Lords Sitting of 21 May 1990

Preamble
The Mouse met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of St. Albans.

Sunday Trading: Restrictions
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
In which countries of the European Economic Community, other than the United Kingdom, it is a criminal offence for a willing seller to sell goods to a willing buyer solely because the sale took place on a Sunday.
The Minister of State, Home office (Earl Ferrers): My Lords, although the majority of member states in the Community have some restrictions on Sunday trading, the detailed information which my noble friend requests is not readily available.
Lord Boyd-Carpenter: My Lords, I thank my noble friend for that not particularly communicative reply. However, can he tell us whether any of our European colleagues reproduce that provision in our law under which it is lawful to sell a pornographic magazine on a Sunday but a criminal offence to sell a Bible?
Earl Ferrers: My Lords, it is difficult enough to know what the law of this country is without knowing what the law of each individual Community country is. We agree that the present position is an absurdity whereby you can buy such things as my noble frend suggested, yet you cannot buy other things.
Viscount Caldecote: My Lords, is my noble friend aware that, although we are all in favour—I believe that there has been wide agreement on this matter—of removing the absurd anomalies to which my noble friend Lord Boyd-Carpenter referred, West Germany, the Netherlands and Italy have prohibitions, similar to those provided for by the Shops Act 1950, on shops opening on Sundays and that there are effective ways of enforcing the laws in those countries?
Earl Ferrers: My Lords, that may be so. We have effective ways of enforcing the laws of this country too—by going to the courts.
Viscount Tonypandy: My Lords, will the Minister bear in mind that another place, which is answerable to the people as a whole in this land, rejected out of hand a proposal to make Sunday like any other day? Will he also bear in mind that a great many people in this land hope that no government will ever make Sunday lose its special distinction as a reminder that this is still a Christian land?
Earl Ferrers: My Lords, I am only too well aware of the noble Viscount's view of what happened to the shops Bill about four years ago. That is the reason why the Government have no intention of producing another Bill until such time as it is likely to prove practical and enforceable, and until it carries widespread agreement and a parliamentary majority.
Lord Hailsham of Saint Marylebone: My Lords, as a member of God's holy opposition, may I ask my noble friend whether the campaign lobbying against the proposed reforms of the shops Bill some years ago was not among the most disreputable and ridiculous which Christian Churches, which are unable to agree about almost anything, managed to put on.
Earl Ferrers: My Lords, that is a peculiarly graphic description of the Bill's passage through another place with which I have no intention of joining in.
Lord Campbell of Croy: My Lords, is my noble friend aware that I buy anything that I need on Sundays without the shops concerned breaking the law because my Sundays are spent at home in Scotland where there are no restrictions; but Sunday is nonetheless special and in my area the churches are full?
Earl Ferrers: My Lords, that is an interesting piece of information on which I would not seek to disagree with my noble friend. Perhaps one day that will happen in this country.
Lord Graham of Edmonton: My Lords, will the Minister take on board the fact that those who advocate complete deregulation of shopping on a Sunday fly in the face of the opinion of the people of this country? Is he aware that, although those people seek to use the device of making comparisons with the rest of Europe, other EC states overwhelmingly proscribe an ability to sell anything at any time on a Sunday? Does the noble Earl agree that, if this country were to deregulate on a Sunday, it would be an exception to the European rule?
Earl Ferrers: My Lords, I understand the opposition which might be generated by complete deregulation. The noble Lord says that all European countries have restrictions. I can confirm that there are restrictions on trading on Sundays in Belgium, Denmark, Germany, Greece, Italy, Luxembourg and the Netherlands. On the other hand, it is absurd when you can sell a razor blade to cut corns, but you cannot sell one for shaving and you can buy newspapers, but you cannot buy toilet paper. Noble Lords will recall that, as I have said before, you can sell tinned or untinned clotted cream and untinned unclotted cream, but not tinned unclotted cream. It is an absurdity.
Lord Stallard: My Lords, will the Minister accept that there are no instructions on my razor blades when I buy them as to what I should use them for?
Earl Ferrers: My Lords, the obligation is on the seller and not the purchaser.
The Lord Bishop of St. Albans: My Lords, does the noble Earl agree that using anomalies cheapens arguments? Does he further agree with the view of the Church of England board for social responsibility which argues that the prime consideration is that we should work for freedom from work on Sunday rather than freedom to work on Sunday?
Earl Ferrers: My Lords, I am grateful to the right reverend Prelate for drawing attention to the points made by the Church of England on this matter. I should be reluctant to comment for fear that I receive a riposte from some other noble Lord. However, I realise that that is one very substantial and important part of a diverse argument.
Lord Boyd-Carpenter: My Lords, is my noble friend aware of the fact that a law riddled with anomalies, absurdities and contradictions does nothing whatever to reinforce or support the Christian idea of Sunday but merely reflects the bad system that we operate and which your Lordships' House, unlike another place, was prepared to alter a short time ago?
Earl Ferrers: My Lords, I quite agree that when a law is riddled with absurdities it is very difficult to make it make sense. My noble friend will understand that he takes one view and the right reverend Prelate takes another. We have had this argument before. Until there is a parliamentary majority for any Bill it is pointless to try to put the matter right. If my noble friend lobbies vigorously the right reverend Prelate and all those who take an opposing view to see whether some accommodation can be reached with his own view, we may get somewhere.
The Earl of Halsbury: My Lords, is it not an additional complication that whereas Christians keep the Sabbath on Sunday, Jews keep it on Saturday and Moslems on Friday?
Earl Ferrers: My Lords, one should not ask a question from this Dispatch Box, but I was going to say, "So what?"

Algeciras-Gibraltar Ferry Service
2.45 p.m.
Lord Merrivale Lord Merrivale asked Her Majesty's Government:
What is the present position in relation to the Algeciras to Gibraltar ferry service following their letter of 9th February to the European Commission requesting that infraction proceedings be commenced against Spain.
The Minister of State, Foreign and Commonwealth office (Lord Brabazon of Tara): My Lords, as my noble friend Lord Reay told the House on 19th April, we await an answer to our request from the European Commission. We have asked the Commission when we can expect a reply to our letter and we hope to receive one shortly.
Lord Merrivale: My Lords, I thank the Minister for his reply. I have two supplementary questions.
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Have the Government reminded the Commission of its obligations under Article 155 of the treaty which states:
"In order to ensure the proper functioning and development of the common market, the Commission shall ensure that the provisions of this Treaty and the measures taken by the institutions pursuant thereto are applied"?
Secondly, as the three-month administrative stage is over, are the Government prepared to start the judicial stage and bring the matter before the European Court of Justice?
Lord Brabazon of Tara: My Lords, we have pressed the Commission for a reply on this matter on numerous occasions since we wrote on 9th February. We have not yet received a reply. So far as concerns direct action by the Government before the European Court of Justice, we shall consider action under Article 170 of the Treaty of Rome at the appropriate time. For the moment it is for the Commission to decide whether there is a case against Spain under Article 169.
Lord Cledwyn of Penrhos: My Lords, is it not the case that Her Majesty's Government support the ferry agreement and also the airport agreement and that the Spanish Government at the moment link the one to the other? Can the Minister say whether there is a possibility that Her Majesty's Government will speak to the Gibraltar authorities to see whether there might be any modification in their attitude to the airport agreement which could lead to a settlement?
Lord Brabazon of Tara: My Lords, we have kept in close touch with the Chief Minister in Gibraltar on the ferry agreement. The airport agreement, we believe, is a good deal for Gibraltar and does not comprise any concessions to sovereignty. What we are talking about in the Question is a different route to get to the ferry agreement. We believe that there is no linkage between the ferry agreement and the airport agreement. But the Spaniards, as we are all aware, take the opposite view. That is why we have taken the other route so far as concerns the ferry services, invoking an EC regulation on the freedom to provide maritime transport services between member states.
Lord Cledwyn of Penrhos: My Lords, I fully support the line that the noble Lord takes on behalf of the Government. Can he say whether or not dicussions have been held with Mr. Bossano on the possibility that Gibraltar might change its mind to some extent on the airport agreement?
