Lords Sitting of 12 July 1989

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Lichfield.
Lord Clydesmuir Lord Clydesmuir—Took the Oath.

London Road Assessment Studies: Funding
Earl Russell Earl Russell asked Her Majesty's Government:
Whether they are prepared to put a cash limit on the cost of the London Road Assessment Studies, and, if so, at what figure.
The Parliamentary Under-Secretary of State, Department of Transport (Lord Brabazon of Tara): My Lords, the total provision for the studies is about £8 million. The Department of Transport is keeping the expenditure under review.
Earl Russell: My Lords, I thank the Minister for that reply. He may perhaps appreciate that I would be somewhat relieved if it were to stop there. However, perhaps I may pursue the Question a little further. Has any consideration been given to putting a cash limit on the total amount of work resulting from these studies? In particular, is the Minister in a position to deny the report which appeared in the Independent on 3rd April that the total cost of the work involved is likely to amount to £3·5 billion?
Lord Brabazon of Tara: My Lords, the implementation costs would depend on the measures adopted. Therefore I cannot put an estimate on the unknown. We await the consultants' work. Any new infrastructure in London will of course be costly, but I emphasise that the figure of £3·5 billion which the noble Lord mentioned is certainly not an official, estimate and is only speculation by the press.
Lord Underhill: My Lords, does the Minister recall that on 29th June the noble Lord, Lord Hunt, tabled a Question on the East London assessment study, when the Minister intimated that the report would be available in the summer—presumably July or August—and that decisions would then be taken? Can the Minister give some assurance that before decisions are taken there will be thorough consultations on the report? If consultations are to take place, with whom will they be conducted?
Lord Brabazon of Tara: My Lords, I can give an assurance that there will be thorough consultations on the report before anything is done. Those consultations would be with the local authorities involved, public transport operators and others.
Lord McNair: My Lords, can the noble Lord tell me whether these road assessment studies are anything more than an attempt to buy time, during which the problem of London's traffic will get so much worse that the Government will then feel able
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to take drastic measures, which they are not prepared to take now, in order to forestall the coming chaos?
Lord Brabazon of Tara: My Lords, I must disabuse the noble Lord that the assessment studies are looking purely at roads. They are looking at public transport and a number of other means of improving the environment. They are certainly not a waste of time. The studies are a good way of looking at some of the urgent problems which need to be solved.
Lord Underhill: My Lords, I am sorry to rise again but will the Minister clarify what he just said in reply to the last supplementary question? I think he said that the studies were not looking at public transport. Surely the studies will consider all passible options: roads, environmental questions, public transport and all associated matters, will they not?
Lord Brabazon of Tara: My Lords, I am sorry if the noble Lord misunderstood. That was exactly what I was trying to say. I was explaining to the noble Lord, Lord McNair, that the studies were looking not just at roads but at other matters too.
Viscount Hanworth: My Lords, does the noble Lord agree that all this should have been over a long time ago, that it is now the eleventh hour and that further studies are beginning to be too time-wasting?
Lord Brabazon of Tara: My Lords, it is a matter of argument as regards what should have been done before. The fact is that there are problems of acute congestion in parts of London and it is the action of a responsible government to look into ways of improving that.

Forestry Commission Land: Public Access
2.42 p.m.
Lord Taylor of Gryfe Lord Taylor of Gryfe asked Her Majesty's Government:
What further plans they have for the disposal of Forestry Commission land and what steps they will take to maintain public access to these woodlands.
The Minister of State, Scottish Office (Lord Sanderson of Bowden): My Lords, as announced by my right honourable friend the Secretary of State for Scotland in another place on 16th June, we have asked the Forestry Commission to sell a further 100,000 hectares of forestry land in the period up to the end of the century. We are giving careful consideration to ways of allowing the general public to continue to enjoy access to these forests in a way which is compatible with management for forestry and other purposes. A copy of the full Statement made by my right honourable friend is in the Library.
Lord Taylor of Gryfe: My Lords, will the Minister confirm that in the past few years 140,000 hectares have been sold to the private sector, and that now an additional 100,000 hectares is to be disposed of? Is nothing sacred in this country any more? The Government have sold off the public's water

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company, the public's electricity company and now the Government have decided to sell off the nation's land. Will the Minister confirm that last year there were more than 50 million day visitors to the nation's Forestry Commission land? Will he give me a firm assurance that there is no danger of the public being excluded from the land which is now being sold and which is an important amenity?
Lord Sanderson of Bowden: My Lords, the noble Lord has raised two questions. To deal first with the question of access, the Government are well aware of the importance of public access to the commission's forests. Therefore, as has already been said, we are considering ways in which reasonable access can be preserved when commission forests are sold. It is a complex issue, however, involving public access to private property. We must therefore take time and trouble to consider all aspects and get the answer right. There are many ways, through voluntary means, by which access to private woodlands has been achieved, and we are satisfied that that part of the voluntary effort is working extremely well.
As to the first question that the noble Lord put to me about the disposal policy, as he has heard from me before, the Forestry Commission owns 915,000 hectares of forest land, 166,000 hectares of unplantable and miscellaneous land (as at 31st March this year), and 62,000 hectares of agricultural land. Part of the Government's policy is to return some of that land to the private sector. I do not believe that the amount that has to be returned in the period to the end of this century is in any way excessive.
Lord Strabolgi: My Lords, does the noble Lord know what proportion of that land is being bought by foreign interests?
Lord Sanderson of Bowden: No, my Lords, I do not know what proportion is being bought by foreign interest. All I have to say is that widespread interest has been shown in the land that has been disposed of. As I understand it, that will continue.
Lord Rees: My Lords, in view of what my noble friend has told the House about proposed sales of Forestry Commission land, and against the background of the Government's proclaimed planting targets, can he tell the House what thought has been given by the Government to encouraging new forms of investment in forestry, particularly by small investors?
Lord Sanderson of Bowden: My Lords, I am very conscious of the importance of attracting smaller investors, and indeed institutional funds, into forestry. I can assure my noble friend that we shall consider carefully any proposals that come forward from the industry. In addition, I have been encouraged by the remarks of those who know about forestry. "A forest of opportunity", an article in Accountancy of February 1989, said:
"Private clients are expressing great interest in woodlands as the full implications of future tax-free income and capital growth have become apparent in an era of lower tax rates and limited tax reliefs".
Lord Grimond: My Lords, are the Government satisfied that the land that has been sold off will remain under forestry, or are the purchasers entitled to make what use of it they like? Can the Minister be more explicit as to how the Government propose to enforce the guarantees, for example, of public access? Is it not the case that, at least under the law of England, once one has parted with ownership in property one cannot enforce burdens on one's successors? Is that not also the case in Scotland and, if so, how do the Government propose to get round it?
Lord Sanderson of Bowden: My Lords, in answer to the noble Lord, Lord Taylor of Gryfe, I said that the Government were looking very carefully at the complex issue of access. What I did not say was that we had an answer to the legal problems that surround this particular issue. I did say, however, that the owners of many private woodlands have an excellent record in allowing public access to those woodlands. Perhaps I may say in addition that when the Forestry Commission, as the forest authority, looks at plans for planting on its lands, reasonable provision for public access is being encouraged and there has been a positive response.
Lady Saltoun of Abernethy: My Lords, is it not possible to include conditions of access in the disposition when the land is sold?
Lord Sanderson of Bowden: My Lords, we have looked very carefully at this particular issue. There are problems relating to access. There are various possible solutions to those problems, but I should not like to go into them at this stage.
Lord John-Mackie: My Lords, perhaps I may ask the Minister two questions based on his right honourable friend's statement in another place in the middle of June, in which he stated that rationalisation has been a success over the past 10 years. How long does it take to rationalise? I understand that most of the management rationalisation has been done.
In reply to the noble Lord, Lord Taylor of Gryfe, the Minister gave figures in respect of land in Forestry Commission ownership which was not plantable or was agricultural land, and indicated that that was the land which was being sold. That does not tie up with the statement of his right honourable friend which referred to the transfer of forests. Who is right and who is wrong?
Lord Sanderson of Bowden: My Lords, perhaps I may answer the question as to what has already been disposed of in the way of forests. As the noble Lord, Lord Taylor of Gryfe, mentioned in his original supplementary question, 140,000 hectares of land have been sold, of which 72,000 hectares were forest land. The remaining 68,000 hectares were non-forest land. In the future, one of the ministerial guidelines to which the commission must give heed when selecting properties for sale is the maintenance and development of the wood processing industry.

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The main raison d'être of the Forestry Commission's enterprise is the production of timber for use by industry. We understand from the commission—and it has agreed—that it will not be in the business of selling core forests, but it has plenty of forest from which to draw for disposal up to the end of the century.
Lord John-Mackie: My Lords, there is one further point. What does the Minister mean by "forest land"? Is that land that has been planted or land that is plantable?
Lord Sanderson of Bowden: Both, my Lords. Basically, it is land that is planted.
Lord Morris: My Lords, bearing in mind that it is far from uncommon for land to be disposed of in the United Kingdom with restrictive convenants attached, will my noble friend explain a little more fully and precisely the legal difficulties facing the Government with regard to the disposal of this land?
Lord Sanderson of Bowden: My Lords, it is a complicated issue and, as I understand it, there are legal problems attached to it. My noble friend may have a solution. I must tell him that we are discussing the matter with great detail within government at the moment and we well understand the desire of most people to ensure that there is adequate public access to private land. However, there are major problems attached to the issue.
Lord Cledwyn of Penrhos: My Lords, will the noble Lord say precisely where the money which is received for that land goes? Does it go back to the Forestry Commission to enable it to do its job more efficiently? Perhaps the Minister will tell the House precisely where it goes.
Lord Sanderson of Bowden: My Lords, I believe that I have answered the noble Lord the Leader of the Opposition before on this matter. The receipts from the disposal programme are surrendered by the commission to the Consolidated Fund.
Baroness Nicol: My Lords, since we are told that rationalisation is complete, are we therefore to understand that the increased sales of forestry and forestry land are a result of the Government's dissatisfaction with the work of the Forestry Commission? If they are not dissatisfied with its work, would it not be easier to leave that forestry in its hands and avoid all the legal complications which seem to cause such difficulties?
Lord Sanderson of Bowden: My Lords, I believe that the noble Baroness said that rationalisation was complete. That is not something that I have stated from the Dispatch Box. Further rationalisation can take place in the long-term interest of the forestry industry as a whole. I believe that, when we come to the turn of the century, it will be seen that the Forestry Commission, though somewhat reduced in size, will be supplying substantially more timber to the industry than it does at present.
Lord Taylor of Gryfe: My Lords, is the Minister aware that my Question was prompted by the concern expressed in Scotland that some of that land will be sold to be used as sporting estates from which the public will inevitably be excluded? Is he not concerned about that? Is he aware that his statement about the necessity of maintaining wood production will be very much welcomed in Scotland? However, how will he reconcile that with the fact that the Government's planting target is 33,000 hectares, and that total planting of new wood-lands this year will be 11,000 hectares?
Lord Sanderson of Bowden: My Lords, I should like to correct the noble Lord on his figure for new planting this year of 11,000 hectares. It is an interesting figure, but it bears no relation to the facts at this stage, although the noble Lord may have information on the matter that has not come to the Government. So far as concerns the sale in Scotland, the Forestry Commission is well aware that it has the power to dispose of planted land as it sees fit. As I said to the noble Lord, Lord John-Mackie, most of that land is planted with trees at the present time or is available for planting. I should have thought that it will continue as an investment for those in the private sector who are interested in forestry.

Narrow Money Supply
2.54 p.m.
Lord Bruce-Gardyne Lord Bruce-Gardyne asked Her Majesty's Government:
When they expect the narrow money supply (MO) to return within its target band.
Lord Brabazon of Tara: My Lords, MO's growth rate has fallen appreciably since last summer. The Government will continue to take whatever steps are necessary to ensure that it reaches, and remains within, the target range.
Lord Bruce-Gardyne: My Lords, I am grateful to my noble friend for that reply. In his Budget Statement, my right honourable friend the Chancellor of the Exchequer said that he expected MO—or "Little Mo" as it is known in the trade—to fall within the target range of 1 to 5 per cent. very shortly. Is it not the case that in the last quarter for which figures were available—the quarter to May —it was still up at 6·2 per cent? Although some of us may have reservations about the relevance of MO, it is my right honourable friend's current favourite. May we be assured that it will not be jettisoned like some previous favourites as being unreliable, simply because it proves to be somewhat wayward?
Lord Brabazon of Tara: My Lords, I think that I can give my noble friend the assurance that he seeks. "Little Mo" has proved a reliable indicator of monetary conditions. The sixth-month annualised growth rate for last month was 2·9 per cent. Obviously, I cannot give my noble friend a date when it might come within target, but I hope that it will be shortly.
Lord Barnett: My Lords, will the Minister tell us whether he or any other member of the Government believes that MO, or any other wider measure, is an adequate measure of money supply? If they believe that, do they believe that that is the only thing necessary to control inflation, regardless of other indicators?
Lord Brabazon of Tara: My Lords, as I said, "Little Mo" has proved a reliable indicator of monetary conditions. Obviously, we continue to take broad money, particularly M4 into account in assessment of monetary conditions, but there are a number of other factors which need to be taken into account in measuring the performance of the economy.
Lord Ezra: My Lords, does the noble Lord agree that, when the Government came to power, they set great store by controlling the money supply as a means of regulating the economy, but that progressively over the years they have discarded the use of the various money aggregates? Are we now to assume that the control of the money supply no longer plays a part in the Government's policy towards the economy?
Lord Brabazon of Tara: No, my Lords. Indicators have their uses, but, as I said, other things are also important. Firm monetary policy is the only way to get on top of inflation. It has worked in the past and it will work again.
Lord Bruce of Donington: My Lords, in the light of the information given to the House by his noble friend Lord Bruce-Gardyne that, at 6·2 per cent., MO is outside the target range already set at one to five in the medium-term financial strategy, will the Minister give any indication as to whether the figures that have been given for 1990–91, 1991 and 1992 are to be revised in view of the apparent unreliability of the present money indicator? Will the noble Lord give the House an undertaking that, as and when the existing definition of monetary aggregate proves to be of little use to them for propaganda purposes and they select a new definition which suits them more conveniently, they will consider using the term "MOO" or, if not, "MOO7"?
Lord Brabazon of Tara: My Lords, I should hasten to add that the Government do not use those indicators for propaganda purposes. I cannot give any information as to any possible revision of targets for future years. The noble Lord will have to wait and see what the Chancellor of the Exchequer says in due course.
Lord Stoddart of Swindon: My Lords, while the technical arguments that we have heard about money supply are very interesting, is it not a fact that Government policy of controlling money supply in the economy has gone completely awry in that, despite high interest rates, credit expansion has gone on apace? Will the Minister ask his right honourable friend the Chancellor of the Exchequer to get rid of that moribund policy and bring forward a new policy to deal with credit expansion, by insisting that the banks and other credit institutions put special deposits with the Bank of England?
Lord Brabazon of Tara: My Lords, I disagree with the noble Lord that the Government's policy is in disarray. We are experiencing an unprecedented growth rate at the moment which I should have thought would be welcome to most people. With the benefit of hindsight, the loosening of monetary policy post the Stock Exchange crash in 1987 proved to have gone too far; but it was a judgment made at the time when the risk of recession was considered to be great.
Lord Stoddart of Swindon: My Lords, is the Minister aware that the growth is in credit and imports from abroad?
Lord Brabazon of Tara: My Lords, at the moment all the indicators, whether for imports or anything else, are showing strong upward signs.
Baroness Seear: My Lords, will the Minister reconsider his statement that the only way of dealing with inflation is through monetary policy? Does he not feel that fiscal policy also has a role to play?
Lord Brabazon of Tara: My Lords, as I said, firm monetary policy is the only way to get on top of inflation. Credit controls would not work again.
Baroness Seear: My Lords, I did not mention credit controls. I do not believe in credit controls. I asked about fiscal policy.
Lord Brabazon of Tara: My Lords, perhaps I should have a discussion with the noble Baroness to find out what her proposals are.
Lord Peston: My Lords, if, as the Minister says, firm monetary policy is the only way to get on top of inflation, why are the Government making such a song and dance about wage settlements at the moment?
Lord Brabazon of Tara: My Lords, obviously excessive wage demands are in themselves inflationary.
Lord Bruce-Gardyne: My Lords, in view of some of the comments from the Opposition Benches, perhaps I may ask this question. Will my noble friend confirm that it is now clearly the view of Her Majesty's Government that a certain disregard of monetary indicators in the period 1984 to 1987 may have been a significant contributor to our current problems with inflation?
Lord Brabazon of Tara: My Lords, as I said, there was a relaxation of monetary policy post the Stock Exchange fall in 1987. With the benefit of hindsight, it is clear that the stock market crash was merely a financial phenomenon of little relevance to the real economy. However, at the time and given the balance of risks, the policy was fully justified.

Manufacturing Investment
3.2 p.m.
The Viscount of Oxfuird The Viscount of Oxfuird asked Her Majesty's Government:
What is their latest available forecast of the likely growth of manufacturing investment this year.
Lord Brabazon of Tara: My Lords, the forecast presented by the Chancellor with his Budget in March forecast total business investment to rise by 8 per cent. in 1989. No forecast for manufacturing investment was given. The DTI's survey of investment intentions published in June suggested that manufacturers plan to increase investment by 15 per cent. in 1989.
The Viscount of Oxfuird: My Lords, I thank my noble friend for that reply. Can he confirm that the United Kingdom's growth in world trade will have to increase by 2 per cent. in order to make good the deficit in the United Kingdom's manufacturing trade? That was expounded by Mr. Glenn Hoggarth, the chief UK economist with the Henley Centre, in his letter to the Financial Times of July 7th. Does my noble friend believe that the forecast investment will achieve that required increase in manufacturing trade?
Lord Brabazon of Tara: My Lords, I read the letter to which my noble friend referred. We do not regard that as a sensible way to see how the current account deficit could be reduced. What matters is how our imports compare with our exports and not our share of world trade. However, the rapid increase in manufacturing investment in 1988, and the continuing strong growth this year, will help to improve further the supply side performance.
Lord Bruce of Donington: My Lords, the Minister gave a percentage figure in relation to manufacturing investment. Can he tell the House by how much in real terms investment in manufacturing industry has increased above the level attained in 1979? Will he also confirm that some 14 per cent. of imports into this country in 1988 consisted of capital goods, and that the total deficit on our current account for the importation of manufactured capital goods amounted to about 1·5 billion as distinct from the positive balance of trade in capital goods in 1979?
Lord Brabazon of Tara: My Lords, in reply to the noble Lord's first question, manufacturing investment grew by 14·5 per cent. last year to reach its highest ever level. In the previous five years it grew on average by 9 per cent. a year; whereas, under the previous government, up to 1979 it grew by less than 2·5 per cent. a year. With regard to his other point concerning imports, I regret that I do not have those figures with me this afternoon.
Lord Williams of Elvel: My Lords, can the Minister tell the House when manufacturing investment as a proportion of gross domestic product will achieve the levels that it achieved in the 1960s and 1970s?
Lord Brabazon of Tara: My Lords, I do not have the figure as a percentage of gross domestic product. However, business investment, which includes manufacturing investment, is now the highest ever recorded proportion of gross domestic product.
Lord Bruce of Donington: My Lords, is it not high time that the Minister acquainted himself with the statistics available for manufacturing investment rather than relying on percentages which cover totally different categories? Can the Minister not give us precise answers to precise questions in the House?
Lord Brabazon of Tara: My Lords, I feel that I have given fairly precise answers to the questions that have been put, particularly as they relate to the one on the Order Paper.
Lord Ezra: My Lords, in view of the substantial gap in our manufacturing balance of payments, is the Minister of the opinion that policies are being pursued now regarding the rebirth of manufacturing industry in this country which will eventually close that gap?
Lord Brabazon of Tara: My Lords, I should have thought that the figures that I gave for manufacturing investment would seem to prove that to be the case.
Lord Orr-Ewing: My Lords, will my noble friend say what percentage of the satisfactory increase in manufacturing investment comes from inward investment by overseas companies? Can he also say whether that has been affected by the wildcat strikes and the many claims in the public sector of our transport system?
Lord Brabazon of Tara: My Lords, I regret that I do not have a figure for inward investment; but of course we welcome inward investment and hope that the latest series of strikes will not affect people's judgment when they come to make those decisions.
The Viscount of Oxfuird: My Lords, does my noble friend agree that, despite the increased interest rates at this time, this country's export performance is holding up extremely well?
Lord Brabazon of Tara: Yes, my Lords, I think it is very fair to say that.

Business
3.7 p.m.
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon, my noble friend Lord Henley will, with the leave of the House, repeat a Statement to be made in the other place on community care. It may be for the convenience of your Lordships to know that the Report stage of the Social Security Bill will be adjourned at approximately 7 p.m. for about an hour and that during that adjournment the Third Reading of the Cardiff Bay Barrage Bill will be taken.

Local Government and Housing Bill
The Earl of Arran: My Lords, on behalf of my noble friend Lord Caithness, I beg to move the Motion standing in his name on the Order Paper.
Moved, That it be an instruction to the Committee of the Whole House to whom the Local Government and Housing Bill has been committed that they consider the Bill in the following order:

Clauses 1 to 15,

Schedule 1,

Clauses 16 to 35,

Schedule 2,

Clause 36,

Clauses 64 to 70,

Clauses 37 to 60,

Schedule 3,

Clauses 61 to 63,

Clauses 71 and 72,

Schedule 4,

Clauses 73 to 131,

Schedule 5,

Clauses 132 to 134,

Schedule 6,

Clauses 135 to 144,

Schedule 7,

Clauses 145 to 147,

Schedule 8,

Clauses 148 to 157,

Schedule 9,

Clauses 158 to 163,

Schedules 10 and 11,

Clause 164.—(The Earl of Arran.)

On Question, Motion agreed to.

Extradition Bill [H.L.]
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of recommitment be discharged.
Moved, That the order of recommitment be discharged.—(The Lord Chancellor.)
On Question, motion agreed to.

Statute Law (Repeals) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Pesticides (Fees and Enforcement) Bill
3.9 p.m.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington): My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move
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a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.
Moved, That the order of commitment be discharged.—(Baroness Trumpington.)
On Question, Motion agreed to.

Social Security Bill
Report received.
Clause 9 [Mobility allowance: increase of age limit to 80 years]:
Lord Carter Lord Carter moved Amendment No. 1:
Page 9, line 15, at beginning insert—
("( ) In section 37A of the principal Act (mobility allowance) at the end of subsection (1) insert "or is deaf and blind or is suffering from severe mental handicap such that he is either unable to walk or virtually unable to do so without physical control by another person".
( ) In subsection (2) of that section leave out "physical".).
The noble Lord said: My Lords, this amendment was discussed in Committee and was then withdrawn to enable those of us who had moved the amendment to study the Minister's response.
We discussed the amendment at some length at the Committee stage and it received support in all parts of the chamber. However, it may help noble Lords if I briefly restate the background to the amendment.
The mobility allowance is a non-means tested benefit. It is paid as a result of physical disability such that the claimant is unable to walk, virtually unable to walk or where the exertion of walking would endanger life or lead to a serious deterioration in health.
A number of problems have arisen regarding the interpretation of the phrase, "virtually unable to walk", especially for the deaf blind and those with severe mental handicap. A number of the commission's decisions attempting to interpret the regulations have been confusing and contradictory and are often reversed on appeal. This amendment is intended to make it clear that a comparatively small group of fewer than 8,000 people should receive the mobility allowance. I should like to make it entirely clear that the intention of the amendment is not to introduce a new concept or to extend the eligibility of allowance to a large new group of people, or indeed to introduce a new allowance. The intention is simply to clarify the current very confusing situation and to ensure that those responsible for some of the most severely handicapped people in our society do not have to apply and appeal up to three times before they receive the allowance. It is a fact that three-quarters of the people concerned qualify if their appeal reaches the third appeal stage. But it is understandable that many cannot stand the trauma of the appeal process and therefore do not attempt to press their case.
There has been some debate about the numbers of people involved. It was thought for some years that the number of people who would benefit from the proposed change would be in the order of 10,000

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to 12,000. That was a figure which, so far as I am aware, has never been disputed by the Government. However, more recent work by SENSE and MENCAP suggests that a maximum of 3,200 deaf blind people would qualify plus 4,400 with severe mental handicap and thereby unpredictable behaviours. That is a total of 7,600 people.
Like all benefits, there is unlikely to be a 100 per cent. take-up. We are therefore talking about perhaps 6,000 to 7,000 people to be added to the 575,000 who already qualify. The cost would be no more than perhaps £8 million to £9 million per annum to be added to the £750 million which is the current cost of the mobility allowance.
The disability organisations and the all-party disablement group have been pressing for this change since at least 1985. When Mr. Tony Newton was the Minister for the Disabled, he said that he wanted some more information. He said that he would like to find a solution "at the margin". That is exactly what this amendment does. He was succeeded by Mr. John Major who said in 1987 that it was a question of definition and knowing the number involved, which the department at the time agreed was very small.
We have found the definition and we know that the number involved is even smaller than the 10,000 suggested to Mr. Major. Noble Lords may imagine the disappointment of the all-party disablement group when recently it met the current Minister, Mr. Nicholas Scott, and found that he was unaware of the points which had been agreed with Mr. Major. He then produced a new reason for delay. The Government now say that they must await the outcome of the OPCS surveys into disability and the review of the social security benefits which will follow the surveys.
Like many others, I have studied the five published parts of the survey. There is one more to come before the end of this month concerning the transport and education of disabled children. That will complete the six. I can save the department a lot of time. There is no information in the five reports that is relevant to this amendment and the problem with which it deals. There is nothing like a great big survey as an excuse for departmental delay and inaction. There will have to be wide-ranging consultations on the OPCS survey, and understandably so. Then there will be the review of benefits which I understand now is to be conducted inside the department. I suspect that it will be years before the full response to the OPCS surveys comes into legislation.
Those of us involved in this matter have all received dossiers of harrowing cases of people being refused a mobility allowance who on any understanding of the requirement should receive it. I quoted a number of these cases at Committee stage and have since received, not surprisingly, a large number of examples. In each of these cases involving a massive sensory impairment or severe mental handicap, it is quite clear that not only do the people concerned have an immense disability but that those who care for them have an enormous burden.
I shall give one further example that I know well. A women of 38 who lives in our village is brain damaged as a result of the whooping cough vaccine. She spends the majority of her time crouched in the foetal position. She shakes a plastic cup which is her form of security. Every time she moves she has to be assisted and controlled by her parents. She lives in a dim twilight world of her own. She is entirely liable to walk backwards, sideways or indeed under a bus. Her parents who are now rather elderly have to look after her. She requires continous physical control. She obviously suffers from severe mental handicap. She has been refused the mobility allowance because—as the rules state—she is able physically to put one foot in front of the other. In fact she is a very big strong lady.
I think we would all agree that it is entirely wrong that people in this condition should be denied the mobility allowance. The numbers and costs involved—7,600 people at a cost of £8 million to £9 million—are minuscule compared with the total cost of the mobility allowance. I find it hard to believe that the Government will turn us down yet once more. I beg to move.
Lord Allen of Abbeydale: My Lords, I support this amendment. As the noble Lord, Lord Carter, has explained, we are talking about two small and clearly defined groups of people. The amendment does not involve any new principle or any radical departure of policy. So far as concerns the groups of the mentally handicapped with which I have been particularly concerned, it has been accepted that those whose walking difficulties stem from handicaps which can be ascribed to a physical cause such as brain damage—whether the consequence of a genetic condition or the result of an accident—can qualify for the allowance. The additional numbers covered by this amendment, estimated to be at the most 4,400, as the noble Lord has explained, will be those who are severely mentally handicapped and who have behavioural problems requiring constant supervision but whose handicap has no identifiable physical cause. They may be able to walk in the sense of being able to put one foot in front of another, but if left to themselves no one would know which way they would walk, sideways, backwards or straight under a bus, or they might choose to lie down screaming in a tantrum in the middle of the highway.
The number of those who are both blind and deaf who do not already qualify for the allowance can be estimated with reasonable accuracy as being not more than 3,200. I am well aware that the noble Lord has given these figures in introducing the amendment, but they are so significantly small that it is worth rubbing in the very modest total and the very modest addition of expenditure which this would involve.
The Government for their part have not so far challenged either the calculation of the total or the calculation of the amount involved. They have expressed sympathy, but it has been explained that they fall back on the argument that we should wait for the OPCS surveys. It is fair to say that the noble Lord, Lord Skelmersdale, implied at the Committee stage in reply to a question from the noble Lord,

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Lord Renton, that it could all be dealt with next year in the inevitable social security Bill in the coming Session. But I am afraid he rather took away that impression when on the next amendment, on the clause increasing the age limit—that is Clause 9 in the present print—he said that that clause now gives us a breathing space for five years. He went on to say:
"That is ample time in which to resolve and implement whatever changes may be needed generally concerning the allowance"—[Official Report, 22/6/89; col. 356].
I fear that these remarks serve only to confirm my doubt that it would scarcely be possible to publish the OPCS survey, to carry out consultations on its findings, to consider the outcome of those consultations, to come to decisions and to translate those decisions into legislative form—the point we are concerned with now is only one of a number of issues which will arise—all in time to put the conclusions in a Bill in the Session starting this autumn. My own belief is that there is no escaping the conclusion that, if we do not take this opportunity to help these people now, today, they will have to wait for years.
I confess to being just a shade surprised that the Government have resisted this modest proposal. In speaking to a number of people outside, some of them loyal Tory voters, the reaction I have gained is one of incredulity that they are not already covered. The amendment is concerned with some of the most grievously afflicted members of the community and those who care for them. Anyone who has had direct experience must be aware of the feelings of despair and frustration, the belief that authority is ranged up against one, and all that is involved in the waiting and expense of appeals. Deservedly or not, the Government's reputation among the disabled and their families is not very high. No doubt in a few minutes' time we shall be hearing some remarks about the inordinate length of time it has taken to come to a decision on the Griffiths Report.
The amendment gives the Government an opportunity to show that they are a caring and sympathetic government who are prepared to take this very small step to help some of our least privileged citizens.
Lord Boyd-Carpenter: My Lords, to my mind, the amendment illustrates vividly the difficulty which your Lordships' House is in in discussing one by one amendments to the Bill. Plainly on its merits it excites the sympathy of all your Lordships in all parts of the House. As the noble Lord, Lord Allen of Abbeyfield, with his skill in advocacy brought out, it is comparatively small in its financial impact.
Lord Allen of Abbeydale: My Lords, I am sorry to intervene, but my title is "Abbeydale" not "Abbeyfield", which connotes other things.
Lord Boyd-Carpenter: My Lords, I am sorry if I was in the wrong field. Dales are of course far more fertile. As the noble Lord brought out, the impact is comparatively small. Therefore it seems an easy matter for your Lordships to consider, taken in
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isolation. But the problem is, as any of us with experience of social security administration knows, that it would be possible to find quite a number of other issues which made a similar appeal both to one's mind and to one's feelings of sympathy and sensibility towards human suffering.
Your Lordships are in a difficulty—this is a fault of our procedure, not of your Lordships individually—in having to take these issues one by one. I believe your Lordships will agree that the mobility issue has been a great success. It has done more to relieve human suffering than almost any of the changes of recent years. It is natural that one should want to extend it to the meritorious class of people covered by the amendment. But what the Government have to do—as I am sure the Minister will tell us in a few minutes—is to weigh this against all the other claims which can and will very properly be made. That is the real problem. It is perhaps an argument for waiting for the OPCS survey, which we hope will line up these various good causes in order of proper priority.
I shall certainly wait to hear what the Minister says, but my present feeling is that there is perhaps a little danger in allowing one's natural sympathy with this proposal to cause one to feel that it should be selected for treatment when other issues of equal importance are not being selected, perhaps for good reason. I shall listen to my noble friend's speech and I hope and believe that he will express a good deal of sympathy with the ideas behind the amendment.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Skelmersdale): My Lords, without in any way wishing to curtail the debate, I thought it would be helpful to the House, especially in view of the speech that my noble friend Lord Boyd-Carpenter has just made, if I at this stage put forward the Government's plans concerning help for these most unfortunate of people so movingly described by the noble Lords, Lord Carter and Lord Allen of Abbeydale. As I told my noble friend the Duke of Norfolk in Committee concerning attendance allowance for the terminally ill, we are not afraid to act as promptly as circumstances allow. On this matter of mobility allowance for the deaf/blind and the mentally handicapped, I cannot stress too strongly that we are wanting to act, willing to act, but waiting to act.
The question we have to ask ourselves, therefore is, why wait? The Government are nearing the end of a voyage of discovery—a voyage which when completed by the end of this month will reveal the largest amount of information ever assembled on the numbers, needs and financial circumstances of disabled people. Five of the six OPCS reports are already published. In terms of this amendment they contain information that the noble Lord, Lord Carter, has made quite clear to us he did not know when he and his advisers originally got together to plan what they could do for deaf/blind and mentally handicapped people.
I confirm at once to the noble Lord that it is true that the published reports do not set out in detail the findings on which our estimates are based. Those estimates have been derived from further analysis

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of the data tapes, drawing on the data relating to behavioural disability. We shall be willing to explore the data with interested groups if they wish. The data tapes are now available in the Economic and Social Research Council's data archive and are accessible to bona fide researchers. They provide all the data not available in the reports themselves. Why do I say that? These reveal that there might be, not less than 8,000 people covered by the amendment, but in fact over 100,000. I say "might" for a very good reason, because we can never say for certain how a particular statutory definition will apply in practice.
I know that the proposers of this amendment sincerely intend that it should apply to only a small group of severely mentally handicapped people. The noble Lord, Lord Carter, explained in Committee, and again today, how the numerical estimate was arrived at. However, as I said, we now have the survey data which shows that there are over 100,000 people who have disabilities affecting their behaviour and intellectual functioning, to such an extent that it could very reasonably be argued that they need to be accompanied in public, even to the extent of physical contact and control.
On the basis of these figures, the amendment could cost anywhere between the £8 million mentioned by the noble Lord, Lord Carter, and a massive £120 million. In fact, of course, it would be somewhere in the middle because some people in this position, as my noble friend Lord Renton confirmed in Committee, are already receiving mobility allowance and in some cases attendance allowance as well.
Be that as it may, the fact is that there are probably a considerable number who do not qualify for these allowances, and I go along with the noble Lord, Lord Carter, to say that we must seriously consider whether we can help them. But should it be with mobility allowance which the noble Lord, Lord Ennals introduced? We need to decide whether this is the appropriate benefit, at the very least. Mobility allowance is currently unattached to any specific condition or illness, the criterion being that it is paid in cases of physical disablement resulting in inability or virtual inability to walk. This has stood the disabled in very good stead since 1976, and numbers and expenditure have risen to a very considerable extent. If this is the case, the allowance is already paid; but in cases where a person is physically able to walk where indeed he is a danger to himself or other people, he is not eligible. That is the problem which the noble Lord, Lord Carter, and the Government wish to solve.
And solve it, my Lords, we will, just as soon as we possibly can. But not so fast that we do not take account of all the OPCS reports, which will very soon be available. As the reports have been published we have encouraged all interested parties to comment on them and their implications for benefits. In view of the figures I have quoted, I am sure that the noble Lord, Lord Carter, and his colleagues and the organisations with which they are in touch will want to look carefully at the data that is relevant to their special concern, and I hope, to discuss them with the department. But meanwhile,
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the large sums of money that could be at stake mean that we cannot take this as a quick interim measure regardless of the wider changes that the reports may indicate.
The information we already have from OPCS surveys, and the need to integrate that with the remaining information soon to be received, means that the Government could not honestly and responsibly accept the solution proposed by the noble Lord, Lord Carter—however tempting and sincerely intended that proposal undoubtedly is. But I can assure the House of our serious intent to find some solution to the problem he has posed. I shall now listen carefully to what other noble Lords have to say. If your Lordships give me leave—and I must make the point, only if your Lordships give me leave—I shall reply to their points later.
3.30 p.m.
Baroness Faithfull: My Lords, following the statement by my noble friend the Minister, perhaps I may ask whether the data report will show how many people would go into institutional care if they did not receive the mobility allowance. Will this report show that? I believe that it is a very significant figure inasmuch as institutional care for this category of people is very expensive.
Lord Trafford: My Lords, I agree with everything that the noble Lords, Lord Carter and Lord Allen, said. I was not aware until two minutes ago of the actual figures which were quoted by the Minister. I do not think I am that worried by the figures and the discrepancy between those quoted by him and those of the noble Lord, Lord Carter, for this reason. One of my anxieties about the amendment is the drafting. Perhaps I may refer to the third line:
"is either unable to walk or virtually unable to do so".
One of the problems that is extremely difficult in regard to all social security payments, all allowances and so forth is that of definition. When the attendance allowance was originally introduced and, up to a point, when the mobility allowance was introduced, the problem was that persons would apply and two different interpretations would be given. In many cases the matter would go to commissions and appeals, as in the story which the noble Lord, Lord Carter, told. I believe that about two-thirds of the appeals are usually granted but nonetheless, however many it may be, the situation is unfortunate.
Therefore with these allowances one needs to have a clear definition of what the person is entitled to. I feel that as regards the mobility allowance and the question of being unable to walk—put graphically by the noble Lord, Lord Carter, who described it as "putting one foot in front of another"—we need a clear cut definition. The amendment says, "or virtually unable", and when we talk about that we introduce a doubt. That is why I do not like the phrase in the amendment. We introduce a doubt and the question, what is "virtually unable to walk"? Many people, for example—
Lord Carter: My Lords, will the noble Lord give way?
Lord Trafford: My Lords, perhaps I may finish my point and then of course I shall give way to the noble Lord, with pleasure. Many people are virtually unable to walk. It may be that it would be reasonable for people to argue then that this should be part and parcel of the definition of the allowance; it should be defined more clearly so that we know what we are talking about.
However, I suspect it may account in part for the discrepancy in the figures given on both sides of the House. Perhaps I may say that I personally would very much like to see something done, not next year or in five years' time, as the noble Lord, Lord Allen of Abbeydale, said, but much more rapidly. I should have liked to see an amendment giving an enabling power to the Secretary of State to do something about the situation in the meantime, rather than wait for another Bill, which was talked about previously. I should have liked something along those lines.
However, as regards this amendment I fear that we may run into a problem of definition which will lead to hundreds of appeals. Those are always distressing for people who have to prove that they are decrepit or that they cannot do this, that or the other.
Another point relevant to what I am talking about concerns the mentally handicapped and the behavioural problems which lead to people having to be with them, wherever they go. As the noble Lord, Lord Carter, pointed out in the example which he gave from, I think, his own village, that person was perfectly capable of putting one foot in front of another. These people are capable of walking, but they are not capable of looking after themselves, in the sense that if they go out then they must have people with them. I suspect that what they should have and what would be more appropriate is an attendance allowance rather than a mobility allowance. Once again, the question is one of definition.
I should like to ask the Minister—whether he is talking about the 6,000 or 8,000 referred to when the amendment was moved, or about the 100,000 that might arise in the circumstances—how many of these people have the attendance allowance? I also wish to ask him whether there is any possibility of changing the amendment in such a way that there would be an enabling possibility which did not have to wait for further primary legislation or something similar in the field.
I have had some personal experience of carrying out various investigations and wondering what on earth to put on the bottom line before signing one's name. One knows how to do that, but what does one put on the bottom line as regards the recommendation? There is the need for a clearcut definition. There is this small point in the amendment which would make me feel, from experience as well as guess work, that it could lead to a great deal of distress, a widening of the applications greater than anticipated by the noble Lords. It might also give rise, I should have thought, to some considerable distress in the number of appeals that might result.
I hope that my noble friend the Minister is able to help us further when he comes to wind up on this
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amendment, both in terms of some form of enabling legislation or a change in the amendment. I hope that the noble Lord will take on board my point about the necessity for clarity regarding definition in order to reduce distress in appeals and the like.
Earl Russell: My Lords, before I attempt to answer the Minister, I should be grateful if I am allowed to set the record straight for having inadvertently misled the House when I spoke to this amendment in Committee. I quoted a figure from the Independent of 13th June saying that only seven out of 359 appeals had been successful. The newspaper published a correction last Tuesday showing that that figure came from the Social Security Appeals Tribunal. However, the figure from the Medical Appeals Tribunal, which is the correct one, was 27 per cent. I owe it to the House to join with the newspaper in attempting to put right that error.
The noble Lord, Lord Carter, has made out very clearly the basic case for this amendment. We have a situation in which the law is not treating like equally with like. That has put the Minister in a rather uncomfortable position. We all know that one of the real curses of the profession of politics is people in it who are against power. In listening to the answers to this amendment, we may hear some reasons why that comes to be so.
I know that the Minister cares about these issues just as we do; but he has been put in a position where he has had to come in and hold a bat which would have been unusually dead even for Geoff Boycott on a bad day at Old Trafford. We have the principle of unripe time which always makes me want to observe irreverently that I wonder when the time will come to be rotten.
We have the argument of the floodgates. That shows that the Government very much overrate the attractiveness of their social security benefits. I have not been in the position to check the figure of 100,000 just offered to us by the Minister. However, the Minister told us recently, when we discussed extending the mobility allowance, that the vast majority of those with locomotion difficulties acquired them over the age of 65 when of course they cannot qualify for the allowance. For a start, those people need to be subtracted from the Minister's figure of 100,000. That will then come to look rather less alarming.
The Minister of State in another place has attempted to argue that the case law is beginning to move in the right direction. I think those were his words. The Minister chooses his words with care. In the Lees case before this House, it is indicated that the word "beginning" had a very necessary part in that statement.
We have here, as we had in what is now Clause 11, an example where the case law is beginning to show a divergence. The Government there were quite eager to change the law to bring it up to the case law. It seems to me that there is an even stronger argument for doing that here.
We also have a suspicion constantly showing up in the appeals tribunals and other places that the claimant may be trying it on. That is a rather

