need should be met. Moreover, the referral of applicants to charity is unlikely to be understood by a public who pay tax and national insurance contributions on the understanding that statutory help will be available when people are in need. I find this shuffling off of responsibility unpleasant and grossly unsatisfactory.

Secondly, this provision may put at risk the welfare of some of society's most vulnerable members. They may be sent from one source of help to another without any certainty of having their needs met while the consequent delay may also exacerbate their situation. Some may be discouraged from applying for essential help in the first place, fearing the complexity and the possible disappointment and humiliation of rejection.

Lastly, I anticipate serious practical difficulties if charities are faced with an increasing number of applications for help from next April or in fact from now. Charities have experienced a dramatic rise in applications for financial assistance over the last few years due to increased unemployment, poverty, cutbacks in statutory service, and benefits. This is especially so in the last 12 months.

The £200 million budget allocated for the social fund in its first year, as has been said by my noble friend, is an estimated £150 million less than the total amount which could currently have been spent on supplementary benefit single payments had they not been changed. There is no possibility of the voluntary sector raising over three times the amount that Bob Geldof found for his Band Aid appeal. We can only allocate more of our limited funds to grant-giving at the expense of other more vital services. We are caught therefore in a deadly bind, the only consequence of which will be to reduce the help available to disabled people. I do not think that the voluntary sector is prepared to do this. It is quite wrong that they should be put in a situation of having in a sense to bail out the state from fulfilling its proper responsibilities.

It is for this reason— at the request of a number of voluntary agencies which do not wish to find themselves in this position—that I beg to move this amendment.

7 p.m.

Lord Swinfen

I rise simply to endorse every single word that the noble Lord, Lord Ennals, has said and to add one small point. A number of the voluntary organisations, because they are generous, will use some of their existing funds to help some of these people. There is no doubt about that. That will reduce their funds available to continue their existing work.

In addition, I suspect that a sizeable number of the public will feel that the money that they give to various charitable organisations is being misused and will therefore reduce the charitable income of a large number of charities and further reduce the work that they do, which in turn could throw far more people back on to the state.

Lord Henderson of Brompton

I should like to endorse every word that the noble Lord, Lord Ennals, has put before the Committee and to support the amendment as the noble Lord, Lord Swinfen, has done.

I ask the noble Lord, Lord Ennals, only this. Does he wish this amendment to be taken in conjunction with the next amendment, or does he wish to have separate debate on the next amendment? Amendment No. 56 suggests a remedy. However, basically our complaint is the sames: that this sum of £150 million will somehow have to be met, if it is to be met at all, by the voluntary agencies and they do not have the resources. I am in the hands of the Committee. I am not sure whether we should amalgamate the two or have separate debates. The only difference between what the noble Lord, Lord Ennals, has put before the Committee and what he and I shall put forward on the next amendment is that we are suggesting a temporary arrangement whereby the deficit of £150 million will be postponed.

Lord Ennals

There is no doubt that the two issues raised in the two amendments are absolutely right. If Amendment No. 56 were to be either accepted or carried, then the need for Amendment No. 55A would disappear, at least for the time being—for one year or two as the case may be. I believe that some agreement has been reached as to what time we should adjourn. I need some advice as to whether we should take the two amendments together because that would require a further debate and possibly a Division, unless the Government seek to change their position. I do not know whether anyone can advise me on whether it is wise at this stage to take the two amendments together. Has anyone any advice?

Lord Ponsonby of Shulbrede

The problem is that the next business needs to be dealt with very soon because the noble and learned Lord the Lord Chancellor is here and has another engagement. Perhaps we could dispose of this amendment first, and come back to the other after the adjournment.

Lord Ennals

In that case I should like to hear the response from the Minister. However, this may well be an issue on which the Committee should divide.

Lord Skelmersdale

Certainly the temper of the debate has changed in the last few minutes. However, earlier I made reference to a Starred Question that I answered from my noble friend Lord Moyne, and I repeated the guts of that. The noble Lord, Lord Ennals, for some reason took exception to the guts that I quoted just now. Whether the charities to which he also referred had read and taken on board that Starred Question I do not know. However, I know that his noble friend Lady Jeger received the encyclical that I promised after Second Reading. I specifically stated in that encyclical that social fund applicants will not routinely be referred to charities. Where help is needed in an emergency, or as a result of a disaster, the procedure for consideration of other sources of help is similar to that operated under the current scheme for supplementary benefit single payments.

The only other instance where an applicant will be referred to another body is when the item or service for which a loan is being requested is excluded by direction from eligibility—and I went on to say—because other bodies have a statutory duty to provide it. It has nothing to do with charities at all. I think that the worries of my noble friend Lord Swinfen on behalf of charities are indeed unfounded in this matter.

However, I cannot accept the amendment on the following grounds. These relate to the exercise of the discretion of an individual social fund officer. There are a number of instances in which this amendment would fetter the social fund officer's discretion to ill effect. For example, consider the case of an application for a community care grant for redecoration expenses. This is mentioned in the Social Fund Manual, paragraph 6505. We believe it is right and proper that the social fund should pay for the labour costs as well as the costs of materials if no one is available to do the work. This goes further than the current single payment regulations which do not allow payment for labour costs. The noble Baroness might say that that is a red herring but nonetheless that is a fact. Equally, it would be to the disadvantage of other applicants to the social fund if moneys were paid out unnecessarily when friends or relatives were available to do the work. You have only to look at the large number of do-it-yourself shops to realise that there are large numbers of people who do not always employ professional decorators. There is no reason why the social fund should pretend that this situation does not exist.