Lord Brabazon of Tara: My Lords, we have certainly discussed the airport agreement with the Gibraltar authorities, We have made clear in negotiating the agreement with Spain that it was subject to the Gibraltar House of Assembly passing the enabling legislation. Gibraltar has not done so. We have made clear to the Gibraltar Government that the agreement constitutes no concession on sovereignty and have urged them to bring benefit to Gibraltar by implementing it. We cannot force the agreement on Gibraltar.
Lord Merrivale: My Lords, does the Minister agree that there is justification for Gibraltar to bring this matter before the European Court of Justice on grounds, as I understand it, that application of the European Community air transport policy has not benefited Gibraltar while other new air routes have been approved? Does that not constitute discrimination?
Lord Brabazon of Tara: My Lords, the airport agreement is a different matter from the subject of the Question on the Order Paper. If the noble Lord wishes me to go into detail on the airport agreement I think it would be better to wait for a Question to be tabled on that subject.

English Industrial Estates
2.48 p.m.
Lord Jay Lord Jay asked Her Majesty's Government:
Whether they intend to continue support for English Industrial Estates in promoting development in areas needing employment.
Viscount Ullswater: My Lords, we certainly intend to support English Estates in promoting the provision of industrial and commercial premises. The Government's policy is to ensure that premises and sites are available to meet the needs of businesses in the assisted areas. Wherever possible that should be done through private sector provision. English Estates will continue to make an important contribution to regional policy; but the Government now want it to move away from direct provision, wherever possible, and in many areas to operate primarily as a facilitator using a range of mechanisms to draw in private sector developers.
Lord Jay: My Lords, whatever that Answer means, the company has been one of the Government's most successful instruments for many years in promoting employment in areas that needed it in England. It owns a large area of valuable industrial property. Will the Minister note that any serious curtailment of its activities would be a major blow to these areas, in particular in the North of England?
Viscount Ullswater: My Lords, yes. I agree with almost everything that the noble Lord has said. The Government will continue to support provision of new floor space in assisted areas both through the range of incentives, as I have indicated, and, where incentives do not prove sufficient, through continued direct provision. A substantial assisted areas programme for English Industrial Estates of up to £52-8 million has been announced for 1990–91.
Lord Molloy: My Lords, in addition to industrial estates, areas are suffering severely because of closures. I refer, for example, to Ravenscraig in Scotland. What will the Government do to try to stop the loss of that steelworks and of so many skilled jobs?
Viscount Ullswater: My Lords, that is an entirely different question. English Industrial Estates deals with England. Scotland is a different region. However, perhaps I may indicate to the noble Lord that where the shipyards have closed down in Sunderland special provision has been made by English Industrial Estates to redevelop certain areas there in order to assist with employment.
The Earl of Selkirk: My Lords, if someone wishes to start an industrial estate, to what government office should he apply? Is it a matter for the Department of the Environment or the Department of Trade and Industry or is it left entirely to the local authority?
Viscount Ullswater: My Lords, I am answering for the Government but from the Department of Trade and Industry. English Industrial Estates encourages private sector developers into the assisted areas and provides a tremendous amount of market information. Such information would include available development sites, demand, rental levels, construction costs and rental and capital value growth indices.
The Earl of Selkirk: My Lords, where does one obtain such planning permission? Is it from the local authority or from the Department of Trade and Industry?
Viscount Ullswater: My Lords, I feel that other noble Lords are already answering the question. All planning is dealt with by the Department of the Environment.
Lord Dormand of Easington: My Lords, is the Minister aware of the splendid work undertaken by English Industrial Estates in the northern region? My noble friend Lord Jay was quite right to refer to it. Those of us who have had close dealings with the organisation over many years realise the tremendous work that is done for the northern region, which still has the highest rate of unemployemnt. Secondly, I am a little confused, as was my noble friend. Is the Minister saying that there is a possibility of privatisation at some time in the future?
Viscount Ullswater: My Lords, no, not so far as I know. The noble Lord may be thinking of what has been announced. English Industrial Estates will sell off some of the portfolio that it holds, thereby encouraging the private sector into these industrial areas.
Lord Peston: My Lords, employment in manufacturing is already declining. According to the Government's own forecast employment may continue to decline and unemployment rise at a faster pace in the coming year. Bearing that in mind, is it not a singularly inappropriate time for the Government to be interfering with English Industrial Estates, which everyone agrees has done an extremely good job? Surely what is required is that the Government give it more support rather than talk of selling off its assets.
Viscount Ullswater: My Lords, I am extremely grateful to hear the wholehearted support for English Industrial Estates from the noble Lord which we thoroughly endorse. I do not believe that investment in these assisted areas could be considered to be diminishing if the budget increased from £42 million last year to £52 million this year. Selling off the estates does not withdraw the premises available; it changes the landlord.
Lord Peston: My Lords, perhaps the Government will confirm my understanding from what I have read in the newspapers. I do not have the advantages of the noble Viscount. Are the Government totally committed to the continuation of English Industrial Estates? Will it continue to have sufficient resources to do the job that it has done so well until now?
Viscount Ullswater: My Lords, that is my reading of the matter.

Housing Associations: Funding
2.55 p.m.
Lord Dean of Beswick Lord Dean of Beswick asked Her Majesty's Government:
What resources are available to housing associations and whether these are sufficient to enable them to carry out the functions laid on them by recent legislation.
Lord Reay: My Lords, Her Majesty's Government plan to increase the Housing Corporation's programme of grants and loans to housing associations from £938 million in 1989-90 to £1, 736 million in 1992-93. Associations are also now able to draw in private loan capital to help finance their grant-aided schemes. As a result associations will be able to fulfil their role under the Government's housing policies as main providers for the future of new homes for low income households.
Lord Dean of Beswick: My Lords, is the Minister aware that his Answer does not accord with the housing associations' view of the situation? Is it not a fact that the Government brought forward £120 million in January from this year's allocation to cover last year's expected overspend? The effect of that was to cut the target for approvals this year from 24, 000 units to 19, 500. The associations now believe that the figure could be reduced to 10, 000. The Government have stated repeatedly that they no longer view councils as builders of houses but only as enablers and that the charity organisations will take their place. Do the figures not indicate that the Government are failing abysmally in what they are trying to do?
Lord Reay: My Lords, on the noble Lord's first question, a new financial regime was introduced on 1st April 1989. It resulted in housing associations bringing forward their schemes faster than had been anticipated. That factor resulted in £120 million worth of capital expenditure which was originally
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planned to be used by the Housing Corporation in 1991 being spent in 1989-90. A corresponding decrease has been made for 1990-91. If the two years are taken together the number of new homes that housing associations will provide is expected to remain as planned. A faster rate of spending will mean that new homes will be ready sooner. That must be a good thing.
Lord Dean of Beswick: My Lords, it was predicted that 27, 000 units would be produced in 1991-92. Unless there is a further increase in funding the figure may reduce to 7, 000 over the two years. Does that not indicate that the situation needs looking into? Mr. Splcer, the Housing Minister, ought not to continue to reject overtures of the housing associations as he did last week.
Lord Reay: My Lords, I do not accept that. The output of houses is expected to double from 1988-89 to 39, 000 by 1992–93.
Baroness Fisher of Rednal: My Lords, I am a little worried by the reply that the Minister gave. I am a member of a housing association. Last week we received a long letter from the director of the Housing Corporation on the difficulties of finance, which were described as considerable. Perhaps I may read part of it. Writing to housing associations the director of the Housing Corporation stated:
"I am aware of the serious financial difficulties caused to housing associations by the failure of the Housing Corporation to forecast its cash flow".
That is contained in the letter—
Noble Lords: Question!
Baroness Fisher of Rednal: My Lords, will the Minister investigate the letter from the director of the Housing Corporation which has made it extremely difficult for those housing associations which had approval to carry on with their programmes only to find now they are without cash until the end of this year?
Lord Reay: My Lords, I appreciate that a difficult situation may arise for some assocations which were expecting to be able to bring forward plans which must now be postponed. However, I am confident that the corporation will do what it can to minimise the problem. I do not believe that the difficulties should be exaggerated. Forty thousand new homes are now being built under schemes which have been approved. We are confident that housing associations can expand to achieve what is asked of them. Indeed, they are already putting forward more schemes than the Housing Corporation can accommodate in its programme.
Lord Dean of Beswick: My Lords, does not the last question bear the truth? Is is not the case that the housing associations, through the Housing Corporation, are ready to meet an expanding need but the Government are not prepared to find the money?