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unrealistic way of looking at things. After all, there is not very much money at stake here. It is £24.50 per week. If noble Lords were offered the chance of having (shall we say?) osteoarthritis for £24.50 per week, I believe they would say that that was not the rate for the job. I do not think that the danger of false claimants being attracted by that sort of rate is nearly as great as the Government suppose. I very much hope that the Minister may yet relent, and that if he does not, the amendment will be agreed to.
3.45 p.m.
Baroness Phillips: My Lords, I should like to say that I have found this debate very distressing. Yesterday I went into the ladies' room, and there I saw a Peer's daughter who was blind. She was not deaf but she was blind. She sat waiting for somebody to come and collect her. It came home to me very forcefully that I am lucky enough to be able to move about, to hear, to speak and to see.
Two doors away from me there lives a young boy who is deaf and blind. I had the privilege of going to the school where that boy is employed. In no way can that boy ever go out on his own. Your Lordships will realise that the blind rely on their sense of touch. If you are deaf, you cannot hear the movements around you. Here we sit cold-bloodedly discussing the numbers involved and the cost. If this concerned armaments, there would be no question as to the cost. But we are talking about human beings, and people who have a contribution to make and who cannot do so in many cases because of their disability.
I shall put a blunt question to the Minister which I am quite sure he will not answer despite the skilful blandishments of the noble Lord on the Front Bench who said that on the one hand this and on the other hand that. But I ask myself how he is going to vote. I answer myself that he will vote against the amendment. I make an appeal to the Minister. If he does not like the amendment, and if the Government are going to do so much for this group of people, let him table an amendment at the next stage to cover these points. I appeal to him in the name of charity. We are not talking about a large number of people. Even if we were, surely the money spent on these people will be far more important than the money which may have to be given to a number of other citizens of the state. I appeal to the Minister.
Lord Renton: My Lords, in Committee a very strong case was made for this amendment; but the noble Lord, Lord Carter, withdrew it because there were various uncertainties felt on both sides of the Committee: there was uncertainty as to the numbers involved; there was uncertainty as to the cost to the Treasury; there was uncertainty as to when the review about which the Government told us would be reported—and we hoped that that would certainly resolve the uncertainty about the numbers involved. There was also uncertainty as to when there would be legislation to deal with this obviously hard situation.
The noble Lord, Lord Carter, wisely withdrew the amendment, as he said, in order to have some idea
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of the timetable. The timetable is at the crux of the matter. Regarding the timetable concerning the completion of the review, we have been told that that review is largely completed and should be completed very soon—this month, it seems.
Turning to the legislation timetable, I listened with much interest and some encouragement to my noble friend Lord Skelmersdale. He said that the Government intend, if I may put it bluntly, to come clean about this matter, but he did not say when. He did not tell us that this matter will definitely be dealt with in the Social Security Bill—and that is an annual affair—next year. However, I very much hope that when he replies to this debate he will tell us that it will be dealt with in next year's Social Security Bill.
The alternative is the one suggested, with much to commend it, by my noble friend Lord Trafford. He said that on Third Reading the Minister should be given power to deal with the matter by regulation. That would be a good solution; but of course that would not be as good as an undertaking to deal with it in the next Finance Bill because the regulations might not be made for several years. Therefore, I must say that when my noble friend replies I would prefer an undertaking here and now to the effect that the Government will deal with this matter effectively in the next Social Security Bill.
Implementation was another uncertainty at the previous stage. That must follow legislation, and when legislation comes we shall no doubt press for it to be implemented as soon as possible. I hope that it will not be long.
We are still in a state of uncertainty on relevant matters. We have been told by my noble friend—and I was astonished by the figure—that the amendment would possibly affect as many as 100,000 people. I confess that I cannot see how that can be. The amendment is perfectly clear and, I should have thought, limited in its effect. It refers to people who are both deaf and blind and I should have thought that the numbers of those are already known by the local authorities and health authorities throughout the country. The amendment also refers to those:
"suffering from severe mental handicap such that he"—
or she, as in the case of my daughter—
"is either unable to walk or virtually unable to do so without physical control".
More often than not, that means that the mentally handicapped person can walk only if held up, or can walk but cannot control the direction of movement.
Having worked, in an amateurish way, in the field of mental handicap for many years I should not have thought that the numbers within that category are so very numerous. Therefore, we are still in a state of uncertainty on that. I am sympathetic towards what the noble Lords, Lord Carter and Lord Allen of Abbeydale, have said and I hope 1hey will forgive me if I say that in my mind (if I am wrong I stand to be corrected) there is a further uncertainty; namely, whether many of the 3,000 deaf-blind and the 4,400 mentally handicapped, unable to walk, are already eligible for mobility allowance under the present arrangements. If a substantial proportion of them are eligible then, to put it bluntly, there is rather less need for this amendment.
Lord Allen of Abbeydale: My Lords, I intervene because perhaps I did not make it clear that I am speaking about the mentally handicapped. The numbers that we are now speaking about are people whose handicap has no identifiable physical cause and who would therefore not be eligible under the present rules.
Lord Renton: My Lords, I am most grateful to the noble Lord, that clarifies the point and removes the uncertainty in that respect. I am sure that all noble Lords are also grateful.
I must say that, although much of the uncertainty has been removed, I find myself in a state of unbearable conflict of loyalties. I am a past-president of MENCAP. I want to do all I can to help the mentally handicapped. I am also an admirer and supporter of the efforts of the Government to control public expenditure—referred to by my noble friend Lord Boyd-Carpenter. Of course, it is in the interests of those who are the least fortunate in our community that public expenditure and, therefore, inflation, should be kept under control. Such people could be indirect sufferers if we allow public expenditure to run unchecked. I am unwilling to cause pressure which might upset the plans of my right honourable friend Mr. John Major, the Chief Secretary to the Treasury. Incidentally, perhaps I may introduce a personal note. He now represents my old constituency, and does so very well.
With this unbearable conflict of loyalties I shall listen to the rest of the debate and then if, unfortunately—and it would be unfortunate—we have a Division I shall decide how to vote. However, I shall be very much influenced by what my noble friend Lord Skelmersdale says as to exactly when the Government propose to cover in legislation the intentions of this amendment. If it is any later than next year I shall have to vote for the amendment.
Lord Dormand of Easington: My Lords, I have only one simple point to make. It has been covered in part by the noble Lord, Lord Renton, but I believe it to be so important that it should be repeated. In fact, I should like to go a little further than did the noble Lord.
I refer to the statistics. In this Chamber we are all accustomed to discrepancies in statistics. The noble Lord, Lord Allen of Abbeydale, gave a figure of 8,000. The letter from the mobility allowance campaign—which perhaps most of us have received—states that approximately 8,000 people are affected and that that is probably the maximum. The Minister, however, gives the figure as 100,000. That discrepancy is too big for the normal style of debate in this House. Therefore, my first point is that I hope the Minister will tell the House exactly how that figure of 100,000 was arrived at.
Like the noble Lord, Lord Renton, I have an interest in that I am president of the Association of Physically and Mentally Handicapped. Like him, I also find it impossible to believe that the number of people who are deaf-blind or suffering from severe mental handicap can be anywhere near 100,000. Therefore, I hope that the Minister can give the House an explanation.
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There is another implication. If the figure is 8,000, or thereabouts, my understanding is that the overall maximum cost at current benefit rates—presumably that is the right basis to take—is about £10 million; which is less than 2 per cent. of current mobility allowance expenditure. If the figures are 8,000 and £10 million some of us see no reason to hesitate. Some items appearing in the newspapers recently—I hope noble Lords opposite will agree with me in this aspect—concern the obscene pay increases that some chairmen of companies are getting. I do not want to make a major point, but if that is what is going on in some parts of society—and here we are referring to a mere £10 million for the most severely handicapped people—what kind of society are we living in?
Disabled people have waited long enough. All of us here, and some of us when in another place, have dealt with the disabled. The cost to them in terms of energy, sheer inconvenience, lost benefit and in lengthy appeals—appeals can extend into many months; a point that has already been mentioned—cannot be justified, and there should no longer be a delay. Therefore, I hope that noble Lords on all sides will support the amendment.
Lady Kinloss: My Lords, I support the amendment. I ask the Minister whether the deaf-blind can be included in a similar interim measure as those who are to receive the mobility allowance until the age of 80 instead of 75? I should have thought that being deaf-blind is a sufficient disability without the trauma, in most cases, of having to prove their inability to walk alone. They should receive the mobility allowance automatically if they wish to apply for it.
Lord Harmar-Nicholls: My Lords, there is one aspect that has not yet been emphasised in this short debate. I believe that it is an important aspect; but it will certainly not be popular compared with the speeches made by the noble Lords Lord Carter and Lord Allen.
If it were just a matter of numbers or cost, both of my hands would go up in support of the amendment. However, I do not believe that numbers or cost comes into the argument compared with the strength of the necessity to want to help people who need assistance. But what is our function? We are not distributors of social services, excellent though they are and much as we want to see them properly distributed in the right quarters.
We are also legislators. Our main function this afternoon is not to be kind and generous however much we may wish to be so, to people who need our generosity; it is to be good legislators. It is not good legislation if we put on the statute book words that carry doubt and uncertainty. I do not believe that that helps. Clause 9 of the Bill as it stands, and the subsection affected by this amendment, are very clear. Section 37A of the principal Act raises the age from 75 to 80 for the people who are entitled under the Act to have the allowance.
This amendment, though excellent in intent, confuses that clear-cut instruction. It will have to be administered in the future by someone. It will

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create a situation about which there may be considerable doubt. I was very impressed by the speech of my noble friend Lord Trafford. As a medical man it would be his job and that of people like him to decide whether "virtually unable" to do things was "virtually" or not. One is putting uncertainty into legislation which has to be clear and understandable if it is to work without disruption.
I am on the side of the noble Lord, Lord Allen. I want him to succeed in what he seeks to achieve, but I am convinced that to attach this amendment piecemeal to the Bill is not the right way of doing so. I have more sympathy with my noble friend Lord Renton. I believe a case has been made for doing something for the people affected by this amendment.
4 p.m.
Lord Allen of Abbeydale: My Lords, the noble Lord speaks as though this amendment has invented the phrase "virtually unable to walk". It is already in the principal Act.
Lord Harmar-Nicholls: My Lords, the noble Lord who, as a doctor, would have to decide the matter, recognises doubt. He said that it makes his job of doing the work that we as legislators want done, that much more dificult. When further investigation is made into the claims of these people, who is to say that the mobility allowance as set out in the Bill is the right way of helping them? It may well be that we shall wish to add to the numbers of the deaf and those virtually unable to walk.
That is why I agree with my noble friend Lord Renton. I wish my noble friend at the Disptach Box to give a clearer undertaking as to when the Government are prepared to take the next step to implement the general principle behind this amendment and the speeches that have been made on all sides of the House. I have had to fight many elections; I believe I recognise the importance of appearing to be popular. It is very easy to make compassionate speeches and appeals which are very well based, but we have to do our duty as legislators. We have to put on the statute book words that can be easily interpreted in a way that assists the people we wish to help.
Lord Carter: My Lords, the phrase has been on the statute book since the Social Security Act 1975 was enacted.
Lord Harmar-Nicholls: My Lords, it may well have been wrong then, because the phrase is creating doubts now. I am asking noble Lords, who are colleagues of mine in this House, to approach this matter not as politicians wishing to help their fellow man but in their capacity as legislators. The piecemeal attachment of this amendment to the Bill as it stands is not the cleanest and the most effective way in the long run of carrying out what we wish to do. I believe that the noble Lord, Lord Allen, and those who support him have done their job very effectively. They have alerted the Government and their colleagues in this House and, I hope, in another
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place, to speed the time when these particular unfortunates can be more effectively dealt with than they will be merely by attaching this amendment to the Bill.
Baroness Seear: My Lords, I may have got it wrong, but I ask the Minister whether he can be right as regards the figure of 100,000 people who are deaf, blind and have difficulty in walking. That means one in every 560 of the population, if I have done the sums correctly. We cannot have one in every 560 people in this country who are blind, deaf and unable to walk. Where are they all?
Baroness Gardner of Parkes: My Lords, perhaps the noble Baroness has missed the point that we are speaking of people who are blind, deaf or unable to walk. I do not believe that all three disabilities have to apply to the same person. However, I agree with the noble Baroness that it would be an impossible situation otherwise in terms of numbers. I shall not vote for this amendment. That is not because I do not have sympathy with the cause. I believe it has been magnificently presented by the noble Lord, Lord Carter, and also in typically moderate tone by the noble Lord, Lord Allen of Abbeydale. I shall not vote for the amendment because as I have listened to the debate, it has become quite clear that no one really knows the situation. The review that is currently being conducted will give the answers in a positive way as regards the number of people involved.
I remember opposing the mobility allowance when it was introduced. I was very upset at the time. As I remember it, it was at the time when the little three-wheeled vehicles were taken away from people. Because the vehicles were not safe, the mobility allowance was brought in. Those who lost their vehicles were pretty upset about it because they did not believe that the money compensated for the loss. The allowance is historically partly due to that. Obviously, the first people to get the mobility allowance had been drivers, but the people we are talking about today, owing to their degree of disability, can never have been drivers. Perhaps that is why they were never considered as regards this provision right from the beginning. I believe all Members of this House believe that there is a case made out for them.
I can tell your Lordships of other cases of people who should be considered. I have those dear to me who have tried for a mobility allowance but have been unable to get it because they have disabilities that come and go. There are all kinds of people who are disadvantaged from time to time. Certain conditions have periods of remission and there is nothing to cover those people. Therefore, I believe that special pleading for one section of people as regards this amendment is something that I shall not support: I wish to see a full review. Other points were made that are highly relevant. I am surprised that it is not possible to bring in some provision for these people under regulations. I am surprised to hear that the power does not exist.
I support the view expressed by my noble friend Lord Trafford. He said that if there was some

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enabling legislation brought in and if the survey, when it is completed, shows an appropriate case, it would mean that at that stage action could be taken before the next Bill. My noble friend Lord Renton made the point that he would rather have a firm promise for next year. I do not feel that one provision does away totally with the other. These regulations should vary from time to time. For example, AIDS victims can very rapidly deteriorate to the point where they cannot walk. In social security terms it would be very helpful to have more powers to introduce measures under regulations.
That is a valid point. It does not prevent anyone saying that they will bring in such provisions in a successive Bill. In passing, the point should be made that the London boroughs are very good at helping people to get around. There are schemes whereby people pay £1 and can have a taxi ride to the value of £10. There is also the Dial-a-Ride scheme that has only come into effect in recent years. These measures are all means of helping people. For as long as I can remember blind people have not only had free travel on London Transport; they have also had the right to be accompanied if they need assistance. I see people managing very well. They are probably not blind and deaf—I would not know if they were deaf—but they are certainly blind. They travel on the London Underground and manage very well. It gives them a sense of independence to do so. Those people are certainly not immobile. They may need financial help and assistance but they certainly do not lack mobility. That is another reason why I think the phrase "mobility allowance" is not appropriate. Although I have every sympathy with the case presented, I cannot support the amendment today.
Lord Wolfson: My Lords, I support the purposes of the amendment on humanitarian grounds. The cost would be minimal and could quite easily be saved in other directions. The question of priorities is always difficult, but I think it is clear that the unfortunate people covered by the amendment are a priority. The Minister, I am glad to note, has confirmed this.
I was very much influenced by the remarks of my noble friend Lord Renton who is so experienced in these matters. He mentioned a conflict of conscience which I also have. I was also influenced by the remarks of the noble Baroness, Lady Phillips, who gave us a sad example. I was very much taken with the views of the noble Lord, Lord Trafford, who is also experienced in these matters. I take his point about people being virtually unable to move, which I think gives rise to confusion as regards the amendment.
I must declare an interest as a company director although I am not clear where the salaries of company directors come into the matter. Forty per cent. would go in taxes, which is probably enough to pay for the amendment. The proposal is modest and eminently right. My noble friend said that he cannot accept the amendment. I hope that when he comes to reply he will be able to put forward an amendment of his own or say that at Third Reading he will be able to introduce an amendment to bring
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about the purposes for which this amendment has been tabled. By that time the full facts should be available.
Lord Nugent of Guildford: My Lords, much as I admire my noble friend Lord Wolfson I am astonished that he, with his keen sense of commerce, should be willing to commit the Government to large sums of money—many millions of pounds—without knowing the facts, especially at a time when we are just about to have the results of the survey which will give us the facts. I have a great deal of personal sympathy for the amendment because I have a brother who is both blind and deaf. I know the difficulties of getting about; I understand the problems. But before the Government are asked to commit themselves I think that we should wait, especially when it is only a matter of weeks, or perhaps months at the outside, to find out the facts.
I should like my noble friend to give a specific undertaking, so far as he and my noble friend the Leader of the House can give an undertaking, that legislation will be brought forward in the next Session. I would be happy to support my noble friend if he could give us, so far as is possible, an undertaking in that direction.
Lord Wolfson: My Lords, with the leave of the House, perhaps I may reply briefly. I thank my noble friend for his kind remarks but I did suggest that when all the facts were available at the time of Third Reading that might be the time to consider the matter.
Lord Skelmersdale: My Lords, I assume from the remarks I have heard that I have the leave of the House to reply very briefly to this debate. My noble friend Lord Wolfson with his unerring skill has put his finger right on the facts. We all support the amendment. There is no doubt about it whatever. Every noble Lord supports the amendment. But we need to know the facts. Those facts will not be available by Third Reading. They will not be available, first, until the last OPCS report is published; and, secondly, until the data tapes to which I referred earlier have been properly studied not only by the Government—I get a distinct impression from all around the Chamber that noble Lords do not trust the Government in this matter—but have been independently checked. That must be right. That is why we cannot do it by Third Reading.
The noble Lord, Lord Allen, referred to remarks that I made which he said rather downgraded what I had said earlier in Committee when talking about the five years. The five years is made available by extending the age limit from 75 to 80. It was never meant as being any indication of how long it would take to implement changes arising from the OPCS findings. The point I was making in Committee is that even the most suspicious noble Lord—me at my worst, my Lords—will have no difficulty in believing that we will act well within this time. My noble friend Lady Faithfull wanted to know how many of the people would resort to institutional care. Neither the reports nor the data will answer that

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question directly for one very good reason. The survey covered specific disabilities. It is a matter of professional judgment. Various individual cases are after all involved. Whether or not they need residential care is a matter for doctors.
My noble friend Lord Trafford answered the question of the noble Lord, Lord Carter, about tribunals and appeals. The noble Lord, Lord Carter, believes that the mobility allowance is in a muddle. I go along with him to a great extent by saying that the mobility allowance is in a muddle. That is one of the reasons why I believe that this is not the time to make it into what my noble friend Lord Trafford would call—I am sorry to put words into his mouth—a greater muddle. The question of entitlement is a matter of medical opinion. It will never be possible, whatever the criteria, to achieve full consistency. However, I agree with my noble friend Lord Trafford; we must get our definition as right as possible, a point made also by my noble friend Lady Gardner of Parkes. The appeal system allows people to have a further opinion on their possible entitlement and to produce evidence should they wish.
My noble friend eloquently and cogently identified the problem of definition which lies at the heart of the gulf between the estimate of the noble Lord, Lord Carter, and the Government's alternative estimate. Some of those who need to be accompanied in public will also satisfy the eligibility criteria for attendance allowance. However, I am afraid that I cannot give a number this afternoon. The idea of an enabling power is quite ingenious but, as I said a few moments ago, it may well be that we would decide that the best way to help these people is by means other than the mobility allowance. That is why I must also tell the noble Baroness, Lady Phillips, that I cannot come back by Third Reading with another amendment. My noble friend Lord Harmar-Nicholls made this point particularly clearly.
The noble Lord, Lord Dormand of Easington, and the noble Baroness, Lady Seear, got to the crux of the matter of figures, which many of my noble friends find do not actually matter very much. However, I shall answer the point because it has been addressed several times. The OPCS data show that more than 100,000 people have difficulties affecting their behavioural and intellectual functioning to such an extent that it could reasonably be argued that they need to be accompanied in public even to the extent of physical contact and control. That is what we have taken as our figure. We are not saying with any certainty, a point that I hope I made earlier, that the figure will be 100,000—in other words, that 100,000 will definitely qualify—but the data show that there are some 100,000 people whose behaviour is sufficiently disturbed to raise serious questions about the need for them to be accompanied in public. At the end of the day, that is what the amendment is about. To set this in context, it was shown that there were 650,000 people between the ages of 16 and 59 who have behavioural disabilities at any level of severity.
The noble Lady, Lady Kinloss, suggested that deaf-blind people should be dealt with separately. The noble Lady's suggestion is of course persuasive.
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However, I must tell her that to me, at any rate, it is uncomfortably divisive. Deaf-blind people are far fewer in number and raise fewer problems as regards identification than the level of behavioural disturbance that requires physical control. But the Government will have to consider most carefully whether to help the one group more quickly than the other.
To sum up: we want to act; we wish to act; and we shall act. However, we need to give more thought as regards how we want to act. But act we assuredly will at the earliest possible date, on what my honourable friend the Minister for Social Security and the Disabled calls, "a very fast track". I believe that I have made it clear that the Government have the best will in the world in this area, but we have not seen what is in the last OPCS report, nor have the data tapes to which I referred been properly studied. Until that has been done, we cannot, even with the best will in the world, come to a conclusion in this matter.
Our basis for bringing forward our detailed proposals will be those findings. We wish to look at them properly; we wish to look at them with the help of your Lordships; and we wish to look at them with the help of all the various voluntary organisations to whom I pay credit in this area. They have done a tremendous amount for disabled people over many years. With their help, we can continue to help such people.
4.15 p.m.
Lord Renton: My Lords, before my noble friend sits down, I notice that he has studiously avoided answering the question which I put to him, which was: will the Government give an undertaking that, having gone through all this negotiating and consulting process, they will deal with the matter one way or another in a social security Bill in the next Session of Parliament? Because, speaking for myself, a lot depends on that.
Lord Skelmersdale: My Lords, I made it quite clear to my noble friend, and to the rest of the House, that we shall act in this matter. We shall act in the first social security Bill after this matter has been concluded.
Lord Rochester: My Lords, is there any reason why the Third Reading of this Bill should not be postponed until the overspill period, when the relevant facts will be available, as I understand it, and when suitable legislation could be brought forward during the current parliamentary Session?
Lord Skelmersdale: My Lords, most regretfully, when we reach a later part of this Bill—Schedule 5—your Lordships will find that this legislation must receive Royal Assent by 30th July of this year. Otherwise, we shall be in breach of our EC obligations. I am afraid that the noble Lord's suggestion, although a wise one, is not on this occasion an option.
Lord Carter: My Lords, I begin by thanking all noble Lords who have spoken in what has been

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an excellent debate. I should also apologise for an omission I made at the beginning of my speech, when I forgot to congratulate the Government—something which does not often happen from this side of the House—for the fact that mobility allowance has increased 10 times in terms of numbers since 1979 to a figure now not far short of 600,000 people. That is why I find it so surprising that the Government are not able to accept an amendment which affects fewer than 8,000 people. I shall return to the issue of the figures later.
Perhaps I may deal just briefly with some of the points which have been made, and in particular one made by the noble Lord, Lord Boyd-Carpenter. We already have an interim measure in this Bill to extend the mobility allowance from the age of 75 to the age of 80. Therefore the Government are prepared to use the Bill for an interim adjustment, and to use the case law to support such matters in many respects. I thought that that is what this Chamber was all about: to clarify confusing situations; to tighten legislation; and to ensure that Acts mean what they say. That is the purpose of this amendment; it is designed to tighten down legislation. I shall return to the question of the wording at a later stage.
The Minister said that he hoped that the OPCS survey would set out all the priorities. In fact, it will not do so. It will contain a wealth of statistics and information, but it is the Government who will have to choose the priorities.
Lord Boyd-Carpenter: My Lords, I am sure that the noble Lord will allow me to intervene, as he referred to me in his remarks. His second version of what I said is the more accurate. What I said, or indeed what I intended to say, was that the OPCS would give us the whole picture and it would then be for the Government, and Parliament, to decide in the light of that action what changes, if any, to make.
Lord Carter: My Lords, that is absolutely true. If the OPCS survey was relevant to this amendment, then that would be quite correct.
The Minister said that the Government would act as promptly as circumstances would allow and that they are wanting and willing to act. But, why wait? We have had to wait for the response to the Disabled Persons Act 1986 and we are still in fact, as the noble Lord will know, waiting for that to be completed. Further, I imagine that after this amendment has been dealt with we shall hear the response to the Griffiths Report, which has taken long enough. I return to the fact that the OPCS survey is really not relevant to this matter.
I turn now to the business of the data tapes. This reminds me of the Perils of Pauline, in that at one bound the Government were free. We have been discussing this matter now since the early 1980s. The figures have never been in dispute up to this point; indeed, they were not in dispute until the Committee stage. But, all of a sudden, the data tapes have become available. However, we are told that the report is not yet published and that the data tapes cannot be properly studied. But, despite that
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fact, the Government suddenly produce a figure of 100,000 people, which as the noble Baroness said, defies common sense.
I ask your Lordships to think about the points made by the noble Baroness, Lady Seear. For example, do we really think that there is one person in every 560 people who is so severely mentally handicapped that they need continuous physical control by another person? The organisations involved—namely, Sense and MENCAP—have done their research most carefully, Indeed, they have used the Government's figures; they have used the 1971 survey which states the incidence of mental handicap; and they have produced a figure of 7,600 people. I am prepared to believe them.
Many noble Lords remarked upon the phraseology of the amendment; that is, the words,
"unable to walk or virtually unable to do so".
However, those are the words contained in the principal Act. It says:
"unable to walk or virtually unable".
We have merely extended the wording to read:
"or is deaf and blind",
or is unable to walk, or virtually unable to walk, as a result of the severe mental handicap. That phraseology has been on the statute book since 1975.
Lord Trafford: My Lords, I am obliged to the noble Lord for giving way. I am aware of the last point he made. However, my point was that that itself has given rise to some difficulty, even when dealing with much more clear-cut physical matters. I suggested to him that he might consider changing the wording in this amendment, or in a subsequent amendment, simply for the sake of clarification. Clarification is quite important in reducing the distress of appeal. That was the point of raising the matter.
Lord Carter: My Lords, if this amendment were accepted there would still be some borderline cases. Indeed, there always are in such matters. However, they would be very much reduced in number. That is the point. As I say, the phrase is already in the Act and in the regulations.
I gave the example of the lady in our village. I shall now give your Lordships another example. It is of a woman who suffers from ME. She is able to walk from here to the other side of Westminster Bridge; but she receives a mobility allowance, because she would be so ill the next day and would be in bed for a week were she to do so. She is able to receive a mobility allowance—and I know her—but the girl whom I described in our village who is so severely mentally handicapped is refused a mobility allowance. That just cannot be right.
I turn now to the remarks made by the noble Lord, Lord Renton. We know the numbers and the cost. The review was completed a long time ago; it is only the publication of the review which has taken a long time. Indeed, the review was completed certainly some months ago. Of course, it takes some time to publish such documents.
However, I repeat that Sense and MENCAP have done their sums most carefully yet, all of a sudden, at this late stage the Government produce a figure

285
which undoubtedly includes all severely mentally handicapped people with behavioural problems. But, this amendment does not deal with that matter; it deals with those who are so severely mentally handicapped that they need continuous physical control by another person.
The noble Lord, Lord Harmar-Nicholls, said that we have done our job in that we have alerted the Government. But the Government were alerted to this problem in the early 1980s. We have been trying to get this concession through since that time. The noble Baroness, Lady Gardner of Parkes, said that mobility allowance altered from time to time and that the condition which gives rise to it recedes. That is absolutely true; but not in the case of the deaf-blind and the severely mentally handicapped, which is what the amendment is all about. There is no recession in their condition ever.
Perhaps I may conclude with some remarks about the Minister's speech. The last report has not been published. The data base cannot be complete. How does the Minister know that the figure is 100,000? Have the civil servants made a big hearted guess? The figure does not stand up. The Minister says that the mobility allowance is in a muddle. It is, and the amendment is intended to deal with it. The excuse is always given that it is never the time. We asked the Government in 1981. We saw the Minister in 1985. We saw the Minister in 1987. We saw the Minister in 1989. We are now told that we must wait; we must wait for the OPCS survey; we must wait for consultations; and, "We will give it a fast track".
The Minister says that over 100,000 people have behavioural problems. I listened carefully to the Minister's words. In support of his case, he described a large group of people. We chose the wording of the amendment to restrict its purpose. The wording is tight. The numbers are known. The only way to solve the problem is to ask for the opinion of the House.
4.31 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 124; Not-Contents, 114.

DIVISION NO. 1

CONTENTS

Airedale, L.

Carmichael of Kelvingrove, L.

Allen of Abbeydale, L. [Teller.]

Carter, L.

Alport, L.

Cledwyn of Penrhos, L.

Ampthill, L.

Cocks of Hartcliffe, L.

Ardwick, L.

Craigavon, V.

Auckland, L.

Cullen of Ashbourne, L.

Beaumont of Whitley, L.

Darcy (de Knayth), B.

Blackstone, B.

David, B.

Blyth, L.

Davies of Penrhys, L.

Bonham-Carter, L.

Dean of Beswick, L.

Bottomley, L.

Dormand of Easington, L.

Briginshaw, L.

Dunrossil, V.

Broadbridge, L.

Ellenborough, L.

Bruce of Donington, L.

Elliot of Harwood, B.

Burton of Coventry, B.

Elwyn-Jones, L.

286

Ennals, L.

Mottistone, L.

Ewart-Biggs, B.

Mountevans, L.

Ezra, L.

Mulley, L.

Faithfull, B.

Murray of Epping Forest, L

Falkender, B.

Nicol, B.

Falkland, V.

Northfield, L.

Gainford, L.

Ogmore, L.

Gainsborough, E.

O'Hagan, L.

Gallacher, L.

O'Neill of the Maine, L.

Galpern, L.

Perry of Walton, L.

Gladwyn, L.

Peston, L.

Graham of Edmonton, L.

Phillips, B.

Greenway, L.

Pitt of Harnpstead, L.

Gregson, L.

Ponsonby of Shulbrede, L. [Teller.]

Grimond, L.

Haig, E.

Prys-Davies, L.

Halsbury, E.

Reilly, L.

Hampton, L.

Renton, L.

Hanworth, V.

Rippon of Hexham, L.

Harris of Greenwich, L.

Rochester, L.

Hatch of Lusby, L.

Russell, E.

Hayter, L.

Sainsbury, L.

Henderson of Brompton, L.

Saltoun of Abernethy, Ly.

Hirshfield, L.

Seear, B.

Houghton of Sowerby, L.

Seebohm, L.

Hunter of Newington, L.

Sefton of Garston, L.

Hylton, L.

Serota, B.

Hylton-Foster, B.

Shackleton, L.

Irvine of Lairg, L.

Shannon, E.

Jeger, B.

Shaughnessy, L.

Jenkins of Hillhead, L.

Shepherd, L

John-Mackie, L.

Simon, V.

Kennet, L.

Somerset, D.

Kilbracken, L.

Stallard, L.

Kinloss, Ly.

Stedman, B.

Lawrence, L.

Stoddart of Swindon, L.

Llewelyn-Davies of Hastoe, B.

Strabolgi, L.

Swann, L.

Lloyd of Kilgerran, L.

Taylor of Blackburn, L.

Lloyd George of Dwyfor, E.

Taylor of Gryfe, L.

Lockwood, B.

Taylor of Mansfield, L.

Longford, E.

Tordoff, L.

Macaulay of Bragar, L.

Turner of Camden, B.

McIntosh of Haringey, L.

Underhill, L.

McNair, L.

Walston, L.

Mason of Barnsley, L.

Williams of Elvel, L.

Milverton, L,

Winstanley, L.

Morris, L.

Zouche of Haryngworth, L.

NOT-CONTENTS

Abinger, L.

Eden of Winton, L.

Alexander of Tunis, E.

Effingham, E.

Alexander of Weedon, L.

Elles, B.

Allerton, L.

Elliott of Morpeth, L.

Annaly, L.

Erne, E.

Arran, E.

Erroll of Hale, L.

Belhaven and Stenton, L.

Ferrers, E.

Beloff, L.

Fortescue, E.

Belstead, L.

Fraser of Carmyllie, L.

Bessborough, E.

Fraser of Kilmorack, L.

Blatch, B.

Gardner of Parkes, B.

Boardman, L.

Goold, L.

Borthwick, L.

Gray of Contin, L.

Boyd-Carpenter, L.

Hailsham of Saint Marylebone, L.

Brabazon of Tara, L.

Bruce-Gardyne, L.

Hardinge of Penshurst, L.

Butterworth, L.

Harmar-Nicholls, L.

Caithness, E.

Havers, L.

Campbell of Croy, L.

Henley, L.

Carnegy of Lour, B.

Hesketh, L.

Carnock, L.

Hives, L.

Carr of Hadley, L.

Holderness, L.

Cockfield, L.

Home of the Hirsel, L.

Colnbrook, L.

Hooper, B.

Colwyn, L.

Ingrow, L.

Cork and Orrery, E.

Johnston of Rockport, L.

Craigton, L.

Joseph, L.

Davidson, V. [Teller.]

Kimball, L.

Denham, L. [Teller.]

Lauderdale, E.

Dilhorne, V.

Long, V.

Dundee, E.

Lothian, M.

287

Lyell, L.

Quinton, L.

McAlpine of Moffat, L.

Rankeillour, L.

McFadzean, L.

Rees, L.

Mackay of Clashfern, L.

St. Aldwyn, E.

Macleod of Borve, B.

Sanderson of Bowden, L.

Mansfield, E.

Savile, L.

Margadale, L.

Selborne, E.

Marley, L.

Sharpies, B.

Marshall of Leeds, L.

Skelmersdale, L.

Merrivale, L.

Stockton, E.

Middleton, L.

Strange, B.

Monk Bretton, L.

Strathcarron, L.

Monteagle of Brandon, L.

Strathclyde, L.

Mountgarret, V.

Sudeley, L.

Mowbray and Stourton, L.

Suffield, L.

Munster, E.

Terrington, L.

Murton of Lindisfarne, L.

Thomas of Gwydir, L.

Nelson, E.

Thomas of Swynnerton, L

Nelson of Stafford, L.

Trafford, L.

Norrie, L.

Tranmire, L.

Nugent of Guildford, L.

Trumpington, B.

Orkney, E.

Vaux of Harrowden, L.

Orr-Ewing, L.

Wyatt of Weeford, L.

Oxfuird, V.

Wynford, L.

Pender, L.

Young, B.

Prior, L.

Young of Graffham, L.

Pym, L.

Resolved in the affirmative, and amendment agreed to accordingly.
Lord Skelmersdale: My Lords, this might be a convenient moment to take the Statement. Therefore we will resume consideration on Report later.

Community Care
4.40 p.m.
Lord Henley: My Lords, with the leave of the House I should like to repeat a Statement that is being made in another place by my right honourable friend the Secretary of State for Health. The Statement is as follows:
"With permission, Mr. Speaker, I wish to make a Statement on the Government proposals for the future organisation and funding of community care.
"Community care is a policy to which successive governments have been committed for almost 30 years.
"The key aim of this policy is to enable people to live as full and independent a life as is possible for them in the community for so long as they wish to do so. For many people, this means providing the services and support they need to continue to live in reasonable comfort in their own homes for as long as possible. For others, who may have experienced long stays in hospital and have more intensive care needs, it means helping them to re-establish their lives away from large institutional settings. I am sure that the vast majority of people wish to live in or near their own homes until or unless age or disability make that impossible. It is the Government's purpose to help them and the people who care for them to achieve that aim. Success depends crucially on the availability of adequate services in the community.
"The background to the developments I am about to announce is one of tremendous growth
288
in both resources and manpower for community care. To give the House some examples of the progress that has been made between 1979–80 and 1986–87, expenditure by the NHS on the community health services has risen by 40 per cent. in real terms, and local government spending on the personal social services has grown by almost 27 per cent. The number of day centre and day hospital places for mentally handicapped people rose by 10,000. The number of home helps grew by 20 per cent. and the number of day centre places for elderly people by 18 per cent. The number of residential places for mentally ill people rose by over a half, and places in day centres and day hospitals by a third. Between 1981–86 the number of community psychiatric nurses doubled. This growth in resources has been taking place alongside a dramatic change in the delivery of care and the movement of people out of hospitals and into community settings. Between 1980 and 1986 the number of children in mental handicap hospitals fell from 2,500 to less than 400 and the number of mentally handicapped adults in hospital fell by around 14,000, while the number in local authority, voluntary and private community based homes rose by 11,000. In addition we have, through the benefit system, put huge additional resources into supporting people in private residential care and nursing homes. The amounts spent on supporting these people have increased from £10 million in 1979 to £878 million in 1988.
"Nonetheless, I am sure that we all agree that progress has not been as even or as rapid as we should like. The rapid growth of residential and nursing home care has been unplanned and largely based on the availability of social security benefits. The Government recognised the need to see whether the arrangements for delivering community care could be improved when we asked Sir Roy Griffiths in December 1986 to report on ways by which the better use of public funds for community care might be achieved.
"We are indebted to Sir Roy for his report Community Care: Agenda for Action, which we published in March last year. The report has succeeded in stimulating valuable public debate. Over 280 organisations, professional bodies and members of the public, have sent us their views on it, many in support of the recommendations, but some favouring other options. We have taken full account of the wide range of views expressed, and considered a wide variety of options. Our conclusions are as follows.
"We accept the distinction Sir Roy Griffiths makes between health and social care. Our proposals do not alter the functions or responsibilities of health services. The community health services will continue to play an essential part in meeting the medical and nursing needs of people outside hospital.
"We are proposing to make important changes in the way in which non-health care is provided and, where necessary, funded at public expense. The great bulk of community care will continue to be provided by family, friends and neighbours. The majority of carers take on these

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responsibilities willingly, and I admire the dedicated and self-sacrificing way in which so many members of the public take on serious obligations to help care for elderly or disabled relatives and friends. Our proposals are aimed at strengthening support for those many unselfish people who care for people in need.
"At present, people who are unable to support themselves and need help with social care can look to two separate sources of statutory help: to social security offices for payments towards the cost of places in residential care and nursing homes; and to local authorities, for home care, day care and residential care services. We accept that the present arrangements are flawed because they cannot ensure that priority is given towards supporting people at home where that is possible and desirable. Social security payments for residential and nursing home care are subject to no assessment of individual needs for care. The public agencies have a financial incentive which no one ever intended to give to them, to rely as much as possible on the availability of social security for residential care. We do not believe that these present arrangements secure the best possible outcomes for people in need, or indeed the best possible use of taxpayers' money.
"We therefore accept Sir Roy's recommendation that those two sources of public funding should be brought together and allocated on the basis of a proper judgment of an individual's needs. By creating this unified source of funding for the full range of social care services, we can ensure that the objective of sustaining people in their own homes wherever possible be given the necessary priority.
"We propose to introduce a new funding structure for those seeking help from public funds for the cost of care. In future there should be a single budget to cover the costs of care whether in a person's own home or in a residential or nursing home. This will enable sensible decisions to be taken about the type of care that best meets an individual's needs and provides best use of public money. At the same time we will remove the perverse incentives in the present benefit system by making all claimants eligible for income support and housing benefit on a similar basis, whether they are living in their own homes or in independent residential or nursing homes.
"We have considered carefully which care authority should hold this new budget and take on the responsibility for the assessment of need and provision of care. Local authorities are already responsible for the full range of social care services and have a great deal of expertise in this area. We have concluded that the best way forward will be to build on local authorities' existing responsibilities. We accept Sir Roy Griffiths' proposal that local authorities should assume responsibility for the care element of public support for people in private and voluntary residential care and nursing homes, and for making the best use of those funds in relation to an assessment of people's needs and priorities. Collaboration between medical, nursing
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and social services agencies will be essential in assessing individual needs, and in designing suitable arrangements for care. We shall look to local authorities to ensure that suitable multi-disciplinary assessment procedures are in place, and to health authorities to make their contribution to those procedures.
"We attach great importance to securing a smooth transition to this new structure, avoiding uncertainty for people currently living in homes and for their relatives. We therefore propose that the new arrangements for social security benefit entitlement will apply only to people not already in residential or nursing home care after the date on which the new arrangements come into force.
"Residents of homes who are in receipt of income support when the new system is introduced will therefore retain their entitlement to help through the existing system. People who are self-financing residents of registered homes when the new system is introduced will also be able to apply for income support under the existing arrangements if their funds become exhausted subsequently. My right honourable friend the Secretary of State for Social Security is today announcing further details of these new arrangements.
"We accept that further efforts will be needed to improve co-ordination between health and social services in the arrangement and delivery of services to individuals. We believe that the clarification of roles in our proposals will make it easier to achieve this.
"The local authorities' responsibilities, in collaboration with others including doctors and other caring professions, will be to assess individuals' needs, design suitable care arrangements, and secure their delivery. It is not necessary for local authorities to provide all this service directly themselves and they should make maximum possible use of the voluntary, not-for-profit and commercial sectors so as to widen individuals' room for choice, increase the flexibility of services and stimulate innovation.
"The Government have long urged local authority social services departments to act in an enabling, and not just a providing capacity. Some authorities are already moving in that direction. To minimise disruption and to ensure that local authorities have every incentive to make use of the independent sector and offer people choice, we propose that they should continue to meet the full cost of accommodating people in local authorities' own homes, subject to their existing powers to make charges according to residents' ability to pay. My right honourable friend is not therefore proposing to change the benefit rules for residents of these homes.
"We believe that these new financial arrangements will give local authorities the necessary incentives to develop better services for people at home, and make greater use of independent providers. It will be important that local authorities should have clear plans for the development of community care services, worked