The noble Lord, Lord Ennals, referred to Section 33(9)(c) of the 1986 Act. It is only right to remind him that this Chamber voted in favour of that precise issue on 15th July 1986.

Lord Ennals

I am afraid the fact that this Chamber took a decision, on which I may have disagreed, will not convince me of the satisfactory nature of the Minister's reply. He suddenly stopped giving the reply when I thought he was halfway through it. The assurance he gave that applicants will not themselves be referred to charities is certainly reassuring. It remains the case that the social fund officers will have to satisfy themselves that grant cannot be provided by a voluntary organisation or by a friend. If that is so, the social fund officer will have to go to Grooms, to MIND or to Barnado's, and the charitable organisations will face the same problems that I explained in moving the amendment.

If the Minister can assure me that social fund officers will not have to go through this process before determination and will not feel that the responsibility should first be picked up by a voluntary organisation, I shall be prepared to accept his assurance and ask that he put it in clear words to be conveyed to the charitable organisations, which, as the noble Lord realises, are very concerned at present.

Lord Skelmersdale

The social fund officer would have to satisfy himself whether a suitable local charity exists with the money or service available.

Let us say that this was happening at the time of the Aberfan disaster. Many of us well remember that tragedy. In such a case an immediate fund would be set up and in those circumstances it would be suitable for the disaster fund to be used for crisis loans. I have said already that in regard to normal non-crisis loans we are talking of local authorities, not of charitable bodies. To reply to the noble Lord's direct question, the answer is, no. The social fund officer will make his own decision.

Baroness Faithfull

Surely this could be resolved by guidelines. If a fund has been set up like the Aberfan fund or, say, a lifeboat fund I can quite see that one would go to that fund before going to social security. I think that that is what people would prefer. I agree with the noble Lord, Lord Ennals, that there should be guidelines for social fund adjudication officers.

Lord Ennals

The example of Aberfan is not on all fours with the normal considerations that a social fund officer would have to take into account. If there were an Aberfan circumstance, of course, the Aberfan fund would respond. Normally, however, it is a matter of providing some essential furniture, a cooker or suchlike to meet the needs of a particularly disadvantaged family.

I did not find the Minister's reply on that issue at all reassuring. If there were to be guidelines, they would have to amend the instructions already given to social fund officers. I do not suppose that the Minister can give me that assurance. I believe that it should be clear in the legislation. If he can say something more to me, I shall withdraw the amendment. Nothing that he has said leads me to believe that the Committee should not be divided to face up to the issue.

7.13 p.m.

On Question, Whether the said amendment (No. 55A) shall be agreed to?

Their Lordships divided: Contents, 34; Not-Contents, 66.

Airedale, L. Lawrence, L.
Attlee, E. Lovell-Davis, L.
Banks, L. Milner of Leeds, L.
Blackstone, B. Mishcon, L.
Broadbridge, L. Molloy, L.
David, B. Nicol, B. [Teller.]
Donaldson of Kingsbridge, L. Pitt of Hampstead, L.
Donoughue, L. Ponsonby of Shulbrede, L.
Dormand of Easington, L. [Teller.]
Elwyn-Jones, L. Ross of Marnock, L.
Ennals, L. St. John of Bletso, L.
Gallacher, L. Stewart of Fulham, L.
Graham of Edmonton, L. Stoddart of Swindon, L.
Hayter, L. Swinfen, L.
Henderson of Brompton, L. Turner of Camden, B.
Jeger, B. Underhill, L.
Kenilworth, L. Wilson of Rievaulx, L.
Kilbracken, L.
Ampthill, L. Hylton-Foster, B.
Arran, E. Inglewood, L.
Auckland, L. Ingrow, L.
Barber, L. Jenkin of Roding, L.
Beaverbrook, L. Joseph, L.
Belhaven and Stenton, L. Killearn, L.
Belstead, L. Kinnoull, E.
Blatch, B. Lane-Fox, B.
Blyth, L. Lauderdale, E.
Boyd-Carpenter, L. Layton, L.
Brabazon of Tara, L. Long, V.
Brougham and Vaux, L. Lucas of Chilworth, L.
Broxbourne, L. Mackay of Clashfern, L.
Caithness, E. Marley, L.
Campbell of Croy, L. Massereene and Ferrard, V,
Carnegy of Lour, B. Merrivale, L.
Carnock, L. Mersey, V.
Coleraine, L. Morris, L.
Colnbrook, L. Munster, E.
Constantine of Stanmore, L. Murton of Lindisfarne, L.
Cork and Orrery, E. Nelson, E.
Davidson, V. [Teller] Nugent of Guildford, L.
Denham, L. [Teller.] Orkney, E.
Dilhorne, V. Rankeillour, L.
Effingham, E. Renton, L.
Elton, L. Rodney, L.
Fortescue, E. Saltoun of Abernethy, Ly.
Glenarthur, L. Sanderson of Bowden, L.
Greenway, L. Skelmersdale, L.
Hailsham of Saint Thomas of Gwydir, L.
Marylebone, L. Ullswater, V.
Halsbury, E. Ward of Witley, V.
Hives, L. Westbury, L.
Hooper, B. Windlesham, L.

Resolved in the negative, and amendment disagreed to accordingly.

The Earl of Arran

I beg to move that the House do now resume.

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

House resumed.

Lord Ponsonby of Shulbrede

My Lords, perhaps the Chief Whip will assure the House that we shall not return to the previous business before 7.50 p.m.

Lord Denham

My Lords, after whatever adjournment there may be, we shall not return to the Social Security Bill until 7.50 p.m.