Lord Reay: My Lords, no. As I said in my original Answer, the Government plan to increase the Housing Corporation's programme from more than £900 million to £1, 700 million in the next three years. That is a substantial increase.

Business
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Committee stage of the Social Security Bill will be adjourned at about 7 p.m. for the purpose of taking the Second Reading of the Australian Constitution (Public Record Copy) Bill. It is possible that that will take something over one hour. Therefore, it may be helpful to say that the Committee stage will resume no earlier than 8.15 p.m. or no less than one-and-a-quarter hours after the commencement of the adjournment.

Social Security Bill
3.2 p.m
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Henley.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chain.]
Lord Seebohm Lord Seebohm moved Amendment No. 1:
Before Clause 1, insert the following new clause:
("Uprating of child benefit
In section 63(3) of the 1986 Act, at the end there shall be added the following paragraph—
"(c) mentioned in subsection (l)(f) above".").
The noble Lord said: The object of the amendment is simple although the original implementation of the provision was complicated. The amendment adds child benefit to the list of those which are indexed each year in order to maintain their real value. In real terms the effect is virtually nothing. Indexation is keeping pace with inflation and we are trying to maintain the real value of child benefit which has diminished steadily over the past three or four years. Today its real value is about 20 per cent. less than in 1976 when it was introduced. It has diminished steadily and, I believe, tragically from the time when we were less prosperous than now.
I make no apology for bringing the matter forward yet again. Since last year there has been an increasing groundswell of opinion in favour of the provision not only among all parties in both Houses but throughout the country. It is worth reminding the Committee that child benefit replaced not only the child-taxed allowances but also family credit. In 1976 the result was that there was almost no net increase in public expenditure. In real terms the benefit costs less now than it did then. Furthermore, I have no hesitation in saying that if no change had
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been made in 1976 no government would have had the nerve to abolish the child tax allowances. That is proved by the fact that no attempt has been made to remove or to reduce the married man's allowance.
As so forcibly pointed out last week by the noble Lord, Lord Joseph, and Mr. Timothy Raison, we are talking about the maintenance of family life and the bringing up of healthy children. I wish to refer to what was said by the noble Lord, Lord Joseph, in a pamphlet for the Conservative think tank and also read an extract from a book written by Mr. Raison. The noble Lord, Lord Joseph, stated that families had gained less from government policies than the childless. Figures showed that expenditure per person in families with dependent children was only £54.31 per week when the mother did not go out to work compared with £117.31 in households without dependent children with a working wife.
That shows extremes that are really remarkable. In his book Mr. Raison stated:
"There are limits to the extent to which governments can change attitudes in this sort of respect: but it is open to them to use the tax system and child benefit to support those mothers who stay at home, instead of tipping the tax system in favour of the couple where both work".
In a newspaper interview Mr. Raison said:
"We say we are the party of the family. I don't want us to become sermonising or priggish but if we believe traditional marriage and the family are very valuable institutions, we should produce policies which will support them".
Those comments are from members of the Conservative Party.
I hope that not only will the maintenance of child benefit remove the necessity for many families to go cap in hand to social security, which so many people feel to be degrading however well it is wrapped up, but that it will be recognised that couples with children are at real considerable economic disadvantage compared with others. We must not be the country among those of the developed world that does the least for the family.
I am not asking for any financial concessions. I am not asking, alas, for any real improvement in family support. All I am asking is that we should stop the situation becoming worse for our children and our families. I beg to move.
Lord Carter: We on these Benches are pleased to support the amendment. It is intended to maintain child benefit as now paid directly to the mother, to make good the amount that has been lost in the three-year freeze of child benefit since April 1987 and to ensure that it is index linked against future inflation.
The commitment to keeping child benefit in line with inflation goes back a long way in the Conservative Party. It goes back to 1975 when the benefit was first introduced. Mr. Kenneth Clarke, who was then Opposition spokesman on social security, said:
"whatever figure is chosen at least keeps in line with inflation thereafter".—[official Report, Commons, 13/5/75; col. 389.]
The noble Lord, Lord Jenkin of Roding, when he was Secretary of State for Social Services, said:
"it is our intention, subject to economic and other circumstances, to uprate child benefit each year to maintain its value".—[official Report, Commons, 28/7/80; col. 1063.]

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The same point was made by Sir Geoffrey Howe when he was Chancellor of the Exchequer. To the credit of the Government they increased child benefit to its highest ever level in 1983. He then said:
"it is the benefit which provides the greatest help to many of the poorest families in the country".—[official Report, Commons, 15/3/83; col. 143.]
The same view was also put by the Prime Minister in 1983:
"It has long been the view of all parties that our tax and benefit system should recognise the needs of families with children and should differentiate between such families and those without responsibility for children".
That point was emphasised in the Green Paper on the reform of social security in 1985 which underlined that argument. It is right that families with children, whatever their income level, should receive some recognition for the additional costs of bringing up children, and the tax and benefit system should allow for a general redistribution of resources from those without children to those who have a responsibility for caring for them.
There has been a dramatic change since those thoughts in the mid-1980s. They were best summarised by the noble Lord, Lord Joseph, in a pamphlet, which has already been referred to, entitled Rewards of Parenthood? which was published only last week. Referring to what has happened it states:
"Child tax allowances have been withdrawn: tax thresholds in real terms have fallen sharply: families now pay tax at below Income Support levels: national insurance contributions have risen: parents who both work are taxed less than when one stays at home while the children are young: and personal cash allowances climb while the only tax recognition of the costs of dependent children—tax-free Child Benefit—is frozen, so that the effective discrimination against the family with dependent children becomes worse each time personal cash allowances are raised …
All this has caused a sideways shift of net income from households with dependent children to the single, to the childless, to families whose children have become independent. The plain fact is that families with dependent children have gained less from our policies than the childless".
Despite all the protestations in the mid-1980s in favour of the uprating of child benefit, since 1987 there has been a change of heart by the Government. The basic reason for that is the cost of child benefit, which is now £4-5 billion. The Government have given two reasons for their failure to uprate child benefit. Mr. John Moore, speaking in another place, said that most of the money would go to better off families including the very wealthiest. He said that the poorest, that is those on income support, would gain nothing at all from the child benefit increase and neither would those who would be claiming family credit.
I deal, first, with the point that child benefit is wasted on the better off. Perhaps one fifth of child benefit goes to better off households. The argument is that the better off do not need an increase in their disposable income which they will receive from an increase in child benefit. We recently heard that argument in a different context and we have heard the Government's answer. On the whole, the better off have done very well out of the poll tax. However,
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the Government have very quickly pointed out that the better off pay a lot more in terms of taxes so they are not better off as a result of the poll tax. Surely the same argument applies to child benefit. We know that the better off have gained an increase in disposable income from the poll tax and the Government find that acceptable for the reasons I have cited. Equally, the better off with children will receive an increase in disposable income if child benefit were to be increased, which this amendment requires. Surely the Government's argument as regards the poll tax and the better off applies equally as regards an increase in child benefit.
Secondly, it is said that those on income support and family credit do not gain through an increase in child benefit as the increase is taken into account in benefit levels. We know that the take up of family credit is of the order of only 40 or 50 per cent. depending on the basis of the calculation. Therefore it is not true that all those eligible for family credit do not gain. Also, there is a complicated relationship between income support and child benefit and other benefits relating to what has been called the poverty and unemployment traps. That was summed up extremely well in Research Note No. 484 of the House of Commons Library Research Division, which points out that:
"Abolishing child benefit would appear to increase the breadth, but not the depth, of the poverty trap and to increase the unemployment trap".
It is clear that the freezing of child benefit would tend to have the same effect, although at a slower speed, as the abolition of child benefit.
The central point is that the freeze in child benefit has saved of the order of £250 million while the increase in the means tested benefits which the Government pray in aid will cost of the order of £70 million. That point was emphasised by the noble Lord, Lord Joseph, in the pamphlet when he said:
"The extra Family Credit for poor families with dependent children (and the extra for single parents) is being provided not by the population at large but by other parents through savings on Child Benefit".
The Government say endlessly that social security benefits should be targeted. We know that child benefit is targeted. It is targeted on children and has a take up rate of 98 per cent. It is our most effective benefit to help those on low incomes who are just above the family credit and income support levels and of course the single parent families. It recognises the extra costs borne by those with children and, above all, it recognises the importance of the family as a social unit.