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out in collaboration with health authorities and the independent sector. I shall expect all authorities to have such plans, and shall ensure that they are open to inspection by my Social Services Inspectorate. I also propose to take powers to call for reports on local authorities' community care services.
"Local authorities will need adequate resources for their new responsibilities. That means that we shall transfer to the local authorities the resources which the Government would otherwise have provided to finance care through social security payments to people in residential and nursing homes. The aggregate amount of transferred resources will allow for the projected growth in the numbers of people needing support. Resources will be needed by the local authorities to carry out their new tasks of assessing individuals' needs, arranging appropriate care services for people at home, and buying private residential and nursing home care.
"We are confident that the proposed funding arrangements, by putting more emphasis on supporting people in their own homes, will provide both more appropriate services closer to individuals' wishes and needs, and better value for money from public spending than under the existing arrangements. We shall be discussing the detailed financial implications with local authority representatives. The necessary decisions on the resources to be transferred will be taken in the public expenditure survey next year.
"I have summarised our conclusions on the main proposals in Sir Roy Griffiths' report. They represent a major challenge for local authorities and social services departments. There are a number of associated issues on which the House will expect me to make the Government's position clear.
"First, we have been especially concerned to ensure that care for severely mentally ill people is properly managed. Here, as in other areas, we have concluded that the right course is to ensure that existing responsibilities are discharged effectively. On the health side, I will ensure that discharges of seriously mentally ill people from hospital will take place only when adequate medical and social care is available for them outside hospital. More details of the initiatives we are taking here will be announced shortly. On the social care side, we have decided to create a new specific grant directed at encouraging local authorities to make their necessary contribution to services, in line with health authority plans and objectives. To achieve that, we have decided that the grant should be payable by health authorities, acting as my agent, on the basis of plans and targets put to them by the relevant local authorities. The details of this proposal will be worked out in discussion with health and local authority representatives.
"Secondly, both Sir Roy Griffiths and Lady Wagner made recommendations about the registration and inspection of residential care and nursing homes. Local authorities will be asked to
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establish inspection and registration units, at arm's length from the management of their own services, which should be responsible for checking on standards in their own homes, and to involve independent outsiders in these arrangements. We have concluded that, for the present, existing statutory functions should remain unaltered.
"Thirdly, we would expect general practitioners to ensure that social services departments are aware of their patients' needs for social care, as recommended by Sir Roy Griffiths in his report.
"I have outlined our conclusions on the main issues. My right honourable friends the Secretaries of State for Scotland and Wales are today announcing separately our conclusions of particular relevance to them. My right honourable friend the Secretary of State for Northern Ireland will be doing the same early next week. We propose to spell out our proposals in more detail in a White Paper which we aim to publish in the autumn. It will be necessary to ensure that the necessary legislative framework is in place before implementation, which we propose should be in 1991.
"Our proposals bring the policy of community care up to date and will improve the way in which it is put into practice on the ground. Community care is no longer primarily about providing an alternative to long-stay hospital care. The vast majority of people needing care have never been, nor expect to be, in such institutions. The policy aim now is to strike the right balance between home and day care on the one hand, and residential and nursing home care on the other, while reserving hospital care for those whose needs truly cannot be met elsewhere. The changes we propose will for the first time ensure that all public monies are devoted to the primary objective of supporting people at home wherever possible. They provide a solid basis for the future, and are founded upon the principles of preserving individual independence, freedom of choice and providing services in a sensitive and personal way. I believe they deserve wholehearted support, and I commend them to the House".
My Lords, that concludes the Statement.
4.57 p.m.
Lord Ennals: My Lords, I thank the noble Lord for repeating the Statement. It must be a great relief for him to be able to do so because, by my calculation, he himself, and his noble friends Lord Skelmersdale and Lord Hesketh, have on 21 occasions used variations of the word "soon" regarding when the reply would come.
The Statement was a very important one, and I must say that I welcome the general thrust of what has been said this afternoon. We welcome the Government's decision to rethink their attitude to Sir Roy Griffiths' proposals, and hope that this may also apply to the ill-considered proposals for the reform of the National Health Service. Hope springs eternal!
Is the noble Lord aware that our satisfaction and our broad acceptance of the Government's broad

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acceptance of Sir Roy Griffiths' proposals is somewhat clouded by irritation and, at times, anger at the incompetent manner in which this matter has been handled by the Government? Bearing in mind the urgency of the problem, the very great increase in the number of elderly, the increase in the number of patients being discharged into the community from long-stay hospitals and the rapid expansion in the number of homeless people, how can the Government justify a 17 month period of consideration of an issue as important and urgent as this? Everone else found time to reach their conclusions. During the period when Ministers sat on this report, the Secretary of State wrote a whole White Paper which has thrown the National Health Service into some chaos and confusion and, of course, into a massive rejection by the public.
What a contrast between the tortoise-like speed of the consideration of this important report and the kind of race track speed at which the Government have handled the White Paper. Even now, it seems to me that the Government show very little sense of urgency, despite the fact that the number of over-85s has exceeded by 10 times the proportion of people attending day hospitals for the elderly; and that over the past 10 years 25,800 long-stay patients were discharged from mental health hospitals, while only 2,230 extra day care places were provided for them in the community, and only 4,000 extra residential places. At a time of greatly increased need for community care provision, those places are at present grossly under-funded. Of course, there has been a great increase in expenditure, but this is largely based on the growing needs of the population which have required additional expenditure.
I wish to put a number of questions to the Minister for his response. First, I note what has been said about the discharge of severely ill people from hospital only when adequate measures of social and medical care are available. Great concern has been expressed in this House about discharges from psychiatric hospitals into the community when provision was not available. Broadly, we welcome the decision, but I hope that it will not mean simply imposing a brake on the closure of psychiatric hospitals when what is needed is a great increase in the availability of community care services in order that we may effectively transfer people into the community.
Secondly, yesterday was the third anniversary of the passing into law of the Disabled Persons (Services, Consultation and Representation) Act. Several provisions of that Act have not yet been implemented. Will the noble Lord say something about the timetable for the implementation of the remainder of that Act, some parts of which are very urgent?.
Thirdly, we welcome the appointment of the local authority as the lead agency for community care. Do the Government still propose to remove from the new health authorities representatives of local authorities? In view of the new confidence in and challenge to local authorities, should the Government not drop the very mean proposal that under the new reorganisation local authorities
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should no longer be represented on local health authorities? I hope that they will look at that matter very seriously.
Fourthly, why have the Government decided to discourage local authority social service departments from providing their own community services? I do not really understand the Secretary or State's motive. Is there any evidence that their standards are lower than those of privately provided services? My own impression is that it is the other way round. How can local authorities set high standards if they are not themselves to be responsible for providing their own services? Surely it is a matter of both enabling and providing, not one rather than the other.
Fifthly, what about the Griffiths proposal for a Minister for Community Care? That was one aspect of Sir Roy's recommendations which gained support from all sides. Not a word was said about it in the Statement. I hope that the noble Lord can comment on that proposal.
Sixthly, what is the Government's policy in respect of helping the carers at a time when growing responsibility, recognised by the Secretary of State in his Statement, is falling on families and their friends to care for the elderly and infirm, often involving, as he said, very great sacrifice? His thanks are welcome, but some of them need money. At present there are 150,000 carers of disabled people who now find themselves £5 a week worse off as a result of recent government action. There is an increasing number of elderly, frail arid handicapped people who are now unable to pay nursing home fees because of social security cutbacks. Some of them have already had to delve into their savings and some are frightened that they may have to leave. That is very bad for people in that position. Complaints were made by Age Concern only today on that score.
Seventhly, and most importantly, there is the question of the provision of funding for the community care programme. I noted that the Secretary of State said in his Statement that the two sources of funding—from social security offices and local authority budgets—are to be brought together. That is broadly to be welcomed. There is merit in a unified source of funding. It is difficult to comment until we have full details and until your Lordships have seen the Statement which was apparently also made today by the Secretary of State for Social Services. However, we on this side of the House must be satisfied that local authorities will receive funds which are adequate to meet the new responsibilities. It is no good putting a new pattern into place if the local authorities are to be starved of funds to enable them to fulfil the task. That is the situation at present and we must have assurances on that score. The discussions which are to take place with local authority associations are extremely important.
Eighthly, I welcome the announcement following the report of Sir Roy Griffiths and Lady Wagner on the registration and inspection of residential care in nursing homes and other accommodation. Will there be some national system of inspection and national standards, or will it simply by a system of local standards? It is important that private care provision

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must come up to the same standard as public and voluntary organisation provision. We must make a great effort to maintain high standards. At present I am very worried about some of the provision made in the private sector, although very substantial profits are made.
My final question concerns the timetable for the White Paper and for legislation. It is of crucial importance that as soon as the White Paper is published we should have the opportunity for a debate in your Lordships' House. As I have said, it is a very important Statement and there is a great deal of information which we want to absorb. I should like to know whether we will have a debate and whether the legislation to bring these proposals into effect will be introduced at the same time as the proposed legislation on the reform of the National Health Service. The two go together and I would expect that the legislation for both would come together.
Baroness Seear: My Lords, I should like to say from these Benches how much we also welcome the Statement given to us today. I can only say, better late than never. I shall not digress on the very large number of times that we have asked when the Statement was coming; I shall merely say that I am delighted that it has now arrived.
In the main the contents are very acceptable. We are very glad indeed that the Government have decided to place the responsibility with the local authorities. If ever there was a job which should appropriately be done by local authorities, with their local knowledge, ability to rally local support and to keep in touch with local voluntary organisations, it is in the area of community care. We have felt all along that that was where the responsibility should lie and we are very glad indeed that the Government have now made up their mind along those lines. Of course it is recognised that that job has to be done in full consultation with the health authorities.
We welcome the idea that there should be individual assessments of need by one authority so that there will be one department in the local authority ensuring that once the assessment is made the provision is available and the needs of individuals who have been assessed will be met. One can see from the proposals put forward, echoing as they do the proposals in the Griffiths Report, that the machinery can be brought in at last to ensure that a programme of care for the individual is mapped out, that care is provided, and, of the very greatest importance, that the services that are being provided for people who need care will be inspected.
Unlike the noble Lord, Lord Ennals, I very much welcome the fact that use is to be made of voluntary organisations and the private sector, provided always that inspection standards are suitably high. As I read the Statement, it does not rule out the provision of care by local authorities. It merely says that in addition to local authorities making their own provision, care can also be provided by the commercial and voluntary sectors.
While welcoming that fact, perhaps I may add that from the point of view of the voluntary
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organisations, if care is to be provided by voluntary organisations there must be adequate funding. To take the approach—welcomed on these Benches—of using a variety of resources to meet the needs could be a disaster unless money is provided to ensure that it is done properly. From experience in other areas in which voluntary bodies are asked to collaborate and provide services, it is clear that they must have an assurance that money will be available over a reasonable period of time and that there will not be frequent changes in the way in which it is made available.
Nothing is more devastating from the point of view of the voluntary organisations—we have had so much of this over recent years—than for them to be encouraged to provide services and to put resources, effort and enthusiasm into them only to find, six months, nine months or a year later, that the financial arrangements have altered. There must not be continuous chopping and changing about provision. Voluntary organisations must be given confidence to know that there will be adequate money and that that will be sustained over a proper period of time.
There are one or two points upon which I should like further clarification, although I think that, from the wording of the Statement, the Government are not absolutely clear as to how they intend to handle the matter themselves. The Statement says that the new provisions will not apply to people at present in residential care. I am looking for the appropriate page of the Statement.
Lord Henley: My Lords, will the noble Baroness give me the paragraph number?
Baroness Seear: My Lords, that is what I am looking for. If I could find it, I should be only too delighted to give it to the noble Lord. I have read the passage three times so I am absolutely certain that it is there. Perhaps the noble Lord, Lord Ennals, can find it. It is a rather important point. I shall come back to it in a moment.
Another point on which we seek clarification is the provision for the mentally ill. The Statement says:
Here, as in other areas, we have concluded that the right course is to ensure that existing responsibilities are discharged effectively … discharges of seriously mentally ill people from hospital will take place …".
That is fine, but the responsibility is to be through the health authorities. The Statement goes on to say:
"the grant should be payable by health authorities, acting as my agent, on the basis of plans and targets put to them by the relevant local authorities."
Will the Minister explain the relationship between the health authorities and the local authorities in the area of people discharged from mental hospitals? There is a clear distinction between that and the way in which one handles other cases. The funding will be different in that it is payable to the health authorities, yet the local authorities still come into the matter. I do not know whether the Minister is in a position to make clear how that mechanism will work. I do not think that it is clear in the Statement. Perhaps it has not yet been fully worked out. Again,

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providing care for mentally ill people is an expensive business. Will the funding be on the same scale or greater? May we be assured that it will be adequate when people move out of mental hospitals? That is an important point.
Lord Ennals: My Lords, the passage to which the noble Baroness referred previously is in paragraph 13.
Baroness Seear: My Lords, I thank the noble Lord, Lord Ennals. That is what one calls comradeship.
Paragraph 13 states:
"We attach great importance to securing a smooth transition … We therefore propose that the new arrangements for social security benefit entitlement will apply only to people not already in residential or nursing home care".
What does that mean? If those people come out, who will provide for them? Presumably, if they are already in a home, some of them will come out. Are they excluded from the new provisions even when they come out? That does not appear to be clear from Paragraph 13. Perhaps the Government have not fully worked it out; but we shall need to know about that because it is an important point. It seems to me that, as the provision is worded at the moment, such people are excluded from the provisions. The new arrangements will apply only to people not already in residential or nursing home care. Will the Minister clarify that point?
However, having said that—in a somewhat confused way, I fear—I should say that we welcome the proposals. We are glad that they have at long last come forward. We hope that they can be brought into force with great speed. I should like to echo the point raised by the noble Lord, Lord Ennals; namely, is the question of a Minister for community care to be considered? Finally, surely this is a subject on which we need to have a debate, rather than having a quarter of a debate now.
5.15 p.m.
Lord Henley: My Lords, I thank both the noble Lord, Lord Ennals, and the noble Baroness, Lady Seear, for their generous remarks in generally welcoming the Statement. I am pleased not to have to use the words "soon" or "shortly" for the moment. I imagine that the same would apply to my noble friends who have also used those words. There has been a delay, but the noble Lord knows that community care is a complex and sensitive area in which a number of departments have a keen interest. We need to take a broad and considered view of government policy.
We are now clear that the proposals outlined in the Statement offer the best way forward. I shall try to deal with quite a number of the points made by the noble Lord. I believe that there was a total of nine.
Lord Ennals: My Lords, I believe that there were 10.
Lord Henley: My Lords, I suspect that I might have missed some—I counted nine—but I shall try to cover them all.
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The noble Lord spoke about the discharge of the severely ill. Perhaps I may say in passing that there will be an announcement about further initiatives very soon. For once, I can tell the noble Lord what the word "soon" means. My honourable friend the Parliamentary Under-Secretary of State, Mr. Freeman, will make a speech tomorrow to the National Schizophrenia Fellowship in which he will outline the Government's new initiatives for the care of the mentally ill. There is at present no intention to change policy or rein back on the closure of psychiatric hospitals. We intend to encourage local authorities to play their part in that process.
The noble Lord, Lord Ennals, raised the question of residents who cannot meet the fees in nursing homes because of cuts in social security. The level of social security benefit is a matter for my right honourable friend the Secretary of State for Social Security. I know that the rates are sufficient in the majority of residential care and nursing homes. My right honourable friend looks at them each year and I am sure that he will review them in the course of events.
The noble Lord was also worried about the question of local authorities' own homes. I was pleased to have some support on that matter from the noble Baroness, Lady Seear, who, I took it, understood that we still accept the fact that local authorities should run their own homes if they so wish. However, they should be encouraged to make use of the private and voluntary sector. We are not making any change to the existing arrangements for people in local authority homes. We are simply encouraging local authorities to beef up their community care domiciliary services in the other sector.
Both the noble Lord and the noble Baroness asked about the recommendation in the Griffiths Report that there should be a Minister of State with special responsibility for community care. We feel that that is unnecessary at the moment. Clearly, the Minister of State for Health already has that responsibility and we feel that there is no need to create a new ministerial post.
The noble Lord also said that carers were badly off as a result of social security. Aain, that is a matter for my right honourable friend. I am sure that he will take note of the noble Lord's comments. The idea behind the social services departments presenting a package is that they can obviously take into account the needs of the carers as well as those of the clients in setting up that package. Obviously, that is a relevant matter.
The noble Baroness mentioned voluntary organisations. I was pleased that she gave credit to the important contribution that they make. We are in a new and exciting climate in which we hope that they will collaborate with county councils and other social services departments in a meaningful way.
The noble Baroness also asked about the specific grant. The intention is to encourage Focal authorities to build up their mental illness services from a low basis and to ensure that the development of their services will be consistent with health authority plans. Health authorities will administer the grant. The grant is not intended to cover all costs—"pump

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priming" I think would be a better word. The level has not yet been decided and will be discussed in the White Paper.
Both the noble Lord and the noble Baroness asked about the timetable of the White Paper which will be published in the autumn. As noble Lords will understand, whether or not we have a debate on that White Paper is a matter for the usual channels. However, I am sure that the usual channels will take note of the extensive interest on this matter in the House.
With regard to the matter of legislation, noble Lords will appreciate that I cannot pre-empt the Queen's Speech.
No doubt I have missed out some points but perhaps I could now say a brief word on funding, although I cannot be very specific. There will be a transfer of funds from central to local government to ensure that the local authorities have adequate resources to carry out their new responsibilities. That means that we shall transfer to the local authorities the resources that the Government would otherwise have provided to finance care for those receiving social security payments in residential care and nursing homes. The transfer of resources will allow for the projected growth in the number of people needing support. Detailed financial implications will be discussed with the local authority associations.
Perhaps I may turn now to paragraph 13, which was causing the noble Baroness some confusion; I thought that it was self-explanatory. Those who are in residential homes at the moment will not lose out because of the new arrangements. Also, those who are there and paying for themselves but who later need support will be protected. It only affects people who go in after the scheme has been set up.
I hope that I have answered Most of the points that have been raised. If not, I shall write to the noble Lords covering any points that I have missed.
Lord Renton: My Lords, perhaps I may first say that the Statement is very welcome, although one will need time to consider the details of it because as Statements go it was very long. I wonder whether my noble friend can give some broad idea as to whether the proposals will lead to a reduction in the number of mentally handicapped people—I am not talking of the mentally ill, but the mentally handcapped—in long-stay hospitals of whom there are still several thousand.
Lord Henley: My Lords, I can only say that we shall continue our existing policy. Where possible we should like to see people coming out of long-stay hospitals. Obviously if mentally handicapped people had been in a long-stay hospital for such a length of time that it would not be a satisfactory care solution to allow them back into the community, then they would stay in the hospital.
Lady Saltoun of Abernethy: My Lords, I too am delighted that after 16 months' brooding the Government have at last hatched this egg. In view of the enormous increase in the cost of residential
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care and nursing homes and the Government's declared aim of keeping people in their own homes so far as is possible, will they make sure of providing local authorities with adequate and if necessary earmarked funds for paying for personal alarms for the elderly and disabled in their own homes in cases where alarms cannot be afforded now that they can no longer be charged to housing benefit?
Incidentally, can the noble Lord say whether in fact the additional funding that the Government will supply to local authorities for implementing the Griffiths Report will be earmarked? Finally, could he possibly say how the hospices will fit into this scheme?
Lord Henley: My Lords, the noble Lady asks about personal alarms. Obviously this will be a matter for the social services departments to consider in relation to all their other home care services. It is the home care services that we wish to see expand. If it is felt that they would make it easier for people to stay in the community, then obviously personal alarms could be of great benefit.
The noble Lady also asked about hospices. Currently the position of hospices is the subject of separate consideration and they will not be affected by the proposals announced today.
Lord Mottistone: My Lords, I too should like to thank my noble friend very much for this Statement which I think is good so far as it goes. I should also like to congratulate him and his right honourable and honourable friends on producing the Statement before the Summer Recess. At one moment it seemed that we might not have it and I like to think that perhaps my Schizophrenia After-Care Bill had some effect in hurrying it up.
I am also most grateful to hear that his honourable friend Mr. Freeman will be addressing the National Schizophrenia Fellowship; he will make a Statement on the detail as regards the severely mentally ill which is still awaited. I hope that the not so severely mentally ill will also be included. The term covers a wide range of people and I hope that he will not be as restrictive as that. In general I welcome what we have heard today.
Lord Henley: My Lords, I thank my noble friend for those remarks. I do not know what my honourable friend Mr. Freeman will be saying. However, knowing the noble Lord's interest and having listened carefully to the discussions on his Schizophrenia After-Care Bill when it was going through this House, I think it very likely that tomorrow he will be there to listen to my honourable friend's speech and take note of what he says.
The Lord Privy Seal (Lord Belstead): My Lords, this has been a very long Statement and it is quite understandable that the House has wanted to take the length of time that it did to discuss it. Nevertheless, we have been discussing it for half an hour. Perhaps I may suggest that we now take the next intervention, that of the noble Lord, Lord Seebohm, and then pass on to the next business.
Lord Seebohm: My Lords, I shall be brief. I speak in my capacity as president of Age Concern. The announcement that we have heard today comes as a very great relief to me and, I am sure, to all my colleagues in Age Concern. My main worry is whether we shall have sufficient funds to undertake all the training and retraining that will be necessary as well as the other facilities that will be required in setting up this new system. I think that that will be very important.
It may be of some small interest to the House to learn that after nearly 20 years on the 24th of this month I shall be handing over the presidency of Age Concern to Sir Roy Griffiths.
Lord Henley: My Lords, I thank the noble Lord for his comments. As regards funding, I cannot add to what I have already said. We spend a great deal on community care, and funding has been rising steadily throughout the past decade. Of course, Her Majesty's Government will ensure that adequate funding is made available.
Lord Winstanley: My Lords, I should like to put two brief and specific questions to the noble Lord before we proceed to other business. First, since local authorities will be given the resources to provide community care rather than merely the opportunity to take the blame for community care not being provided, does he think that it would be helpful if a named and known local government officer were to be made responsible for this work? If so, does that mean that there is now a case for restoring the old and much respected office of medical officer of health in local government? The medical officer of health carried out many of the new functions which the noble Lord has just described, saying that local authorities will have to undertake them.
Secondly, can the noble Lord confirm the new arrangements for ensuring that mentally ill patients are not discharged from hospital until the community care arrangements are in place? Will those new arrangements come into force tomorrow, after the Minister speaks, or will they have to wait until 1991?
Lord Henley: My Lords, with regard to the noble Lord's first question, I should have thought that what they call the officer is a matter for the local authorities. In my view the title director of social services is just as good as chief medical officer but I leave that matter to the local authorities.
So far as concerns discharges from hospitals, I can only repeat that the position remains the same. No one should be discharged from hospital until adequate care arrangements are available. That has always been the case.

Social Security Bill
5.30 p.m.
Consideration of amendments on Report resumed on Clause 9.
Lord Stallard Lord Stallard moved Amendment No.. 2:
Page 9, line 16, leave out ("paragraphs (a) and (aa)") and insert ("paragraph (a)").
The noble Lord said: My Lords, it might be for the convenience of the House, and certainly in the interests of time, if I were to link my remarks with Amendment No. 4.
We all accept the changes in Clause 9 to extend the age limit, although we have reservations on how far we extend it. However, the extension principle was welcomed. In my amendment I am concerned to abolish the age of 65 on first qualifying for mobility allowance. I should like to see. the 65 age limit abolished. The present rules create the ludicrous situation by which someone becoming disabled the day before his or her 65th birthday may receive mobility allowance for the next 10 or 15 years. But someone receiving precisely the same injuries the day after his or her 65th birthday will receive no benefit whatever. It is an anomalous and ridiculous situation for such people. I can find no logic or justification for that situation. It does not cost a person aged 65 and a day with disabilities any less to cope with those disabilities than it costs someone who is younger. Nor does it matter less to the older person to be able to get about because he is a day over 65.
I am particularly distressed at this assumption. It goes against all current trends in discussions that we are having on ageism. The assumption underlying the imposition of the upper limit on eligibility for first claims is that disability in old age—"old age" being 65—is the norm. That is not an assumption that has been accepted by people who are at this moment studying ageism from a more positive stance than hitherto. There is a school of thought, to which I subscribe, that does not accept that mobility requirements decrease at the age of 65. People are quite capable of performing a very useful, productive function in society long after 65. It is long after 75 for some. I look around me if I need proof of that. Noble Lords are mentally fit, active and alert but they may be a little unsteady on their pins. They are no less mentally alert and fit after 65. I therefore say that the 65 upper age limit goes against the trend. It is against the Government's stated policies.
As I understand it, the Government would like to enable elderly people to maintain maximum health and independence in later life. That is what it is about.
One may say that "later life" stops at 65. But one cannot say both. One cannot say that one is in favour of maximising independence and mobility in later life and then put a stop on it at the age of 65. That emphasies that life stops at 65 for social security legislation. I believe that the upper age limit of 65 is an anomaly. I suggest that it ought to be abolished. I hope that the House will accept this very modest amendment.
I sometimes become a little worried about discussions that take place on social security in your Lordships' House. I sometimes think that I am discussing a finance Bill rather than a Social Security Bill. The tendency seems to be to discuss finance first, second and always. If there is anything left, then we talk about compassion, but only in passing.

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The main aspect is finance. How much will it cost? How much can we save? How much have we got? I am a little worried that we have the matter a little out of balance. Of course there has to be consideration of finance. One would be a fool if one did not accept that. One has to accept and understand that. One has to act within certain restraints. However, within those restraints we ought to be able to discuss priorities and to consider them and not all the time to be saying, "That is that. There will be no bother. We shall not budge."
It might be more honest if the Minister sometimes were to stand up and say, "I have to tell you before we start this Committee that I am under instructions to accept no amendments that cost more than the price of a first-class stamp. Therefore you are wasting your time if any of your amendments will cost money." That would be the honest situation. I become very depressed when I feel that atmosphere developing in a Committee.
I hope that it will not be the criterion this time. I hope that the Government will seriously consider this amendment in the light of current thinking on ageism on people over 65, and that they will see fit to accept the amendment. I beg to move.
Lord Skelmersdale: My Lords, the amendments in the name of the noble Lord, Lord Stallard, seek to extend mobility allowance to enable people to claim it at any time up to age 80, which he has just explained. The age limit of 80 for the payment of the allowance which we propose in Clause 9 would still apply.
I do not ever recall mentioning in Committee the subject of money. Indeed I was congratulated on the fact on several occasions. In fact I have the feeling that the noble Lord, Lord Stallard, did so himself. However, I do not think that one can go through a Social Security Bill without mentioning the subject of money. It is right that the noble Lord, Lord Stallard, should himself have requested a balanced approach with regard to money and other reasons for accepting or not accepting a particular amendment.
It was exactly because of money that when the noble Lord, Lord Ennals, introduced the mobility allowance he said that there would be an upper age limit for claiming mobility allowance. That has been maintained ever since. We estimate that the extension such as the noble Lord, Lord Stallard, requests would be very costly. The reasons for this are clear; locomotion disabilities are by far the most common of all disabilities, and their prevalence increases dramatically with age.
I should like to remind your Lordships of the figures from the OPCS disability surveys which I quoted in Committee. These show that the prevalance of locomotion disabilities is 31 per 1,000 in the 15 to 59 age group; 195 per 1,000 in the 60 to 74 age group; and 464 per 1,000 at age 75 or over.
This means that the proposed amendments would involve significant extra costs. We estimate that to extend the age limit in the way proposed would initially cost around £400 million a year with a steady rise well beyond that in the following years. In the light of the OPCS findings, it would not be appropriate to incur such large additional
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expenditure in advance of our examination into the benefit system. I have mentioned the cost implications of the epidemiology of ageing, which mean that we cannot dismiss the rule which allows people to claim mobility allowance for the first time only for disability incurred before the age of 65.
There is also a very good practical reason, even though the noble Lord, Lord Stallard, in his short speech called it anomalous. The age limit is less arbitrary than it may seem. It is disability incurred during working life which casts the longest shadow because if it affects earning capacity, it affects people's capacity to save and to build up pension rights and to prepare for an old age in which sober realism indicates to us that reduced mobility is very likely. Mobility allowance therefore continues to be available to claimants disabled up to age 65 with a further year's grace in which to claim.
We shall of course have to consider what effect another part of the Government's programme has on this issue. It is the abolition of the ernings rule, and indeed the intended changes—when we make concrete proposals in legislation—for the equalisation of pension age, to which we are committed. For the moment I would say that we appreciate that there are difficult cases among people who find themselves just on the wrong side of the dividing line. But that will happen wherever a dividing line is drawn. In seeking to mitigate the effect of any dividing line, we have to consider whether the group in question does indeed have the highest priority for the resources available to us.
From what I have said, the House will realise that I am firmly persuaded that these are not matters which can be resolved here and now in response to these amendments. I must urge your Lordships that this must wait until after everyone concerned—I refer now to the list I mentioned at the end of the last amendment—disabled people's own organisations. government and parliament—have had the opportunity to consider carefully all the information which is now becoming available from the OPCS surveys. In the circumstances, although I have some sympathy with the noble Lord, we believe that this requires a lot more study. I am grateful to him for raising the issue.
Lord Stallard: My Lords, I am grateful to the Minister for his reply and the detail that he has mentioned. I deliberately mentioned in my remarks the current approach to ageism and age. The Minister's reply simply restates old myths: that 65 is the dead end. There is a great school of thought that accepts that age expectancy is far longer now than it was when the noble Lord, Lord Ennals, first introduced his mobility allowance. That is a factor that has to be taken into account. The pension rules, the discussions and arguments and the implementation in some places of flexible retirement means that people can work beyond 65 and can become injured beyond 65. They could qualify for the mobility allowance in all kinds of circumstances beyong 65. Therefore that must be taken into account.
The earnings rule means that many more people will be encouraged to work beyond 65. One of the

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Government's aims in abolishing the earnings rule is to allow older people who are fit and active to return to the workforce because of the shortage of youngsters. All these factors will have to be taken into account when we discuss positively our approach to the problems of the elderly. The Minister's reply could have been given to the original discussion in the 1970s when it was first raised. It is totally out of date with modern thinking and modern conditions. The only straw that the Government can clutch at is that the Minister says that there will be a review and that they will be thinking about this in the course of the surveys that are taking place. They are latching onto that. I accept that in good faith, and I shall wait until I see the results of that. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.45 p.m.
Baroness Jeger Baroness Jeger moved Amendment No. 3:
Page 9, line 17, leave out ("80") and insert ("85").
The noble Baroness said: My Lords, I hope that the Minister will believe me when I say that I am trying to help him. We find that it is extraordinary that there should be an upper age limit for the mobility allowance. As the Government have agreed that the age limit should be raised from 75 to 80, that seems to indicate to my simple mind that the Government do not have a philosophical objection to 80 year-olds driving.
I have put down the amendment suggesting the age of 85 rather than repeating the arguments for abolishing it altogether because I know that the noble Lord thinks in what I believe the other day he called quintiles. By suggesting this increase to 85 I was trying to come to terms and not to be absolute in the amendment.
Another affection which the Minister seems to have for quintiles was when he indicated in his reply at Committee that:
"However, taking up the point we made on the previous amendment, we have a five-year period before we need to make a further change".—[Official Report, 22/6/89; col. 355]
Although the Minister might have a five-year period, all we old people probably will not have a five-year period before there is a change. It seems to me to be rather illogical to expect people to look forward in their old age to the Minister's words and think that perhaps it will be all right for me in another five years. That is not what life is like. It does not seem to have any logic or sense. I do not want the Minister to tell me how much it will all cost because we have heard enough about that this afternoon. I suggest that when he is having his discussions he will bear in mind that perhaps there is not a great deal of logic or sense in the proposal to give a five year increase. It would be much more generous and much more popular and kindly, as I know the Minister always likes to be, if he could see his way to further increases in the age allowance for this mobility allowance. I beg to move.
Lord Skelmersdale: My Lords, I appreciate that the amendment in the name of the noble Baroness
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seeks to make only a modest improvement to what we are proposing in Clause 9. I am grateful to her for that. In effect, it doubles from five to 10 years the proposed extension of the age limit up to which mobility allowance can be paid to those who have already qualified for it.
When we brought forward our proposal to extend the current limit from 75 to 80, we made it quite clear that it was an interim measure to prevent the oldest recipients of the allowance losing it from next November which otherwise would have happened. The five-year extension will give us more than enough time to consider the findings: of the OPCS disability surveys and to bring forward our long-term proposals and to implement them.
The noble Baroness groans, which gives me a clue at least to her thinking, which sometimes I do not get through any other method. But the fact is that it is over five years from today that elderly people will under the Bill stop drawing the allowance. Therefore it gives us a breathing space which I described earlier today and in Committee as more than enough time to discover where we go from here and how.
The five-year extension gives elderly recipients of the allowance the full opportunity to plan ahead for their mobility arrangements, in the knowledge that they will not lose their payments, which they will have been receiving for 10 years or more. The possibility of more far-reaching changes, and the age limits in particular, will, as I said to the noble Lord, Lord Stallard, figure very largely in our thinking on the review.
If it is any help to the noble Baroness—and I suspect it is not, which is why I am saying it—a quintile of 80 is 16.
Baroness Jeger: My Lords, before the noble Lord sits down, can he assure me that when I am 81 I shall not lose my mobility allowance? That might be very soon.
Lord Skelmersdale: My Lords, the noble Baroness will not qualify, because as we discussed on the last amendment she was not eligible before she was 65.
Baroness Jeger: Yes, my Lords, that is another bad thing. In view of the explanation and the interesting discussion which we have had, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 4 not moved.]
Clause 10 [Extension to personal pensions of occupational pension provisions relating to the abatement of unemployment benefit and the meaning of "earnings".]:
[Amendment No. 5 not moved]
Clause 11 [Unemployment benefit: requirement to seek employment actively.]:
[Amendment No. 6 not moved.]
Baroness Jeger Baroness Jeger moved Amendment No. 7:
After Clause 12, insert the following new clause:
("Prescribed circumstances.
. In section 35(2) (attendance allowance) of the principal Act, after the words 'and (b)' there shall be inserted the words 'except in such circumstances as may be prescribed'.").
The noble Baroness said: My Lords, we put down this amendment because we hoped that some ideas might be contributed towards the difficult matter which we discussed at Committee stage in relation to an amendment moved by the noble Duke, the Duke of Norfolk, which concerns whether we ought to keep the six-months' rule for attendance allowances.
Your Lordships will recall that attendance allowance cannot be claimed by people who need total care unless they have been in that situation for six months. There are various complications about this sensitive matter. All of us on this side appreciated the Minister's approach. I say that in all seriousness.
We have had some discussions with the people concerned. It seems that the problem falls into two parts. There are those about whom great anxiety was expressed who do not survive six months after the diagnosis of their terminal illness.
This is a very difficult matter to translate into some legalistic formula. I know from my experience in our practice how one has very carefully to decide how to tell people that they are terminally ill. How does a doctor tell someone that they have not got six months, or that it will only be five months? How will the family react? How will the patient react? It seems to me that if we make an amendment to the attendance allowance regulations to give a definitive description of the unlikelihood of the patient surviving six months, that might be very difficult in some cases.
The second group of people about whom I am worried are those who have an acute illness which does not last for six months. It might be a stroke which incapacitates them for four or five months. During the whole of that time they might need total care, as set out in the previous legislation, but they cannot get it because they have not been ill enough for long enough. I have known cases of terrible traffic accidents where people have been totally incapable for three, four or five months. But, thanks to advances in medicine and treatments, they make a recovery. However, for the whole of the interim period of their very acute and serious illness we say, "You can't have an attendance allowance, you've got to linger on. If it lasts for six months, you will get it". I know that it is easy for noble Lords to say that we brought in the six months rule. The attendance allowance was introduced by the Labour Government, there was no such thing before we introduced it. I have a feeling however that social security allowances should all be looked on as growing provisions and that many changes occur in society. We all ought to have second thoughts on how things work out.
I think it was Emerson who said:
"…consistency is the hobgoblin of little minds".
Maybe we can be inconsistent this afternoon and say that we are not tied to the six months rule, we wish it had been revised before. I appreciate all the difficulties which face the Government in trying to deal with these very complicated, personal problems.
In putting down the amendment it seemed to me that rather than trying to prescribe the kinds of situations, illnesses and circumstances involved, the prospects of life or death of the people involved, perhaps we could give the power, as the amendment says,
"except in such circumstances as may be prescribed."
Then we shall not be putting labels on people or making it a very legalistic matter.
I hope the noble Lord, Lord Trafford, will forgive me, in that again we are putting more work onto the doctors who can look at the provisions as set out in the previous legislation, which defines very closely the general state of patients who have to be in need of attendance. Then, perhaps at a later stage, we could find some form of words that would deal with these difficult problems. It is in that spirit that I move the amendment.
Baroness Faithfull: My Lords, if I remember rightly, at the last stage of the Bill my noble friend the Minister was very sympathetic to the whole matter of the recommendations made by the hospice movement. He said that he was willing to consider them and bring the consideration to the fore. I think that we have all received representations from the hospice movement that this is something, not of an emergency, but that cannot wait all that long, perhaps it cannot wait for another social security Bill next year. Therefore I wonder whether my noble friend the Minister would address his mind to a proposal being put forward, such as the noble Baroness has suggested.
Lord Skelmersdale: My Lords, I am most grateful for the explanation of the noble Baroness, Lady Jeger, about why we have been asked to consider the amendment today, and for the great sympathy which she showed in moving it. I hope that from what I said in Committee noble Lords understand that I share that sympathy. Nevertheless, I must admit that I remain uneasy both about the purpose and the timing of the amendment.
As regards consistency, I am about to demonstrate an inconsistency in that what I say now is rather different from what I was able to say in answer to Amendment No. 1. As my noble friend Lady Faithfull has pointed out, I am sure that we all remember vividly the debate in your Lordships' Committee on 22nd June about the problems of terminally ill people who satisfy the disablement criteria for attendance allowance, but who die before the six months qualifying period is complete. At the end of that debate I gave a clear declaration that the legislation necessary to tackle these problems without a six months qualifying period will be laid in the next social security Bill and that it will be implemented as soon as is practicable, after Royal

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Assent to that Bill. I could not give that commitment on Amendment No. 1, and I believe firmly that it was that which got me into the gravest trouble. However, never mind.
That declaration was not made lightly; nor was it made as a delaying tactic. As I indicated on 22nd June, we are determined to tackle the problems of the terminally ill. We are also determined that in tackling those problems we get it right. What we need to do is to make sure that we reach all terminally ill people; not just those receiving hospice care, but also those for whom open recognition of death and the support needed cannot be so readily assumed. In a situation which inevitably involves difficult and sensitive judgments and entails an unequivocal statement that a person is dying, we have to ensure that the practical arrangements achieve what is intended and avoid distressing misunderstandings. To make sure that we do get it right, we need time to work out the details. In our estimate the earliest point in time that we can reasonably hope to achieve these objectives is in the next social security Bill.
I realise that there are many people, including Members of your Lordships' House, who would wish us to move very much faster on this issue. I believe that the amendment before us today is intended to do just that. But, sympathetic as I am to these aspirations, I am also concerned with practicalities. In practical terms, the amendment does not move things forward at all. It simply provides an enabling power to exempt people from the six months qualifying period and requires regulations to fill in the details. Whether by primary legislation or by regulations, we cannot move any faster on this issue than the timescale I have already outlined.
With that timescale, it would be premature now to fix the precise form which the legislation will take. It may well be that when we have resolved the practicalities of what we are committed to do for terminally ill people, the legislation will take the form proposed by this amendment. It is equally possible that it may need to be entirely contained in primary legislation. At this stage, we cannot be certain. However, I am certain that we should not, prematurely, be committed to one particular course.
We are firmly committed to tackling the problems of terminally ill people in the timescale I have mentioned. This will give us the opportunity we need to ensure that we make arrangements which effectively tackle the problems in a sympathetic and sensitive manner and which, above all, work. Achievement of these objectives will not be helped or speeded up by this amendment.
Baroness Jeger: My Lords, I thank the Minister for that reply. He constantly referred to the terminally ill, whereas I share the anxiety of many people—as I tried to say in my brief contribution—for the acutely ill, for the survivors who have to endure the six months without help.
In conclusion, I hope that the Minister will put into the melting pot of his thinking that aspect of the problem as well. It is far more complicated and goes well beyond the other problem of the terminally
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ill. I know that it causes great strain and distress in many households where people have to be on the six months probationary period before they receive the help that their relatives or family members need. I thank the Minister for his concern and his promise to go further, and I beg leave to withdraw the amendment in the hope that the Minister will take on board that other, larger, question.
Amendment, by leave, withdrawn.
Clause 13 [Disqualification for unemployment benefit]:
6 p.m.
Earl Russell Earl Russell moved Amendment No. 8:
Page 12, line 12, at end insert ("or
(c) to seek or accept any employment in which, in the opinion of the adjudication officer, his normal earnings would have been so low that his financial circumstances would have deteriorated if he had accepted that employment.").
The noble Earl said: My Lords, I hope that this is an improved version of an amendment which I moved in Committee. The Minister pointed out some drafting faults in that which I have endeavoured to correct.
I cannot do better than to rely on the Minister's own description of the effects of this amendment. He said that,
"this amendment seeks to introduce into legislation the concept that a person should not be disqualified from receiving unemployment benefit if he turns down or fails to follow up an opportunity of employment which would leave urn less well off than if he had been on benefit".—[Official Report, 29/6/89; cols. 875–6.]
In that, I quibble only with the use of the word "introduced". The basic principle of this amendment is one stated by the noble Lord, Lord Joseph, when he was Secretary of State and which most of us believed until recently to be the law. It has come into question as a result of the general tightening up of case law, and the intention of this amendment is for the law again to be what, until very recently, we all believed it was.
I must say that, like the Minister, I am concerned about the total cost of the social security system. I watch what is before us to see whether there are matters which may make the cost rise where there is no need for it to do so. I believe that here we have a case of that sort because, apart from unemployment, one matter which contributes to the high cost of that system is the large number of people who claim benefit while in full-time work—a fact which tends to prove the willingness of most people to work.
I believe that we should notice that during the period of the tube strikes, there has been evidence that the work ethic in this country is very much alive and well. This is not a minimum wage amendment, but is a freedom of choice amendment and, as such, I should have thought that that would be well within the limits of the Government's expressed philosophy.
It is one thing to let people take a job which is below benefit level because they happen to want to work, it is quite another to force them to act against their own economic interests to take a job and to use the threat of deprivation of benefit to make them

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do so. I should have thought that that attempt to make people act against their own economic interests was dead against this Government's philosophy. I believe that there is some reason to think that where people are worse off in work than on benefit, that is a case for saying that wages in that occupation have become too low.
In Committee the Minister expressed doubt about the idea of benefit subsidising low wage jobs. I read what the Minister said several times and I still wonder whether or not it amounts to a contradiction in terms. He said:
"I do not believe that family credit subsidises employers paying low wages. It is there to help working families with children who do not have enough money coming in from their earnings".—[Official Report, 29/6/89; col. 878.]
I should have thought that that was a contradiction in terms, because an economic job should be one which can be taken by a mother or father with children. It is not a living wage unless that is the case. In fact, it is only in the case of part-time work that the Minister's statement would not be a contradiction in terms. If a job cannot pay a living wage, it is an uneconomic job. If we are going to use the benefit system to subsidise uneconomic jobs in a blanket way, that seems to me a colossal commitment to future expenditure. It seems to be a new Speenhamland system coming in here.
I shall take only one case by way of illustration. At present it is claimed by NALGO that 11 per cent. of local government white collar workers are eligible for income support. I know that from these Benches we have often argued for more generous Government treatment of the finances of local authorities. However, is that really the most efficient way to do that—a blanket subsidy to low-wage jobs, regardless of their efficiency and necessity? I believe that that could be done with a great deal more efficiency. In fact, I believe that this is a case where targeting has something to be said for it. I beg to move.
Baroness Turner of Camden: My Lords, I rise to support the amendment moved by the noble Earl, Lord Russell. As he said, the amendment is rather similar to amendments moved from these Benches when the Bill was in Committee, except that we return to it this afternoon having had the benefit of the Minister's reply last time round and, as the noble Earl said, the wording has been amended to take some account of what he then said.
We on these Benches are anxious to avoid claimants being forced into work at sub-standard pay, pay which in effect is being subsidised by the social security system and pay which enables bad employers to offer a rate below that which should be paid for any sort of work.
As we have repeatedly said, the evidence is that most unemployed people are quite realistic about the rates which they are likely to command in the labour market. If they have been unemployed for some time they are significantly less choosy about jobs and, in any event, as we have seen, there are restart programmes, counselling, monitoring and so on to ensure that those people know what they are likely to receive by way of remuneration.
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Why should we not say quite explicitly on the face of the Bill that such claimants may not be compelled into sub-standard employment where they could well be receiving less than they would receive on benefit? Last time we debated this matter the Minister said that,
"we have ensured that in practice nearly everyone is better off in work than remaining on unemployment benefit or income support".—[Official Report, 29/6/89; col. 877.]
Surely that is a desirable objective, but the people who should be ensuring that that is the case are those who are offering employment. I believe that to maintain a system where employers are enabled to employ people at sub-standard rates, rates at which people get into a cycle of deprivation and debt is, in the end, socially uneconomic because in those circumstances such people often present other social problems. They may become ill, and in extreme circumstances—and examples of this have been quoted to me by a number of voluntary organisations concerned in this sphere—there may be instances leading to suicide, and then families have to be taken care of by the social system.
Therefore, I appeal to the Minister this time to accept the revised wording. We have taken on board what he said last time and we think it quite inequitable that people should be forced to accept jobs by the threat of deprivation of benefit, jobs which are at a sub-standard level at which employers are being subsidised by the social ecurity system. I support the amendment.
Lord Skelmersdale: My Lords, that is all very well, but the Bill does not do anything of the sort, as I hope to go on to explain. I should point out that although the noble Earl, Lord Russell, has tried to redraft this amendment, I am afraid that in terms of drafting it inevitably suffers from much the same deficiencies as did its predecessor, but I should not dream of dwelling on that.
The real charge here is that the Government are forcing people into work against their own economic interests. As I said, we are not doing that. Family credit ensures that very few people will be worse off in work than on social security benefits. However, the important matter is that no one will be forced.
While we believe it right that, immediately after becoming unemployed, a claimant should be able to concentrate on looking for work which offers a rate of pay similar to that which he has been receiving—and we are providing that by way of our concept of a "permitted period"—we do not believe that an automatic right to a certain level of pay is helpful thereafter.
We think the present legislation is unnecessarily restrictive and has an adverse effect on the availability of work. Employers seek to recruit the staff they need at rates of pay they can afford. If they cannot recruit staff at anything other than a so-called "rate for the job", this inevitably will have an adverse and unnecessary effect on their ability to develop their business and generate more jobs. The noble Baroness will agree that that cannot be in the interests of employers. It benefits no one.
An employer must be able to take into consideration how up to date are the abilities, skills

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and experience of potential recruits in deciding what pay to offer them. It cannot be right that people should continue to expect to be paid on the basis of a job they left months or even years previously. Nor should they be encouraged to hold out such hopes. I believe the noble Baroness said that the majority of unemployed people do not; but this is a case where we are concerned not with the majority but with the minority who have unrealistic expectations of what they are worth.
Nevertheless, as I have said, recently unemployed people with skills that are still relevant to the labour market and who have experience that is still new can reasonably expect to look for a period of time for jobs in their usual occupation at rates of pay they used to receive. That is why we are allowing a "permitted period" ranging from seven days for only a tenuous link with a particular occupation—for example, a person whose first employment was very recent—to a maximum of three months in which claimants will be able to do just that.
After that period they will be expected to widen their scope but we intend to ensure that people will not be penalised for turning down ridiculous wages. We propose to provide specifically in regulations that good cause for failing to follow up a job opportunity advised to the claimant by the employment service cannot be shown where the failure arises from the claimant's expected financial position. To ensure, though, that unemployed applications for jobs are not taken advantage of by unscrupulous employers we intend to provide, through the regulations, that a claimant will not have to show good cause for refusing or failing to apply for a vacant situation, or refusing to accept such a situation when offered, where he learns of the vacancy from a potential employer.
I can, however, assure noble Lords that the employment service will seek to offer vacancies which are representaive in terms of pay and conditions of employment available in the labour market. They will ensure that the vacancy is one the person can do and fits not only his skills, experience and other qualifications, but also takes account of the length of time he has been unemployed. In addition, claimants will, as now, be made aware of the benefits they can claim when they are in work. Therefore, I believe that both the noble Earl and the noble Baroness are labouring under a misapprehension. I hope I have been able to show that there is absolutely no intention in the Bill of forcing people into work against their own economic interests.
Earl Russell: My Lords, I connot claim to be satisfied with that reply. There is perhaps a misapprehension but I think there may be some question as to where it resides. I could not help wondering, in listening to that reply, whether, whether it was drafted for the amendment in Committee on suitable work. There is no attempt in this amendment to suggest that people should be able to look for a rate of pay that they have had in a specific job. The suggestion is only that they should not suffer a loss
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of unemployment benefit by refusing a job which is below benefit level.
The Minister repeated again the point about unrealistic expectations which has been debated exhaustively already. However, leaving that aside, I find it hard to imagine that for a full-time job it is unrealistic to expect the equivalent of benefit level. That is a very limited expectation indeed. If that is to be classified as unrealistic we are getting dangerously near to returning to the days of sweated labour. I commend the amendment.
6.15 p.m.
On Question, Whether the said amendment (No. 8) shall be agreed to?
Their Lordships divided: Contents, 79; Not-Contents, 129.

DIVISION NO. 2

CONTENTS

Airedale, L.

Kinloss, Ly

Beaumont of Whitley, L.

Lawrence, L.

Blackstone, B.

Llewelyn-Davies of Hastoe, B

Bledisloe, V.

Bonham-Carter, L.

Lockwood, B.

Bottomley, L.

Macaulay of Bragar, L.

Briginshaw, L.

McNair, L.

Brooks of Tremorfa, L.

Mason of Barnsley, L.

Bruce of Donington, L.

Murray of Epping Forest, L

Carmichael of Kelvingrove, L

Nicol, B.

Ogmore, L.

Carter, L. [Teller]

O'Neill of the Maine, L.

Cledwyn of Penrhos, L.

Peston, L.

Cocks of Hartcliffe, L.

Phillips, B.

Craigavon, V.

Pitt of Hampstead, L.

David, B.

Ponsonby of Shulbrede, L.

Dean of Beswick, L.

Prys-Davies, L.

Dormand of Easington, L.

Rea, L.

Elwyn-Jones, L.

Rochester, L

Ennals, L.

Russell, E. [Teller.]

Ewart-Biggs, B.

Ryder of Warsaw, B.

Faithfull, B.

Saltoun of Abernethy, Ly.

Gallacher, L.

Seear, B.

Galpern, L.

Seebohm, L.

Gladwyn, L.

Serota, B.

Graham of Edmonton, L.

Simon, V.

Grey, E.

Stallard, L.

Halsbury, E.

Stoddart of Swindon, L.

Hampton, L.

Swann, L.

Hanworth, V.

Taylor of Blackburn, L.

Hatch of Lusby, L.

Taylor of Mansfield, L.

Hayter, L.

Thomson of Monifieth, L.

Henderson of Brompton, L.

Tordoff, L.

Hirshfield, L.

Turner of Camden, B.

Houghton of Sowerby, L.

Underhill, L.

Hylton, L.

Walston, L.

Jeger, B.

Williams of Elvel, L.

Jenkins of Hillhead, L.

Wilson of Rievaulx, L.

John-Mackie, L.

Winstanley, L.

Kennet, L.

Winterbottom, L.

Kilbracken, L.

NOT-CONTENTS

Alexander of Weedon, L.

Boyd-Carpenter, L.

Allerton, L.

Brabazon of Tara, L.

Annaly, L.

Broadbridge, L.

Arran, E.

Brougham and Vaux, L.

Ashbourne, L.

Butterworth, L.

Beloff, L.

Caithness, E.

Belstead, L.

Campbell of Alloway, L.

Birdwood, L.

Campbell of Croy, L.

Blatch, B.

Carnegy of Lour, B.

Blyth, L.

Carnock, L.

Boardman, L.

Colville of Culross, V.

Borthwick, L.

Colwyn, L.

315

Cork and Orrery, E.

Macleod of Borve, B.

Craigton, L.

Margadale, L.

Crickhowell, L.

Marley, L.

Cullen of Ashbourne, L.

Marshall of Leeds, L.

Davidson, V. [Teller.]

Merrivale, L.

Denham, L. [Teller.]

Milverton, L.

Derwent, L.

Monk Bretton, L.

Dilhorne, V.

Monteagle of Brandon, L.

Dundee, E.

Morris, L.

Eden of Winton, L.

Mottistone, L.

Effingham, E.

Mowbray and Stourton, L.

Elibank, L.

Munster, E.

Ellenborough, L.

Murton of Lindisfarne, L.

Elles, B.

Newall, L.

Elliot of Harwood, B.

Norfolk, D.

Elliott of Morpeth, L.

Norrie, L.

Elton, L.

Nugent of Guildford, L.

Fanshawe of Richmond, L.

O'Hagan, L.

Ferrers, E.

Oppenheim-Barnes, B.

Fortescue, E.

Orkney, E.

Fraser of Carmyllie, L.

Orr-Ewing, L.

Fraser of Kilmorack, L.

Pender, L.

Gainford, L.

Peyton of Yeovil, L.

Gardner of Parkes, B.

Pym, L.

Goold, L.

Rankeillour, L.

Greenway, L.

Rees, L.

Haig, E.

Renton, L.

Hailsham of Saint Marylebone, L.

Renwick, L.

Rippon of Hexham, L.

Hardinge of Penshurst, L.

Rodney, L.

Harmar-Nicholls, L.

Sanderson of Bowden, L.

Harvington, L.

Savile, L.

Havers, L.

Selborne, E.

Henley, L.

Sharples, B.

Hesketh, L.

Skelmersdale, L.

Hives, L.

Stodart of Leaston, L.

Holderness, L.

Strange, B.

Home of the Hirsel, L.

Strathclyde, L.

Hooper, B.

Thomas of Gwydir, L.

Hylton-Foster, B.

Thomas of Swynnerton, L.

Ingrow, L.

Torrington, V.

Jenkin of Roding, L.

Trafford, L.

Johnston of Rockport, L.

Tranmire, L.

Joseph, L.

Trefgarne, L.

Keyes, L.

Trumpington, B.

Killearn, L.

Ullswater, V.

Lauderdale, E.

Vaux of Harrowden, L.

Liverpool, E.

Westbury, L.

Long, V.

Wise, L.

Lucas of Chilworth, L.

Wynford, L.

Lyell, L.

Young, B.

McFadzean, L.

Young of Graffham, L.

Mackay of Clashfern, L.

Zouche of Haryngworth, L

Resolved in the negative, and amendment disagreed to accordingly.
6.23 p.m.
Lord Carter Lord Carter moved Amendment No. 9:
After Clause 13, insert the following new clause:
("Invalidity benefit.
. In section 17(1)(d) of the Social Security Act 1975, as amended by the Social Security (No. 2) Act 1980, after the words "not more than 8 weeks" there shall be inserted "(or not more than 12 weeks, in the case of a trail work periiod as defined for the purpose of section 12 of the Social Security Act 1989" ").
The noble Lord said: My Lords, this is a probing amendment to deal with a rather complicated point concerning the invalidity benefit. The Social Security Bill now provides an exemption from disqualification from employment benefit that will enable people to undertake a trial period of work of 12 weeks without jeopardising their entitlement to unemployment benefit. The proposed amendment would extend this trial work period to people in receipt of invalidity benefit.
As the Bill stands it gives people, including the disabled, the right to go onto unemployment benefit without any penalty after a 12-week trial period. However, that does not help the person who, at the end of the trial period, is incapable of work. The invalidity benefit is much higher than the unemployment benefit and it is often higher than income support. But, once lost, as a result of the period at work, it takes 28 weeks to requalify. It is a real barrier for disabled people who are anxious to work again but who have families and financial responsibilities to consider, if they are unable to make the grade despite their best efforts.
We suggest that the trial work concept introduced for the purpose of entitlement to unemployment benefit can be extended equally helpfully to invalidity benefit. Until the Social Security (No. 2) Act 1980 introduced the eight-week linking period, sick or disabled people could have up to 13 weeks back at work without losing entitlement to invalidity benefit. Obviously, that can be very important to disabled people. For someone who has been off work for six months or more and then tries to find out whether he can again cope with a job, the period of 12 weeks will have a distinct edge on the period of eight weeks as the trial period.
I repeat, as it stands the Bill gives people, including those who are disabled, the right to go onto unemployment benefit without penalty after a 12-week trial period. But it does not help the person who is incapable of work when the trial period ends. The principle of the incentive to work should be extended to those whose disability or ill-health has given them reason to be apprehensive about returning to work in that they stand to lose most if they find themselves incapable of working and lose on their current benefit. As I have said, invalidity benefit is much higher than unemployment benefit, and it is often higher than income support. But, once lost, as a result of the period at work, it takes 28 weeks to requalify. That is a very real barrier to disabled people who are anxious to work again but who have families and financial responsibilities to consider, if they are unable to get back into work despite their best efforts.
The proposed amendment will extend the trial work period to the entitlement to invalidity benefit. The wording may not be exactly right because, as I have said, it is a probing amendment. I hope that the Minister will be able to respond helpfully on this rather complicated but important matter. I beg to move.
Lord Skelmersdale: My Lords, I wish to begin by making a personal apology to the noble Lord, Lord Carter. I know that he was very keen to discuss this matter with me before today, but unfortunately our paths did not cross after he made the request. I would have told him that we have already come a long way along the road that he would have us take. This is to be found in Clause 13(4) of the Bill.
In essence this covers a new opportunity to take a job on trial. It will help any long-term unemployed persons whether able-bodied or not, to overcome natural apprehensions about taking up unfamiliar employment by providing a trial period for them to

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give the new employment a try. If, after having given it a real chance, they are then unable to settle, they can come back onto unemployment benefit, or income support where appropriate, without suffering any voluntary unemployment sanction. This general approach applies equally to invalidity benefit for people who have to give up the attempt to restart work within eight weeks because they are still incapable. Indeed it is inevitable that those returning to invalidity benefit must have originally been long-term unemployed.
I come now to the noble Lord's amendment. As he has explained, he is concerned about the person who is unable and incapable of work and in receipt of invalidity benefit. Under the present rules, if an invalidity pensioner recovers sufficiently to take a job, but then falls sick again within eight weeks, he can go back on to invalidity benefit immediately. If the gap is longer than eight weeks, he will instead be entitled to either sickness benefit or statutory sick pay and will need to requalify for invalidity benefit. As invalidity benefit is payable at a higher rate than sickness benefit, there could be some reduction in benefit if he does not requalify for invalidity benefit. The noble Lord's amendment would extend from eight to 12 weeks the period under which a former invalidity pensioner who had taken a job under the job trial arrangements could return to invalidity benefit if he had to give up work because he fell sick.
The noble Lord, Lord Carter, wants us to go even further. I have to say to him, as I said to the noble Lord, Lord Henderson of Brompton, in Committee, that the Government are equally concerned about helping the long-term sick and disabled back into the employment field where this is possible. Indeed it is a personal crusade of mine. However, it would clearly be anomalous to have a different linking rule in this area from that for other incapacity benefits. But I cannot go further today, because the Government are fully committed to reviewing the whole issue of the rules governing the incapacity and disability benefits in the light of the results of the OPCS surveys on disabilities.
All the rules governing incentives to work for the disabled will be looked at together once all the reports have been received and studied. We shall also need to take account of the Department of Employment's review of services for the disabled. I have to tell the noble Lord therefore that, while I am sympathetic to the aims of his amendment, it would not in the Government's view be sensible to introduce piecemeal provisions for specific categories of disabled people in advance of the consideration being given to the basic rules for incapacity and disability benefits as a whole.
As the noble Lord has said, this is an extremely complicated subject and no doubt he will want to read very carefully what I have just said.
Lord Carter: My Lords, I am grateful to the Minister. We could save a good deal of time on the Bill if on successive amendments he were to stand up and say, "OPCS" and then sit down. In the light of what he said, which I found fairly helpful, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 14 [Income support and unemployment]:
6.30 p.m.
Lord McNair Lord McNair moved Amendment No. 10:
Page 13, line 28, at end insert—
("(3) In regulation 71(1) of the Income Support (General) Regulations—

(a) the words "90 per cent. of", wherever they occur, shall cease to have effect;

(b) for each of sub-paragraphs (a)(iii) and (d)(ii) there shall be substituted—

"any premiums applicable under Parts II and III of Schedule 2; and".").
The noble Lord said: My Lords, at first sight this is one of those obscure amendments which means nothing unless one is armed with the necessary regulations and documents. It is essentially very simple. We are talking about asylum-seekers —people who see themselves as refugees—and we are concerned about what happens to them during the time their applications for refugee status are being considered. We are not remotely concerned with the ideology of the regime from which they are fleeing but simply with refugees as defined in the 1951 convention of which we are a signatory nation.
The social security problem is that until the changes which came into force in April last year asylum-seekers were entitled to supplementary benefit except for a reduction during the first two weeks. After April 1988 they became entitled to income support but for some reason only to 90 per cent. of what was paid to nearly every other claimant. They were not then entitled to any of the premiums —family premium, one-parent premium, disablement premium and so on—except for the pensioner premium.
It is difficult not to suspect that the exception was made in favour of the pensioner premium because so very few of them would be in a position to claim it. However, there is some good news. As a result of what was said in another place and of representations made by the British Refugee Council and other bodies, the department has relented in the matter of premiums. For this concession all of us who are concerned with refugees say a sincer and heartfelt thank you. But the abatement, as it is called, in the personal allowance, cutting it to 90 per cent. of what other claimants receive, is still in force. It is this which we seek to remedy because we can see no possible justification for it.
Is it simply intended to penalise these people for being foreigners? That would sit very ill with the proud claims we so often hear about the traditional hospitality of this country towards the oppressed? Does it not ignore the fact that asylum-seekers, unlike other claimants, are not allowed to look for work or to take it? This abatement lasts for the full time during which the claimant's right to asylum is being assessed. It is seldom less than a year and is quite often more than two years. We are asking the noble Lord to tell us today that the Government are ready to take this last small step towards justice for asylum-seekers by agreeing that they should be paid the same personal allowance of income support as other people—100 per cent. and not 90 per cent. I beg to move.
Baroness Jeger: My Lords, I rise briefly to support what the noble Lord has said. It is a matter of justice and fairness that people seeking asylum should not suffer deprivation. It does not cost them 90 per cent. of what it costs other people for rent and living expenses. While we welcome the concessions to which the noble Lord referred, we hope that the Government will take this further step of abolishing the 90 per cent. rate and making the payment equal for all. I support the amendment.
Earl Russell: My Lords, I support the amendment. Some things do not change. One of them is the spirit in which entry into this country is sometimes approached. I am reminded of a friend who was parachuted behind the German lines at Arnhem. He had the misfortune to break his leg on landing. He crawled away after nightfall and made his way to France. When the Gestapo came to his hotel he leapt out of the window. He got in touch with the French Resistance and was taken across the Swiss frontier, discovering a minute before he crossed that the French Resistance had planted spying documents on him. He finally made his way to Portugal and after a three months' wait got a boat home. He had with him one bottle of sherry. He said, "The Customs impounded it and then I knew I was home." That is the same spirit behind this 90 per cent. regulation.
I have been trying to investigate the question which my noble friend raised. Why should there be this 90 per cent. rate? This is the usual problem of social security debates. If we wrote them up as a comedy we should entitle them "The wrong box". These refugees have been put into the wrong filing cabinet. They have been put into a category of special hardship cases for those who have been deprived of benefit as a penalty. In Committee in another place (at col. 674 of the Official Report of 21st February) the Minister said:
"The existing regulations ensure that if they would suffer hardship they will receive a regular, if reduced income. That reflects the fact that they are not strictly entitled to benefit. The reduction is not merely because they seek asylum; it applies to others too".
Precisely, my Lords. These people have been put in a category of those who have suffered a penalty when they have done nothing to which a penalty should legitimately attach. This is simply a mistake in filing categories and I hope that it can be put right.
Lord Henley: My Lords, I am glad that both noble Lords and the noble Baroness welcomed the Government concessions with regard to paying income support premiums at the full 100 per cent. rate to all people and not just to pensioners. The amendment covers more than just asylum-seekers. The Government intend to reduce the number of groups to whom these provisions apply by allowing seasonal workers in the off season to receive income support in the normal way as soon as the appropriate regulations can be introduced later this year.
The noble Lord, Lord McNair, was particularly concerned about the effect of this abatement on asylum-seekers. We must remember that asylum-seekers can seek a work permit after six months. In most cases this will be granted. The reason for the abatement is that even though income
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support does not have a contribution or residence test, it is not intended that it should be freely available to everyone entering the country. People such as tourists, students, people visiting relatives, business people and those about whom the noble Lord is most concerned, asylum-seekers, are therefore excluded from normal income support because they have been granted limited leave or temporary admission by the immigration authorities. Instead they can claim under the urgent cases provisions. United Kingdom citizens whose source of income has been interrupted are likewise only temporarily without funds and are therefore not eligible for income support at the normal rate.
The logic of the 10 per cent. abatement is that there is no point in having rules which exclude people from benefit and then paying full benefit anyway by another route. Housing costs and children's allowances are paid at the full rate, and in future, as I said earlier, premiums will be payable. We are convinced that a 10 per cent. abatement of the applicable amounts for adults is still justified and reflects the fact that they are not entitled to full benefit under the normal rules. I hope that what I have said will enable the noble Lord to withdraw the amendment.
Lord Hylton: My Lords, this is quite an important amendment. I am sure that it would be obvious to anyone who thought about it that the first six months in this country for an asylum seeker, who probably arrives totally destitute, will be the most difficult months of his stay, even if later he may be able to obtain normal work. Surely the regulations could distinguish between asylum seekers on the one hand and EC nationals and tourists on the other. I hope that the noble Lord who moved the amendment will not withdraw it too lightly.
Lord McNair: My Lords, I cannot possibly pretend to find the response encouraging. I too studied the matter as it was put forward in another place, and the noble Lord has more or less repeated what was said there. It is like a parent, asked by a recalcitrant child, "Why should I?" replying, "Because I say so". There is little more in the Government's position than that.
The noble Lord, Lord Hylton, made the point that I wished to raise as regards the first six months. Six months is a long time when a person is trying to live on an amount of between £20 and £30 a week. On the other hand, the evidence produce this evening suggests that there is not very much to be gained by asking the House to divide and thereby decide the matter. Therefore, most reluctantly, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Henderson of Brompton Lord Henderson of Brompton moved Amendment No. 11:
Page 13, line 28, at end insert—
("(3) In section 22 of the 1986 Act (income related benefits) after subsection (8) there shall be inserted—
"(9) In relation to income support and housing benefit the applicable amount for a person in board and lodging accommodation shall include an amount in respect of his being a person in board and lodging accommodation.

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(10) For the purposes of this section "board and lodging" accommodation means—

(a) accommodation provided to the claimant or, if he is a member of a family, to him or any other members of his family, for a charge which is inclusive of the provision of that accommodation and at least some cooked or prepared meals which are both prepared and consumed in that accommodation or associated premises: or

(b) accommodation provided in a hotel, guest-house, lodging-house or other similar establishment where facilities for the preparation of food are inadequate to the needs of that person.

(11) Regulations may prescribe the circumstances in which the facilities for the preparation of food are deemed to be inadequate." ").
The noble Lord said: My Lords, I beg leave to move Amendment No. 11 which, I regret to say, is identical to an amendment which was moved in Committee by the noble Baroness, Lady Faithfull. I say "regret" because I had hoped that the opinion expressed throughout the Chamber would have moved the Minister during the interval to put forward an amendment of his own. However, as I have not heard from him I find that my only course, with support from friends on all sides of the House, is to put down the amendment again in the hope that perhaps we may achieve some movement between now and Third Reading.
The amendment concerns the notorious and infamous concept of board and lodging which all of us find extremely offensive. I am sure that the Government share that view. I know that they are doing everything they can to phase out board and lodging. Meanwhile, a pressing problem has emerged since 10th April. The amendment is designed to reintroduce an additional amount or premium into the claimants' income support where people are boarders; that is, living in board and lodging accommodation as defined in subsection (10) of the amendment.
Under the old system those living in such accommodation received a special rate of benefit which included an "eating out" allowance. However, that allowance was ended on 10th April when the Government decided to switch the benefit to housing benefit. I fully understand the logic of that switch. As the noble Lord, Lord Seebohm, said in Committee, this is basically a housing problem. In the meantime, until the Government have managed to phase out board and lodging, which we all dislike, depressing deprivation is being experienced by those who have suddenly had their "eating out" allowance taken away.
I think that all Members of the Committee expressed the view, which is undeniable, that those living in board and lodging accommodation simply cannot be expected to eat out on the same allowance as all the other claimants who are in receipt of income support. I say that because they either have to buy expensive convenience food or they have to eat out. I defy the Minister to say that in those circumstances he would be able to eat out, or buy convenience food, on anything less than the old "eating out" allowance.
I must say that I was most surprised when the Minister said in Committee, on 29th June at col. 893 of Hansard that,
"the main point to remember is that meals allowances payable under the old rules were too generous".
As I understand it, the meals allowance payable under the old rules was about £27 a week; that is, £3 a day. Will the Minister tell us how you can eat out on that, especially if you have not even been provided with breakfast in your so-called board and lodging? How can a person survive on £3 a day, either taking in convenience foods or paying for meals at eating out places? That sum could not possibly be described as generous. Yet that is how he described it. It is in fact barely adequate. Moreover, the allowance has been taken away from these people since 10th April.
It is a crying shame that the allowance has been taken away. In my view, it is absolutely essential that it should be reinstated. This is, if the Government are successful in their policy of doing away with the concept of board and lodging, a problem of short duration. Indeed, it will disappear when they have succeeded in eliminating the condition which gives rise to the deprivation. It will of course cost something to do this now; but such cost will be constantly diminishing—diminishing in proportion as the Government are successful in their policy of doing away with board and lodging accommodation. In the meantime, this absolutely obvious hardship for those living in such conditions must be dealt with.
I asked the Minister in Committee what he was prepared to do about the matter. He said that he recognised the problem. But, he said, for some reason or other our amendment was inadequate for the purpose. In our turn, I think we recognised, bearing in mind his expertise and the advice which is available to him, that something was perhaps wrong with the amendment. In the meantime, however, what is he going to do about the matter and do quickly? This is an urgent problem and one which must be dealt with.
The allowance must be made available until the time comes—which I hope will be as soon as possible—when board and lodging is discontinued. Until that time, something along the lines we suggest must be done. In the circumstances, therefore, I make no apology for reintroducing the amendment in the same form as it was when moved in Committee. I beg to move.
Earl Russell: My Lords, this appears to be another "wrong box" amendment. I say that because under the new system we have a separation into housing benefit, which is for lodging, and income support, which is for eating. And never, it seems, the twain shall meet, particularly if it is a case of bed and breakfast. Of course, those categories were based upon the notion that people live and eat at home, as of course people short of money normally do. As is fairly obvious, eating at home is a great deal cheaper than eating out, especially in London.
Until April of this year there was an extra £21.70 a week for meals for people living in board and lodging accommodation. That was little enough. I

323
do not know whether any of us could keep ourselves fed in London by eating out on £21.70 a week. However, now we do not even have that; we simply have eating out in London on income support.
It is, I think, the basic purpose of the social security system that everyone should have enough to eat. This amendment, and the next that we have to discuss, relates to two cases where that purpose is not being met. I have no doubt that we shall be told that we should await the result of the review of homelessness being undertaken by the noble Earl, Lord Caithness. I wish him luck with that review, but I cannot see that we can get away from the bed and breakfast system until local authorities are able to spend their capital receipts. So far as I can see, that does not seem likely to be in the near future. Meanwhile, we want to keep the people concerned alive.
The noble Lord, Lord Trafford, argued at length on that point in Committee. I gave him notice that I would answer him tonight. At lunchtime, he expected to be in his place and I am sorry that he is unable to be here. He argued that passing the amendment might lead to rackets and to landlords putting up the rent. I regret to say that I believe that the noble Lord achieved overkill. We have here, in effect, a system which has been privatised. We have people providing a public service for private profit, and it is of the essence of that, where it happens, that the people doing it have an incentive to maximise their profits by cutting their costs—in fact, by providing a poorer quality sevice. That has been true, as the noble Lord, Lord McIntosh of Haringey, once pointed out, since right back to the reign of Elizabeth I. It is the same story as that of the Dungeness lighthouse which was financed by tolls. With an incentive for cost-cutting, those who ran it used one candle as the lighthouse.
The noble Lord's arguments in fact went entirely against a privatised system of board and lodging. Granted that, I cannot see that there is any reason for supposing that there is more incentive to cut costs if the basic finance is adequate or that there is more incentive to raise rents if the amount of money is adequate. Of course, the argument about the incentive to raise rents applies with every annual uprating of social security benefits. If the noble Lord wishes to persist with that argument, he should stop the whole of the annual uprating for fear that someone might be encouraged to make a profit out of it. I believe that that is a little more than the noble Lord intended.
Meanwhile, we have a health problem, as my noble friend Lord Winstanley pointed out in Committee. Wherever there is a health problem, there is a problem of concealed costs. I wonder whether the Government save as much money out of the situation as they think they do.
So far as I know, no one has died of starvation on the streets of this country since 1649. I hope that it will stay that way. To ensure that it will, we should carry the amendment.
Lady Saltoun of Abernethy: My Lords, I must point out one thing: as the noble Earl, Lord Russell, said, one does not eat much on £27 a week if one has to
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eat out; and one eats very little on £21 a week. I must ask the Minister to remember that when one eats in restaurants one has to pay VAT on every mouthful. When one buys food to cook at home, one does not.
Lord Seebohm: My Lords, I want to add little to what I said last time. The problem is mainly one of housing. With the best will in the world, it cannot be cured within three or four years even if the Government were to have an advanced building programme. What are the people to do during that time if they have no money for food?
Baroness Faithfull: My Lords, I am grateful to the noble Lord, Lord Henderson, for moving the amendment. I moved a similar one in Committee. I withdrew it, although it was supported on all sides, because I wanted to make further inquiries about the comments made by the noble Lord, Lord Trafford; and the health of the children involved.
I am given to understand by a group of bed and breakfast places that the noble Lord's surmise would not have been true, as was said by the noble Earl, Lord Russell. Secondly, I have consulted the health visitors involved with some of the Bayswater bed and breakfast places. There is no doubt that the health of the children is suffering.
If a person is in ordinary board and lodgings they have easy access to a kitchen or at least one meal is provided for them. The bed and breakfast accommodation either has nowhere for cooking or the cooking facilities are four floors down and shared by a tremendous number of people. If one finds that one has forgotten the pepper or the salt and goes upstairs, by the time one returns the food has disappeared.
It is a distressing state of affairs for the people involved, and economically it is a bad state of affairs because, as the noble Earl, Lord Russell, said there are hidden losses. The health of the children and the mothers is suffering. That is the opinion of the health visitors who deal with the bed and breakfast places.
We pay tribute to my noble friend Lord Caithness who is well aware of the scandalous situation with regard to bed and breakfast accommodation. With all the goodwill in the world, he cannot do away with it within a few years. If we have to wait until he does away with the system the children's health will suffer; and the parents and the families will suffer. I support the amendment.
Lord Hylton: My Lords, I support the amendment. For the past 30 years or more we have suffered from acute local housing shortages and attendant homelessness. As a result, the housing problems have had to be picked up by social services departments and social security payments. I hope that the Government will be successful in their attempts to make it no longer necessary to use bed and breakfast accommodation, especially for families with children.
In the past I have drawn to the Government's attention the success story of Leicester city. Although it has severe housing problems, it has managed to minimise the use of bed and breakfast

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accommodation by employing a whole range of other strategies. I have corresponded with the noble Earl, Lord Caithness, and asked him why the Government do not reward those local authorities which use their housing resources efficiently by enabling them to spend, in the year of receipts, the proceeds they receive from selling council houses, flats and other assets. That is a situation which has obtained for many years in Northern Ireland. The Housing Executive, which is responsible for housing throughout the Province, has that facility. Why cannot it be granted to at least those English or Welsh authorities that have an acute problem, but that make the best possible use of their existing housing?
The noble Lord, Lord Skelmersdale, has experience in the Department of the Environment. I hope that he will be highly sympathetic to the amendment.
7.15 p.m.
Baroness Gardner of Parkes: My Lords, as we are all aware, the bed and breakfast system is unsatisfactory. Bayswater is full of people from other boroughs all over London who are in bed and breakfast accommodation, although it is Westminster accommodation. I have spoken previously about how children from Lambeth have to go there every day for various services although they live in Westminster.
Part of the problem lies in the fact that we are a free, democratic society. There are plenty of parts of the country with spare housing, but we cannot oblige people to leave London and to live there.
Last week, through my family, I received an appeal from a woman who did not want to be moved out of bed and breakfast. She was begging to stay in bed-and-breakfast accommodation in Leominster Square because she did not want to move out to Lewisham, which she did not like. Lewisham is not very far away. She had a very satisfactory housing offer but she did not want it.
People are very unreasonable in terms of being moved out of bed and breakfast. Although we think that bed and breakfast is unattractive and undesirable—and I think that it is unsatisfactory—obviously the people in it are more reluctant to move.
When I was Chairman of Social Services, people lived in those places even then. The council officer rang me and said that a woman would not move unless she was sure that she would have somewhere to bath the baby in the place that she was going to. He said that he could not give her a place where she could bath the baby in a separate bath. All he could do was offer her what he had, which was an acceptable standard of housing unit. I went to see the woman. She asked me to promise that she would have a place to bath the baby and I said that I could not promise that. I said that all I could promise was that we would buy a plastic bowl to put in the sink or bath in which to put the baby. She accepted that. She said: "At least you have been honest about what you are offering."
There is a degree of fear as to what these people are going to. No matter how bad the bed and breakfast is,
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they grow used to the surroundings. They get used to the terrible job of taking children right across London for other services. However, they do not want to move to an area that they do not know, and they certainly do not want to move out of London. I do not know how that matter can be dealt with.
The problem of providing food is genuine. The suggestion was made at Committee stage of giving people cooking facilities. It would be a nightmare to consider providing those facilities in the type of bed-and-breakfast hotel that we are talking about because it is difficult enough as it is to police the safety standards of accommodation. If cooking facilities were put into those rooms, it would not be on. I am not sure whether this amendment is the answer. I do not know what the answer is.
Lord Skelmersdale: My Lords, this amendment seeks to overturn arrangements that have been in force for just over three months, by modifying the way in which benefits are paid to people living in board and lodging accommodation.
The remarks of my noble friend Lady Gardner have put another complexion on this complicated matter. I should like to add a third. Much of the discussion today and during the debates on this amendment at Committee stage has centred on the position of homeless families. Your Lordships might therefore be led to believe that all boarders were homeless families. As I am sure many of your Lordships realise, that is by no means the case. Homeless families accounted for only 10 per cent. of all boarders. A large number of those in bed and breakfast accommodation were single young people. I feel that it would be prudent to remind the House of the position which existed before April and which led the Government to change the old arrangement.
The special rates of income support for boarders were a carry-over from the supplementary benefit scheme. They had created perverse financial incentives for many claimants, particularly the young, to seek boarder status at prices people in work would scarcely have been able to afford. Landlords were not blameless in this area. Many took advantage of the system by making higher charges without always providing extra services. Some, to their eternal discredit, went so far as to place advertisements in newspapers stating, "DHSS welcome" and "DHSS only".
The old rules included special meals allowances which were particularly generous when compared with normal income support. I was interested to hear a comment that the noble Earl, Lord Russell, made. He said that the £21.70—and I confirm to the noble Lord, Lord Henderson, that this is the figure that we are talking about—was in addition to normal income support. I was then asked how people could feed themselves on £3 a week. The point is that it is an extra £3 a week, and the normal income support rates apply. The income support rate, for single people aged 25 and over is £34.90, and £54.80 for a couple. They might also get premiums. That also puts a different complexion on this matter.
Claimants living in board and lodging could receive up to £ 29.40 per person per week for food alone, irrespective of age. That was clearly

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anomalous when one considers that other claimants living in bedsits and flats, and with broadly similar lifestyles to boarders, received the basic rate of income support to cover all their living expenses, not just food, and without any extra money.
You will not be surprised, my Lords, to hear that all these factors resulted in a dramatic increase in the numbers of boarders and a consequent rise in public expenditure. In the period December 1982-December 1984 expenditure trebled.
All our evidence suggested that boarders lived in accommodation similar to that of other claimants in bedsits or flats. The only difference was that their benefit was calculated on a different basis because their landlord sometimes provided them with a meal, however inadequate that might be. Boarders received income support to help with both their accommodation charge and living expenses, whereas other claimants in rented accommodation and boarders in work received housing benefit for their accommodation costs. The changes introduced from April put boarders on a par with all other claimants in rented accommodation and are an important step in ensuring that the benefit system does not make distinctions based on the type of accommodation involved. All claimants now look to housing benefit for help with accommodation costs, and to income support for other living expenses.
Noble Lords have mentioned their concern about the levels of income support now paid to people in board and lodging accommodation. Your Lordships will appreciate that income support does not include specific amounts to cover individual items of expenditure, such as food. The rates set take account of a number of factors, includingl the level of income available to people who are not receiving benefit. They are intended to cover all normal day-to-day living expenses. Premiums are payable, in addition to the personal allowances, to help towards the extra living costs of certain vulnerable groups, for example, families, disabled people, and lone parents and pensioners.
This Government is committed to protecting those who need to live on income support. During our period in power supplementary benefit levels increased by over 5 per cent. in real terms. In setting the income support rates, an additional £220 million was committed to the budget. This has been maintained in real terms in this year's uprating. Commencing this week—a point we will be discussing later—16 and 17 year-olds on income support who, of necessity, have to live independently, will see an increase of nearly 32 per cent. in their benefit level.
Whatever rates are set, there will always be some people who are housed, or house themselves, at prices that cannot be afforded on the normal levels of income support. It is clearly not right for the benefit system to subsidise or encourage such behaviour. However, your Lordships will gather from what I have said that this is precisely what happened under the old rules. The board and lodging provisions created perverse incentives for claimants to seek, and landlords to provide, such accommodation.
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Returning to the position of homeless families, I shall repeat what I said during Committee, at shorter length I hope; that the solution to the problem lies fairly and squarely in the hands of local authorities. I agree with the noble Lord, Lord Seebohm, and my noble friend Lady Gardner, who made this point. There is no point in repeating the figures which I gave during our earlier debate on this question. Suffice it to say that improved management of the housing stock by local authorities would release other, more suitable and less expensive, forms of accommodation in which to house these unfortunate families. If, despite all our advice and guidance, local authorities insist on placing these families in unsuitable bed and breakfast accommodation, there is very little that the Government can do to prevent it.
Local authorities, on the other hand, can. In Committee some noble Lords suggested that income support was adequate if there were reasonable cooking facilities. In this connection I understand that the London Boroughs Association operates a bed and breakfast information exchange which monitors the standards of accommodation in hotels used by local authorities to place homeless families. It was set up and is run by the association and helps to ensure that families are placed in accommodation with adequate facilities, including cooking arrangements. This is an admirable situation and I should like to see it extended to other parts of the country, even though the problem is chiefly in London.
It is my strong view that local authorities should not be placing homeless families in bed and breakfast hotels. I think that this view is shared by the whole House. If they do so this arrangement should help to ensure that the kinds of difficulties to which noble Lords have referred are minimised. It may be that, where problems exist, the local authorities concerned are unaware of the information exchange and are not using its services.
Local authorities had over a year to prepare for the changes and homeless families placed by local authorities were entitled to up to three months transitional protecton to give them time to adjust to the new arrangements. I therefore see no good reason why these families should not have been rehoused.
As I said at the outset, this amendment seeks to overturn arrangements that have been in force for just three months. It would simply restore all the anomalies and problems of the old system, and I must therefore urge your Lordships to reject it.
Lord Henderson of Brompton: My Lords, I do not at all wish to press this amendment. I want the Minister to do something about the tragic situation which has come about since 10th April. However, what the Minister is doing is washing his hands of this problem. The Government are washing their hands of this problem. The Minister said that the solution lies fairly and squarely in the hands of the local authorities. That may be so, but what do we do in the meantime? The Minister is doing absolutely nothing. I gave him the opportunity in Committee to come back and do something ad interim, and all he says is that our amendment is no good because

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it restores the situation that existed before 10th April. That may be so, but it is better to restore the situation before 10th April than do nothing, until the bed and breakfast scheme is eliminated.
All I am asking for is a transitional arrangement. I appeal even now to the Minister to consider bringing in a transitional arrangement until bed and breakfast is abolished. Will the Minister respond to that appeal?
Lord Skelmersdale: My Lords, I have already referred to the transitional arrangement which was in place for three months. I maintain my view that local authorities had plenty of time to get people out of bed and breakfast accommodation. They had accommodation of their own or accommodation which could be rented to achieve this. There is no excuse for local authorities placing people in bed and breakfast accommodation.
Lord Henderson of Brompton: My Lords, meanwhile the health problem which was referred to by the noble Lord, Lord Winstanley, and buttressed by what the noble Baroness, Lady Faithfull, said about the suffering of mothers and children remains. Is the noble Lord content that that should be so? There is the concealed cost in future social services to redeem the lack of imagination by the Government to deal with this parlous situation. There is concealed cost and continuing health problems, but nothing is to be done in the interim and everything is blamed on local authorities. The Government are washing their hands of this problem. In these circumstances there is no alternative but to press the amendment.
7.13 p.m.
On Question, Whether the said amendment (No. 11) shall be agreed to?
Their Lordships divided: Contents, 67; Not-Contents, 95.