3.15 p.m.
Baroness Seear: On these Benches we support this amendment. I know that the Minister will tell us that the Government want the money to be targeted on those who are worst off. We have heard that so of ten and it will be very disappointing if we do not hear him say it again today. I want to make the point that, although I agree that there are times when that argument applies, there are times when it does not. There is no need to be dogmatic in supporting the principle of targeting or the principle of universality. It is horses for courses. Some benefits are appropriate

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for targeting and others are appropriate for universality. I should like to make the case very briefly that child benefit is supremely a benefit which is not suitable for targeting but is suitable for universality.
I believe that I can say that with even more confidence and more appropriately than the previous two speakers because it is crystal clear to any single person who has not had children that that person is a great deal better off than colleagues doing the same work receiving the same salary but trying to bring up children. The case for redistribution between a single person with no dependents and a married person or a single parent with children is surely unanswerable. This is a case for universality and no1 for targeting.
The Government's argument is that the benefit goes to the very well off. That depends upon how one defines "very well off". However, a great deal goes to that large band of people on middle incomes who, it is true, are above the poverty level but are struggling to maintain reasonable standards and a reasonable, decent home. The child benefit is a considerable advantage if that is so. I believe—and one cannot prove this—that that additional money, normally in the hands of the mother, can do a great deal to oil the wheels for families which are stretched for money and do not know where to look to meet the demands being made upon them.
Child benefit has the enormous advantage that it does not increase the poverty trap. Because it is not a tax benefit it does not mean that when a person obtains a job or is promoted he does not gain considerably because he loses out through his benefit, which is the case with many other benefits. That is a great advantage. On these Benches we believe that there is a very strong case for some kind of basic income which should be free of all statutory taxation. Child benefit is a very good example of that principle. For no other reason that is a strong case for maintaining it and I hope that the Minister will not produce the same old arguments and opposition.
Lord Stallard: I too support this amendment. It is useful to go back to how it started. The noble Baroness, Lady Seear, has given me that opportunity by talking about the difference between those with children and those without them. This benefit was introduced in place of a married man's tax allowance. It was never introduced as a social handolt but was introduced to make a distinction and equity between those who had children and those who did not. It was a deliberate tax policy to produce that kind of equity.
We must remember that because the benefit is discussed as some sort of social security handout. It is essential to remember that it started as a definite part of our fiscal policy to try to create some equity between those with and those without children. It was paid to the mother. There would be an outcry if, for instance, it were suggested that the married man's allowance—there are other examples—be frozen because it was paid to all people whether or not they needed it, or because some people were receiving above average income and some were not.
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That would be ridiculous, yet we gladly put forward the same argument with regard to child benefit. It does not stand up. I should like the Minister to reply to the original perspective of child benefit: that it was introduced in order to create some equity between the two types of tax benefit.
Lord Boyd-Carpenter: Nobody disputes that child benefit has been a useful part of our social security system. The question that this amendment poses is whether priority be given to increasing it in line with inflation over the many other directions in which that money could usefully be spent.
If he will allow me to say so, the noble Lord, Lord Seebohm, in moving the amendment, rather obscured counsel when he said that the proposal did not cost anything because it was proposed simply to adjust to the level of inflation. As I understand it, to adopt what is proposed in the amendment would cost £250 million per year. That money, if spent in that direction, would not be available for the other good causes for which many noble Lords plead—and rightly plead—from time to time. The question therefore is not as simple as the noble Lord, Lord Seebohm, appears to think. The question is whether it is right to apply £250 million a year to this particular benefit in preference to the other claims which are made and with which your Lordships are only too familiar.
Child benefit has the disadvantage that it is paid regardless of means. There is no doubt that if we were to adopt the amendment a large part of the £250 million extra would go to people who in no sense need it. of course they should like to have it; of course people would like to be paid to help with their family, but around one-fifth of the recipients are not in need. On the other hand, if we were to accept the amendment it would not benefit the people at the bottom of the scale.
Lord Carter: Perhaps I may intervene. Before the noble Lord leaves the point regarding the better off, will he deal with the point I made, that the Government felt that it was acceptable for the people who were better off to gain from the poll tax because they paid more taxes. Exactly the same argument applies to child benefit.
Lord Boyd-Carpenter: That does not apply at all. On the one hand the noble Lord is talking of a tax. We are here speaking of a payment from the Exchequer to the individual, and there is all the difference in the world. I see both the noble Lord, Lord Carter, and the noble Baroness, Lady Seear, are seeking to intervene, but I shall finish my sentence before leaving it to them to decide whether chivalry demands that the noble Baroness should speak first.
There is all the difference in the world between paying a social benefit raised from taxation to those who do not need it, and adjusting the system of taxation in one respect only as against many other respects in a way which may be said to benefit one particular section of society.
I shall happily give way if your Lordships will settle who wishes to speak next.
Baroness Seear: Does the noble Lord agree that income tax relief for those in the 40 per cent. tax band also benefits those who are particularly well off, and that a reduction of that benefit to 25 per cent. would more than meet the uprating of the child benefit?
Baroness Phillips: Perhaps I could—
Lord Boyd-Carpenter: I cannot carry a list of interventions in my mind. I hope I shall be allowed to reply to the noble Baroness. There is all the difference in the world between reducing the burden of taxation and making a grant. I do not want to weary the Committee by widening the debate, but the levels of taxation imposed—particularly the higher levels—have a considerable impact on the growth of the economy, the development of productivity and the stimulus to effort. With great respect to the noble Baroness, therefore, it is utterly irrelevant to compare making a social security payment to the better off with any reduction which can be made in lowering the level of taxation. Experience over the past few years has shown that that has greatly mitigated the working of our economy.
We therefore come back to the question posed by the amendment whether it is right to spend £250 million per year on increasing child benefit regardless of the fact—as the noble Lord, Lord Carter, said—that it is not targeted; regardless of the fact that perhaps one fifth of it goes to people who are in no sense in need; and, as I was about to observe when I was interrupted, the perhaps even more important feature that it would not benefit the poorest people involved. If child benefit is increased, that amount is then deducted from income support and family benefit, which is the benefit paid to the poorest.
What is proposed therefore is to increase a benefit—many people no doubt find it useful—which will help a limited number of people who do not need it in any sense and which will confer no benefit on the poorest. If we are concerned with social security administration, as some of us have been concerned for many years, the important factor in any such proposal is whether we are to benefit those most in need of the benefit. The brutal fact remains that this amendment, if carried, would not do that. There is also the factor that it is a large amount which might otherwise be favourably spent elsewhere.
I should like to remind the Committee, because it is very relevant in this context, of words spoken by the late Mr. Aneurin Bevan in his farewell speech, quoted by the noble Lord, Lord Wilson of Rievaulx, at the beginning of his book, The Labour Government 1964–1970:
"I would describe the central problem falling upon representative government in the western world as how to persuade the people to forgo immediate satisfactions in order to build up the economic resources of the country".
Those are wise words spoken in his final speech by a great man whom a great many of us remember, quoted by a former Prime Minister from the Party opposite, and they are true. It is easy to say that it is a good thing to increase various benefits, including
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child benefit. of course that would give some pleasure and do some good, but if we are to work an effective social security system which takes care of need without crippling the development of the economy upon which that social security system depends for its well being, we must take a severe view; we must take a strict view. That view suggests that if there is £250 million more to spend, it should not be spent in increasing a benefit which helps some of the rich but gives nothing at all to the very poor.
Baroness Seear: The noble Lord referred to my reference to the relief for 40 per cent. income taxpayers. He must agree that that relief gives additional spending power to people in the better off sections of the community, otherwise they would not be paying 40 per cent., and the Exchequer is the poorer because those people receive it. That means that it is not irrelevant to the argument.
Lord Boyd-Carpenter: I do not wish to contradict the noble Baroness and I am sure that it is hopeless to do so, but there is all the difference in the world between making social security payments to people from public funds and deciding to take less from their earnings by way of taxation. If the noble Baroness cannot see that I can only comment that she obviously fails to understand the effect of taxation, particularly of high taxation, on diminishing the growth of the economy, the incentive to work, to undertake enterprise and to take risks. If that is so, we must agree profoundly to differ. Perhaps the noble Baroness will allow me to say that if that is the view of the Liberal Party it is no doubt one of the explanations for its state today.