DIVISION NO. 3

CONTENTS

Addington, L.

Greenway, L.

Airedale, L.

Grey, E.

Allen of Abbeydale, L.

Hayter, L.

Barnett, L.

Henderson of Brompton, L [Teller.]

Beaumont of Whitley, L.

Blackstone, B.

Hooson, L.

Blyth, L.

Houghton of Sowerby, L.

Bonham-Carter, L.

Hylton, L.

Bottomley, L.

Irving of Dartford, L.

Brooks of Tremorfa, L.

Jeger, B.

Carmichael of Kelvingrove, L.

Jenkins of Hillhead, L.

Kilbracken, L.

Carter, L. [Teller.]

Kinloss, Ly.

Cledwyn of Penrhos, L.

Lauderdale, E.

Cocks of Hartcliffe, L.

Lawrence, L.

Craigavon, V.

Lockwood, B.

David, B.

McNair, L.

Davies of Penrhys, L.

Nicol, B.

Dormand of Easington, L.

Ogmore, L.

Ewart-Biggs, B.

O'Neill of the Maine, L.

Faithfull, B.

Peston, L.

Gallacher, L.

Pitt of Hampstead, L.

Galpern, L.

Ponsonby of Shulbrede, L.

Graham of Edmonton, L.

Prys-Davies, L.

330

Rea, L.

Swann, L.

Rochester, L.

Taylor of Blackburn, L.

Russell, E.

Taylor of Gryfe, L.

Russell of Liverpool, L.

Taylor of Mansfield, L.

Saltoun of Abernethy, Ly.

Turner of Camden, B.

Seear, B.

Underhill, L.

Seebohm, L.

Walston, L.

Serota, B.

Willis, L.

Simon, V.

Winstanley, L.

Stallard, L.

Winterbottom, L.

Stoddart of Swindon, L.

NOT-CONTENTS

Annaly, L.

Lucas of Chilworth, L.

Arran, E.

McFadzean, L.

Ashbourne, L.

Mackay of Clashfern, L.

Barber, L.

Margadale, L

Beloff, L.

Marley, L.

Belstead, L.

Marshall of Leeds, L.

Blatch, B.

Merrivale, L.

Bledisloe, V.

Milverton, L.

Boardman, L.

Mottistone, L.

Borthwick, L.

Munster, E.

Boyd-Carpenter, L.

Murton of Lindisfarne, L.

Brabazon of Tara, L.

Nelson of Stafford, L.

Brougham and Vaux, L.

Newall, L.

Buttenvorth, L.

Norfolk, D.

Caithness, E.

Nugent of Guildford, L.

Carnock, L.

O'Hagan, L.

Carr of Hadley, L.

Orkney, E.

Clitheroe, L.

Pender, L.

Colnbrook, L.

Plumb, L.

Colwyn, L.

Pym, L.

Cork and Orrery, E.

Rankeillour, L.

Craigton, L.

Renton, L.

Crickhowell, L.

Renwick, L.

Cullen of Ashbourne, L.

Rodney, L.

Davidson, V. [Teller.]

Sanderson of Bowden, L.

Denham, L. [Teller.]

Savile, L.

Dilhorne, V.

Sharpies, B.

Dundee, E.

Skelmersdale, L.

Effingham, E.

Stockton, E.

Elibank, L.

Strange, B.

Ellenborough, L.

Strathclyde, L.

Elles, B.

Suffield, L.

Elliott of Morpeth, L.

Thomas of Gwydir, L.

Elton, L.

Thomas of Swynnerton, L.

Feversham, L.

Torrington, V.

Fortescue, E.

Trafford, L.

Fraser of Kilmorack, L.

Trefgarne, L.

Gainford, L.

Trumpington, B.

Haig, E.

Ullswater, V.

Harvington, L.

Vaux of Harrowden, L.

Henley, L.

Vinson, L.

Hesketh, L.

Westbury, L.

Hives, L.

Wise, L.

[ngrow, L.

Wynford, L.

Johnston of Rockport, L.

Young, B.

Keyes, L.

Young of GrafTham, L.

Killearn, L.

Zouche of Haryngworth, L

Long, V.

Resolved in the negative, and amendment disagreed to accordingly.
7.20 p.m.
Lord Henley: My Lords, this may be a convenient moment to break the proceedings on the Social Security Bill. I suggest that we return to the Bill at 8.15 p.m. I beg to move that further consideration on Report be now adjourned.
Moved accordingly, and, on question, Motion agreed to.

Cardiff Bay Barrage Bill {H.L.
7.21 p.m.
Lord Brooks of Tremorfa: My Lords, I beg to move that this Bill be now read a third time. In moving the Third Reading I can do no better than to refer to the Special Report of the Select Committee which, over 13 sitting days together with a day to view Cardiff Bay and no doubt several sittings in private, considered every aspect of the Bill in the greatest detail. Your Lordships will note from paragraph 6 of the Special Report that the Committee had before it an Instruction from this House to pay particular attention to two aspects: the achievement of an acceptable water quality standard and the effect on fish migration. I draw your Lordships' attention to the Select Committee's study of those aspects in paragraphs 33 to 41 and I commend the Committee on its findings.
In its conclusion the Committee's report states in paragraph 42 that:
"the case for the barrage stood or fell on the economic evaluation of the investment which would be attracted to the area … the Committee were convinced on the evidence that the economic case was sound and that the investment prospects were good."
I ask the House to endorse the findings of the Select Committee.
Moved, That the Bill be now read a third time.—(Lord Brooks of Tremorfa.)
Lord Moran: My Lords, all of us would wish to thank the committee very much for their work in considering this question. I read through the whole of the transcript of its hearings, and it is clear that the noble Lord, Lord Elibank, and his colleagues went into all aspects of the problem over many days with great care and thoroughness. We must all be very grateful to them.
I should say a word about the House's Instruction to the Committee, which I moved at Second Reading. Perhaps I may remind your Lordships that it called, first, for an acceptable water quality standard at all times and the safeguarding of public health; and, secondly, for the safeguarding of the passage of migratory fish.
On both those issues the authoritative experts in Wales are, without question, Welsh Water. Halfway through the hearings I asked Welsh Water when they would be giving evidence. I was told that they had not been invited to do so—and they are indeed not mentioned in the transcript among the prospective witnesses listed by the promoters on Day 4 of the proceedings (pages 3 and 27). I thought that surprising as I did not see how the committee could carry out the terms of the Instruction given to it by your Lordships' House if the promoters were not going to call Welsh Water. I therefore raised the question with the clerks. I assume that your Lordships' committee did then raise it with the promoters because, happily, Welsh Water were subsequently asked to give evidence on fisheries and water quality, and that valuable and comprehensive evidence is now on record.
Perhaps I can deal first with the second point in the Instruction dealing with fisheries. I studied Dr
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Cresswell's evidence on Day 7. I note that Welsh Water has laid down stringent conditions, which seem to me reasonable, given all the work that they have done and are doing to rehabilitate the fisheries on the Taff. I am content with what is proposed. One cannot be absolutely certain that it will work—I believe that the fish will have to swim downhill to get into the lake—but I very much hope that it does.
Turning now to the question of water quality, that seems to me of central importance. It has been suggested that at Second Reading I exaggerated the risks. I have looked again at what I said, which was based very largely on Welsh Water's original petition and their subsequent public statement, and I do not think that there was any exaggeration. Indeed, it seems to me that what I said was substantially endorsed by what was said by the experts at the hearings.
It was confirmed that there can be no immersion sports (Day 1, page 35) and that there is no possibility of raising the water quality to bathing standards (Day 8, pages 21 and 33). At Second Reading I said that there would be a health hazard for those who fell into the lake. I did not then know that an unfortunate man had fallen into the Taff during a raft race and subsequently died, very tragically, from leptospirosis, as recorded on Day 4, page 62.
The committee were given the fullest evidence on the problems of algae, of blue-green algae and toxins, on non-biting midges—which I am sorry to see might need to be controlled by chemicals—and on the quantities of rubbish carried down by the rivers Taff and Ely. Those problems are to be dealt with by Vitox units, slurp units, booms across rivers and "water witches", at substantial cost. They will require a major continuing effort which we must hope will be effective.
I observed that Mrs. Essex, a planner with Mid-Glamorgan County Council and a Cardiff City councillor, said in her evidence,
"I feel very strongly that the water quality of the impounded lake is nowhere near the point of quality we were all led to believe would be the case when the barrage was first mooted".
Incidentally, no one appears to have asked how the rubbish and algae which are to be collected from the rivers and lakes are to be disposed of. I should like to ask the noble Lord, Lord Brooks, about that. As it is, domestic refuse has hitherto apparently been dumped in the Penarth dock and will have to be cleared out at a cost of f 12 million or more (Day 3, page 22). That is more than double what it is proposed should be spent on an alternative facility for the birds.
The question of the funding of nutrient stripping after 20 years is still, so far as I know, unresolved and is not referred to in the Committee's report. Perhaps the noble Lord, Lord Brooks, can tell us how that stands.
I recognise that by the use of machines great efforts are going to be made to deal with water quality problems. But machines can go wrong and, as we know, men can go on strike. The Times of 8th May, for example, reported one of the worst pollution incidents in recent history when storms washed sewage into the Thames, the "bubbler" machine which puts oxygen into the river was being repaired,

333
and vast numbers of fish were killed along the river from Kew to Tower Bridge—there were dead fish floating down past your Lordships' House.
The hazards of water quality are not fantasies. They are very real, not only in this country but in many other parts of the world. The Daily Telegraph of 4th July reported that:
"At the eastern end of the Baltic, near Leningrad, a 14-mile dam nearly complete across the Neva delta is causing major problems".
A Soviet expert said:
"Because of inadequate water treatment there is an alarming increase of blue and green algaes … Three months ago, the bacteria count was one thousand times the permitted level".
The Sunday Telegraph of 18th June carried a very strange photograph of a gondolier with two passengers in a gondola on the Grand Canal in Venice with the Rialto Bridge in the background, but all three of them were wearing face masks. The caption under the photograph read:
"Gondoliers and tourists guard against the growing stench of the Grand Canal by wearing face masks".
The accompanying article quoted the mayor of Venice as saying:
"We are on the brink of catastrophe … Almost the entire lagoon is covered. The algae are changing the whole environment, and I'm afraid I have little faith in the measures we are taking".
The article went on to quote the man in charge of the operation as being "pessimistic" saying:
"These algae double in size every 15 days. It's simply a battle we cannot win".
The article added:
"Nearby towns have already blocked barges trying to dump the mess on their doorsteps".
It went on:
"Worse is in store, for the scum … is a perfect breeding ground for billions of tiny flies. Once hatched, they head for the lights of Venice. Last year they descended on the city in a plague of biblical proportions. The city's airport was closed as carpets of insects made runways unusable and infiltrated aircraft engines. The railway station was cut off and street lighting obliterated".
It is clearly a nightmare situation in Venice, but it shows what can happen when questions of water quality go wrong. Subsequent reports have described growing and serious problems with algae all down the Adriatic coast. Venice is a city—if ever there was one—with a "superb maritime environment", but the deterioration of water quality is creating grave problems. It shows what can happen. I greatly hope that those problems will not come to Cardiff. We must all hope that.
Turning to the other question of the extinction of the Taff-Ely SSSI and the problem of the wading birds, I see that the Nature Conservancy Council said in their evidence on Day 12 that the Severn estuary is an internationally important wetland and Cardiff Bay a uniquely important component of that wetland; that,
"very large populations of birds of several species depend on Cardiff Bay for their feeding and their survival";
and that,
"passage of the Bill would lead to the destruction of the Cardif Bay and thus do serious damage to the nature conservation interest of the Severn estuary as a whole".
As the committee noted, this appears to be the first time that an entire site of special scientific
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interest might be eliminated as a result of development proposed by a public authority. Sir Peter Scott was quoted as saying,
"You may also add my personal voice to those vehemently against this disastrous proposal".
There can be no doubt that it would be an extraordinarily damaging precedent for development elsewhere. That is a worry when some 30 barrage schemes are being considered in Great Britain on the Tees, Severn, Humber, Mersey, Morecambe Bay and many other estuaries.
It runs against the spirit, if not the letter, of the Ramsar Convention, which requires the wise use of wetlands, and the Community's birds directive, and would result in the loss of many birds, including some like the dunlin which are becoming scarcer. The committee noted that the outlook for the dunlin, redshank and curlew is not, in its words, "reassuring".
The alternative area proposed is regarded by the experts, according to the evidence that they gave, as far too small to make a real difference. I am surprised that the committee did not require the promoters to provide something much more substantial. Perhaps the noble Lord, Lord Elibank, will say a word about that.
The case against the barrage is essentially that it is purely cosmetic, that it will do away with the tides, the SSSI and most of the wading birds and that, while seeking to create a "superb maritime environment", it will shut away the sea behind a wall of concrete and Cardiff will become rather less maritime than it is now. It has also been argued by the petitioners that the welcome development of Cardiff docklands is going ahead anyway.
The case for the barrage seems to depend on the assessment of the property developers. Their expertise clearly carried weight, but not all their remarks create confidence. On Day 7 Mr. Richardson, of Rothschild's, for example, talked about,
"a freshwater lake which is blue and sparkling"
That betrayed a surprising ignorance, for it has been clearly established that, whatever else it is, the lake is unlikely to be blue. The promoters also used rather cloudy language when talking about the barrage, describing it on Day 6 as "a destination" or "an attraction". In summing up, their counsel used the word "superb" five times in describing the plan.
I am strongly in favour of the development of the Cardiff Bay area, but I am still not happy about the barrage. With the greatest respect, I think that the committee gave insufficient weight to the extinction of the SSSI and its consequences, both national and international. I think that they should have stipulated a much better alternative for the birds. Although the committee profess themselves satisfied that the water quality will be satisfactory visually, biologically and for limited recreational purposes provided that strict standards of control are maintained, I must say that, if I lived by Cardiff Bay, I would be nervous about the problems of water quality and algae in the bay. Those environmental questions matter a great deal to people as recent evidence shows. I do not think that we should assume

335
that the public always want developmental considerations to prevail. But we must now, I think, leave it to another place to consider the question.
Lord Elibank: My Lords, I must begin by thanking the noble Lord, Lord Moran, for his kind words about the work done by our committee which I know that all the members will appreciate.
This is a project which stands or falls, as we said in our report, by the economic evaluation of the attractiveness of the development possibilities either with an impounded freshwater lake behind a barrage or, as with existing circumstances, when the tide rises and falls freely. When the tide is low, the area is covered by mud flats with birds coming and going.
It is entirely possible and reasonable to hold either of those points of view, but the committee was greatly influenced by the weight and experience of those witnesses whom the promoters brought before us and who had enormous experience in the development of estates and areas throughout the United Kingdom.
We considered the evidence very closely because it was, as I have indicated, critical to our assessment of the merits of the Bill. I believe that, in the end, we were all convinced that the project offered great economic benefits to Cardiff. It is not that, if the barrage were not built, south Cardiff would remain an area of desolation. There is no doubt that development would take place over a considerably longer period of time. We were offered evidence which showed that the quality of much of that development would be inferior to the development with the barrage.
I emphasise that economic aspect because, as the noble Lord, Lord Moran, rightly pointed out, there are drawbacks to the scheme which we again considered very carefully. He mentioned the effect on bird life. There is no doubt that the bird life in the area will suffer. The experts on that subject were modest in their evaluation of what might happen. There was no degree of certainty except a general consensus that the number of birds, particularly dunlin and redshank, would diminish. Some would find another site in the Wentloog artificial lagoon. Others would find sites in the Severn estuary, but a number would not return to the estuary and some, it must be presumed, would die in transit.
That is a serious disadvantage as is the other point mentioned by the noble Lord, Lord Moran, about the extinction of the SSSI and the impact that the Bill will have the public's attitude to the Ramsar Convention and the relavent EC directive. Again, I do not think that the committee was particular happy about that outcome, but it had to be weighed against the economic advantages.
The noble Lord, Lord Moran, asked me why the Wentloog lagoon should not be larger. I think that there are two reasons. Primarily it is a question of money. There is a certain amount of money made available for its construction and any larger lagoon would obviously cost more. The second reason is that it is experimental in nature. It may or may not be a success; but if it is a success there is no real reason why the lagoon should not be extended
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further eastward along the Severn estuary. It can be increased in size if it turns out to be a successful attraction to the birds.
One of the questions that most worried the committee concerned groundwater. The impoundment of the bay will lead to a rise of up to 3 metres in the groundwater levels. Groundwater is a sinister element rather like gas which creeps up on the householder very often unnoticed until his cellars, basements and even the superstructure of his house are damaged.
It is fair to say that the promoters have gone to quite extraordinary lengths to provide reassurance, by way of surveys and engineering works, to the citizens resident in the area around the rivers and around the impoundment lake. The relevant clause, Clause 12, was much discussed in evidence. The Committee thought it right to extend further the protection offered by Clause 12 to those residents between the inner and the outer zone. That not only extends protection to those citizens but in our view also made the Bill a great deal easier to understand for all the residents of Cardiff.
Lastly I come to the issue of water quality which, I think it is fair to say, is the main concern of the noble Lord, Lord Moran. It concerned the committee also. The basic problem is that the water from the rivers which feed into Cardiff Bay—the Ely and the Taff—are polluted industrially and by sewage. It will be very difficult to make the quality of the inland lake better than the quality of the two rivers which supply the water to it, at least in the short term. There is every prospect down the road that the new water authorities will be able to take action to decrease the pollution in those two rivers and so improve the quality of the lake.
However, that must lie in the future. In the meantime, we have to grapple with the project as it stands today. There seem to be three real problems with which the promoters have to deal: the debris on the surface; the algae that will form from time to time in the lake; and the oxygenation of the water which affects its quality and particularly any fish in it. Again, the promoters have promised or undertaken to take quite elaborate measures to ensure that those three problems are properly grasped when the lake is finally impounded behind the barrage.
The committee listened very carefully to the evidence given principally by the Welsh Water Authority, whose evidence was most helpful and most useful, but also by other witnesses that came before us. One cannot be totally reassured about the quality of the water. A point that may be helpful to a layman in judging the quality is that no full immersion sports will be tolerated or permitted. That is to say, bathing will not be permitted, at least in the initial stages, but other water sports that involve the occasional ducking—for instance, sailing—will be allowed. I think that gives a fair indication of the level of water quality that the promoters hope to achieve.
It is only fair to say that in the course of the committee's visit to Cardiff we saw what was the Bute Dock—a system of water without any of the

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benefits that the promoters propose to use to improve the quality of the inland lake. To the superficial and inexpert eye the quality of that water appeared excellent. So we are hopeful that the level will be of an acceptable standard. Certainly I should put it no higher than that.
The noble Lord, Lord Moran, mentioned—and indeed it was in the committee's Instruction—that we should have regard to the ability of fish to come and go over the barrage. Again in most respects that involves a fairly conventional engineering contrivance, and the Welsh Water Authority was perfectly satisfied with the steps that the promoters proposed to take. The one ingenious or novel aspect is that at times the water outside the barrage will be higher than the water in the lake, and so the fish will have to descend rather than ascend at that point. However, that has been provided for and will be monitored from the time that the impoundment takes place.
All in all the committee felt (I must say with varying degrees of enthusiasm) that the benefits of this scheme outweigh the drawbacks, which are undoubted and have to be clearly faced. For that reason we recommend that this Bill should be allowed to proceed through your Lordships' House.
7.45 p.m.
Lord Prys-Davies: My Lords, the House is grateful to the noble Lord, Lord Elibank, and the members of his committee for having discharged the task which it delivered into their care. I trust that my noble friend Lord Brooks of Tremorfa will forgive me when I remind the House—not that it needs to be reminded—that the Cardiff Bay Barrage Bill has been contentious; and notwithstanding the reassuring nature of the report, it remains contentious in Cardiff. There has been a flow of opinion in its favour; but it has also created a barrage of criticism. The conflicting views and pressures remain. I feel that that fact must be placed on the record in your Lordships' House.
I have studied the report produced by the committee, and as one would expect it took into account all the anxieties which were voiced during the Second Reading debate in this House. I shall limit my comments this evening to one of those; namely, the damaging effect on residential properties of the raising of the water table. Indeed, that has been very fairly underlined this evening by the noble Lord, Lord Elibank. On this issue, which is one of the key issues, there is at least one significant disagreement between the experts: the expert evidence produced by the promoters and that brought forward by the people—the residents whose properties might be adversely affected.
The committee acknowledged that:
"The uncertain results of changes in groundwater levels were a cause of very real concern to many of the residents of the area".
However, having heard the evidence, the committee was also satisfied that the amendments made to Clause 12, which is a very complex clause dealing with the protection to the property near the bay, together with the undertakings given by the
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promoters, would adequately meet that concern. I have this afternoon checked in the Private Bill Office that the undertakings relate to Clause 12(2)(b) and Clause 12(24). The noble Lord, Lord Elibank, and his committee are satisfied with the terms of those undertakings.
As my noble friend Lord Brooks pointed out, the committee accepts in paragraph 42 that the case for the barrage stands or falls on the economic evaluation of the investment which would be attracted to the area. Therefore while the committee accepts that that case has been made out, it also acknowledges in paragraph 42 that the assessment is "in large measure subjective". I believe that the words I have quoted provide some food for thought.
I have no other point to make except to say that as the regeneration strategy is implemented I would expect the promoters to keep a watchful eye on the position and fully to implement the undertakings that they have given, if that need arises. I very much hope that my noble friend Lord Brooks of Tremorfa will be able to give that confirmation to the House.
Lord Crickhowell: My Lords, I had not intended to intervene in this debate except briefly to pay tribute to the work of the committee. Like the noble Lord, Lord Moran, I have read all the evidence and I was deeply impressed by the thoroughness with which the committee undertook its responsibilities.
I must declare an interest. I am a director of Associated British Ports which is a major landowner with development plans in the area. I had considerable responsibilities for the origins of this scheme. Clearly I am a believer in the scheme. I set out the arguments in Second Reading and I do not propose to repeat them. But when the evidence of developers is questioned and we are told that it is subjective, I think that I am entitled to say that it is not just the view of a few people carefully selected by the promoters to give evidence but of a much wider circle of expertise.
During my period as Secretary of State, before we took the firm decision to go ahead we spent more than a year talking to every single person in the property world on both sides of the Atlantic who we thought might be able to guide us in the wisdom of the matter. It was only after we had heard their overwhelming consensus on the economic merits of this scheme that we decided to proceed. Since then I have been actively involved with a company with a direct interest and have met a very large number of others who have supported that view. It must be said that there really is a very strong economic case of which the committee is convinced, as my noble friend Lord Elibank has made clear.
The noble Lord, Lord Prys-Davies, said that the scheme was contentious. I suppose that all great, massive schemes—in particular schemes involving property—will be contentious. However, I can think of very few schemes of this scale and magnitude that have had such comprehensive cross-party support or which have united so effectively differing local authorities and groups of people as this scheme has in Cardiff. There are those who have fears; there are those who are critical. But there is a quite strikingly impressive unity of opinion among the elected

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representatives in local government and many others besides.
Of course anxiety has rightly been expressed about the need to do away with an SSSI. It was one of the points that, as Secretary of State, I faced up to myself. I called upon the best environmental advice. As the committee has made clear, it too weighed up the unhappy consequences of the loss of an SSSI and some possible effects on bird life against the economic arguments. Just as I had, it decided that the economic and social arguments prevail.
I add, as I added at Second Reading, that there are also environmental arguments. There is a very strong environmental case for this Bill. It is not just that habitats will be created—and they will be created—but that much will be done to improve the environment in the whole area, indeed right into the heart of the City of Cardiff. That must also be weighed in the scales.
However, what prompted me above all to rise to my feet and to say rather more tonight was the contribution of the noble Lord, Lord Moran. He said that at Second Reading he did not exaggerate. On that occasion he certainly painted a very alarmist picture. I remember being told that we faced the prospect of hundreds of thousands of dead fish and all sorts of other horrible things. Reading the evidence I formed a rather different impression. It happens that I brought into the House tonight the evidence given on 24th April when Mr. Owens, the witness of the Welsh Water Authority, was cross-examined in detail. I shall not refer to the fisheries issues because the noble Lord said that he was content. But he also said that the evidence of Welsh Water was valuable and comprehensive. It should therefore clearly be put on the record that Mr. Owens, giving evidence for Welsh Water, made it absolutely clear that it was satisfied that the standards that it felt were necessary could be met. When the examination had been conducted and re-examination took place, Mr. Owens was asked this.
"On the question of the steps needed in order to ensure that the water quality standards are adhered to, and the cost of those steps, are those matters which you have gone into in detail, or have you been concerned with what the standards and what the level of monitoring should be? A. It has been Welsh Water's responsibility to consider the standards that are to be applied to that lake. We have satisfied these in the dicussions with the promoters. The promoters have commissioned a whole series of studies into these various aspects. We have discussed those studies with the promoters and we have had access to all the findings of those studies which have been carried out by a whole range of consultants. Our judgement has been formed basically on knowing standards which we have set, our own judgement as to the validity of some of the studies carried out and some lessons which have been learnt from those studies".
He subsequently made it perfectly clear that it had looked at the uses that will be made of that area of water. He stated:
"We have set down the standards to safeguard those uses".
That is the view of the expert evidence of Welsh Water. It should be weighed against what we heard earlier in this debate.
Of course there are hazards in undertaking sports in polluted rivers, although the River Taff is nothing like as polluted as is sometimes made out. Mr. Magnus Magnusson is quite wrong when he said in
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the course of last week that it is one of the most polluted rivers in Great Britain. If it were, the noble Lord, Lord Moran, would be expressing justified concern about the survival of the salmon that now pass up that river. However, there is much to be done and I declare an interest. The NRA will have to ensure that the quality of those rivers and the water system in South Wales is substantially improved in the years ahead. That will be one of my responsibilities; it clearly must be.
Welsh Water is satisfied that the standards will be adequate for the uses to which the water will be put. In Bristol immersion sports are not permitted, but major sporting activities take place in the docks at Bristol. I referred at Second Reading to my own past when I spent more hours than perhaps today I like to think of rowing and sailing on the Thames. I frequently fell in. At the time the Thames was a great deal more polluted than it is today. Some noble Lords may recall a regatta not very long ago during which the noble Lord, Lord Callaghan, fell in. He, for many years, represented a part of Cardiff. He and I survived. The truth is that the water quality is not perfect, it will not be pristine, but in the view of the experts it will be quite adequate for the uses to which it is put.
Disposal of rubbish is always a problem. But Penarth Docks is not to be emptied to deal with the problems of water quality. The idea is that it should be emptied because the value of land for development in the area will be so considerable. People do not wish to freeze land which has been used in a rather thoughtless way when there could be a future use for it were it not unsuitable because of methane and other problems connected with refuse disposal. However, the refuse of Cardiff and the surrounding area will have to be disposed of whether the barriage is built or not.
I believe that the committee has rendered an immensely valuable service in answering the understandable concerns in great detail. I do not believe that anyone who has read the report, still less anyone who has read the massive evidence presented to the committee, can have the smallest doubt that this House is well justified in allowing the Bill to pass for consideration in another place.
Lord Galpern: My Lords, as the only member present here this evening who served under the chairman I should like to say a few words. It was a great pleasure and an honour to serve under the noble Lord, Lord Elibank, as chairman. As a member of the committee I learnt a great deal about wildlife on the Severn Estuary. I learnt too—this was even more satisfactory—of the delightful sense of humour of the noble Lord. Tonight the House should be grateful to him for the masterly presentation that he made of the proceedings and of our conclusions as a result of deliberations over several weeks.
The best I can say is that if ever again I am asked to serve under the noble Lord, Lord Elibank, nothing would give me greater pleasure.
The Minister of State for Defence Procurement (Lord Trefgarne): My Lords, it may be helpful if I give your Lordships a brief indication of the

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Government's position on this Bill and the amendment made by the committee. As I told your Lordships during the Bill's Second Reading, the Government have a substantial interest in the objectives of the Bill as it is the intention that the cost of building the barrage will be met by the development corporation with the assistance of a grant in aid provided by the Welsh Office. We, like the committee, are satisfied that the economic benefits that will flow from the barrage will outweigh the costs involved.
We are pleased that the committee having considered all the evidence, has recommended that the Bill should be allowed to proceed. The amendment simplifies the provision in the Bill to protect property that might be affected by rising groundwater. As such the amendment is perfectly acceptable to the Government and we believe that it should be kept to overcome the concern of the local residents.
We have studied the evidence on water quality put before the committee based on expert reports and the witness from the Welsh Water Authority. This is a subject in which the Government have the closest possible interest. We are reassured by the committee's conclusions that it considers that satisfactory measures will be undertaken to ensure that the quality of water in the inland bay will meet the standards specified in the Bill. We share this view and also the committee's conclusions that the sponsors must maintain the strict standards that have been set. The National Rivers Authority will also of course have a role to play in this in due course.
The Government believe that the Bill should be read for a third time and allowed to proceed.
On Question, Bill read a third time.
Lord Brooks of Tremorfa: My Lords, I beg to move that the Bill do now pass.
I wish to thank all those noble Lords who have played their part this evening. In particular, I congratulate the noble Lord, Lord Elibank, for what I thought was a superbly concise summary of all the work that he and his committee did over many days. It listened to a great deal of evidence.
I am afraid that I come to different conclusions from the noble Lord, Lord Moran. I too read all the evidence. Indeed I read it almost as soon as it was printed, and I came to a different conclusion. I must point out that it was never envisaged that immersion sports would take place in the impounded water after the barrage was built.
When the scheme was first mooted, I had two concerns which have been expressed by some of the petitioners and indeed have been mentioned this evening. The first was the effect on the environment. But far more important to me was the concern expressed by many people in Cardiff, particularly in the Riverside and Canton areas, about the effects of possible flooding. I was born between the two rivers and I would not advocate any measure that would make the situation worse. I remember on many occasions the flooding of the rivers Taff and Ely and
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all the distress that that caused. I am satisfied that the evidence that has been given to the Committee will resolve that problem.
Accordingly, I commend the Bill to your Lordships.
Moved, That the Bill do now pass.—(Lord Brooks of Tremorfa.)
On Question, Bill passed, and sent to the Commons.
Viscount Long: My Lords, I beg to move that the House do now adjourn during pleasure until 8.15 p.m.
Moved accordingly, and on Question, Motion agreed to.
[The sitting was suspended from 8.7 to 8.15 p.m.]

Social Security Bill
Consideration of amendments on Report resumed on Clause 14.
Baroness Faithfull Baroness Faithfull moved Amendment No. 12:
Page 13, line 28, at end insert—
("(3) In regulation 36(3) of the Income Support (General) Regulations after sub-paragraph (b) there shall be added—
'and
(c) any sum paid by the claimant, if he is a member of a family but has no partner, for the care of a child who is a member of his family—

(i) while he is engaged in or travelling to or from that employment, or

(ii) for the purpose of enabling him to engage in that employment." ").

The noble Baroness said: My Lords, I spoke to this amendment during the previous stage of the Bill, but I hope that my noble friend the Minister will forgive me if I speak to it again. Many of us in this country are deeply disturbed about single parents. That means the widows, the divorced, all single parents who are caring for children. Before April 1988, if these women wished to go out to work their work expenses were taken into account. By their "work expenses", I means their fares, the cost of putting the child with a carer, a foster parent or putting the child in a nursery.
The purpose of this amendment is to reduce the existing major disincentives to work for lone parents, thereby reducing their enforced dependence on means-tested benefits. As is well known to your Lordships' House, there is now a movement on the part of Her Majesty's Government to press single parents to go out to work. That is being done by a unit based on the Home Office because that office is responsible for equal opportunities for women. It is also an interest of the Department of Health and the Department of Education.
I believe that I am right in saying that the Minister's right honourable friend the Secretary of State is also pressing single women to go out to work. If they do so, whatever happens, the country must not disregard the children of those single women. Otherwise ultimately it will lose out because the

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children of the single women will not be looked after properly, they will not be properly cared for.
If the woman is drawing a very low wage, then of course she receives income support. But if she is drawing a wage above income support and has to pay for her fares and the money for the nursery, having to deduct the child care expenses from her earnings will involve a very considerable sum. Therefore it is hoped that in order to achieve a situation where the lone parent works without the children suffering, child care expenses should not be taken into account when calculating income support and housing benefit.
This is a very important amendment; it concerns more than one Ministry. It concerns the whole policy of Her Majesty's Government to persuade lone women with children to go out to work. I think we must examine not only the position of the women but also that of the children. I beg to move.
Earl Russell: My Lords, I am pleased to support this amendment. As I have said before this evening, I am concerned about how much the whole system costs. Where costs can be kept down without causing undue pain to those concerned, I believe that we should try to do that.
The cost of single parents to the social security budget has now reached £3.4 billion. I know that the Secretary of State is concerned about that figure. I share his concern, although I do not necessarily share all his ideas about the solution. It seems to me that the cheapest solution as regards the cost of single parents to the social security budget is contraception. However, failing that, the second cheapest solution where possible is to enable the parents to return to work, to get off benefit and to support themselves and their children—a solution compatible with self-respect as well as humanity.
However, the children do not simply disappear when the mother goes back to work. It is not like the guide book I once relied on, which described a country walk at the end of which you would meet the car which has meanwhile gone round. The children do not "meanwhile go round" and they have to be looked after somewhere. They must have care. Inevitably, care costs money and those who cannot afford the care cannot work. People are quite rightly concerned about the quality of the care which they are receiving for their children. Children are not just to be dumped in a left luggage office but need to be looked after. Therefore, I believe that parents should be in a position to try to find child care of sufficient quality. That means a real risk of a classic poverty trap, and we all know the arguments against that. Therefore, I do not need to prove any further that this amendment is to the advantage of the claimant.
I believe that it is also to the advantage of the Government and even, believe it or not, to the advantage of the Treasury. I have not always expressed myself with great favour about the Treasury but it has a point of view and where it can be heard, it should be. I shall not develop any further the points about women returning to the labour market. I know that the Government are well aware of them. In the debate initiated by the noble Baroness, Lady Turner, on 21st June we developed
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those points further. I believe that this is a very strong case and I am happy to support the amendment.
Lord Skelmersdale: My Lords, I am the first to admit that lone parents, like other parents who wish to work, need to balance their work and family responsibilities. The Government believe that child care is something on which the parents should decide and arrange. However, there are also others who have a very important part to play. Employers are showing increasing interest in child care as a way of helping them to recruit and retain staff as labour markets become increasingly tight. Many voluntary bodies are very active in child care, and the Government provide financial support for a number of them. The Government see their role as to facilitate the development of child care facilities by employers, voluntary bodies and others, and to ensure proper standards.
My noble friend Lady Faithfull, in introducing this amendment, commented on the Ministerial Group on Women's Issues, which is chaired by my honourable friend the Minister of State at the Home Office. In April it announced a plan which included the promotion of partnerships between employers, the voluntary sector, local statutory authorities and others; the issuing of guidance to local education authorities and school governors about after-school and holiday schemes; and encouragement to employers to use tax reliefs available to them to provide, or help with the cost of, child care.
This aims to help lone parents and other parents who want to work. It is relevant to this debate because it demonstrates that the proposition put before the House in the amendment is far from being the only way to help lone parents who want to work. I should like to look now more closely at the change being proposed by the amendments, because it is not so straightforward as it might appear.
As the House knows, there used to be a disregard of child care costs for lone parents receiving supplementary benefit and working part-time. But the House should also know that when we commissioned a study of how it was working, it was found that most lone parents did not actually gain from the provision. Nearly 78 per cent. of the working lone parents in the survey incurred no child care costs and only just over 2 per cent. had costs of more than £10 per week.
Noble Lords earlier this afternoon talked about the social security arrangements and budget adapting to circumstances; that is exactly what the Government did. In April 1988, we replaced this disregard and a complicated general disregard of earnings by the simpler arrangement we have now. Lone parents who receive income support and work part-time receive an earnings disregard of £15 per week, which can in some instances be £5·50 more than they would have received under the previous arrangements. This helps all lone parents who work part-time and receive income support, not only those who have child care costs.
But there is a further point. We need to make sure that what we do help claimants without actually

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encouraging reliance on income support and damaging their incentives to greater independence. Yet the change which is proposed would in fact do just that. This is because direct help with child care costs from the public purse is not available to people in full-time work. To provide help as the amendment would propose would create a disincentive to leave income support. It cannot be right to do that.
Noble Lords should also be aware that there is little evidence from the inquiries we have received that the absence of a disregard for child care costs is having a disincentive effect on lone parents taking up employment. But we have always said that we will monitor the various new disregards and consider what changes, if any, are necessary in the light of their operation. The noble Lord, Lord Carter, will be delighted that this is not an occasion to mention the OPCS report. However, to be serious as I must be, we are therefore commissioning an independent study to see how claimants generally are adapting to the new rules.
In conclusion, I would like to emphasise that I fully understand the reasons which have led my noble friend to put forward this amendment. But we have already announced plans for action to promote provision of child care, working with employers, voluntary bodies and others. To change the social security rules as this amendment proposes would weaken incentives to greater independence. But we are monitoring the way the new rules work and, in the light of that, will consider whether changes are needed. The House knows full well that we are not frightened of making changes to the 1986 Act arrangements. We have made several this year and I have no doubt that we shall be in the process of making several next year. I hope that that helps my noble friend.
Baroness Faithfull: My Lords, I thank the Minister. When one changes from one system to another, there is always difficulty with the bridging process. At the moment there is no doubt that there is a big change of policy on the part of Her Majesty's Government; namely, that lone women should go out to work and that the market forces should take over and provide the nursery accommodation or accommodation for the care of their children. That is only the first step towards this new process. For example, I know that the banks have started crèches. I know, for example, that Marks and Spencer intends to buy in places. Nevertheless, while this new system is taking over there are difficulties for lone parents and their children.
My noble friend the Minister said that it is perfectly possible with a Social Security Bill every year to make changes. I should have thought that there might have been the possibility of accepting this amendment and then, when all the market forces begin to operate—whether they ever will is another matter—it will be possible to take this out in next year's Bill, in so far as we have a Bill every year.
I am therefore disappointed on behalf of all these women and their children and indeed the workforce in the way that Her Majesty's Government want
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it to work. However, having made my point and underlined it, at this hour of the night I would not consider pressing the amendment. I therefore beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.30 p.m.
Lord Henderson of Brompton Lord Henderson of Brompton had given notice of his intention to move Amendment No. 13:
After Clause 14, insert the following new clause:
("Applicable amounts.
—(1) In paragraph 1 of Part 1 of Schedule 2 to the Income Support (General) Regulations 1987, after the words "applicable amounts and polygamous marriages" there shall be inserted the words "except that, for this purpose, any person aged less than 25 to whom any paragraph in Part 11 of the Schedule l A applies or would apply if he were aged 16 and had not reached the relevant date determined under regulation 13A (3)(b) shall be treated as if he were aged 25."
(2) In paragraph 1 of Part 1 of Schedule 2 to the Housing Benefit (General) Regulations 1987, after the words "17(a) and (b)" there shall be inserted the words "except that, for this purpose, any person aged less than 25 to whom paragraph in Part 11 of Schedule IA to the Income Support (General) Regulations 1987 applies, or would apply if he were aged 16, claiming income support and had not reacted the relevant date determined under regulation 13A(3)(b) of those regulations, shall be treated as he were aged 25.").
The noble Lord said: My Lords, to use the words of the noble Baroness, Lady Faithfull, at this hour of the night it would be inappropriate to move Amendment No. 13. I have the agreement of the co-signatories to this amendment not to move it. I believe that the noble Baroness, Lady Faithfull, likewise will not be moving Amendment No. 14.
[Amendment No. 13 not moved.]
Baroness Faithfull Baroness Faithfull had given notice of her intention to move Amendment No. 14:
After Clause 14, insert the following new clause:
("Income support for persons aged 16 or 17
In regulation 13A of the Income Support (General) Regulations 1987—
(a) for paragraph (3) there shall be substituted—
"(3) In case of a person to whom any paragraph in Schedule IA applies, the relevant date is the date on which he attains the age of 18.";
and
(b) in paragraph (7) the words "(3)(b) and" shall cease to have effect.").
The noble Baroness said: My Lords, the same applies to this amendment. I do not move it.
[Amendment No. 14 not moved.]
Lord Henderson of Brompton Lord Henderson of Brompton moved Amendment No. 15:
After Clause 14, insert the following new clause:
("Employment rehabilitation.
. In paragraph 7(1) of Schedule 8 to the Income Support (General) Regulations 1987, after the word "derived" there shall be inserted the words "from employment in a work programme for the rehabilitation of persons who would otherwise be unlikely to obtain remunerative employment or".").
The noble Lord said: My Lords, there is no reason why this amendment should take a great deal of time as I had a promising and sympathetic response to my amendment from the Minister in Committee. I therefore withdrew the amendment because I

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thought it would have been churlish to have done otherwise.
I tabled the amendment again today because I very much hope that the Minister will be able to elaborate on his reply given in Committee and because I want to say one or two words myself. In his reply in Committee the noble Lord, Lord Skelmersdale, referred to the employment training programme being open to those with disabilities and other problems, which is indeed the case. However, it does not follow that everyone seeking work rehabilitation is able to use those programmes.
The experience of the voluntary agencies which are specially expert and experienced in this field is that many people who have suffered or are suffering a psychiatric illness are simply not able to use the mainstream programmes. It is their experience and their belief that these mainstream programmes have great difficulty in adjusting to the needs of such people. They are needs which are not at all like those of people who have learning disabilities, such as the mentally handicapped. People with psychiatric illnesses are in a different category. What they need is a special stage before they can consider making use of government programmes. Therefore I ask the Minister kindly to take note of that special feature of those who suffer from psychiatric illnesses.
Secondly, people who have worked closely with the rehabilitation schemes were pleased, as I was and I am sure the rest of the House was, to learn during the Committee stage that the Government are commissioning—I believe these were the words used—"a comprehensive research programme to monitor the effects of the rules relating to earnings disregards". I think that that is a very acceptable expression of government policy. All I ask is that when this is put into effect the Government will take into their confidence the voluntary organisations which are experienced in this field, make use of their expertise and give them every opportunity to contribute to the Government's thinking.
Having made those two points, and hoping for a little further elaboration on the Minister's statement in Committee, I beg to move.
Baroness Jeger: My Lords, we support this amendment. It is a modest and very necessary amendment. It comes before your Lordships with the support of some of the voluntary organisations which are carrying out this extremely difficult work of endeavouring to get people who are often written off as unemployable into a pattern of working.
I am sure that all noble Lords will want to pay tribute to organisations such as the Richmond Fellowship, the Peter Bedford Trust, St. Mungo, and others, because they put society in their debt. They are carrying out work that other people do not care about. They work hard to raise funds and they deal on a very personal basis with people who have a multitude of difficulties.
The trouble is that unless the people they are trying to help are on a disability premium, as referred to earlier, they are only allowed to have the earnings limit disregard of £5 per week. If they were on the disability premium they would have a disregard of
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£15 per week. I am genuinely seeking information. I ask the noble Lord how the department sorts out the £5 people from the £15 per week disregard people? When were these limits set? Are they due for an up-rating? It seems to me that £15 per week is a little enough incentive and that £5 will not give the incentive that is important for some people who have not been in employment and who do not have an established work pattern to agree to go on these courses.
A great deal of very valuable work is being done and it would be a great encouragement to the people operating these schemes if the Government were to show some further understanding and give some assistance.
Lord Hylton: My Lords, I give general support to this amendment. So far we have had mention of the mentally handicapped, the physically handicapped and those suffering from psychiatric illness. I draw attention to discharged prisoners who often need employment rehabilitation before they can have any hope of finding work in the normal way. That arises, or course, from the regrettable situation in many prisons where there is a great shortage of work and where, alas and unfortunately, prisoners are being locked up for 22 or 23 hours each day.
The noble Baroness, Lady Jeger, mentioned the Peter Bedford Trust. That is one organisation that is active in employment rehabilitation. On those grounds, as well as all the others cited, I believe that this is an important amendment which, even though it deals with small amounts of cash per week, should be taken very seriously.
Baroness Faithfull: My Lords, I add one comment from the point of view of those people who are running these centres. It is difficult to instil into the people—men and women—a desire to work if some are receiving one amount of money and the others receiving less. I have to say that it is difficult to inspire those who are receiving less to work harder when they see their colleagues at the next bench receiving much more. If we are to get them back onto the labour market and into the workforce they should be earning about the same amount instead of having this differentiation within a project.
Lord Skelmersdale: My Lords, that again was a most illustrative comment from my noble friend that I shall come to. As the noble Lord, Lord Henderson, said, this amendment was discussed at some length during Committee stage and I am not sure how much I can add to the explanation that I gave then. I do recognise the strength of feeling which exists that something extra should be done to help people who have recurrent mental health problems to get into employment. But I cannot accept that because some of these people qualify for the higher £15 disregard while others the standard £5 disregard this is sufficient justification for raising the earnings disregard for all of them to £15 a week.
My noble friend Lady Faithfull, in essence, asked why they are getting less. The answer is because their disabilities are either greater or lesser. The whole point of the social security system is that people who

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are more disabled should get more money in various ways. The purpose of the existing structure of the earnings disregards is to recognise and encourage those people with very special difficulties caused, for example, by long-term sickness, lone parenthood or long-term unemployment in the case of couples. I am sure that is right. As the noble Lord, Lord Henderson, said in Committee, some of the group he wishes to help are already getting the £15 disregard because they are entitled to the disability premium.
The disability premium is available to people who, for example, have been incapacitated for 28 weeks or more, or who are receiving invalidity benefit, mobility allowance or attendance allowance or who are blind. People with recurrent mental health problems may well satisfy the qualifying condition for receiving the disability premium and therefore be entitled to the higher earnings disregard. However, I can assure the House that it is not necessary for any of these people to register as a disabled person in order to qualify for the higher disregard. I hope that this will dispel the fears than some might have therefore that entitlement to the disability premium could hamper their future prospects for obtaining employment.
But I must also make it clear that the Government do not believe that increasing the disregard level for young, fit, single people will necessarily encourage them to take up full-time employment. Indeed, I am sure that for some it will have quite the opposite effect by removing the financial incentive of doing so. It has been mentioned earlier that we are reviewing the whole matter of disregards. In answer to a question from the noble Lord, Lord Henderson, I can assure him that the views of those groups running rehabilitation schemes will be taken into account when monitoring the new earnings rules.
I believe that a way of helping the people at whom this amendment is aimed is by making them better informed about the nature and conditions for the existing disregards. In this respect I feel sure that organisations involved with them will wish to continue to play a part. The noble Baroness, Lady Jeger, asked me about up-rating the disregards. These were set on 11th April 1988, which I believe is very recent indeed. The Government make annual decisions on up-rating. Much to the fury of your Lordships the Government do not up-rate some benefits and much to the surprise of your Lordships, others they do up-rate. Therefore I cannot make any guesses as to which benefit and by how much up-rating will take place this autumn.
In the meantime, my officials continue to carry out an undertaking I gave regarding last year's Social Security Bill and remain in contact with St. Mungo Housing. They have met again with its representative only recently. Together they hope to work out how best to help this unfortunate group.
I do not believe it will be productive for me to say any more. I do not believe I can add to the two explanations that I have now given on this matter except to repeat to the noble Lord, Lord Henderson (because I am not sure that he was in the House at the time) what I said in Committee. I am absolutely determined—I have made it a personal
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crusade—that the more people with disabilities who are able to work should be encouraged to do so, and I maintain that stance.
8.45 p.m.
Lord Henderson of Brompton: My Lords, I am grateful to the Minister for his reply, but not quite so grateful as I was for his reply to the amendment moved in Committee which I prefer to this one today. I was in my place when he expressed his own personal interest in helping those who are disabled to increase their determination to find work. I am very much conscious of the fact that he has this matter at heart. I very much welcome that.
Regarding his assurance, I thank the noble Lord for saying that when his officials come to consider the new earnings rules in detail they will take into account the views and consult with the experts in this field. As the noble Baroness, Lady Jeger, rightly said, these experts have put us all in their debt for looking after these people and for encouraging them while trying to lift them out of their hopelessness and dependency before they are rehabilitated by these excellent institutions and devoted people. With that hope for the future and my thanks to the Minister, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 15 [Housing benefit to take the form of payments or reductions]:
Baroness Gardner of Parkes Baroness Gardner of Parkes moved Amendment No. 16:
Page 13, line 43, at end insert—
("(3) In section 28 of that Act, the following subsection is substituted for subsection (6)—
"(6)(a) For the purposes of assessing housing benefit an authority shall disregard in determining a person's income the first £10 (or such higher amount as may be prescribed) of any war disablement pension or war widow's pension payable to that person and may by resolution modify any part of its housing benefit scheme to disregard the whole or part of the remainder of any such pension;
(b) an authority may by resolution modify its housing benefit scheme in such other respects as may be prescribed," ").
The noble Baroness said: My Lords, this amendment is fairly self-explanatory. I spoke in great detail at the Committee stage of the Bill. This amendment would increase the present disregard of £5 by 100 per cent. to £10. It would be of great benefit to all of the war disabled pensioners and war widow pensioners. At Committee stage I was concerned that if we asked for a statutory disregard increase it might disadvantage those whose local authorities are giving a much higher disregard.
I have had consultations with the Association of District Councils and it does not believe that will be the case. It believes that those authorities that are already being more generous will continue to be so. That would be of great benefit to everyone. There were other points raised at Committee stage. For example, there was the question of the difference in pension between that of a colonel's widow and a serviceman's widow. I was sent the figures on that matter and, interestingly enough, there was only a difference of about £3 a week between the sums received by the two widows. One received £56 a

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week and the other £59. Therefore, there was not a difference there to be concerned about.
As I made clear at Committee stage, housing benefit helps only those who are in need and therefore are in need of housing benefit. This provision will be of great value. I believe that the Chamber generally agreed on the great merit of these people who had either made a personal sacrifice through the loss of a husband or who had suffered injury themselves, and that they are a particularly deserving group. I beg to move.
Lord Trafford: My Lords, at Committee stage I made some remarks concerning a similar amendment moved by my noble friend. I believe that I was mistaken both in the interpretation that I gave to the amendment at the time and in one or two of the remarks that I made. I support what she has to say now. I hope that my noble friend will be kindly disposed towards this amendment with which I agree.
Baroness Strange: My Lords, I wish to support my noble friend Lady Gardner of Parkes. I can remember—and I expect that most of your Lordships can, too—when a £5 note in your pocket would buy a whole trolley load of food in a supermarket. Not even a £10 note will now do that. I suppose it might if you filled a trolley with 22 loaves of bread. In this instance we are talking of women whose husbands and chief bread winners sacrificed their lives to their country. I do not say that the country owes those widows a living, but merely that we are a great country and are proud of our people. We owe it to those who died for us to care for the wives they loved.
Lord Henderson of Brompton: My Lords, in Committee I briefly supported the noble Baroness and I should like to voice my support this evening. Sadly, the number of people involved is diminishing. It will eventually, in the absence of future hostilities, dwindle down to nothing. In those circumstances, the House should support the noble Baroness, and the Minister and the Government should generously accede to what she proposes.
Lord Skelmersdale: My Lords, I am afraid that I am going to be inconsistent again. I hope that on this occasion the House can live with my inconsistency. My noble friend is seeking an extension of the present £5 statutory disregard in housing benefit of any war disablement or war widow's pension. She has proposed an increase to £10, which doubles the present disregard while retaining the discretion which local authorities have to increase the disregard—or indeed to disregard war pensions in full. The amendment—and hence the increase. — applies to housing benefit, and housing benefit only.
By this amendment my noble friend shows herself to be a staunch supporter of the war disabled and war widows. She has attracted support from almost all round the House. I gather that on the Benches opposite silence means consent. The Government
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wish to be no less supportive. Indeed, as noble Lords will be well aware, this Government have done much for war pensioners. On taking office we completely freed all war pensions and allowances from income tax. We have fully maintained the value of the war pensions and allowances in line with the retail prices index—that is my answer to my noble friend Lady Strange—by means of no fewer than 11 upratings since taking office.
In 1983, we introduced a new mobility supplement for war disablement pensioners, set at a rate higher than the ordinary mobility allowance. From 1984, there have been significant improvements in the age allowances payable to war widows, with substantial extra help for those over 80. And in April 1987, the provision for paying funeral costs for war pensioners dying of their war disablement was significantly improved. There is no mistaking the force and strength of the current of sympathy that is flowing at present around the House in recognition of what the country owes in regard to the sacrifices made by individual war pensioners and war widows.
I am therefore happy to announce to the House that the Government accept the case for this very special and well defined group and will increase from £5 to £10 the statutory disregard of war disablement and war widows' pensions in housing benefit. Moreover, we see the case for extending the increase not just to community charge benefit but also to income support and indeed, in the rare cases where it will apply, to family credit.
There is, however, a technicality: the amount of the statutory disregard is contained in regulations, not in an Act of Parliament, and it follows that the present Bill would not be the right vehicle for conveying this change. The Government would therefore wish to effect the increase by means of an amendment to the appropriate regulations to become effective in April 1990, at the same time as the general up-rating of benefits. I hope that my noble friend will be able to accept this as being the appropriate way of giving effect to the improvement which she is seeking and which I, as Minister with special responsibility for war pensions, warmly endorse.
Baroness Gardner of Parkes: My Lords, I thank my noble friend for that reply, which delights me. However, I am still slightly puzzled. He said that the amount is not embodied in an Act but in regulations. It seems to me to be embodied in the Act. My amendment sought to amend the Act. Perhaps he can explain that point.
Lord Skelmersdale: My Lords, with the leave of the House, the amount of money is not set out in the Act. It is a general power in the Act. The amount of money is set out in regulations made under the Act. That is what we need to change in order to accede to my noble friend's wishes.
Baroness Gardner of Parkes: My Lords, I thank my noble friend for that answer. I had not realised that the £5 was not specified in the previous Act. I knew that the words "statutory disregard" were used. I do not have that section of the Act with me. I am

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only too pleased to express the thanks of war widows and war disablement pensioners. No doubt I shall be able to send them a copy of Hansard which will show exactly when this will come about.
They have asked me to express their gratitude to the present Minister, my noble friend Lord Skelmersdale, and to my noble friend Lady Trumpington, both of whom have been particularly helpful to them in upgrading their pensions in recent years. The chairman of the War Widows Association of Great Britain, Mrs.Hazel Murphy, wrote to me just to remind people that, while the war pensioners—the man—had always received their pensions free of tax, it was the present Prime Minister who brought in the same concession for the women, who had been disadvantaged before and had had to pay tax and have their money treated as unearned income during the years of bringing up their children. That was hardship for them. They were grateful for that. I know that they will be grateful for this announcement by the Government. I thank the Minister for what he has said and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Earl Russell Earl Russell moved Amendment No. 17:
After Clause 17, insert the following new clause:
("Income support for disabled people.
After section 22(4) of the 1986 Act (calculation) there shall be inserted the following subsections
"(4A) Without prejudice to the generality of the preceding subsection a person shall be treated as a severely disabled person if a medical practitioner certifies in respect of that person that he has a medical condition or other disability and that the extra weekly expenses directly attributable to his medical condition or other disability exceed such sum as shall be prescribed.
(4B) In relation to income support and housing benefit the applicable amount for a disabled person shall include an amount in respect of his being a disabled person.
(4C) Regulations may specify circumstances in which persons are to be treated as being or as not being disabled.
(4D) Without prejudice to the generality of the preceding subsection a person shall be treated as a disabled person if a medical practitioner certifies in respect of that person that he has a medical condition or other disability and that the extra weekly expenses directly attributable to his medical condition or other disability exceed such sum as shall be prescribed." ").
The noble Earl said: My Lords, this is an enabling amendment. It allows the Minister to do things by regulations, the normal means of introducing changes in matters relating to income support. It has been drafted mainly with the needs of AIDS sufferers in mind. It could also be of benefit to those suffering from cancer or other terminal illnesses. It allows the Minister to deal with cases where people suffer a disability which causes serious extra weekly expenses and to specify the circumstances in which the severe disability premium—SDP—may be paid to those who stand in need.
In many ways the expenses of those who suffer from AIDS are a good deal higher than those of other people. In answering a question in another place the Minister of State estimated that they need something of the order of 150 per cent. of normal protein. His estimate of the extra cost of that per week is £14·19. The Royal Victoria Infirmary at
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Newcastle calculates it at £30. That discrepancy may not surprise the House, but even at the lower figure this is a quite significant addition to the extra expenses of people living on income support, which does not, I think, provide normally for real luxury in diet.
The amendment will also deal with the 28-week period normally needed to qualify for severe disability benefit. In a number of cases, as the noble Duke, the Duke of Norfolk, and the noble Baroness, Lady Faithfull, have already reminded us, sufferers from AIDS may be dead before they have qualified for the premium. From the Treasury's point of view it may be a cheap way of solving a problem, but I do not think it is a good one.
The Minister, I suspect, will take the advice of the noble Lord, Lord Carter, and simply say "OPCS" and sit down. But this problem will not wait. A good many people to whom this amendment may apply would be dead well before the OPCS survey could be completed, considered and embodied in legislation after all the necessary procedures. This is genuinely a matter of life and death. I beg to move.
Lord Carter: My Lords, I am pleased to support the amendment. As the noble Earl said, there is a real problem for those who suffer from AIDS and HIV infections. It is one of the problems we foresaw with the abolition of the additional payments under the old system of supplementary benefit for items such as heating, laundry and bathing. The Government replaced targeting with the relative inflexibility of the disability premium and the severe disability premium. With the AIDS condition there is severe sweating and incontinence. Pneumonia is almost invariably associated with AIDS with the extra heating costs that are required.
If the Minister mentions the OPCS, I am sure that he will be aware that the questionnaire which was used for the survey did not include any consideration of AIDS or HIV infections. Therefore it would be interesting to know how that survey is supposed to help with this problem.
The amendment moves us only slightly towards a comprehensive disability income which is the target of all of us involved in disability matters. I must say that those of us on this side of the House are very pleased to support the amendment.
9 p.m.
Lord Skelmersdale: My Lords, if the noble Earl, Lord Russell, and the noble Lord, Lord Carter, were living in a world where there was no other disability benefit, I could immediately see the logic for this amendment. Of course, there is an OPCS factor in the matter, as the noble Lord, Lord Carter, knows full well. However, I think I should make the point that in the study of the OPCS data the considerations will obviously cover proposals of the kind introduced by this amendment. But I must stress that it would import into the income support scheme some of the worst features of the old supplementary benefit system which so bedevilled it and which led to the urgent need for its reform.

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The whole object of those changes was to replace subjective judgments of the type which this amendment would require with much simpler objective ones. Moreover, those of us who are very questioning about a comprehensive disability pension would, I think, take that line as a matter of course. As I pointed out just now to the noble Lord, Lord Henderson of Brompton, different levels of disability attract different levels of benefit. I, for one, believe that that policy is correct.
So far as concerns objective criteria, I believe that that has provided certainty for the claimant about his income support entitlement and has improved ease of administration. Flat-rate premiums for the sick and disabled, linked to the receipt of long-term incapacity and disablement benefits, and based on other objective criteria, were one of the major achievements of the reforms. I believe that it would be quite wrong to damage or reverse that situation now.
The rationale of those premiums remains sound, not least because most illnesses are short and do not involve extra cost. It is those which persist long term and which incapacitate for a long time which attract the premiums. Therefore I agree with the noble Earl and the noble Lord that this is a matter which needs to be looked at very seriously indeed. I should, however, point out to the noble Earl that the sum of £14·19 which he mentioned is not the extra cost; it is the cost of a diet as a whole based on 1986 rates. If the noble Earl is interested, the source of that information is McDonald and Forsythe at St. James's University Hospital.
However, I was talking about the amounts which are payable now. I think that it would be appropriate to remind the House that the disability premium currently stands at £13·70 for a single person and at £19·50 for a couple. Moreover, the severe disability premium—payable on top of those amounts—is £26·20 for a single person and double that where both people in a couple satisfy the criteria.
The noble Lord, Lord Carter, in particular, will know that in addition the independent living fund exists to help severely disabled people who need personal care or domestic support to live independently in their own homes. If the noble Lord wanted to twit me he would say that the independent living fund is such a success that the Government are embarrassed by it. I must tell him that the Government are not in the least embarrassed by that fact; indeed, we are delighted at its success.
In view of my arguments, I hope that the noble Earl will see fit not to pursue the amendment at this time of night.
Earl Russell: My Lords, I thank the noble Lord for that reply. It is not the first time tonight that we have heard the argument that the proposal in question reintroduces the worst features of the old supplementary benefit system. I am beginning to wonder whether, when the Minister speaks about the worst features of that system, he may occasionally be speaking about certain aspects of it which some of us on this side of the House may regard as the best features of the system.
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The Minister spoke about objective measures. But there is a little difficulty here, as we may hear later tonight, about objective measures of pain and suffering. It is also an objective fact that not all disabilities are equal to all other disabilities. In fact, I tried to put forward an argument to show that there is here a case for arguing that some disabilities do not have equal expenses with other disabilities.
There is, I think, some force in the remark of Aristotle that justice does indeed involve equality, but equality for those who are equal, and not for all. This objective measure is losing sight of the very real differences between cases.
As regards the sum of 14·19 being the cost of a complete diet, I take the point. However, it makes me wonder whether the passage in my briefing paper which said that this was based on 1896 prices is perhaps not a misprint after all. Nevertheless, with the crumb of comfort that the Minister knows that this matter needs looking at again, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Speaker (Baroness Lockwood): My Lords, I must point out that if Amendment No. 18 is agreed to, I cannot call Amendment No. 19.
Clause 23 [Recovery of sums equivalent to benefit from compensation payments in respect of accidents, injuries and diseases]:
Lord Campbell of Alloway Lord Campbell of Alloway moved Amendment No. 18:
Leave out Clause 23 and insert the following new clause:
("Recovery of sums equivalent to benefit from compensation payments in respect of accidents, injuries and diseases
23.—(1) No compensation payment may be made in respect of an accident, injury, or disease unless—

(a) the Secretary of State shall have furnished to the person proposing to make such payment a certificate showing the categories and amounts of benefits paid, or to be paid, by reason only of such accident, injury or disease for the relevant period;

(b) the Secretary of State shall have approved a statement of deductions of the amounts received under categories of benefit which fall within a like head of damage furnished by the person proposing to make such payment to the Secretary of State and to the intended recipient of compensation.

(2) This section shall not apply to any compensation in payment for an amount not exceeding 10,000 (or such amount in excess of £10,000 as may be prescribed by regulation) as a single payment or in aggregate with any other compensation payment for the same accident, injury, or disease; or to any "exempt payments" as provided by subsections (4) and (5) of this section.
(3) The right of the recipient to receive compensation shall be satisfied by payment of such sum less deduction as appears in the statement of deductions as approved by the Secretary of State; and within 14 days of payment of compensation the person who has made such payment shall pay to the Secretary of State an amount equivalent to such deduction.
(4) For the purposes of this section the following are the "exempt payments"—

(a) any payment made to or for the victim under section 35 of the Powers of Criminal Courts Act 1973 or section 58 of the Criminal Justice (Scotland) Act 1980;

(b) any payment to the extent that it is made—

(i) in consequence of an action under the Fatal Accidents Act 1976; or

(ii) in circumstances where, had an action been brought, it would have been brought under that Act;

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(c) any payment to the extent that it is made in respect of a liability arising by virtue of section I of the Damages (Scotland) Act 1976;

(d) without prejudice to section 6(4) of the Vaccine Damage Payments Act 1979 (which provides for the deduction of any such payment in the assessment of any award of damages), any payment made under that Act to or in respect of the victim;

(e) any award of compensation made to or in respect of the victim by the Criminal Injuries Compensation Board under section 111 of the Criminal Justice Act 1988;

(f) any payment made in the exercise of a discretion out of property held subject to a trust in a case where no more than 50 per cent. by value of the capital contributed to the trust was directly or indirectly provided by persons who are, or are alleged to be, liable in respect of—

(i) the accident, injury of disease suffered by the victim in question; or

(ii) the same or any connected accident, injury of disease suffered by another;

(g) any payment made out of property held for the purposes of any prescribed trust (whether the payment also falls within paragraph (0 above or not);

(h) any payment made to the victim by an insurance company within the meaning of the Insurance Companies Act 1982 under the terms of any contract of insurance entered into between the victim and the company before—

(i) the date on which the victim first claims a relevant benefit in consequence of the disease in question; or

(ii) the occurrence of the accident or injury in question;

(j) any redundancy payment failing to be taken into account in the assessment of damages in respect of an accident, injury or disease.

(5) The Secretary of State may by regulations provide that any prescribed payment shall be an exempt payment for the purposes of this section.
(6) Except as provided by any other enactment, in the assessment of damages in respect of an accident, injury or disease the amount of any benefits paid or to be paid shall be disregarded.
(7) Schedule 4 to this Act shall have effect for the purpose of supplementing the provisions of this section; and this section shall have effect subject to the provisions of that Schedule.
(8) This section and that Schedule shall apply in relation to any compensation payment made after the coming into force of this section to the extent that it is made in respect of—

(a) an accident or injury occurring on or after 1st January 1989; or

(b) a disease, if the victim's first claim for a relevant benefit in consequence of the disease is made on or after that date.

(9) In this section "benefit" means such benefit under the Social Security Acts 1975 to 1988, or the Old Cases Act as may be prescribed for the purposes of this section by regulation.
"compensation payment" means any payment falling to be made (whether voluntarily, or in pursuance of a court order or an agreement, or otherwise)—

(a) to or in respect of the victim in consequence of the accident, injury or disease in question, and

(b) by or on behalf of a person who is, or is alleged to be, liable to any extent in respect of that accident, injury or disease,

and includes, in particular, so much of the payment as represents reimbursement for costs incurred in procuring it, but does not include benefit or an exempt payment;
"costs", in relation to proceedings in Scotland, means expenses;
"payment" means payment in money or money's worth, and cognate expressions shall be construed accordingly;
"relevant period" means—

(a) in the case of a disease, the period of 5 years beginning with the date on which the victim first claims a relevant benefit in consequence of the disease; or

(b) in any other case, the period of 5 years immediately following the day on which the accident or injury in question occurred;

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but where before the end of that period the compensator makes a compensation payment in final discharge of any claim made by or in respect of the victim and arising out of the accident, injury or disease, the relevant period shall end on the date on which that payment is made whether or not any subsequent payment falls to be made in respect only of taxed costs.").
The noble Lord said: My Lords, I beg leave to move this amendment, which stands in my name, conscious of the fact that the view has been taken in certain quarters that it is too cumbersome and that that view, in fairness, may be well-founded. But, if the Government cannot accept like for like as a principle of deductions, and not only accept it but administer it, then it may be better that Clause 23 and Schedule 4 be excised altogether from the Bill.
It is understood that a simple alternative proposal to ensure like for like to limit the incidence of deductions to people in respect of loss of earnings and hospital and medical benefit is not acceptable to the Government. The amendment in that regard moved by the noble Lord, Lord Allen of Abbeydale, in Committee was not acceptable to the Government. In short, the Government do not accept the principle of like-for-like, and bring forward no amendment to implement that principle which is less cumbersome than the amendment I am moving. I accept that when I drafted it I had not assistance, and that inevitably it is defective. However, the question which will arise tonight is whether your Lordships will wish to divide on the amendment, albeit with the defects that I freely confess, in order to establish the principle so that, after consultation, the drafting of Clause 23(1)(a) and (b) may be pruned and amended before Third Reading; or, on the other hand, whether your Lordships will wish to excise Clause 23 and Schedule 4 from the Bill so that the Government may think again.
I have given due notice that should your Lordships wish to divide on the amendment to establish the principle, as was the intention in Committee, there will be a post-prandial Division, but that if your Lordships wish to divide only to excise Clause 24 and Schedule 4 then, I say it frankly, I shall go in to the Content Lobby because I cannot accept Clause 23 and Schedule 4 as they stand.
I have the most cordial relationships with my noble friend the Minister, and I thank him for the efforts that he has made in consultation. He understands my position. It is right that I should make the position wholly plain to your Lordships' House. I shall oppose the clause unless the Government give on the principle. Whether or not that succeeds is a matter of votes in a Division.
Let us start with the common ground. It is the best way to start in any analysis. It is common ground that the present practice under which all, half or none of the social benefits received, depending upon the type of benefit, are offset against the settlement or award should cease. Save as regards the CBI, for whom my noble friend Lord Mottistone speaks so eloquently, and the TUC, for whom the noble Baroness, Lady Turner of Camden, speaks, it is also common ground, or was in Committee, that irrespective of the type of benefit, all benefits should be set off to avoid double compensation.
Against that area of common ground, the question arising on the amendnment is whether that wider area of common ground should be qualified, first, by the like-for-like system of deduction; and, secondly, by the exclusion of settlements and awards of under £10,000. That is the essential question. The complexity of the drafting obscures the essence of the question. Because it is a complex subject, it inevitably requires complex drafting. In that regard, the terms of reference—I beg your Lordships to accept this if you have not read it; I have it with me—of the Touche Ross Report, commissioned by the Government, excluded consideration of a like-for-like system of deductions and all questions of administrative difficulty. It cannot be relied upon to defeat new Clause 23(1)(a) and (b) in the amendment: the essence was excluded.
As regards the second aspect of £10,000, there is a finding in paragraph 2.3 of this vast report. It is a magnificent document. I have read it twice, but I am not quite sure what it amounts to. It is a brilliant effort, but I am not sure what it means. I am totally certain that the Government do not have a clue because they have expressly excluded from the report all questions of administration.
In paragraph 2.3 one finds that if amounts of less than £1,500 were excluded in 1987, the Government would still recover 95 per cent. of benefit. So what? What on earth does that have to do with the problem with which your Lordships are concerned tonight? That paragraph was wholly related to a question of saving administrative costs. It was not concerned in any way with justice for the victim in the form of these relatively small awards, to which reference was made at the Committee stage and which I shall not repeat. That aspect of the Touche Ross Report may not therefore be relied upon by my noble friend the Minister to defeat Clause 23(2).
I am no draftsman and I have received no assistance. I acknowledge that this amendment must inevitably be wrong and defective, but nonetheless I shall move it if it is your Lordships' wish. Why? It is intended to force the Government to accept the principle of like-for-like. It would then be possible by consultation to work out how that principle should be fairly applied. However, it is a matter for your Lordships as to whether we excise the clause altogether.
I have removed total benefit and relevant benefit. I have removed benefit from the exempt payments and included it in Clause 23(9). I have simplified the definitions section and retained "relevant benefit". In other words, I have tried to simplify the complexity of the government draft.
In Clause 23(1)(a) I have dealt with categories of benefits and amounts. That is quite simple. The Secretary of State could do that at the drop of a hat.
I accept that Clause 23(1)(b) is a more difficult proposition. The person proposing to pay compensation sets out a statement of deductions and amounts received under categories of benefit against the like head of damage, but only against the like head of damage. No compensation may be paid until the Secretary of State has approved the proposed like-for-like deductions.
In a redraft of Schedule 4 there would be a simple appeal machinery in the event of disagreement, and, unless the Secretary of State had given approval within a reasonable time such as two or three months, then payment could be made in accordance with the statement of proposed deductions. The implementing machinery would be put in redraft of Schedule 4. With regard to Clause 23 and the body of the statute, I am concerned only with matters of fundamental principle. It is right to bring the exclusion figure onto the face of the statute in Clause 23(2). This is a matter for your Lordships to decide here and now because of the injustice that arises on the small payments.
Why should your Lordships leave it to the Minister? We must decide, on the basis of objective and fair discussion, what we should leave to the Minister. Why should we just leave everything to the Minister? That is something that I have never been able to understand, whichever government have been in power. I am not making a political point; it is a lawyer's point made by someone who believes in constitutional government. There are also consequential amendments.
Baroness Turner of Camden: My Lords, I said in Committee that my main argument is against what is proposed in Clause 23 and the schedule. That is still my position. We debated this matter at length in Committee and I do not wish to repeat all the arguments which were so well made by other noble Lords. However, I repeat that my main objection is that we have here two systems in operation. There is the industrial injuries scheme introduced in 1948 which is a system of no fault benefit for which contributions are paid. To establish a right to weekly benefit, which by no means compensates for loss of salary let alone any cost for pain and suffering, an injured employee only has to demonstrate that the accident or injury arose out of or in the course of his employment to qualify for benefit under the scheme.
If there is negligence by some other person or his employer, he then has another and quite separate claim at common law. For many years employers have had to carry employers' liability insurance; in practice it is the insurers who pay compensation payments where there has been negligence or contributory negligence. Fifty per cent. of some benefits is already taken account of in the assessment of damages. What is now proposed and what I find so objectionable—this has already been referred to by the noble Lord, Lord Campbell of Alloway, in moving his amendment—is that all social benefit should be deducted from the compensation received in a negligence claim. I do not accept that at all. I think all kinds of problems will arise. We shall end up in situations where people simply do not receive compensation for pain and suffering. The noble Lord, Lord Campbell of Alloway, has attempted in his amendment to ameliorate that situation to some degree by setting a level of £10,000, below which there will be exemption from deductions.
However, I believe the most objectionable feature to this whole suggestion is not only that it will be extremely cumbersome to administer—a point

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amply made in Committee and by the CBI and the Association of British Insurers in representations to the Government—but it will also result in a great deal of injustice and inequality. In effect it undermines yet again the industrial injuries scheme. People will end up being a great deal worse off than they are under the present system.
As I have said, I do not wish to repeat all the arguments that we heard in Committee. While I would much prefer not to have this clause in the Bill at all—that is why I put my name to the amendment which seeks to delete it—it seems to me that the amendment of the noble Lord, Lord Campbell of Alloway, ameliorates the position somewhat. As the noble Lord has said, the amendment attempts to deal with the whole issue on a like-for-like basis. As I see it, it attempts to endeavour to ensure that loss of wages will be counted as compensation in a compensation deduction. That is what is meant by comparing like with like.
Lord Campbell of Alloway: And hospital expenses likewise.
Baroness Turner of Camden: Hospital expenses would also be included in the provision, as the noble Lord says. There is the limit of £10,000. So there would be some amelioration. As I said earlier, I would prefer a situation where the clause simply did not exist at all because I see no justification for it whatsoever. I say that after a great deal of discussion and consultation outside the Chamber with the noble Lord, Lord Skelmersdale, who has been good enough to send me some material, including the Touche Ross report to which much reference has been made. But in default of having a situation where the clause simply does not appear, I support the amendment of the noble Lord, Lord Campbell of Alloway, because it provides some amelioration of a situation which I otherwise find quite unacceptable.
Lord Allen of Abbeydale: My Lords, like the noble Baroness, I would prefer the clause to be left out of the Bill altogether. If this amendment is not accepted I hope that when we come to discuss the next amendment I shall have an opportunity to explain my reasons.
The clause now proposed has the two great merits, as the noble Baroness has said, of attempting to deal with the like-for-like problem and introducing a small payment definition of 10,000 with provision for it to be increased as the years go by. To that extent the amendment is certainly an improvement on the clause in the Bill.
However, I see problems. I think that the administrative set-up of the department monitoring settlements between parties, coupled with a right of appeal, could prove very time-consuming and expensive. The proposals do not in any way meet the difficulty, on which I feel strongly, about contributory negligence. I think that there is the practical problem that the clause would have to be rewritten, as I think the noble Lord would be the first to agree, and Schedule 4 would have to be completely redrafted. And here we are at this very late stage of the Bill.
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As I have said, my position is that this is a valiant attempt and if it were pressed to a Division I would support it. However, I venture to hope that the noble Lord will not press it to a Division in view of the problems that I have just outlined, particularly the problem of getting it licked into shape in the time available. I hope that, instead, we can proceed to the next amendment and discuss whether the clause should stay in the Bill.
Lord Mottistone: My Lords, I should very much like to support what the noble Lord, Lord Allen, has just said. As has already been pointed out by my noble friend Lord Campbell of Alloway, I have no time for modification, and I would not support my noble friend's amendment because it seeks to retain what I consider to be a fundamental flaw in the existing Clause 23. I hope to reserve my ammunition for Amendment No. 19, which seeks to defeat the clause altogether.
Earl Russell: My Lords, before dealing with the amendment I should, first, like to offer thanks to the Minister, and through him to his officials, for the care and courtesy with which they dealt with the debate which took place on this clause in his office. There we all entered the discussion with real political good will. I believe that if there had been agreement to be reached we would have reached it.
Like the noble Lord, Lord Mottistone, the noble Baroness, Lady Turner of Camden, and the noble Lord, Lord Allen of Abbeydale, I have considerable doubts about the principle of the clause. I would be prepared to compromise on the principles of the amendment drafted with so much care and work by the noble Lord, Lord Campbell of Alloway, if I could be satisfied that that amendment is viable. Here I beg the Minister to do the best he can to satisfy me that compromise on these lines can be made to work, for there is the political will to make it work. The question is, can it? That is a question on which I hope the Minister will satisfy me.
We have here an immense complication caused by the Government, Becket-like, asserting the principle that not even Beveridge compensates twice for the same injury. Whether the principle of double compensation is entirely relevant to the matter of the clause is something on which some of us have a certain amount of doubt. The Government's case would be stronger if the Minister would agree, as a minimum concession, to omit contributory benefits from the scope of his clause. But even if he were to accept the principle of double compensation being wrong—and I do not believe that many of us are quite as worried about that as the Government think we ought to be—lift for the disabled is so difficult that if once in a blue moon they happen to get a windfall I do not necessarily regard that as the worst thing that can happen in the field of social security.
However, even if one accepts the double compensation principle, I do not think that it is easy to follow the Government in their Becket-like elevation of that principle to a lonely eminence whereby it overrides every other principle in the clause. It overrides any attempt to take account of contributory negligence. Between us we have failed

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completely to find a way in which the clause can be amended to treat cases of contributory negligence in a different way from those involving no negligence at all. That does not satisfy me. It completely overrides the principle of like for like, so damages for pain and suffering may all be sent to pay social security benefits with the result that a person may perhaps end up repaying rather more than he receives in damages. I find that situation thoroughly unsatisfactory.
I see here an incentive to litigation because, if one feels that one needs £10,000 of damages to be satisfied and one must repay £5,000 in social security benefit, one will then ask for £15,000. I understand that the department sees the contrary argument here. As it sees the position, the longer one postpones the settlement to litigation, the more benefit one will receive and the more benefit one will repay. The department thinks that that is an incentive to avoid litigation and settle quickly.
The question between us is which of those incentives is more powerful. Anyone who has studied the odds of the football pools and the size of the prizes will appreciate that the jackpot is the greater attraction. The thought of large and satisfactory damages and the sense of injured innocence will draw people to press claims for damages in the courts. The clause will lead to a vast increase in litigation. I share the misgivings of the noble and learned Lord, Lord Griffiths, that there is a risk that it could swamp the courts.
There is also here an issue of costs. The Government speak throughout of costs to the taxpayer. That is important, but it is not the only form of cost. The question is: are we to have costs paid by the taxpayer or by insurance? Whichever way, we pay, so it is relevant to consider which way we end up paying more.
If we abandon the present system and rely on insurance, we shall end up paying more. We shall have a much more complicated system. Noble Lords need only look at Schedule 4 to appreciate that that must be the case. It is also the basic principle of insurance that one keeps down the cost by spreading the load. I do not see what can do that more fully than a scheme of national insurance. So, in abandoning that and relying on private employers' insurances, we shall put up the costs. To keep down the cost to the taxpayer while increasing the costs to the public by a greater proportion does not seem to me to be good sense.
We must also think here about our industrial costs. We on these Benches have many times drawn attention to the need to encourage manufacturing industry and the need for government to take a more sympathetic attitude to it. In terms of increased insurance premiums, the measure will certainly put up industrial costs. The latest estimate is 8 per cent. It is not the highest estimate and all those estimates are guesses. It might be higher than that.
I appreciate that, under the rules of GATT, we cannot subsidise our exports, but perhaps I may quote the normal accountants' rule: we need not so arrange our industrial affairs as unnecessarily to attract costs. If we do that, we put a handicap in the way of our attempts solve our economic problems.
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I also see behind this a real move towards a notion of privatisation of liability. It has been suggested in another place that the Government could respond to the shifting of costs of industrial insurance by reducing national insurance contributions. I find that an ominous suggestion. I also find it ominous that the Government reject the view of the Pearson Committee that benefits should be used to reduce the liability of the compensator.
This attempt to privatise liability is, I think, in the Government's sense as well as mine, inefficient. If it has to be done at all I would rather have it done in the way argued by this amendment. However, unless the Minister can convince me that this amendment is viable, I do not think that it can be done at all.
This clause is opposed by the CBI, the TUC, the Association of British Insurers, the Law Society, the Faculty of Advocates and the Medical Protection Society. So is this perhaps a case of all out of step but—and I shall not go on for fear of offending standing orders.
Baroness Gardner of Parkes: My Lords, at Committee stage the noble Lord, Lord Allen of Abbeydale, said that he welcomed the provision in the Criminal Justice Bill which was more or less a parallel of this clause. He said that it gave effect—I see that the noble Lord wishes to intervene.
Lord Allen of Abbeydale: My Lords, I welcomed it because it did that in exactly the opposite way.
Baroness Gardner of Parkes: My Lords, as I read Hansard he said that it,
"gave statutory effect to the existing practice of deducting social security payments from compensation for criminal injury".
I thought that this clause concerned deducting payments for negligence and other injury. Perhaps I am wrong on that point.
I am concerned about whether this amendment changes the whole precedence of recoupment which seems to occur in all sorts of fields. I sit as a member of an industrial tribunal and recoupment is always something that is taken into account in all compensatory awards that are made. Also taken into account is the degree of contributory effect. It is most important that a contributory effect in a case of negligence should be taken into account. As I listened to the debate I understood that this amendment would remove the contributory element.
Lord Campbell of Alloway: No, not a bit, my Lords. If my noble friend would allow me to intervene, perhaps I may say that I tried to support this measure at Committee stage. I am attracted to the justice of it but cannot find the logical justification for it because benefits are not relevant to fault. I shall not take up more time but perhaps my noble friend will allow me to say she has got this one upside down.
Baroness Gardner of Parkes: My Lords, I thank the noble Lord. I would like to be put right on this matter by the Minister when he replies. I thought there was quite a difference. I understood that under the Government's proposals the recoupment would