Baroness Seear: I cannot accept that patronising reply from the noble Lord. I fully understand the effect of high taxation on the development of the economy. What we are discussing here is not giving a specific benefit, a generous benefit, to the better off That is an entirely different matter from increasing taxation. I have no desire to see taxation increased. I have every desire not to see benefits of that order given to people who most emphatically do not need them.
Lord Jay: Perhaps the noble Lord, Lord Boyd-Carpenter, did not notice that one of his arguments is in fact in favour of the amendment. Several times he argued that the great advantage of reductions in taxation is that they give incentive to the worker because he can earn more by having an increase in his spendable income. That is precisely one of the merits of child benefit. It is a social payment such that if your wage or salary is increased you do not lose social benefit. That is an extremely powerful argument in regard to just the incentive to which the noble Lord referred. That would appear to be one of the major elements in this argument.
Lord Boyd-Carpenter: Does the noble Lord not recognise that there is obviously some force in what he said? One has a much better incentive by reducing the tax that the person concerned pays.
3.30 p.m.
Lord Jenkin of Roding: I must begin by apologising to the noble Lord, Lord Seebohm. With the best will in the world I failed to arrive here for the beginning of the debate on this amendment.
I should like to take a slightly different line from that taken by other speakers. I believe that over the years we have got ourselves into a confusion about child benefit. My mind goes back to the Treasury in 1970 to 1974 when my noble friend Lord Cockfield—I am delighted to see him in his place—invented for us the tax credit scheme. We quickly came to the conclusion that if it were to be introduced it should be in stages and that much the easiest first stage would be to introduce a child tax credit in order to make sense of what then existed—a thoroughly illogical and undesirable combination of child tax allowances and family allowances. A great deal of the work was done under the leadership of my noble friend Lord Barber, who was then Chancellor, so that the incoming Labour Government of 1974 to 1979 was able to introduce what they chose to call child benefit.
The noble Baroness, Lady Seear, made the very good point that, because it replaced child tax allowances, this benefit was to be regarded as part of the process of achieving horizontal equity—a perfectly horrible economists' phrase—between different categories of taxpayer. It cannot be gainsaid that families at almost any level of income who bear the responsibilities of bringing up children will have heavier commitments than those who do not. Certainly there is not the slightest doubt that at the outset all major parties recognised that child benefit had that considerable purpose behind it; namely, that it perpetuated a system of horizontal equity between families with and families without children.
It was an enormous improvement on what went before because it went to families who were below the tax threshold and who could benefit only in part or not at all from the child tax allowances. It went to them whether or not they were in work. Therefore, it was a considerable easing of the disincentive to take work, if one was out of work, and it represented immediate cash.
The logic of the case—if noble Lords care to look back over the history of the matter they will see that this was argued—was that the benefit should, like the tax allowance, appear in the breadwinner's pay packet. However, I do not need to remind the Committee, and perhaps the noble Baroness less than most, that the argument for making sure that the element of the family allowance went to the mother in cash over the post office counter was lobbied with great passion and force and the government of the day felt obliged to abandon any suggestion that part of the child tax credit or child benefit should appear in the worker's pay packet.
In terms of incentive and of reward for work, to have retained that characteristic of the old child tax allowance would have had considerable advantage in regard to incentive and all the other important characteristics to which my noble friend Lord Boyd-Carpenter referred. However, it was not to be. It proved to be politically untenable. Therefore, faute
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de mieux, the child benefit rapidly acquired the characteristic not of a child tax credit, which is what it started as and what in some respects it still is, but of a benefit like any other social security benefit. Naturally that has given rise to all the arguments that my noble friend Lord Boyd-Carpenter and others have deployed in asking where is the sense of paying benefits to families who manifestly are not in need.
Perhaps I may take issue with my noble friend on one point. He stated that child benefit confers no advantage on the really poor. That would be true if the take-up of the means-tested benefits was anything approaching 100 per cent. It is certainly better than the old family income supplement, but nobody seeks to pretend that the family credit, or the one-parent family benefit, reaches anything like 100 per cent. of the families who are eligible. The advantage of child benefit, however, is that at least it goes automatically to all families.
I come back to the point I made earlier. I believe that we have all got ourselves into confusion. We have lost sight of the point about horizontal equity.
Baroness Seear: I mentioned the point.
Lord Jenkin of Roding: The noble Baroness says that she mentioned the point and I have acknowledged that. The arguments for index linking or regularly increasing child benefit have perhaps taken far more into account that this is a benefit akin to pensions, invalidity benefit or all the other social security benefits.
I believe that this Government, or any other, will have to face up to the problem of whether we are to treat child benefit as essentially a benefit which should be phased out or phased down in favour of selective benefits for families on very low incomes. The absolute logical concomitant of that must be the reintroduction of child tax allowances. I do not shy away from that. I believe that that is now possible with the increasing sophistication of computerisation at the Inland Revenue and the arrangements of the great majority of employers for paying wages and salaries; the growing practice of wage payments monthly rather than weekly; the growing practice of payment by bank credit and the increasing use of information technology.
I believe that some of the arguments advanced 10 or 15 years ago that the system of tax allowances had to be extremely simple no longer apply. There were only the three broad categories—LHT: the lower rate, higher rate and a third category. It is now, or will be, open to future Chancellors of the Exchequer to have a more tailored system of taxation which can take account of such matters and, if thought appropriate, introduce a child tax allowance; and then follow through all the powerful arguments which my noble friend Lord Boyd-Carpenter has deployed about the automatic indexing of child benefit. At the same time it should be possible to ensure that the take-up of some of the means-tested benefits is higher if only by involving employers.
I now turn to the question of family credit. When first mooted in the Green Paper which heralded social security reform it was to be paid to the

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breadwinner in the wage packet. That attracted me enormously: there was an incentive for every employer to see that employees entitled to the benefit received it. It meant a larger sum of money in the pay packet.
I say in sadness that the feminist lobby insisted that, notwithstanding the fact that the child benefit was already going to the mother, so should the family credit, at least temporarily. I have a letter on my files from Sir Norman Fowler. At that time I had left the Government: I challenged him on the matter. He said that we would have to start by paying the credit in cash to the mother but that did not rule out the possibility at some future stage, and as part of a wider reform, of it going to the breadwinner in the pay packet.
Therefore, there is a combination of measures that could be undertaken to make sense of a system of child support. It would be a combination of tax allowances, a general cash allowance and a more effective and selective allowance for the very poor. Those measures would represent a considerable improvement on what we now have.
Where does all this leave us when considering the amendment? It cannot be right for the Committee to accept an amendment of this kind, carrying implications of immediate expenditure, which was tabled on Friday. No one who had not had his attention specifically drawn to it over the weekend would know of its appearance on the Marshalled List today.
Furthermore, Members of the Committee such as the noble Baroness, Lady Seear, who argue that the child benefit still retains some of the characteristics of a child tax allowance, one of its purposes being to maintain horizontal equity, will know perfectly well that if there were a child tax allowance we would not be allowed to debate it let alone to table an amendment. Certainly we would have no power to amend the Finance Bill.
In those circumstances it cannot be right for the Committee to pass this amendment. However, the noble Lord, Lord Seebohm, can take some comfort from having given the Committee the opportunity to look again at what is now a somewhat tangled skein of support for families. If he intends to put this matter to the decision of the Committee I make it perfectly clear that I shall support the Government in resisting the amendment.
Lord Seebohm: I am sorry that the noble Lord was not here when I spoke. I ask him a direct question. If the noble Lord had not preferred child benefit and had left it as a tax allowance, would he be reducing that benefit now until it withers away?
Lord Jenkin of Roding: I have wearied the Committee at some length but perhaps I may answer that. I have consistently argued, both in and out of government, with successive Chancellors of the Exchequer, that the levels of child benefit should be considered at the same time and in the same context as the levels of tax allowance. Had that been done and the measure had retained more of the characteristic of a child tax allowance, we might have found ourselves in a rather happier position.
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Because it is a social security payment paid in cash across the counter of a post office and because it has been increasingly dealt with in social security legislation, it has progressively lost that character. Therefore, I believe the noble Lord's question is a little hypothetical. We are dealing with what the provision is now. I have argued a number of steps which might usefully be taken and which could get us out of a mess.