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cease at the date of settlement; otherwise the recoupment could go on much longer. I thought that various considerations were involved such as that the Secretary of State had to agree the amount but there were no criteria given to him to do so. I appreciate that the sheer complexity of this amendment must have made it almost impossible to get right. However, I support the principle of recoupment and no duplication of payment. My support is therefore for whichever argument is heading that way.
Lord Trafford: My Lords, I am rather sorry that we are discussing Amendment No. 18 without considering Amendment No. 19. Amendment No. 19 to leave out the clause in a sense goes with the other amendment. It means that we are exchanging the clauses. I accept the fact that it makes acceptance extremely difficult.
This is a complicated issue and I was very impressed with the speech of the noble Lord, Lord Allen, on this very question at Committee stage. I do not wish to say any more about the wording of this amendment. I should however like to take up one point.
The noble Earl, Lord Russell, put his finger directly on the point when, in pointing out that to a very large extent he accepted in broad terms the principle of no double compensation he asked—and this I think is the nub of the matter—this question. Is it therefore the taxpayer who should pay by means of social security in one way or another, in larger and smaller settlements where the social security system—that is the taxpayer essentially—subsidises the payment; or is it through insurance premiums?
If one strips away some of the references to Becket and other matters that came up, the noble Earl's major point was that in effect industrial costs would rise. It would be more damaging overall to finance negligence and injury compensation in this way than it would be by the total removal of social security payments from any compensation.
It seems to me that it is difficult to argue that, whether through contributory or non-contributory benefits, the taxpayer, or indeed the contributor, should necessarily subsidise the payment of compensation by those who should pay it, which is of course through insurance. One insures against a liability to such compensation.
I accept that such provision would be uncomfortable in the sense that it would raise many insurance contributions. I accept that it would be somewhat more complicated in bureaucratic terms. I accept that it may even lead to more litigation as the noble Earl and the noble Lord suggested. Nonetheless, the two fundamental principles that strike me are these. First, it would eliminate double compensation. The only objection that I can see in theory is the argument about the contributory element of payment. Secondly, it would mean that those who should have paid the compensation would be the people who paid the compensation either through premium, or directly if it was not through insurance. However, from that compensation should then be deducted that which has been the contribution of the taxpayer.
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I cannot see that there is anything wrong or evil about either of those propositions. It is for this reason that I would have reservations about the question of changing Clause 23. I would also have reservations in view of the fact that about 80 per cent. of all these settlements are I believe within his lower figure of £10,000. Also, if I understand him correctly, only about 20 per cent. of such payments amount to benefit.
Nonetheless, leaving those specific figures aside for the smaller sums, those two principles to which I have referred do not seem to be ones which we should lightly discard.
9.45 p.m.
Lord Coleraine: My Lords, I listened to the debate in Committee in this Chamber a fortnight ago very much as a bystander. I felt that the debate, in particular that intiated by the noble Lord, Lord Allen of Abbeydale, on the like-for-like amendment went on and on. It took in all the amendments that had been put on the Marshalled List. I felt that that debate was singularly unelightening.
As in all amendments, the amendment called for debate. However, the noble Lord immediately tacked onto it another amendment in which he was interested. Therefore other noble Lords came into the debate and raised their own particular points.
Lord Mottistone: My Lords, we are not doing it this time.
Lord Coleraine: My Lords, the result was that on that occasion some noble Lords argued one way, and some the other. But all seemed to agree that by so doing they had proved that Clause 23, as it now is, was a nonsense and should be taken away and consigned to the dustbin. To me it was all rather reminiscent in parliamentary terms of the riot scene at the end of the first act of "The Mastersingers". With respect it settled very little.
I find it surprising that tonight we do not have proper amendments to consider. I congratulate my noble friend Lord Campbell of Alloway that he has brought forward one; in fact two tied up into one.
Lord Mottistone: My Lords, it is only one amendment—
Lord Coleraine: My Lords, he has brought forward the like-for-like amendment and the £10,000 limit amendment and put them together into one. I wish only to talk about the like-for-like amendment. It is well known that a number of authorities have said that the like-for-like principle is correct and is justified. I understand that the Pearson Royal Commission said that as well. So far as I can see, this is not in your Lordships' debates.
Lord Campbell of Alloway: My Lords, I welcome any criticism that my noble friend can give of my amendment.
Lord Coleraine: My Lords, let me put the point simply in this way. If a social security benefit is for £5,000 loss of earnings and it has, as we are to

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assume for the purposes of the amendment, to be paid back to the Secretary of State out of the £5,000 pain and suffering award made by a court, then the reason for that is that the court has decided that the pain and suffering is all that has been sustained and there is no loss of earnings. That is putting it at its most simple.
I find it perfectly fair that the injured person will have received an amount which was the actual loss as decided by a court, even if he received it via his benefit and not by a judgment, because in this way he will have received his loss but once and not twice. It is the taxpayer or the national insurance contributor who will benefit.
I have been discussing my noble friend's amendment, but in the way that these amendments have to be treated the debate has moved on to a debate on whether Clause 23 should remain in the Bill. I should perhaps take up once again the question of contributory negligence. I have not understood that there is any problem here. The noble Lord, Lord Allen of Abbeydale, postulated in Committee that £5,000 of benefit—
Lord Mottistone: My Lords, we are not taking these together.
Noble Lords: Order!
Lord Coleraine: My Lords, it has all along been the case that the whole thing has been taken as one because—
Lord Mottistone: No.
Lord Campbell of Alloway: My Lords, to save time, contributory negligence is not before the House in my amendment and is no longer before the House. Nobody has an amendment which raises the amendment introduced by the noble Lord, Lord Allen of Abbeydale, on contributory negligence. Therefore, to speak on it, with the greatest respect to my noble friend, is to waste the valuable time of your Lordships' House.
Lord Coleraine: My Lords, I do not propose to speak on contributory negligence then, but when my noble friend reads Hansard in the morning he will see that other noble Lords who have supported his amendment have also widened the argument to the whole question.
Lord Mottistone: My Lords, if I might intervene, last time we did that in Committee. That was a mistake. It was my fault. This time, at the request of my noble friend the Minister, we have grouped amendments so that this amendment is separate and the amendments on deleting the clause will be dealt with under Amendments Nos. 19 and 20. This will be a separate debate when this one has been completed.
Lord Coleraine: My Lords, I am grateful to my noble friend for making that point. The answer I was giving to my noble friend Lord Campbell of Alloway still stands and I shall not repeat it now. I hope that, if and when this amendment comes to a Division, your Lordships will reject it.
Viscount Dilhorne: My Lords, it is with very considerable modesty and a remarkable amount of temerity that, having read everything that was said by very eminent and learned Members of the House, I now rise to make a very small contribution. I realise that complexity begets complexity. Social security measures were always an element of tax that I carefully avoided studying in the detail in which I studied other areas of tax. I feel that I am in a large minority of one—I cannot make myself smaller. It seems to me that it is a very simple matter that is put forward by the Government. It is as simple as this when it is put into words: where the compensation to be paid is £100 (that is an easy figure for my limited mathematical capability) and where the social security payment which, I understand is made fairly promptly, for the sake of this example, is £20, there is a claim. The claim comes from a person who is called the compensator. The compensator pays out £100 but only £80 goes to the person who is being compensated, the injured person.
As I understand it, the measure proposed by the Government—and I am probably wrong—is that £20 then goes back to social security. It seems to me that for an additional reason this is a good measure. As I understand it, at present the benefit paid is offset only against special damages. The proposal is to set it against all damages, to put it into one pot. As I understand it, special damages—
Lord Allen of Abbeydale: My Lords, I am sorry to interrupt. Am I not right in thinking that the noble Viscount is talking about the merits of the clause and not about the amendment tabled by the noble Lord, Lord Campbell? That is what we are supposed to be discussing.
Viscount Dilhorne: My Lords, if the noble Lord will allow me to finish what I am saying, perhaps he will understand what I am suggesting. I started my speech with some deference to him and to what he had contributed. However, I do not agree with his amendment which was moved in the previous debate. I support the Government's proposal; I do not support the amendment of my noble and, if I may say so, nearly learned friend Lord Campbell of Alloway, who is far senior to me at the Bar and is learned in these matters.
Lord Campbell of Alloway: But not learned in this House, my Lords.
Viscount Dilhorne: My Lords, I said "nearly learned". I understand the position to be that the main cause of complaint is that the benefit paid from the total compensation is recouped, whereas the present offsetting is applied only to special damages. That is a term I understand to mean earnings and expenses. But it is not applied to the general damages. Those are the things which one cannot exactly specify.
As I understand it, the amendment of my noble friend Lord Campbell of Alloway will involve the courts or someone dividing out each element of
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cost. That seems to me to involve very considerable difficulties because when one settle; a case with another barrister or with the other side, at that stage one takes into account an immense compendium of different factors. One of those factors has already been mentioned—the factor of costs, the costs of continuing to fight.
I am sure that that is a mistake, considering the work that will be done in putting in these different heads. It will complicate matters enormously, it will put—
Lord Campbell of Alloway: My Lords, the noble Viscount mentioned my name. I am not contemplating the intervention of the courts. That is a total misapprehension. It will probably go to a social commissioner. There is already an appellate machinery in operation. There is n3 question of involving the courts in this. The concept that this will be overlaid by legal complexities is wholly misconceived.
Viscount Dilhorne: My Lords, I am obliged to my noble friend for his help on that matter. For the reasons I outlined at the outset, I support the Government's proposal to recover the benefit paid where that benefit is going to exceed, on the final compensation, the total amount which the person compensated is entitled to receive. On that basis, I support the Government.
Lord Skelmersdale: My Lords, clearly after that debate the one trap into which I must not fall is to stray into a debate on clause stand part. My noble friend Lord Campbell has asked that Clause 23 be adapted in two important respects. In my estimation my noble friend Lord Coleraine is absolutely right about that because my noble friend Lord Campbell, like other noble Lords who came to my meeting, which has been so generously praised round the House, characterised our proposals as unfair to the victim.
My noble friend Lord Campbell of Alloway, the noble Lord, Lord Allen, the noble Baroness, Lady Turner, and the noble Earl, Lord Russell, characterised our proposals as unfair in that way. The main cause of complaint is directed at our proposal to recoup the benefit paid from the total compensation payment whereas the present offsetting is applied to special damages, the technical term for loss of earnings and expenses, but not to general damages for things like future earnings losses, pain and suffering, and many other things. But one of the major difficulties is that the 99 per cent. of awards not determined by a court are not broken down into heads of damages.
It would be counter-productive if we had insisted, as recommended by the Faculty of Advocates in Scotland, that all such claims must go to court rather than continue with the sort of informality which goes on now. I appreciate that that is not what my noble friend Lord Campbell wants. Those who have sought to amend the Bill in this respect have acknowledged that the proposals they have made will indubitably complicate matters, involve the

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courts and slow everything down. I am quite sure that no one wants that.
If we were to take the path urged on us of recouping only from a loss of earnings element, we would face the immediate problem that settlements do not actually express how much of the payment represents loss of earnings. It would be natural, and to both parties' financial advantage, to minimise the amount of benefit which could be recouped. This would be avoidance not evasion but, having looked closely at the matter, we do not wish to leave such a tempting loophole.
When equivalent measures were passed into law in Holland, that was the exact result. There was a transfer from one head of damages to another. It would certainly be counter-productive, knowing of the Dutch example, for the United Kingdom to go down that route. My noble friend Lord Campbell of Alloway has sought to get round this problem in his amendment by putting the onus on compensators to tell the Secretary of State how the payments break down and for the Secretary of State to approve that breakdown.
The noble Lord, Lord Allen, described this approach at the meeting as an administrative nightmare. He accused me of being rather more muted today and perhaps I may now return the compliment to the noble Lord. However, I must say that I agree wholeheartedly with him. My noble friend has amended his wording since our meeting but the main objections remain. How is the Secretary of State to decide what is fair? What criteria is he to use? Has he the final say or will there be an umpire? I must tell my noble friend that I foresee at the very least a delay in compensation getting to the victim, and at most a total muddle.
My answer to the noble Earl, Lord Russell, is that the scheme that my noble friend Lord Campbell suggests in this amendment is simply not workable. It was suggested earlier that I use the term "wrecking" but that has a particular meaning in this House so I do not intend to level that charge at my noble friend.
We know that the average claim takes between two and two-and-a-half years to settle. One of the objectives of Clause 23 is that the earlier the claim is settled, the fewer benefits will be recouped. Under my noble friend's proposal, the greater the delay the more benefits will have to be recouped. That cannot be right. Nevertheless, my noble friend has a point. Neither he nor we wish our very simple system of total damages, to be offset by total state benefits, to work unfairly.
We have the only information about settlements, of which I am aware, in the report which Touche Ross made last year when we were considering this whole matter. It found that where special damages were assessed they formed about 40 per cent. of the payment whereas benefits formed only 22 per cent. of payments. That figure was taken from a statistically viable sample of actual payments made by a number of insurance companies. Since the benefits are less than the special damages, according
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to the actual examples in the report, my noble friend's worries are unfounded. That is precisely why we are recouping from the whole compensation payments.
My noble friend mentioned paragraph 2.3 of the Touche Ross report. I would reply that the terms of reference on which it was commissioned included,
"to assess the administrative difficulties for insurance companies …inherent in a recovery scheme of this nature".
From what I have said the House will appreciate that the report has clearly done that.
10 p.m.
Lord Campbell of Alloway: My Lords, I am obliged to my noble friend for giving way. I quote from page I of the report:
"We were subsequently instructed by the DHSS not to consider the administrative difficulties which may be faced by the DHSS".
Lord Skelmersdale: My Lords, I do not have a copy of the report with me.
Lord Campbell of Alloway: My Lords, I have.
Lord Skelmersdale: My Lords, clearly that is so because my noble friend has just quoted from it. However, paragraph 2.3, as my noble friend might be kind enough to confirm, recommended that contributory negligence should be ignored but there is no specific mention of like for like.
If we go along my noble friend's route we have, as I said, the example of what happens in the Netherlands where we understand very few payments are now said to be made under the heading of "special damages" and the revenue from recoupment has suffered. So, not only is my noble friend's amendment unworkable in the way it is set up, but the evidence is that it is unnecessary even if one takes the view that benefits should be recouped only from that part of a compensation payment made for loss of earnings. For this reason alone I urge my noble friend not to press his amendment.
I must stress that this clause is not anti-victim; it is designed simply to provide that compensation payments complement each other and do not overlap. I do not think that the fear that repayment claims will affect awards for pain and suffering are justified. However, I recognise from the debate that there are real anxieties in this respect and I undertake to monitor very closely what happens in court awards once the scheme begins to operate. Those awards are the visible tip of this iceberg—only 1 per cent. of claims are actually settled in court—and are the yardstick by which settlements are made. If we find that there is the unfairness for which we have found no evidence at the moment, we will look at the legislation again to see if there is any way in which we can change it without creating a loophole or swamping the courts. That is as far as I can go tonight, but my words are on the record and we will honour the undertaking to monitor the situation.
The second change that my noble friend has made in his new clause is to put a figure on the lower limit for recoupment. I think that there is some confusion about our intentions. We accepted a

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recommendation by Touche Ross that if we were to refrain from making a claim from awards which were below £1,500 over one-third of all claims would continue to be treated as under the present system and we would forgo some £2 million. This would result in both insurers and the department reducing their administrative costs. The figure of £ 1,500 is of course based on 1987 awards and would mean a total recoupment of £55 million made up of £38 million from the National Insurance Fund—the figure given in the financial memorandum to the Bill—and £17 million from non-contributory benefits. Any figure above this on a more or less real-term basis would not find favour either with the National Audit Office or with the Public Accounts Committee.
This was a sensible measure which we accept. The amount is not in the Bill because by September 1990 the figure will need to be higher to achieve the same sort of result. We therefore left it to regulations which will be made at the same time as the normal up-rating to which I referred earlier this evening. It will be affirmative and so debated fully by the end of the year.
It surely cannot be right to put a figure on the face of the Bill at this stage. Certainly a figure of £10,000 would remove far more cases from recoupment (over 90 per cent. in fact) although they will still be subject to at least 50 per cent. offset over five years in every case. It would also substantially reduce the amount recouped. I appreciate my noble friend's later amendment which provides the power to vary the figure by regulation, but only if it is above £10,000.
There is an unwarranted assumption on the part of some of those who have attacked the Government's proposals that the present rules are somehow invariably better for the victim. My right honourable friend the Minister of State gave an example in Committee in another place on 2nd March which showed quite graphically that this is not so. I must remind the House that under the present rules either 50 per cent. or 100 per cent. of benefits is deducted from a compensation payment from the date of the injury for a full five years after that date, no matter when the settlement takes place, by making assumptions about what benefits will remain in payment. By contrast, recoupment under the Government's proposals will cease at the date of settlement. I venture to suggest that the effect of this major difference has not been universally grasped. It means that if a settlement is made after a year, under our proposals only that year's benefits will be deducted. Under the current rules at least 50 per cent could be deducted for the next four years as well.
At whatever level the lower limit is set, the current offsetting provisions, rationalised to 50 per cent. of all the benefits, will continue to apply. I would also suggest that in general the lower settlements must be among the 80 per cent. which are settled within two-and-a-half years. We have been quite unjustly accused of being unfair to victims. From what I have just said, it will be clear that, however well-intentioned the aim of ensuring that most claims escape recoupment, the actual effect in a
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number of cases will mean a greater deduction for the victim and will reduce the liability of the compensator to pay the victim at the expense of the benefit system. I hope the House, and in particular noble Lords opposite, will ponder that very carefully. If they support this amendment, they will doubtless be the heroes of the insurance industry. Victims may be less than enthusiastic when they realise the possible implications for their settlements.
I can go on, but it is quite clear that many noble Lords would rather kick out this whole operation from the Bill than pursue the new clause that my noble friend Lord Campbell has taken enormous care to draft very clearly. Therefore, at this stage I leave the matter in the hands of noble Lords.
Lord Campbell of Alloway: My Lords, I wish to thank quite sincerely my noble friend the Minister for his courtesy and good humour and to congratulate him on the manner of his presentation according to his departmental brief. But that is the end of the congratulations. The question is whether we divide on this matter in order to establish a point of principle. The questions are like for like and the £10,000. Both are fundamental. If the figure is £7,500, who is going to argue? Let us not talk about £1,500 in 1987. Are we going to let this matter go? Are we going to give the Government a blank cheque? Would your Lordships prefer that this amendment is divided on to force the Government to accept the principle and then to sit down and work it out? Or would your Lordships chuck out the whole clause? I shall be perfectly frank, if I may. I could not care more or less. I put down this amendment as a constructive way of trying to induce the Government to bend. They will not bend. There is no bend. They will not accept the principle. So what are we to do?
Am I to divide the House on this amendment to establish the principle so that the Government can settle down and try to work it out, or are we to chuck out the whole clause and Schedule 4? I really do not know. As regards the Dutch experiment and the problems of what was called the "fiddle", at one stage the Dutch changed the categories of benefit to suit their purpose. That is taken care of in the way that I have drafted the amendment, I have had regard to this in paragraph (b). It has been conceded to be appropriate that in the schedule there would be an appellate procedure. At this hour of the night I do not want to indulge or condescend to detail. I have not ignored some of the questions that my noble friend the Minister appears to imagine I have ignored. I have not, but let us not get on to that score.
Do we want to chuck out the whole clause, or do we want to divide on this amendment? I am in the hands of the House.
Noble Lords: No!
Lord Campbell of Alloway: My Lords, I shall take the opinion of the House.
10.12 p.m.
On Question, Whether the said amendment (No. 18) shall be agreed to?
Their Lordships divided: Contents, 28; Not-Contents, 50.

DIVISION NO. 4

CONTENTS

Addington, L.

Lockwood, B.

Allen of Abbeydale, L.

McNair, L.

Bruce of Donington, L.

Manchester, D.

Campbell of Alloway, L. [Teller.]

Pitt of Hampstead, L.

Ponsonby of Shulbrede, L.

Carter, L. [Teller.]

Rochester, L.

Cocks of Hartcliffe, L.

Russell, E.

David, B.

Saltoun of Abernethy, Ly.

Dormand of Easington, L.

Seear, B.

Feversham, L.

Swann, L.

Halsbury, E.

Tordoff, L.

Hanworth, V.

Turner of Camden, B.

Hatch of Lusby, L.

Willis, L.

Jeger, B.

Winstanley, L.

Lloyd of Kilgerran, L.

NOT-CONTENTS

Alexander of Weedon, L.

Henderson of Brompton, L

Arran, E.

Henley, L.

Belstead, L.

Hesketh, L.

Blatch, B.

Hives, L.

Borthwick, L.

Home of the Hirsel, L.

Boyd-Carpenter, L.

Hylton, L.

Brabazon of Tara, L.

Ingrow, L.

Brougham and Vaux, L.

Jenkin of Roding, L.

Butterfield, L.

Johnston of Rockport, L.

Butterworth, L.

Joseph, L.

Caithness, E.

Long, V.

Carnegy of Lour, B.

Lucas of Chilworth, L.

Coleraine, L.

Lyell, L.

Craigmyle, L.

Mackay of Clashfern, L.

Crickhowell, L.

Morris, L.

Cullen of Ashbourne, L.

Mottistone, L.

Davidson, V. [Teller.]

Sanderson of Bowden, L.

Denham, L. [Teller.]

Savile, L.

Dilhorne, V.

Skelmersdale, L.

Dundee, E.

Strange, B.

Elliot of Harwood, B.

Strathclyde, L.

Faithfull, B.

Thomas of Gwydir, L.

Fraser of Carmyllie, L.

Trafford, L.

Gardner of Parkes, B.

Trumpington, B.

Harvington, L.

Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.
10.19 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 19:
Leave out Clause 23.
The noble Lord said: My Lords, after that dramatic occasion, I now seek by moving Amendment No. 19, and speaking to Amendment No. 20, to leave out Clause 23 and Schedule 4 completely, and not to amend them. I do so because, for reasons I shall explain, I think that the best thing the Government can do is not to proceed with having these provisions as part of the Bill.
However, before I continue with my argument, I should like to thank my noble friend the Minister for attending a very long meeting with all the people who are interested in this matter at which he gave everyone the chance to have a say. He managed to control the meeting so that we could get away for lunch. He did a first-class job, but I left that meeting no more convinced that that was the fair or proper way to deal with the problem than I had been previously.
On Second Reading and in Committee I suggested that the simplest way to tackle the problem was for Clause 23 and Schedule 4 to be omitted from the Bill with a view to the Government considering carefully many of your Lordships' detailed criticisms of the clause and schedule. My noble friend Lord Campbell of Alloway said that that might be the answer to the problem; but he went on to suggest an amendment. I do not believe that the matter is basically right for amendment. If they wish to proceed further, the Government could introduce a modified form of legislation in the Social Security Bill which I understand will be introduced in the next Session.
The potential loss to the Exchequer of a delay of one year is small by modern standards, and in any case is uncertain. Touche Ross, who advised the Government, said that the value of recoverable benefits probably lay between £37 million and £84 million. The CBI has shown that they might be even less.
I have identified three failings in the Bill. I listened to the debate on the earlier amendment. We need, first, to examine what the authority is for what the Government call double compensation. I quote from the Touche Ross report—and I am sorry that my noble friend does not have a copy of it. It states:
"In 1942, Lord Beveridge, in his report on Social Insurance and Allied Services, found that the existence of an alternative remedy should not prevent an injured person from receiving social security benefits. However, the report stated that this person should not have the same needs met twice".
Later it states:
"The Monckton Committee report in 1946 recommended that an injured person should receive social security benefits in full with no obligation to repay them in the event of an award. However, in arriving at the amount of this award, the court should make a deduction for the benefits paid".
That is the present situation, broadly speaking.
We are talking about 47 and 43 years ago. In 1942, I was a relatively junior officer on a ship escorting convoys in the Atlantic. I do not know what some of your Lordships were doing. In 1946 I was contemplating leaving the Navy and becoming a medical missionary in India. Life was so different then. Therefore, I think that your Lordships should review this matter.
Beveridge based his recommendations on the statistics contained in the Rowntree reports. They went back early into the century. Beveridge said that the alternative remedy should not prevent an injured person from receiving his social security benefits—period! His report went on, but who put other things into his report is anybody's guess.
One of the failings is that the Government's proposals deprive companies and employees of double insurance benefits to which they have contributed. They have contributed to national health insurance and industrial injury. Companies will pay twice and effectively receive one benefit. That is basically wrong.
One observes that the National Audit Office in 1986 and the Committee of Public Accounts in 1987 thought that the original theory should be adhered to. However, they did not consult industry at all; they only consulted the Treasury. The Treasury would do

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anything if it thought that it could grab money back. That is in its nature. We pay it to do that. However, that is not necessarily fair or right.
The second point is that the insurance company will incur extra administration costs and payments to the DSS, which will be passed on to the customer.
The third failing is that all of this adds up to an extra cost. The noble Earl, Lord Russell, said that 8 per cent. or more will be passed on to companies. It will hit them in 1992 when, we are told by the Government—the same government that is trying to impose this clause—that British industry needs to be at its most competitive. Here, another cost is thrust upon them in order to change something which will satisfy some little theory involving a relatively few millions of pounds in terms of general Exchequer expenditure and receipts. It is all about a kind of principle which seems to be falsely based and which is being pursued for bureaucratic reasons. It has been done without an understanding that it would be a good thing to say to companies: "We are not going to impose this clause and the meaning of it upon you; we might go the other way; we want to encourage you to be as competitive as you possibly can in 1992." That is not the situation at all. It is just another little thing.
I expect that during the coming years there will be other little things of this nature passing through your Lordships' House which will impose yet another little financial burden—not much for this company, not much for that; they will get some of it back in tax. They will not all get some of it back in tax because not all of them will have to pay full tax. These little arguments will continue, but this goes against the main thrust of what we want to do in 1992. I am sure that this is the reverse of what the Government want to do.
I hope that my noble friend and noble Lords who have been listening will agree that this is something which needs to be considered in the wider sense rather than in technical detail. My noble friend ought to agree to go back and try again. I understand that there will be another Bill next year. He can improve on it or even forget it and come back to it in a year's time. I beg to move.
10.30 p.m.
Lord Allen of Abbeydale: My Lords, I should like to speak in support of the proposal that this clause should be left out. After our rather extraordinary debate on the previous amendment, I am glad to have the opportunity of explaining briefly why I have formed that conclusion. I accept the desirability in principle of avoiding double payments. So I arrive at the same conclusion as the noble Lord, Lord Mottistone, but by a rather different route. I wish to add my appreciation of all the trouble the noble Lord, Lord Skelmersdale, took in writing to us and talking to us. I am sorry that, like the noble Lord, Lord Mottistone, I remain unpersuaded that the solution proposed in this clause is fair and just.
Like others I have received a copy of the Touche Ross report. I note with some interest that the report is quite frank in explaining that everyone consulted, including other government departments and
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insurance companies, saw serious objections to the scheme for one reason or another. It seems to me that the clause is unfair for the two main reasons that it fails to deal with the principle of like for like, which we have discussed at some length, and with contributory negligence.
On the first point, I shall certainly not attempt to repeat what I said in Committee to explain why I think that social security payments in general should be set against that element of the compensation award which relates to pecuniary loss, and that element only, and not against that part which relates to pain and suffering and loss of quality of life. I recognise that a most formidable problem is to deal with out of court settlements—that is the vast majority—when sometimes the parties may agree on a compromise total but may not agree on how that total is made up and where there could be a temptation, as the noble Lord, Lord Skelmersdale, said, to inflate the proportion allocated to loss of quality of life.
I fear that Clause 23, like the amendment we discussed last time, is silent on contributory negligence, unlike the 1948 Act which holds the field at the moment. It must surely be right in all fairness to achieve the result that an individual whose compensation award is cut by, say, 25 per cent. because of contributory negligence, should receive more in total—that is, social security payments plus a reduced compensation award—than someone who is 50 per cent. negligent. The Government evidently think not. I cannot for the life of me understand why.
The solution I proposed in Committee was to reduce the calculation of the deductible social security payments by the same percentage as the reduction of the tort award, although I was well aware that the two awards are made on different principles and that this could be only rough justice. It seemed to me that rough justice was better than the total injustice of the Government's clause. However, I recognise that here again we are up against the overriding problem of out of court settlements.
For reasons I can well understand, the Government themselves cannot be certain of what the savings to the Exchequer would be if this clause came into operation. But it would clearly be a sum far far less than the Public Accounts Committee was led to believe. I just do not think that the effort is worth it. At a time when the civil justice review calls for justice to be cheaper, quicker and simpler, the clause goes in exactly the opposite direction. At a time when the Government are economising on staff, the clause will mean, we are told, 100 more civil servants, as well as extra demands on resources for the insurance companies, the lawyers and the rest. At a time when our courts are already overworked, the best legal advice I get is in no doubt that the clause will mean more cases coming to court. Above all, the clause fails the test of fairness. It is fatally flawed, both on the like for like principle and on contributory negligence.
We are from time to time reminded that there is a social security Bill every Session. Like the noble

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Lord, Lord Mottistone, I think that the Government should take this clause away, along with its twelve pages of schedule, and have another think before putting a revised proposal in some future Bill.
Baroness Turner of Camden: My Lords, I rise to support the amendment, to which I have put my name. As I indicated earlier when I spoke on the amendment moved by the noble Lord, Lord Campbell of Alloway, it has always been my intention to oppose the clause altogether. My only reason for supporting the previous amendment was that it seemed slightly to ameliorate the clause in two major respects.
I support everything that has been said by the noble Lord, Lord Mottistone, about the clause. My opposition stems from my feeling that it is grossly unfair to victims. I do not accept what the Minister had to say in that regard. It is grossly unfair, particularly, as the noble Lord, Lord Allen of Abbeydale, has said, in relation to contributory negligence.
The Minister referred earlier to examples. I am indebted to the Law Society for an example which concerns contributory negligence in the case of somebody whose damages were assessed at £5,000 for pain and suffering and £10,000 for loss of earnings, but who was found to have been two-thirds to blame for the accident. He received £6,000 under the 1948 Act benefits. Under the present law he would eventually receive £4,000 from the defendant, calculated as follows: £5,000 for pain and suffering; £10,000 for loss of earnings, making a total of £15,000; less half the 1948 Act benefits (£3,000), making a total of £12,000; less two-thirds for contributory negligence (£8,000). He would therefore eventually receive £4,000 under the present set-up.
Under the clause, if it were in operation, he would receive £5,000 for pain and suffering; £10,000 for loss of earnings, making £15,000; less two-thirds for contributory negligence (£10,000), making £5,000; less all the benefits under the clause (£6,000), and he would end up owing £1,000 to the DHSS. Of course he would not receive any benefit at all for the pain and suffering that he had sustained. It seems to me that for somebody to be injured in an accident and receive no compensation at all for pain and suffering is quite unacceptable. That is the basis for my opposition to this clause.
As other noble Lords have indicated, there are other reasons for objecting. The mechanism suggested in the schedule is cumbersome. It has already been pointed out by those who will have to administer it—the Association of British Insurers, insurance companies, the CBI and so on—that the mechanism for putting it into operation would be very cumbersome.
In my view, and in the view of solicitors who have been involved in this field professionally, it is bound to lead to more cases going to the courts because people will be less willing to settle out of court if they believe that they will lose a large part of the amount on offer. That means that instead of settling out of court they will go into court to try to get as
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much as they can for their injury. As we know, a great many cases are settled on a compromise basis. Compromises will become much more difficult if the claimant realises that he or she has to lose a large part of the total amount of compensation in repaid benefits.
Noble Lords will already be aware that I take the view that the industrial injury scheme is a quite separate scheme from the situation which applies where there is employer's liability insurance, which all employers have to carry. So the courts will be clogged and it will be much more difficult to settle out of court.
Furthermore, I believe that the amount of money which the Exchequer aims to recoup as a result of this clause will not be worth the effort. I agree with everything that the noble Lord, Lord Allen of Abbeydale, said in that regard.
The Touche Ross Report, for which I am grateful to the Minister for sending me a copy, makes it clear that an apparatus will have to be constructed—probably a co-ordinating centre—in order to recover that money. According to our information, it is likely to raise £38 million a year for the Exchequer. Is it worth all the hassle that it will cause, the injustices that will occur and the delays in courts that will arise when, at the end of the day, a relatively small amount of money will go to the Exchequer? And all for some ideological concept that I do not accept and which, when it is explained to many other people outside the House, they will not accept either.
I do not see any great public demand for what has been proposed in the clause. When it gets across to people working in industry and commerce precisely what that means in terms of industrial injury compensation, the Government will not be very popular either. I therefore support the amendment.
Lord Campbell of Alloway: My Lords, I support the amendment. I shall be brief. I am much relieved in many ways that my amendment was defeated because my heart and my whole sense go with this amendment. In so saying, I am not much moved by what the CBI says or does not say by courtesy of my noble friend Lord Mottistone. I assure noble Lords that it is not that matter that concerns me.
I am much more concerned with the analysis of the noble and learned Lord, Lord Griffiths, who has spent his lifetime in that sphere and knows at first hand—not from some brief—what he is talking about, and with that of the noble Lord, Lord Allen of Abbeydale, who was a member of the Pearson Committee. I also, in a small way, have practical experience in that sphere, although not on the same scale as the noble and learned Lord, Lord Griffiths.
I support the amendment because of the reasons given at Committee stage by the noble and learned Lord, Lord Griffiths, and the noble Lord, Lord Allen of Abbeydale. I take note of the fact that, on this occasion, the CBI and the TUC both want the same thing. I am not a CBI man and I do not pay much attention to what it says. I do not think that it is particularly important, but noble Lords should take note when the CBI and the TUC agree.

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I support the amendment and I hope that the clause will be taken away. As the noble and learned Lord, Lord Griffiths, said, it should be taken away and the Government should think again.
Earl Russell: My Lords, I hasten to assure noble Lords that I shall not make the same speech twice. However, I agree with every word of the noble Lord, Lord Mottistone. I should also like to try to clear a little of the confusion that the business has created.
The trouble is that those of us who attended the meeting that the Minister so kindly called have moved on to a further stage of the argument since the Committee stage. That meeting was held with a real will to improve the clause. Bit by bit, most of us have been persuaded that the clause cannot be improved in any of the ways that we wish. That explains the absence of detailed amendments to which the noble Lord, Lord Coleraine, drew attention. We are convinced that they would not work, so we must decide to have either the principle of double compensation or everything else to which noble Lords have drawn attention, such as like for like, contributory negligence and all the rest. We are therefore faced with a straight choice. We either have the clause as it stands or we have no clause.
The nearest that there has been to dissent from that view is the gallant attempt of the noble Lord, Lord Campbell of Alloway, to play Michael Drayton and see whether from death to life, he might it yet recover. The noble Lord has discovered that he cannot; and since we cannot recover the clause, then I think that a great many of us are agreed that we should delete it.
The noble Lord, Lord Trafford (in a speech to which I listened with a great deal of interest) if I understood him aright, put up two arguments which deserve answer. He dealt with the argument of cost to the taxpayer. We are concerned about the cost to the taxpayer; but my position on this issue is that if I save £1 as a taxpayer but have to pay £2 extra on insurance premiums, I do not feel that I have made a good exchange.
The noble Lord also drew attention to the proposition that costs ought to rest on those who have incurred blame. But that point was answered in great detail by the noble and learned Lord, Lord Griffiths, in Committee. He said that we should not suppose that industrial damages are in fact paid by an identified tortfeasor. That is not the way it works. It falls on insurance companies. So once again we have a case in which either we pay or we pay. Therefore I think that it is reasonable to consider in which capacity we pay the less.
I am convinced by the Minister that the amendment was unworkable; but if it was unworkable then so also is the clause unworkable. I am very much impressed by the argument of the noble Lord, Lord Mottistone, about imposing extra costs on industry in 1992. If this Government do not withdraw this clause, they will once again convince a good many of us that they are not a pro-industrial government. They are a government who favour commerce. I am not convinced that they favour industry.
10.45 p.m.
Lord Trafford: My Lords, I do not wish to detain the House by intervening again in this debate; but I think that the noble Earl has slightly misquoted the point in the argument that I put forward. When I referred to the taxpayer, I was referring to the social security payments not claimed back. I did not at that point deal with the question of contributory and non-contributory benefits in social security payments. I was referring to the taxpayer in general.
When I referred to the insurance payment, it was not from the point of view of any blame regarding any accident that had occurred or any claim for negligence. It was simply a reference to the fact that companies and others carry insurance liability, and I argued that it would be more appropriate that those who had to pay or should pay the compensation should be the people upon whom this charge lay rather than the general taxpayer. With due respect to the noble Earl, that is slightly different from the argument that he said I produced. But I do not dispute that point greatly with him.
Regarding the basic principle, I have nothing to add to what I said earlier. I still believe that the principle on double compensation, despite the original half-quote from Beveridge in 1942, is correct. Although I accept what the noble Lord, Lord Allen, said about the increased bureaucracy—and I think that that is quite likely, and I also believe that there would be a tendency to greater litigation—I do not believe that there would necessarily be greater unfairness, as he suggested.
Lord Pitt of Hampstead: My Lords, I find it difficult to understand why in a Bill by which the state seeks to withdraw any contribution to the insurance fund, at the same time the state should be seeking to recoup compensation from people who have been injured and are receiving benefit as a consequence.
It seems to me that as a consequence of Clause 3 we are now in a position in which the benefits that people receive from social security are no different from the benefits that I would receive if I were injured and was paid under the insurances that I hold. Noble Lords will remember that I asked the noble and learned Lord, Lord Griffiths, about this point. He said that in fact the court does not take into account payments that have been made from private insurance. I cannot myself see the difference.
What is happening is this. People have paid for an insurance from which they receive a benefit if they have had an accident or injury. They are not paid in a lump sum, but weekly. Many of the insurances that people carry are like that. They are private insurances. Therefore they are no different. What is more, the contributions are being made by the person and their employer. Again, there are quite a few insurances of that kind, where employers contribute to the insurances of their workmen. Therefore I cannot for the life of me see the difference between those private insurances and the benefit that is being paid through the National Insurance Fund to workmen or anybody else as a result of injuries.