3.45 p.m.
Lord Renton: For the reasons already given by my noble friend I also oppose this amendment. I did not know about it until I reached the House shortly before the debate started. I find the amendment unacceptable. The strength and validity of our social security system is dependent on inflation not reducing the value of benefits.
The amendment will be automatically inflationary for two reasons. The first is that the Secretary of State will be required in a year's time, if not before, to increase the amount of benefit whatever view the Chancellor of the Exchequer may take about the threat of inflation. That is a wrong principle to put on the statute book. The second reason is one which I mentioned in a similar context last week and the week before. Government expenditure will be increased by £250 million. Although that may be only a marginal addition to inflation it is not to be ignored. The very people whom the social security system is intended to benefit will suffer if we allow public expenditure to continue to increase indefinitely. Therefore, I hope that the Committee will reject the amendment.
Lord Stallard: When the noble Lord says that the amendment would cost £250 million drawn from social security, does the noble Lord not agree that that sum would have been paid as tax allowances? Had we left the tax allowance with the married man with children, has the noble Lord calculated how much that would have cost? Has he also deducted it from the £250 million which he alleges would have to be spent?
Lord Renton: My noble friend Lord Boyd-Carpenter has already answered that question and he will support me further if he wishes to do so. We are here dealing with a separate financial issue from that of tax allowances.
The Lord Privy Seal (Lord Belstead): My noble friend Lord Henley is in charge of this Bill for the Government but for reasons which I hope will shortly become apparent it seemed appropriate that I should deal with this first amendment.
Almost exactly 11 months ago I stood at this Dispatch Box and on behalf of the Government put the case against an amendment which provided for the annual uprating of child benefit. But the Committee divided, the amendment was agreed to and another place was asked to think again.
Another place did think again and almost exactly 10 months ago I stood at this Dispatch Box once more and informed your Lordships that another place had disagreed to the amendment for reasons

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of financial privilege. I therefore asked the House not to look into the question but to refrain from insisting on the amendment. To that your Lordships agreed.
Here we are again. For behind this somewhat technical-looking wording one might be forgiven for not readily grasping that the effect of the amendment is to require the Secretary of State to uprate child benefit in all future years by at least the level of general price increases without having regard to all the circumstances, as he is at present required to do under the law as it stands.
I make it absolutely clear that I do not—I repeat—do not deny the right of the Committee to make this amendment if that is its wish. It would be up to another place to assert its financial privilege if it wished to do so. I suppose that, in that event, in about a month's time, I should be at the Dispatch Box arguing again that we should recognise the financial privilege of another place. At this moment I simply ask the Committee to consider whether it is sensible or necessary to risk going round that course again.
I recognise the sincere feelings expressed on the matter not least by the two noble Lords and by the noble Baroness whose names are attached to the amendment. From this side of the Committee perhaps I may briefly put a few points against the amendment which I do not believe have emerged from the speeches of those who support it.
Resources are finite and we have a duty to spend as carefully as we can. This of ten involves difficult judgments about the needs of different groups of people and who ought and who ought not to have the prior claim to additional resources which are available. This year we are spending more than £55 billion on social security—more than £1 billion a week—but even that unprecedented sum must be directed to where it is most needed. I reflected as I listened to the interesting intervention of my noble friend Lord Jenkin of Roding that the need to leave the way open for making difficult judgments was undoubtedly in the mind of the Government of noble Lords opposite when the Child Benefit Bill was introduced 15 years ago. That Bill required child benefit to be reviewed annually but not to be indexed annually. The law has remained exactly the same under Labour and Conservative governments ever since child benefit was introduced.
But this amendment, by committing available resources from the outset, would effectively limit the scope for putting money where it would do most good—that is, in the hands of those who most need it. The Secretary of State, when reviewing child benefit is required under the Act to consider all the circumstances, which necessarily include whether there are other groups of people whose needs should be given greater priority; groups such as less well off families, pensioners, disabled people and those who care for them so devotedly. Under this amendment, however, the Secretary of State would have to give an automatic increase to child benefit, which from this April would have worked out at 55p per week per child, regardless of the fact that this would not help the least well off families—those on family credit and income support—because those benefits
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are adjusted to take account of changes in child benefit; and regardless of the fact, which was brought out clearly by my noble friend Lord Boyd-Carpenter, that, among the families who would gain more than £1 billion goes to 1¾ million families with incomes of more than £20, 000 a year. As my noble friend indicated in his intervention, that is hardly the most effective way to spend £250 million.
In contrast, the policies which we have tried to follow have directed extra help over and above normal upratings to families with children through their income-related benefits—extra help which since 1988 has amounted to more than £350 million a year in real terms.
Lord Carter: Does the noble Lord agree with the words of his noble friend Lord Joseph on that very point? In a pamphlet published last week he stated:
"The extra family credit for poor families with dependent children and the extra for single parents is being provided not by the population at large but by other parents through savings on child benefit".
Does the noble Lord agree with those words?
Lord Belstead: If I may say so, the noble Lord will find that about 80 per cent. Of families with children are taxpayers. Tax has to contribute to child benefit. It is impossible, if that is what the noble Lord is putting to me, to consider child benefit in isolation from other benefits. We have tried tenaciously and honestly to achieve a balance by putting money where there is greatest need.
Both the noble Lord and the noble Baroness, Lady Seear, drew attention to the position of those who are, to quote the noble Lord's words, "better off", or, as I think both the noble Lord and the noble Baroness said, just above benefit level. However, I did not hear them mention gains in family income from increased earnings, lower taxation and higher personal allowances. During the lifetime of this Government real take-home pay for a married man on average earnings but with two children has increased by 34 per cent. compared with just 0.6 per cent. under the previous Labour Government.
Despite those considerations, this amendment seeks mandatory across-the-board increases in child benefit. My noble friend Lord Renton felt that this was public expenditure which at the present time would not be wise and indeed could be inflationary. Our policies, by contrast, have been designed to achieve a balance between income related and universal benefits by facing up to the difficult decisions of where best to direct available resources. Perhaps I may end my remarks on the substance of the case by giving one example. We have tried to put the available resources where they will do most good. It is impossible to conceive of an affordable level of child benefit which could possibly provide the level of help offered by family credit, paid incidentally to the mother, with more than 40 per cent. Of family credit recipients getting £30 a week or more and payments of £40 or £50 by no means uncommon.
I am not arguing against the right of noble Lords to put down amendments which are within the relevance of the Bill, although I must say that this

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amendment, which I at any rate only saw printed on Friday, is stretching the good nature of the Committee a good deal. But we should hesitate before using this Bill as an opportunity to cover ground which was covered only 10 months ago and where another place asserted its financial privilege. I therefore hope that the noble Lord who moved the amendment will not press it.
Lord Seebohm: I get awfully tired of a long-playing record which is as scratched as the one I have heard today. None of the arguments is new and half of them are fallacious. We are not asking for any increase in the proportion of child benefit to GNP. The noble Lord, Lord Boyd-Carpenter, spoke as if we were seeking to increase only one side of the expenditure and were not looking at the increase on the other side. I do not propose to continue arguing about it. We have had it over and over again. I am completely unconvinced. I am sorry that the noble Lord the Leader of the House takes the view that he does. I sympathise in many ways. I know that he has a difficult task and that he will have a very difficult one if I divide the Committe on the amendment.
I do not propose to divide the Committee. However, I hope that the Government realise that the whole swing of the country is against them on this matter. It is no good pretending that it is not. Even members of their own party are speaking very loud and clear about this, as two did last week. I shall not leave the matter alone. I shall have to think of what steps I should take next but I do not propose today to divide the Committee. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 [Attendance allowance for the terminally ill]:
Lord Carter Lord Carter moved Amendment No. 2:
Page 1, line 9, at end insert:
("() the claim shall be treated as having been made three months before it was actually made; ").
The noble Lord said: This is a probing amendment which deals with the difficult and sensitive matter of the time limits for application for attendance allowance for the terminally ill. The amendment attempts to give a time limit of three months in which to make a claim under the terminally ill provisions. Within that period, benefit can be backdated to the first day on which the person satisfied the test of terminal illness. That is to acknowledge that the terminally ill provisions for attendance allowance represent virtually a new benefit. A person qualifies from the first day he counts as terminally ill. As such it is legitimate to treat it differently from ordinary attendance allowance, where the qualifying period theoretically gives time to adjust to disability, discover benefit entitlements and make claims.
Currently attendance allowance can be awarded only from the pay day—usually a Monday—on or following the day the claim is received in the department's office. Where life expectancy is so
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short, as with the terminally ill, missing out on a week's benefit is more crucial than in the ordinary attendance allowance case. It certainly means that the terminally ill will miss out on a far greater proportion of the total attendance allowance payable to a person who is not terminally ill.
This is a difficult matter. On balance we consider that a time limit of three months should be introduced immediately for those claiming attendance allowance under the terminally ill provisions. This is to align fresh claims under the terminal illness provisions with the normal three-month time limit for requesting reviews of existing awards. We believe that the more difficult position of those who have recently been diagnosed as terminally ill warrants particular sensitivity and consideration. As I said, it is a sensitive matter. The Government have tried hard to get the matter right and we give them credit for that fact. However, we believe that the six-month requirement does not completely meet the needs of these people and that a change to the three-month period would improve the situation. I beg to move.
4 p.m.
Baroness Seear: I rise briefly to express my support for the amendment. I am sure we all realise that this is a very sensitive matter. In many cases the person concerned is dead before he or she has reached the stage of qualifying under the provisions of the Act. What is proposed would ease that most difficult position. It would not cost a great deal of money.
Lord Henley: I thank the noble Lord for giving the Government credit for introducing Clause 1. I should also like to thank him and the noble Baroness for putting down this amendment in such good time.
Lord Carter: I am most grateful to the noble Lord for giving way. Before we hear too much about this aspect, will he agree that on Friday he tabled an amendment to Clause 3 for a reduction in the earnings allowance? Is he suggesting that we should not also discuss that amendment?
Lord Henley: No. When we reach Clause 3, I shall speak to it briefly. However, I can tell the noble Lord that it is a very minor technical amendment.
Lord Carter: It was put down on Friday!
Lord Henley: I accept the fact that it was put down on Friday. However, all the other government amendments were put down in good time. I just thought that I should make that point about the noble Lord's amendment.
Lord Stallard: Before the noble Lord leaves the point, is he aware that these amendments were available on the 17th? I saw some of them actually dated the 17th. Moreover, I am sure that he must have seen them.
Lord Henley: The amendment tabled in the name of the noble Lord was put down in very good time. I cannot remember the exact date, but perhaps the

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noble Lord, Lord Carter, will be able to say. In any event, I think that it was put down before the 17th.
As I said on Second Reading, Clause 1 fulfils the commitment announced by my noble friend Lord Skelmersdale during the passage of last year's Bill. Several noble Lords, my noble friend the Duke of Norfolk in particular, pressed long and hard for this provision to be introduced last year. Since then we have consulted widely among organisations and individuals directly involved, all of whom welcome these proposals. We have found their comments to be very helpful and constructive. One of the major concerns expressed was that claimants should not have to wait as long as is normally the case for their claims to be decided. In recognition of this concern, the need for a medical assessment of their attendance needs will generally be replaced by a factual report from the claimant's own doctor sent with the claim, and all claims made under the special rules for terminal illness will be put on fast track. The aim is to clear them within about two weeks of receipt.
The removal of the qualifying period for those who are terminally ill will help 58, 000 people at a cost of about £20 million in 1991 rising to £35 million in 1992-1993. If we were to accept the amendment we would be faced with considerable further costs because attendance allowance would be payable for a period of three months before the date on which a claim for it was made. This would be contrary to the basic premise on which the scheme operates—that claims cannot be backdated. There is good reason for this. It would make it unreasonably difficult for doctors charged with assessing the disabled person's attendance needs to do so for periods long past. That said, we are retaining the provisions in regulations which allow a claim for income support to be treated as a claim for attendance allowance if they contain a clear and unequivocal statement of the disabled person's attendance needs.
I appreciate the point being made by the noble Lord in putting forward the amendment—that there may well be a period of denial immediately following diagnosis of terminal illness, during which the terminally ill person, and his family, has difficulty in coming to terms with the diagnosis and will possibly refrain from claiming under the provisions of Clause 1. Nonetheless, I believe that backdating would be difficult to operate in practice—from the administration angle as well as the medical adjudication point of view—and could only lead to delays in processing claims.
Abolition of the six months' qualifying period for terminally ill people coupled, as the noble Lord will know, with our proposals to reduce it to three months for the generality of claims for the new disability allowance (as announced on page 29 of the White Paper) represent real, worthwhile and practical steps to accelerate help to disabled people faced with extra costs. I think that it would be wrong to encumber those arrangements with additional flourishes which could only slow down the adjudication process and delay settlement of claims.
The noble Lord said that his amendment was a probing one. I hope that I have been able to clarify
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most of the points he raised and that he will, therefore, feel able to withdraw the amendment.
Lord Carter: I am most grateful to the Minister. I said on Second Reading that I thought the Government would have a problem with the period of three months for mobility allowance and the six-month period for the terminally ill. However, it is a technical point and I shall read with care what the Minister said. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Carter Lord Carter moved Amendment No. 3:
Page 1, line 25, leave out from ("and") to ("within") in line 27 and insert ("there is a significant risk that his death in consequence of that disease may occur".).
The noble Lord said: This amendment is based on the same subject but it approaches it from a different angle. In moving the amendment I shall, with the leave of the Committee, speak also to Amendment No. 4 with which it is grouped and which contains almost the same wording.
Lord Kilmarnock: I appreciate that the wording of the two amendments is practically identical. However, if the noble Lord will permit me, I should like to speak to my amendment as there is a slight nuance of difference.
Lord Carter: I am happy to agree to the noble Lord's request. The definition of terminally ill as someone who is suffering from a progressive disease in consequence of which death,
"can reasonably be expected within 6 months",
has caused a good deal of concern among those involved with the care of the terminally ill. The point of concern is not on the technical point of claiming for attendance allowance; it is based on the definition which is used.
The object of the amendment is to get away from the stark prognosis that death can be expected within six months. It would have a similar effect to that of an amendment which was debated in Committee in another place. On that amendment the Minister said:
"I shall certainly take it away and look at it very carefully to see whether we can respond". [official Report, Commons, Standing Committee G, 1/2/90; Col. 36.]
As I said when moving the previous amendment, this is a sensitive and delicate matter. It is a very difficult decision for the carers of the terminally ill to make. It is difficult for them to apply for the attendance allowance. Moreover, it is especially difficult for those who suffer from AIDS. The Terrence Higgins Trust has expressed concern in this respect. I hope that the Minister can offer both an explanation and a reassurance on the matter and tell the Committee whether the commitment to respond, which was given in another place, has been fulfilled. I beg to move.
Lord Kilmarnock: With the leave of the Committee, I should like to speak now to Amendment No. 4 which has been grouped with the amendment moved by the noble Lord, Lord Carter. It is indeed almost identical in its wording to

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Amendment No. 3, which was also supported by the noble Baroness, Lady Seear. I discovered that fact only on Friday afternoon. We seem to be getting into trouble about Fridays. At that time it was too late to contact anyone and therefore I left my amendment to stand. However, as I said, there is a nuance of difference in that mine is slightly tighter and it is also a peg upon which to hang some additional arguments.
As the noble Lord, Lord Henley, said, there is much to be welcomed in Clause 1 in that it removes the six-month qualifying period for the terminally ill before they can claim attendance allowance. Thus it should eliminate such very sad cases as those where approval came through after the death of the claimant. It also allows a claim to be made on behalf of a terminally ill person without his or her knowledge or authority. That seems to me to be a welcome concession. On that latter point, can the noble Lord confirm that that concession will extend not only to carers and relatives but also to voluntary organisations, such as the Terrence Higgins Trust, to which mention has already been made, making a claim or acting on behalf of a person suffering from AIDS? I should like clarification on that point.
The noble Lord, Lord Carter, has made the general case. However, the Bill as worded is in fact a little chilling. The phraseology is that:
"a person is 'terminally ill' at any time if at that time he suffers from a progressive disease and his death as a consequence of that disease can reasonably be expected within 6 months".