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From the beginning I found this clause objectionable. I have found it particularly objectionable because it comes in the same Bill in which the state no longer contributes to the National Insurance Fund. I hope that the Minister will be able to convince me that there is a real difference between the contributions that are being made through the National Insurance Fund and those which would have been made through an ordinary insurance to cover accidents and injury. I should like to have the difference explained to me. Unless there is a real difference, then I do not think that the Government are on solid ground.
Lord Skelmersdale: My Lords, without repeating in detail what I said in Committee, the basic principle behind Clause 23 is simple. The point has already been made by my noble friend Lord Trafford. It is that no one should receive more money in compensation for an accident from two sources added together than they would from one. This principle has a respectable history starting with Beveridge and more recently backed up, as we have heard, by the Pearson Commission, the National Audit Office and the Public Accounts Committee of another place and, most importantly, by the courts.
In 1948 a compromise was reached whereby 50 per cent. of all social security benefits were rebated, or offset as it came to be known. With the advent of new social security benefits the question arose as to how much this offset should be. The courts have ruled that there should be a full 100 per cent. offset for these so that the very least the Government need to do is to clear up the mess that the law is in in this area.
I am not sure that it helps the debate, but my noble friend commented on 47 and 42 years ago. Forty-seven years ago, I was not even a twinkle in my father's eye. In 1948 I had just become eligible for a tenant's allowance, except that it did not then exist. Knowing all this, your Lordships will wish to know two things. First, what happens to benefits and what happens to the money that has been offset?
Nothing at all happens to benefits, either now or under this clause. That is a point which I made on Second Reading, at col. 566. They will continue to be paid as now, immediately an individual need arises and the qualifications are fulfilled. This is an important point which has been misrepresented in some cases—not, I hasten to add, in your Lordships' House.
Secondly, what happens to the money that has been offset? It goes, surprisingly, to the insurance company to reduce insurance premiums. Under this clause, however, the money will go where it properly belongs; that is, to the state to pay for the social security benefits in question.
That is why my noble friend Lord Mottistone—who, as he has said, has been briefed by the CBI—has led a vigorous campaign to strike out this clause from the Bill. He and it fear that insurance premiums will rise, which, to an extent they will, but—
Baroness Turner of Camden: Of course they will have to, my Lords.
Lord Skelmersdale: My Lords, of course they will. I am glad that the noble Baroness agrees, but both the CBI and my noble friend have forgotten the maxim of this House—something else that was referred to by one of my noble friends behind me—namely, that we all believe in the polluter pays principle. In this connection, it means that someone responsible for an accident will pay for the effects of that accident in full. This maxim is, however, complicated by the fact that by law motorists and employers have to insure themselves against accidents. The effect of this is that the premium payer has to meet the costs of the compensation rather than the individual who causes the accident. The clause does nothing to change that. It happens at the moment and it will continue in the future, whether or not your Lordships approve the clause. Thus insurance premiums will rise.
For employers, Touche Ross originally estimated that they would rise by 16 per cent. But the Association of British Insurers now believes that the figure should have been 8 per cent., a rise to 1–6 per cent. of the total labour bill and an increase of only 0.1 per cent. in total expenditure. This is the amount of money that my noble friend Lord Mottistone is talking about. For motorists the rise will be well under I per cent. I gave these figures on Second Reading and explained then how they would work, so I shall not repeat them.
Before I pursue this case I want to comment on a supposed unfairness exposed by the noble Lord, Lord Allen of Abbeydale. He believes that there should be an allowance in the offset for contributory negligence. My noble friend Lord Campbell of Alloway does not agree any longer. However, as I said, the noble Lord, Lord Allen, believes that the offset should increase according to a percentage of contributory factors to an accident, or, put another way, the greater the proportion of contributory negligence the smaller the proportion of his benefits which would be deducted. He therefore receives proportionately more than the person who in no way contributed to his own injuries. The interesting effect of this would be that, depending on the percentage whereby a person is judged to have contributed to his own accident, he would get more in total benefit. This cannot be right or fair. Indeed, it is not an amendment currently before the House, so I shall not dwell on it now, except to comment on the case put to us by the noble Baroness, Lady Turner.
I note that in the case cited the total amount was £15,000, of which £10,000 was for loss of earnings. The degree of negligence was 66 per cent. so that the person gets £4,000 from the compensator at present, plus £6,000 benefit which we are told the person received. Thus the total is £10,000 when they are added together. But the £15,000 award was compromised by two-thirds, the noble Baroness told us. The person actually receives £10,000 and so loses only one-third. That really does not seem to me to be right.
If we can agree on nothing else this evening, I am confident that we can agree about one thing—that

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the subject of compensation for injury is a very complex matter. Much of the complication arises from the fact that only about 1 per cent. of all awards are made by the courts. The remainder are informal settlements between the parties. In theory, settlements are based on what the courts would do, but in practice a number of factors are involved and the outcome of the claim is often a compromise by both parties. This has been apparent in the discussions I have had with some of my noble friends and noble Lords opposite.
We have, however, been able to clear up some misconceptions which have arisen about our proposals. Indeed, it would seem that some of those who have sent briefing to noble Lords on this clause have themselves been under some misapprehension. For example, some of your Lordships will have received briefing from a firm of solicitors recently with case histories purporting to show how a claim might be settled under our proposals. One such example gave a settlement figure of £27,500 and benefits of £21,646. It did not say at what point the settlement was made, so we are left to assume it was after five years since that puts our proposals in the worst possible light. We also assume that the £27,500 was net of the offset for benefits—although your Lordships would be forgiven for overlooking this since it was not stated.
The example concluded that all the £21,646 benefits would be deducted from the net figure of £27,500, leaving only £5,853. That is plainly wrong. The clear implication of the example is that compensators will not assume full liability for compensation as the legislation intends but will first apply the present offset and pay the Secretary of State from what is properly due to the victim. Of course, I am sure that this was unintentional. In the example the victim would get only £27,500 in benefit and compensation. In fact, using the assumptions about timing of the settlement and the value of the settlement before offset had been made, assuming that a 50 per cent. offset of benefits had been made, the victim should end up under our proposals with £16,677 compensation which, when added to the benefit, gives £38,323 in all.
Your Lordships may also note that since the Bill was published and it was clear that recoupment would apply only up to the date of settlement, no example has been put forward where a settlement has been made in under five years. And yet in mid-1988 the Industrial Injuries Advisory Council, which the noble Baroness opposite will know well, produced what I believe was an actual case as an example in a paper it sent to the Secretary of State and others. The case was settled after two years, and in Committee in another place on 2nd March at col. 909 of Hansard, my right honourable friend the Minister of State was able to show that while £20,000 would be deducted under the present rules, only £9,500 would be recouped under the proposals.
It has been suggested that our proposals would mean extra costs for compensators because employees will seek higher awards to make up for the reduced sums they receive. However, the present system deducts from their compensation not only
386
benefits already received but what it is estimated that they might get for the five years after the injury or even longer in some cases. There is no reason to believe that these proposals will encourage people to seek higher awards. It is also suggested that more cases than the present 1 per cent. would end up in court. That usually means a delay. Court proceedings, as we all know, tend to take a long time. I agree that this would be to nobody's advantage. But as recoupment ceases at the date of settlement or award, there is a greater incentive to settle as quickly as possible, rather than delay. There may indeed be a bedding down period at the start of the scheme, but we do not believe that our proposals materially affect whether people choose to pursue their claim to a court award.
I should remind your Lordships that 80 per cent. of claims are settled within two-and-a-half years and so most people should receive no less under our proposals than under the present arrangements unless they were to a great extent themselves to blame for their own injuries, which, as I said earlier, I believe to be fair. At present 50 per cent. or 100 per cent. of benefits are offset over a full five years or more in some cases. Roughly speaking, at about two-and-a-half years there is no difference between the net compensation payable, whether the benefits are offset as at present or recouped up to the date of settlement. Indeed, if settlement is made quite speedily, the amount recouped could actually be less than is currently offset.
This is a reform which is long overdue and returns to basic principles. I understand that those closely concerned do not relish a change from the system which they have been used to for 40 years, even though they recognise that change is needed. We are working with those who would have to operate the scheme to ensure that any procedure:3 are as far as possible compatible with what they do now and we do not impose unnecessary burdens on the private sector. The total amount which is likely to be recouped is £55 million in a full year.
The noble Lord, Lord Allen, complained about this and asked why the Touche Ross estimate of £55 million was so different from the National Audit Office's £150 million. The National Audit Office estimate of £150 million, which was seen by the Public Accounts Committee, was based on the only data which was available at the time its report was made. I understand that it was originally produced for the 1978 Pearson Commission Report and increased by the NAO to take account of the passage of time. I am sure that the noble Lord, Lord Allen of Abbeydale, would be able to confirm that that was the figure in the report of the commission of which he was a distinguished member.
Lord Allen of Abbeydale: My Lords, I believe that is how the figure came about, but the painful fact is that the PAC was given totally false information as to what would be achieved.
Lord Skelmersdale: My Lords, if the noble Lord will do me the courtesy of waiting until I have finished the point, he may be able to attack in an even stronger fashion.

387
The £55 million estimate made by Touche Ross derived from an examination at the beginning of 1988 of a sample of cases provided by the insurance companies. Therefore it is the most up-to-date estimate available and is most likely to be reliable. After this passage of time, I cannot estimate whether the Pearson Commission figure was reliable, but I am quite convinced that, on the most up-to-date figures available, the Touche Ross investigation is certainly the most reliable as to figures available at present. The figure of £55 million includes statutory sick pay of £17 million in addition to the £38 million for other benefits set out in the financial memorandum to the Bill.
The noble Lord, Lord Pitt, spoke of everybody paying insurance, by which I suppose he meant state insurance—the National Insurance Fund. I believe that I can best answer that by pointing out that unemployment benefit, which is probably the largest of these, together with sickness benefit, is already offset. Because they are offset, money goes to the insurance companies and not back into the National Insurance Fund where it properly belongs.
Lord Pitt of Hampstead: My Lords, that still does not explain the point I am making. I am saying that if you are involved in an accident, compensation is paid to you. If you have a private insurance, it will not be deducted from that money. That is the difference.
Lord Skelmersdale: My Lords, I am grateful to the noble Lord because the point is that you are not being compensated out of private insurance which you yourself have paid for. In the vast majority of cases you are being compensated out of the compulsory insurance scheme which your employer has taken out to pay for any injury which occurs on his property or because of the job for which he employs you. Therefore, the situation is quite different.
As I said in answer to a Question for Written Answer tabled by the noble Lord, Lord Allen of Abbeydale, the department's administrative costs are estimated at about an extra 100 staff at a cost of about £1 million per year.
Perhaps I may now take up the point raised by my noble friend Lord Campbell of Alloway on the last amendment. I shall quote from the introduction of the Touche Ross Report. It states:
"The terms of reference for our review were:
—to establish how much would be recoverable from damage settlements and awards if 100 per cent. of all social security benefits paid in consequence of an injury were to be recoverable by the DHSS;
—to assess the administrative difficulties for insurance companies and DHSS inherent in a recovery scheme of this nature".
My noble friend went on to read the next part:
"We were subsequently instructed by the DHSS not to consider the administrative difficulties which may be faced by the DHSS".
But those carrying out the review were not instructed not to consider the administrative difficulties to be faced by the compensators. Therefore the situation is quite different.
Lord Campbell of Alloway: My Lords, it can be seen on reading the report that it did not deal with any other administrative difficulties.
Lord Skelmersdale: My Lords, in another place on 26th April, the Opposition spokesman offered what he called a "grudging word of congratulation" because the Government have tackled an extremely difficult problem. We do not find it acceptable that state benefits should subsidise the liability of those responsible for causing injuries simply because the benefit system has already had to pay as a result of those injuries. The present situation is ripe for reform.
We firmly believe that this clause does that in a way which recognises how compensation is dealt with in this country. It is a system which builds on what already happens rather than a radical change. There are incentives for earlier settlements than at present and we have no reason to suppose that this clause will increase the number of cases which are decided by the courts or will deter people from seeking compensation, as they do now.
I have undertaken to ensure that we monitor what happens in court awards to see whether there is any substance in the fears that recoupment would bite into payments for pain and suffering. At present, what evidence we have does not support this contention.
My final point is that whatever happens to this clause will be reflected in Schedule 4—in other words, if this clause continues to stand part of the Bill then Schedule 4 will remain. If the clause disappears, then clearly Schedule 4 will have to disappear with it. I commend the clause to the House.
Lord Pitt of Hampstead: My Lords, I have listened to the Minister but I am still disturbed. He has not answered my point. If I carry a private insurance and then I am compensated by the court, there is no clawback in regard to my private insurance.
Lord Mottistone: My Lords, perhaps the noble Lord would like me to answer that point.
Noble Lords: Order!
Lord Ponsonby of Shulbrede: My Lords, my noble friend is intervening in the Minister's speech.
Lord Mottistone: Yes, my Lords, but he has now sat down.
Lord Henderson of Brompton: My Lords, this is the Report stage of the Bill. The only noble Lord who can speak more than once with the leave of the House is the Minister.
Lord Skelmersdale: My Lords, I thought that my noble friend was replying to this amendment as he moved it, which rather absolves me from returning to the charge.
I have tried to do my best to deal with the point raised by the noble Lord, Lord Pitt. If one is voluntarily paying insurance to cover one's own

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potential injuries—for example, if you insure yourself against injury in an aeroplane or a train—it would be anomalous for anyone to seek to take away any money paid to you. But when dealing, as we are here, with premiums for national insurance purposes, employers' liability purposes or motor insurance, which are payable by law, I suggest that the position is different.
Lord Pitt of Hampstead: My Lords, in what way is it different?
Lord Skelmersdale: My Lords, of course it is different, because one pays it voluntarily. That is the quick answer to the noble Lord. Perhaps I should now hand back to my noble friend Lord Mottistone.
Lord Mottistone: My Lords, the crux of this matter, to which my noble friend has not addressed himself, is the fact that he assumes, in the words of the Beveridge Report, that double compensation is bad. The noble Lord, Lord Allen of Abbeydale, has gone along with the Pearson Commission. But why is double compensation bad? I give an example at the risk of my noble friend introducing legislation to change the position. I receive two pensions, to both of which I have indirectly contributed. One is paid by the Government—my naval pension, to which I contributed by not receiving as much pay as I should have done for many years. The other is my civil pension which I received afterwards. Nobody has suggested that, having contributed to the two pensions, I am receiving double compensation by having two pensions. Why should they? What is wrong with double compensation if you make two sets of contributions?
I take the case of the companies. They contribute their share of national health insurance. They would expect to be compensated in the way of insurance for anything that comes back to them. They contribute to industrial injury insurance which they would expect to come back to them. When I say "them", I mean companies as a whole. In fact the company pays a share of the national health contribution and so does the individual.
When there is an industrial injury the individual gets the compensation from the national health insurance part of the scheme, but all the other people in the company do not get anything at all. Likewise, as regards industrial injury compensation, the company pays the premium. A company is not simply something nasty with a board of directors, but is made up of a great many people including all the employees.
The employee who has been injured gets a part of the compensation. What is wrong with double compensation? That is where my noble friend, the Government and Sir William Beveridge, in 1942, were sidetracked by some official who wrote into his report that double compensation was a bad thing. It is as simple as that. If you pay two premiums, why should you not be able to recover from both of them?
That is basically what I object to about this clause, and why I should like the Government to take it back and think again. It is not because of all the
390
technicalities and who gets £5,000 and who gets it repaid; it is because double compensation is perfectly all right if you have a double contribution. I tried to say this at Second Reading, and at Committee stage, and I tried to say it earlier in my introduction to this amendment.
I should like my noble friend to say that he is going to take it away and think again because it is based on a wrong premise.
Lord Pitt of Hampstead: My Lords, before the noble Lord sits down—
Lord Belstead: My Lords, no. We have received some wise advice from the noble Lord, Lord Henderson of Brompton (who knows this House well) which is that the only person who may speak after the Minister is the mover of the amendment. That is my noble friend Lord Mottistone. When he has finished, the matter should be decided by your Lordships.
Lord Pitt of Hampstead: My Lords, is the noble Lord, the Leader of the House, suggesting I am out of order? I wish to ask a question.
11.17 p.m.
On Question, Whether the said amendment (No. 19) shall be agreed to?
Their Lordships divided: Contents, 26; Not-Contents, 36.

DIVISION NO. 5

CONTENTS

Addington, L.

Jeger, B.

Allen of Abbeydale, L. [Teller]

Lockwood, B.

McNair, L.

Butterfield, L.

Mottistone, L. [Teller]

Campbell of Alloway, L.

Pitt of Hampstead, L.

Carter, L.

Ponsonby of Shulbrede, L.

Cocks of Hartcliffe, L.

Rochester, L.

David, B.

Russell, E.

Dormand of Easington, L.

Saltoun of Abernethy, Ly.

Faithfull, B.

Seear, B.

Feversham, L.

Swann, L.

Halsbury, E.

Tordoff, L.

Henderson of Brompton, L.

Turner of Camden, B.

Hylton, L.

NOT-CONTENTS

Arran, E.

Hesketh, L.

Belstead, L.

Hives, L.

Blatch, B.

Johnston of Rockport, L.

Brabazon of Tara, L.

Joseph, L.

Brougham and Vaux, L.

Long, V.

Caithness, E.

Lucas of Chilworth, L.

Coleraine, L.

Lyell, L.

Craigmyle, L.

Mackay of Clashfern, L.

Davidson, V. [Teller]

Morris, L.

Denham, L. [Teller]

Oppenheim-Barnes, B.

Dilhorne, V.

Sanderson of Bowden, L.

Dundee, E.

Skelmersdale, L.

Elliot of Harwood, B.

Strange, B.

Fraser of Carmyllie, L.

Strathclyde, L.

Gardner of Parices, B.

Thomas of Gwydir, L.

Harmar-Nicholls, L.

Trafford, L.

Harvington, L.

Trumpington, B.

Henley, L.

Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.
11.25 p.m.
Schedule 4 [Recovery of Sums Equivalent to Benefit from Compensation Payments in respect of Accidents etc: Supplementary Provision]:
[Amendment No. 20 not moved.]
Schedule 5 [Employment-related Schemes for Pensions or Other Benefits: Equal Treatment for Men and Women]:
Baroness Seear Baroness Seear moved Amendment No. 21:
Page 54, leave out lines 37 to 41 and insert—
("( ) any provision for the preservation of rights accrued before the operative date of this paragraph;").
The noble Baroness said: My Lords, with the leave of the House in moving Amendment No. 21, I shall speak also to Amendments Nos. 22, 23, 24, 25 and 27. I am truly reluctant to embark upon what is a new and important subject at this time of night. Nevertheless, these amendments are an attempt to begin to deal with what is in fact an anomaly in our legislation which goes back to the 1970 equal pay legislation. When that legislation was passed, it was agreed that discrimination on the grounds of sex could be continued in relation to both retirement ages and pensions. That principle has been embodied in our legislation ever since.
The purpose of these amendments is to take a small step in the direction of correcting that anomaly. I should point out to your Lordships that sooner or later we shall have to correct this. There is no doubt that with directives coming out of the EC, and with the general thrust of opinion today, the continuation of this anomaly in retirement ages and in pension provision is something which will soon have to go.
These amendments attempt to bring forward a first stage in that development. What is proposed deals, as your Lordships will be aware, with occupational pensions only; it does not attempt to do anything about the state pension scheme which is another issue. Modestly, it does not attempt—as in many ways I should have preferred—to modify existing schemes. All that is requested, in line with the way that developments are plainly going, is that in all occupational schemes which come into force after 1st April 1990, the permission to have different retirement ages and different pension conditions for men and women will be removed. That is the purpose of the amendment.
As I said, it is a step in the direction in which undoubtedly we not only should, but will, be travelling before long. I beg to move.
Baroness Turner of Camden: My Lords, at this hour I intend to be very brief. I simply say that I agree with what the noble Baroness said in regard to this series of amendments. Of course, as long ago as 1976 the Occupational Pensions Board, of which I am a member, was recommending that there ought to be equal pension ages in the state retirement scheme because many occupational schemes are geared to what happens in the state scheme.
We still have not reached the point where we have equal retirement ages in the state scheme; but I am
392
quite certain that the day when we reach that stage is not so very far off. There will be directives emerging which will compel us to move along those lines. Moreover, it will not be very long before the Government have to seize this nettle and deal with it. I therefore have pleasure in supporting this series of amendments.
11.30 p.m.
Lord Henley: My Lords, I thank the noble Baroness, Lady Seear, for moving the amendment so briefly. I also thank the noble Baroness, Lady Turner, for speaking. I hope that I can be equally brief.
I can, first, meet the noble Baroness half way in respect of the words which she wishes to insert under Amendment No. 21. Her amendment would provide that any provision in a pension scheme which applied to the preservation of rights accruing before the operative date of 1st January 1993 would remain outside the scope of the equal treatment requirements. The schedule already makes such provision in paragraph 3(3). I can assure the noble Baroness, therefore, that the Government accept her intention on this particular aspect of the amendment but I have to advise your Lordships that the wording of the amendment is unnecessary.
I must however, immediately advise your Lordships that I cannot be so forthcoming in respect of the other provisions in the noble Baroness's group of amendments. Amendment No. 21, together with the consequential Amendment No. 27, would also, by the lines which it repeals, require schemes to equalise pension ages, to provide survivors' benefits on equal terms, and to remove any distinction on the basis of sex in the treatment of optional provisions in scheme rules. Those give members the choice to purchase added benefits, to draw their scheme pension from a date earlier or later than normal or to choose which of more than one benefit available they wish to receive.
Amendments Nos. 22 to 24 would continue to permit diferences in pension age, survivors' benefits and optional provisions, but only for those who were already scheme members before 1st April 1990 and for schemes already established before that date. Amendment No. 25 provides similar restrictions to pension schemes established before April 1990 in respect of special provisions for particular individuals.
The House will be aware that Schedule 5 is intended to implement the requirements of the 1986 EC equal treatment directive. When adopting that directive the Council of Ministers accepted that member states were not yet ready to introduce equal treatment in all aspects of occupational social security schemes. It therefore made certain specific derogations, particularly under Article 9 in respect of pension age and survivors' benefits and under Article 2 of the optional provisions. The pension age and survivors' benefit exceptions were allowed until, but only until, the state scheme had equalised treatment in those areas. The Bill takes account of those permitted derogations. The noble Baroness's amendments would either abolish them altogether

393
or restrict them to members of schemes at 31st March 1990. The Government do not think it right to require occupational schemes to equalise their requirement in the state scheme. Indeed, as occupational schemes are set up voluntarily, to do so without considering the full implications could discourage employers from setting up schemes at all.
At this late hour I do not consider it appropriate to have a full debate on the issue of pension age or survivors' benefits. Your Lordships will have the opportunity to discuss those issues when the House considers the report of the Select Committee under the chairmanship of the noble Lord, Lord Allen of Abbeydale, which looked at those issues in the context of the draft third social security equal treatment directive. Your Lordships will at that stage have had time to ponder in depth the Select Committee's recommendations.
Finally, I should like to refer to Amendment No. 25. This relates to single, one-off arrangements for particular individuals. The noble Baroness would wish to remove that exception from the principle of equal treatment. The problem is that as those arrangements apply only to a particular person, there is no one against whom the treatment of that individual may be compared. If, for instance, a scheme makes special provision for the managing director of a company, irrespective of the person's sex, there is no one else in the scheme with that status against whom a comparison can be made. The amendment therefore, if adopted, would be inoperative.
I hope that I have not spoken at too great length in response to the noble Baroness, who nevertheless I hope will recognise that I have not attempted to go in great depth into the issues which she has raised. As there will be a further opportunity for your Lordships to discuss these issues at greater length, I hope that she will feel able to withdraw the amendment.
Baroness Seear: My Lords, the reply from the noble Lord is very much what I had expected. The whole purpose of these amendments was to try to stop the Government from taking advantage of the derogations. It provides an opportunity to seize the nettle that will have to be seized sooner or later, while we are making changes in this social security legislation, which is the appropriate place for doing so, and to make a modest advance in relation to occupational pension schemes. I should like to test the opinion of the House to see how much support there is for moving in the direction of greater equality of opportunity in relation to pensions.
11.36 p.m.
On Question, Whether the said amendment (No. 21) shall be agreed to?
Their Lordships divided: Contents, 18; Not-Contents, 33.

DIVISION NO. 6

CONTENTS

Addington, L.

Cocks of Hartcliffe, L.

Carter, L.

David, B.

394

Feversham, L.

Ponsonby of Shulbrede, L.

Halsbury, E.

Rochester, L.

Henderson of Brompton, L

Russell, E.

Jeger, B.

Seear, B. [Teller.]

Lockwood, B.

Swann, L.

McNair, L. [Teller.]

Tordoff, L.

Pitt of Hampstead, L.

Turner of Camden, B.

NOT-CONTENTS

Arran, E.

Hesketh, L.

Belstead, L.

Hives, L.

Blatch, B.

Johnston of Rockport, L.

Brabazon of Tara, L.

Long, V.

Brougham and Vaux, L.

Lucas of Chilworth, L.

Caithness, E.

Lyell, L.

Coleraine, L.

Mackay of Clashfern, L.

Craigmyle, L.

Morris, L.

Davidson, V. [Teller.]

Mottistone, L.

Denham, L. [Teller.]

Sanderson of Bowden, L.

Dilhorne, V.

Skelmersdale, L.

Dundee, E.

Strathclyde, L.

Elliot of Harwood, B.

Thomas of Gwydir, L.

Faithfull, B.

Trafford, L.

Fraser of Carmyllie, L.

Trumpington, B.

Harvington, L.

Wynford, L.

Henley, L.

Resolved in the negative, and amendment disagreed to accordingly.
11.42 p.m.
[Amendments Nos. 22 to 25 not moved.]
Lord Mottistone Lord Mottistone moved Amendment No. 26:
Page 54, line 43, at end insert—
("(h) any additional pension payable under a scheme to a man at any time between the ages of 60 and 65 for as long as—

(i) equality of pensionable age for males and females is not achieved under the State scheme and

(ii) the additional pension is not more than—

(a) in the case of a scheme which is a contracted-out scheme an amount equal to the basic component of the Category A retirement pension under the Pensions Act, or

(b) in the case of a scheme which is not a contracted-out scheme an amount equal to the basic component and the additional component of the Category A retirement pension under the Pensions Act

which would have been payable to him at that time under the Pensions Act had his pensionable age under the State scheme been 60 (but disregarding any increase for deferred retirement under section 12 of that Act) and

(iii) payment of the additional pension is discontinued immediately he reaches pensionable age under the State scheme.").

The noble Lord said: My Lords, I shall try to be even more brief, particularly when I see the Government Chief Whip sitting on the Opposition Front Bench.
This amendment raises again the matter of an anomaly in the Bill, as worded, in creating an inequality of total pensions for those companies which have specially arranged adjustments to occupational pensions for men and women between the ages of 60 and 65 to match the different state pensions for them, and thereby to create equality.
I do not want to go over the ground again which I spelt out on Second Reading and in Committee. Suffice it to say that I am most grateful to my noble friend the Minister for arranging last Friday afternoon, at a relatively late hour, the meeting

395
between himself and his legal advisers and myself and the CBI's legal adviser, who on an earlier occasion gave counsel's opinion on the matter. I also wish to thank my noble friend Lord Lucas of Chilworth who kindly attended the meeting on my behalf because I had duties in the Isle of Wight at that time. I am also grateful to my noble friend Lord Lucas for helping to ensure that the matter was dealt with expeditiously.
At that meeting it was established that both sets of legal advisers agreed that the legal position on the relevant Community directive was not clear, and that there is no authoritative decision of the European Court of Justice on derogation. In consequence, it was agreed that the Government should consider certain actions to clarify these points and to work towards correcting the anomaly.
The purpose of the amendment is therefore to give my noble friend the Minister the opportunity to tell the House what the Government propose to do as a result of that meeting. I beg to move.
11.45 p.m.
Baroness Turner of Camden: My Lords, my name is also attached to the amendment, which I rise to support. I supported a similar amendment in Committee. I did so because I believe that the EC directive on which the present clause in the Bill is said to be based is capable of a different interpretation from that which appears to have been placed upon it by the Government's lawyers. I believe that the counsel who has advised the CBI—and I have seen a copy of the advice—has a very strong point.
The position in the UK is different from that in many other countries. It is not only that there is a difference between the ages at which men and women retire, which seems to be set in concrete in this country—there are also different retirement ages in, I think, three other EC countries—but we have a different system of pension provisions in this country. We have a rather unique system which involves a partnership between the state pension provision and occupational pension provision. Then we have the system of contracting out.
Some very good occupational schemes are integrated with the state scheme. That means that by the time pension ages of 60 for women and 65 for men are reached there is a gap of five years during which men would not receive equal benefits in the form of the occupational benefit and the state benefit until they reach the age of 65. If employers and such pension schemes had not been willing to provide bridging pensions for the period between the ages of 60 and 65 for men it would not have been possible to introduce a common retirement age of 60 for both men and women.
It seems absurd that a provision which was intended to result in equal treatment of recipients should now be regarded as being illegal under the directive. I cannot believe that that was the intention of the directive. I think that there are grounds for looking at the whole matter again. For those reasons I support the amendment in the name of the noble Lord, Lord Mottistone.
Lord Swann: My Lords, I shall make only the briefest of comments on the amendment of the noble Lord, Lord Mottistone. I am very much in favour of it. It aims to get rid of a manifest anomaly and injustice, and I am persuaded by the arguments that the noble Lord deployed at earlier stages.
We have the extraordinary situation of an amendment designed to achieve equality of treatment of the sexes in danger of being bowled out because some element of identical totals is different. It sounds to me like the situation in which a man goes to the post office to get his pension and a woman goes to the post office for an identical pension, and if the postmaster hands the man his pension in £10 notes and the woman hers in £5 notes that would be out of order because it is a clear discrimination in the treatment of the two sexes. Can there be anything sillier than that?
Baroness Seear: My Lords, we on these Benches strongly support the amendment.
Lord Skelmersdale: My Lords, during our previous debate on this issue, I agreed to my noble friend's request for a meeting and was pleased to have the opportunity to meet with my noble friend Lord Lucas of Chilworth and his advisers to look again at the question of bridging pensions. Unfortunately my noble friend Lord Mottistone was unable to be present, as he has explained.
At that meeting I was able to inform my noble friend that we are drafting a letter to be sent to the Commission in Brussels formally requesting its opinion on the application of the directive to schemes which pay bridging pensions. In the light of previous discussions which my officials have had, I have little doubt what the Commission's view will be. If its considered view were other than our own, we should of course reconsider our obligations under the directive and whether an amendment to the current Bill would need to be made between now and 1993.
At that meeting, my noble friend's adviser raised the possibility of the Government accepting my noble friend's amendment pending a decision of the European Court. This is not a Government who pass legislation knowing full well that they will be taken to the European Court. Nonetheless, he suggested that only if the court ruled bridging pensions to be a breach of the directive should we take powers to outlaw them. It was his view that there would be time between any judgment by the court and December 1992 to pass amending legislation. I do not believe that to be the case. It is likely to take almost two years from a case being referred to the European Court to its final judgment. It is simply not possible to obtain a judgment of the European Court in time for amending legislation to be passed in time for operation from January 1993. To await the court's judgment is not a viable alternative.
The other option that has been suggested to us is to follow the recommendation of the Select Committee. We shall respond in due course to its report. In the meantime, I cannot hold out much hope that we shall be able to persuade our European partners to

397
agree to a course that would have the effect of nullifying, albeit temporarily, a provision in the equal treatment field which has already been adopted. Nevertheless, I am now able to go considerably further than I did in Committee and say that, should the opportunity arise to negotiate a stay of execution for bridging pensions, we would most certainly take it up.
The issue of bridging pensions has been considered at length by your Lordships. My department has also looked into the issue in great detail. Our conclusion that the directive does not permit schemes to calculate and pay pensions to men on a more favourable basis than to women, or vice versa, has not altered in the light of the representations which we have considered with great care.
I can assure the noble Lord, Lord Swann, that this is not a case of paying £10 notes with one hand and £5 notes with the other to the same amount. The amounts paid by the pension scheme are different. I accept that the issue is not clear beyond peradventure, but the judgment to which we have come is in our view beyond reasonable doubt. That judgment is backed up by your Lordships' Select Committee.
As to why we need to legislate in this Bill, not only do we need to give pensions schemes time to prepare, but, perhaps even more importantly, we are bound by Article 12 of the directive which says:
"Member States shall bring into force such laws, regulations and administrative provisions as are necessary in order to comply with this Directive at the latest three years after notification thereof."
This means that, having identified our obligations, we must legislate by 30th July 1989. I have been asked privately why I made a remark in answer to the noble Lord, Lord Rochester, earlier today, and that was the reason.
The Government have learnt a lesson, and I hope that the pensions industry has too. It is that we must be doubly sure what our obligations are before we approve European directives. No one, neither the industry nor the Government, had full cognisance of the directive when it was approved, despite full consultation and despite advice by learned counsel; nor could either have been expected to anticipate the judgments in this field which the European Court would come to following the adoption of the directive but before its implementation. If we had, we would certainly have delayed the measure in order to pursue a solution with the industry. With the greatest respect, I must say that the time for this is past.
I am, therefore, grateful for the courtesy with which my noble friend has moved his amendment, but for the reasons which I stated at an earlier stage and which I do not wish to reiterate tonight, I respectfully request him to withdraw it.
Lord Mottistone: My Lords, I thank my noble friend for his answer. As I understand it, there will be communication with the Commission. It may be that some amendment will be made to the measure in next year's social security Bill, if the communications with the Commission come through fast enough.
398
However, I shall not pursue the matter with my noble friend. It is asking him to speculate too much too close to midnight. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 27 not moved.]
Lord Henderson of Brompton Lord Henderson of Brompton moved Amendment No. 28:
Before Clause 27, insert the following new Clause—
("Jurisdiction of the Parliamentary Commissioner. In Schedule 2 to the Parliamentary Commissioner Act 1967, social fund officers and social fund inspectors shall be added to the list of departments and authorities subject to investigation.").
The noble Lord said: My Lords, I am reluctant to move this amendment at this late hour but I have to do so in view of what I consider to be the unsatisfactory reply of the Minister when I moved the amendment in Committee. The amendment is designed to bring the social fund officers and social fund inspectors within the jurisdiction of the Parliamentary Commissioner.
When we discussed this matter during the passage of the Social Security Bill in 1988 I asked how it was that everyone who was present naturally assumed that these officers and inspectors were subject to the jurisdiction of the Parliamentary Commissioner. That included the Minister himself. He made that assumption, as did his noble friends Lord Boyd-Carpenter and Lord Trafford as well as the noble Baroness, Lady Jeger, who was moving the amendment and, I believe, everybody else in the House.
Surely the arguments against such a strong assumption by so many experienced people must be immensely powerful to rebut it. I would say that the assumption is made again today if one considers the signatories to this amendment which come from all round the House.
I shall not go into details because at the Committee stage I clearly demonstrated that the social fund officers, by reference to the statute, ought to be within the jurisdiction of the ombudsman. They are officers of the DSS, appointed by the Secretary of State and subject to his directions and guidance. What could be clearer than that? There is no right of appeal against their decisions. Indeed, Members of the House tried to introduce such an appeal and the Government would not allow it. So they are not in any way equivalent to the judiciary.
The ombudsman of course would not interfere if their decisions were taken without maladministration, but he certainly ought to be able to interfere if there is maladministration. In that respect these officials are no different from any other government officials.
So far as concerns the inspectors, the matter may be very slightly different because they are formally appointed by the commissioner. Nonetheless they are certainly not part of the judiciary and are, like social fund officers, obliged to comply with the Secretary of State's directions. Although the department and the Minister were at pains to stress the independence of the inspectors, nevertheless they

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are not truly independent. Judging from the ombudsman's 1988 report, I would say that he clearly thinks that they are not independent and ought to come within his jurisdiction.
Where a matter is in dispute in such an important area it would seem, as I said in Committee, entirely inappropriate that the department should be the judge in its own cause. The noble Lord, Lord Skelmersdale, rather indignantly and rightly said that in fact it was not the department that was judge in its own cause but the Civil Service Department that was the judge. In my view that does not make it any better, because it is not just the department which is judge in its own cause but the Government are judge in their own cause, and that cannot be right.
I believe that this is a matter of such importance that it ought to be resolved by an independent judge. After all, it concerns the interpretation of a statute and it can only be done by the independent judiciary. So I press the Minister most urgently and seriously to take steps to ensure that this issue is resolved by an independent judge. We cannot accept the partisan view of the Civil Service Department. For that reason I bring this matter before the House on Report. I beg to move.
Baroness Jeger: My Lords, the noble Lord, Lord Henderson, moved this amendment with his usual clarity and erudition. It is not only an important amendment in respect of social fund inspectors and officers; it deals with the basic principles of the Government's right to withstand decisions which in other departments would be under the jurisdiction of the Parliamentary Commissioner. It is a very important amendment. I hope that the Minister will have something helpful to say. It has very wide ramifications and is a matter of considerable principle.
Baroness Faithfull: My Lords, I rise briefly to support this amendment. As an ex-director of social services whose clients are very much involved with the social fund I think the provision would be a great safeguard for those clients, for the officers administering the social fund, and the local authorities whose clients are the ones to be involved in this matter. I therefore support the amendment.
12 Midnight
Lord Skelmersdale: My Lords, I shall try to be brief because I do not wish to repeat what has been said previously in Committee, or indeed in a certain amount of correspondence between myself and the noble Lord, Lord Henderson. It is perfectly true that having taken advice, I changed my mind in the early stages; but since I changed my mind I have not wavered. I am sure that the noble Lord, Lord Henderson, would accept that.
I am not sure that the noble Lord, Lord Henderson, and other noble Lords, appreciate that in addition to deciding whether to make an award, or the amount to be awarded, social funds officers have a number of other functions conferred on them expressly by Section 33 of the Social Security Act 1986. These are: deciding whether an award is
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payable by instalments; deciding whether an award is repayable; and deciding whether payment should be made to a third party. In other words, in these respects they act as sort of adjudication officers. As the noble Lord, Lord Henderson, will know, when adjudicators are adjudicating, they are not subject to the Parliamentary Commissioner. Social fund officers are also required by statute to review determinations where an application for review is made in the prescribed time, form and manner, and may review a determination in such other circumstances as they think fit. This is in Section 34 of the Act.
The plain fact is that the social fund officers are acting independently when performing the statutory functions. Neither the Secretary of State nor any other Minister can intervene in the decisions they make under the statutory functions. The comparison that I have drawn with the position of adjudication officers is, I believe, a fair one.
I accept that the position of social fund inspectors is different from that of social fund officers. However, the noble Lord, Lord Henderson, still seems to be under the misapprehension that aggrieved applicants to the social fund have no recourse to having the decision examined by an independent body. This completely overlooks the function of the social fund inspector. He is independent of the department and answers to an independent social fund commissioner. Thus applicants do have access to an independent and impartial review of the decision.
If it would help to convince the noble Lord, and indeed any other Members of your Lordships' House, that the social fund commissioner and her inspectors are independent and acting independently, I invite them to take up the general invitation that the commissioner issued some time ago that anyone who doubts the commission's independence is welcome to visit the Birmingham headquarters to watch what is going on.
I believe that the final question to be addressed—and possibly the key question on this amendment—is whether an applicant is disadvantaged by having decisions made by officers in performance of the statutory functions of social fund officers subject not to the Parliamentary Commissioner but to review by an independent social fund inspector. The Parliamentary Commissioner can only be approached by a Member of Parliament with all the delay implicit in that procedure. An aggrieved person has no direct access to the Parliamentary Commissioner, but he has access to the social fund inspector or the social fund commissioner in the case of maladministration by the social fund inspector.
I really believe that he is far better and more appropriately treated under the existing legislation than he would be under the Parliamentary Commissioner Act. Accordingly, I have no hesitation in asking the noble Lord once again to withdraw his amendment.
Lord Henderson of Brompton: My Lords, before the noble Lord sits down, he has not answered my question. It was whether he would submit this

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matter—which was a question of the interpretation of a statute—to an independent judiciary, an independent judge. It is totally inappropriate that this issue should be decided by the Civil Service Department. In addition to that, what is the authority for saying—I accept that it is the case so far—that adjudication officers are not subject to the parliamentary commissioner? I know that that is accepted. But who made the decision? In what circumstances? Was it made by an independent judicial authority. Or was it too made by the Civil Service Department?
Lord Skelmersdale: My Lords, I am afraid that the noble Lord, Lord Henderson, has caught me rather on the hop. Nevertheless I must answer him by leave of the House. As I understand it, it is a decision of Parliament as expressed in the Parliamentary Commissioner Act. If I am wrong I shall write to the noble Lord.
The other matter that he cross-questioned me on I am afraid I am unable to deal with at the moment. I shall have to write to him.
Lord Henderson of Brompton: My Lords, I regret to say that I find that as unsatisfactory as the reply given me in Committee. As the noble Baroness, Lady Jeger, said, this is not confined solely to the fund officers. It is a matter of much wider importance, and this is a particular example that I am drawing to the attention of the House. Generally speaking, the interpretation of the Bill when enacted cannot be left in the hands of the Government. It must be decided by an independent judge.
I believe that those who have supported my amendment feel as strongly as I do that this is something that should be pursued. I asked those questions in Committee. I have not had a reply on Report. I can only say that I hope that by Third Reading replies will be forthcoming. Meanwhile I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Schedule 8 [Minor and Consequential Amendments]:
[Amendment No. 29 not moved.]
Lord Pitt of Hampstead Lord Pitt of Hampstead moved Amendment No. 30:
Page 78, line 16, at end insert—
("Income Support: Pregnant women aged 16 or 17
18. In Part 1 of Schedule 1A to the Income Support (General) Regulations 1987, after paragraph 4 there shall be inserted the following paragraph—
"4A. A person who is pregnant."").
The noble Lord said: My Lords, I shall speak also to Amendment No. 31. I shall not repeat what I said on Second Reading. The purpose of both amendments is to help pregnant women. The first is to help the pregnant 16 to 17 year-old who does not receive any benefit until the last 11 weeks. I do not think that it is in the interests of the child that that should go on. I hope that the Minister, in the period between the Committee stage and now, has given some thought to that and can bring me some better
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answer than I was given then. I do not think that this is a right thing for us to be doing.
My second amendment seeks to give the family premium to mothers bearing their first child. Again it is because of the cost of pregnancy and the consequences again for the child of the mother being in financial straits during that period that I feel we ought to try to help by giving the person carrying her first child the family premium. The mother expecting a second child receives family premium anyway.
By doing it this way, all pregnant mothers will receive the family premium. That will help them to meet the costs that go with being pregnant. I beg to move the amendment; I hope that the Minister will be able to say something nice and helpful.
Earl Russell: My Lords, I hope that the House will forgive me at this time of night for supporting the amendment.
Baroness Jeger: No.
Earl Russell: I can only beg the pardon of the noble Baroness. This is a point of some importance. Some of the cases in the briefing papers are really quite harrowing. I do not want to quote them at length at this time, but the reduced rate of income support for teenagers is particularly illogical in the case of pregnant women. I cannot believe that it is doing anything other than giving severe hardship. Although I know that the sins of the fathers are visited on the children, I do not think that the state needs to be an accomplice in the process.
Lord Skelmersdale: My Lords, I am not sure that I can help the House very much, especially in relation to Amendment No. 31. As the amendment is drafted, the only people who would get the family premium under this amendment who do not already qualify for it would be couples expecting their first child. I am not at present persuaded that pregnancy of itself gives rise to special needs over and above those already catered for by the issue of free milk and vitamins and the social fund maternity payment, which would justify a special premium. But even if I were, I could not see any justification in giving such a premium for a minority of pregnant women only.
Furthermore the amendment would mean that the premium would be payable from the very beginning of pregnancy—presumably from the moment of conception. I am not certain that it is possible to establish the precise date of this event; but even if the marvels of modern medicine could do so, it could only be done once preganacy had been confirmed some weeks later. This would be very cumbersome to operate. It would inevitably result in retrospective payment in every case, including those where, sadly, the woman loses a child which she was unaware she was carrying. I am afraid that this is just not practical.
Amendment No. 30, which is grouped with Amendment No. 31, seeks to extend entitlement to income support to young women aged 16 or 17 who are pregnant whatever the stage of their pregnancy.

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I have already mentioned that while most 16 and 17 year-olds are not entitled to income support, we have ensured that the most vulnerable groups are. One of these groups is those who are pregnant and within eleven weeks of the expected date of confinement or who, at a time before this date, are incapable of work because of illness. Noble Lords should note that these are not rules which were made up last year specially for 16 and 17 year-olds who are pregnant. They are the same rules that apply to all pregnant women who claim income support. They too are normally required to be available for work up to the 11th week before the expected date of confinement.
We have guaranteed the offer of a YTS place to all young people who want one. The guarantee is being honoured. It includes young women who are pregnant. Those who are on YTS of course get more each week than they would get on income support. I remind noble Lords that if any pregnant young woman were to meet any problems in getting a YTS place, the training agency would make arrangements for suitable training to be provided for so long as she or her doctor considered appropriate. There is therefore no justification for giving entitlement to pregnant girls before the point at which they are no longer required to be available for work.
Lord Pitt of Hampstead: My Lords, I do not suppose that there is any point in pursuing the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 31 not moved.]
House adjourned at twelve minutes past midnight.