I must confess that I am not too happy with that wording for several reasons. On the grounds of the morale of the patient, doctors may well be unwilling to give so pessimistic a prognosis; alternatively, they may not want to commit themselves to such a prediction on professional grounds in case they were proved wrong, which could result in someone being denied attendance allowance who desperately needed it.
We should also remember that we are not talking in general terms; we are talking in the context of attendance allowance at the higher rate. To qualify for that higher rate allowance the Attendance Allowance Board has to be convinced that 24-hour care is required. That is a big hurdle. It means that the person in question is probably unable to wash or go to the loo without assistance. Someone in such a condition is by definition seriously ill. When combined with the terminal prognosis, life expectancy is clearly severely limited.
It could be persuasively argued that the definition could have dispensed with the survival time. The allowance could then have been based on two main conditions: first, that the patient is not expected to recover; and, secondly, that his or her condition is such as to qualify independently of that for the higher rate of attendance allowance. That would be more humane and hardly more expensive. It might save money overall for reasons that I shall give shortly. However, I recognise that the Government would probably argue that that would open the door to long-term, incurable diseases, such as multiple sclerosis, or to elderly people who have suffered strokes. I am not convinced that a formula could
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not still be found to exclude long-term conditions. However, in order to avoid the floodgates argument, I have, like the noble Lord, Lord Carter, stuck with the phrase, "within six months", allowing at the same time a little more flexibility to the prognosis.
I speak now in my capacity as the chairman of the all-party parliamentary group on AIDS. That is a disease which, with the present state of knowledge, is terminal, and, as many members of the Committee will know, the multi-system nature of the disease, which can be present in a number of different guises, makes prognosis difficult. The time of survival from contracting full blown AIDS varies widely Consequently, the median is 18 months although some 40 per cent. of sufferers have died within 12 months. In most cases supporting the sufferers in the community is highly desirable both on humane and financial grounds. The cost of a hospital bed for an AIDS patient is well over £1, 000 a week and for a hospice bed about £700 a week, whereas attendance allowance at the higher rate is £37.55 a week.
If all those with AIDS expected to be alive at the end of this year—some 2, 350 according to the Day Report—claim and qualify for a whole year, not just for six months, the cost would be approximately £4.5 million. It is inconceivable that claims would be made and established on that scale, given the varying pattern of episodes and remissions in the disease. I doubt whether the claims would exceed a quarter, and definitely not a half, of that sum. I mention those figures merely to show that a slightly more liberal phraseology in the definition of terminally ill in the Bill would hardly open the floodgates. When compared to hospital and hospice costs, it would probably produce savings in general Government expenditure. It would also be of great benefit to people with AIDS and their carers. I therefore hope that the Government will accept one or the other of these modest amendments.
Lord Stallard: I do not wish to detain the Committee much longer or to indulge in a long debate on clause stand part. I hope that the Minister will be able to answer two questions which arise from the clause. Why has it been necessary to specify renal failure as a special case? There must be many other conditions—I could think of them if I had time—which would be equally open to a similar specification. Renal failure has been specified and that point should be clarified. I am sure that the Minister will be able to answer that question. Secondly, why is there no special appeals procedure included, given that the Attendance Allowance Board will be deciding who is terminally ill and who is not? There is an appeals procedure, but it could be long drawn out. I wonder why there is not a special, speeded-up procedure given all the special circumstances of those sick people. Why could it not be two weeks from the beginning to the end of the procedure, given the urgency of the cases? Perhaps he could answer those two points: why renal failure has been spelt out, and why there is no special appeals procedure in relation to the board's designations.
4.15 p.m.
Lord Henley: I hope that I can find the answer to those questions before I reach the end of my speech. I agree with the noble Lord, Lord Carter, that the issue is a sensitive one and that it is difficult to get the matter right. That brings me to a point made by the noble Lord, Lord Kilmarnock, about people not wanting, to make an application. I am sure that the noble Lord is aware of subsection (5) which clearly states that it is not merely the dying person who can make an application, but it can also be,
"any other person purporting to act on his behalf, whether or not that other person is acting with his knowledge or authority".
Lord Kilmarnock: I made that point. I congratulated the Government on including that subsection. The query that I then put to the Minister was whether that provision extends beyond carers and relatives to voluntary organisations such as the Terrence Higgins Trust making a claim on behalf of the patient.
Lord Henley: My right honourable friend the Minister of State, Mr. Nicholas Scott, said in Committee in another place that we would be publishing a draft upon which people would have every opportunity to comment. We have consulted a wide range of organisations involved in the care of terminally ill people, including Help for Hospices, the Association of Hospice Social Workers, the Sainsbury Foundation, the Marie Curie Cancer Care, the Association of Palliative Care and of course the BMA. We have also consulted individual doctors caring for terminally ill patients and the patients themselves. We have commissioned independent research to test the proposed claim form and leaflet, and after taking account of the comments received, we consulted again before preparing the final printing.
All the organisations we consulted welcomed our proposals. However, that does not answer the point whether, in law, an organisation is a person. I should have thought that a "person" as in subsection (5)(b) could be an organisation. My understanding is that a body is a person.
The amendments relax the test of the likelihood of death within six months from our own definition of "reasonable expectation" to a "significant risk". The amendments would raise serious problems of definition. "Significant risk" represents a subjective test which could be applied much more widely than is intended by the provision. The risk of dying within six months must be greater for someone who has a terminal illness than for others who have a progressive disease, and "significant" could be seen to add little to the degree of risk. The term "can reasonably be expected" was chosen carefully. I agree with the Committee that it is difficult to decide where to draw the line. We felt that "can reasonably be expected" would be less likely to lead to questions of degree.
The noble Lord, Lord Stallard, asked about renal failure and a special appeals procedure. I shall write to him about renal failure, but the noble Lord will remember that when we were discussing the previous amendment moved by his noble friend Lord Carter,
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I said that we were trying to create a special fast track for those claims to ensure that they were processed much quicker than others. I hope that will go some way towards meeting his point of asking for a special appeals procedure.
I hope that having made those points about "significant risk", and expressed our feeling that the definition is slightly too wide, the noble Lord will feel able to withdraw his amendment.
Lord Carter: I am grateful to the Minister. We have had a useful if short debate. It is a difficult matter which is hard to get right. The Minister's explanation will help many people outside this place who are worried about the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 4 not moved.]
Lord Carter Lord Carter moved Amendment No. 5:
Page 2, line 40, at end insert:
("(5A) After section 106 of that Act there shall be inserted the following section—
"107. Where a claim for an attendance allowance has been made under section 35(2B) above and the Attendance Allowance Board are satisfied that an award cannot be made under that subsection but that the person concerned would be entitled to an attendance allowance on other grounds, they may treat the claim as a claim for an attendance allowance on those other grounds.".").
The noble Lord said: This again is a probing amendment to seek clarification. The purpose is to ensure that where a claim for attendance allowance on grounds of terminal illness is turned down, the attendance allowance board can proceed to consider whether the person is entitled to an allowance under the normal rules without requiring a new claim. The main advantage of this is that the allowance could be awarded from the date of the original claim.
As we heard in the debate on the previous amendment, the department is considering the use of a claim form which I believe has been circulated for consultation on it and on the design of the claim form. It covers both types of claim under the normal rules and on grounds of terminal illness. To the extent that a combined form of this kind is to be used if it is designed correctly, the amendment may be unnecessary. However, until we see a final draft of the form, we feel that we should probe to see what are the intentions of the Government.
We are advised that there is one type of case where a combined form would not be possible, where a claim on grounds of terminal illness is made by a third party. That was also discussed on the previous amendment. Clause 1(6)(3) enables such a claim to be made even without the sick person's knowledge or authority. However, that applies only to grounds of terminal illness. A claim on other grounds would have to be made by the claimant himself or herself, perhaps resulting in the loss of attendance allowance for several weeks. The amendment would avoid the need for a new claim in these circumstances.
Clause 1(1)(b) on line 20 of page 1 may answer the point when it states:
"the period specified in a certificate issued by virtue of paragraph (a) above shall be the remainder of the person's life, beginning with that date".
We wish to know whether that will cover the situation if the application is turned down on grounds of terminal illness and whether the same application would stand for the normal attendance allowance. I beg to move.
Lord Boyd-Carpenter: This seems a sensible proposal. Unless the form is such that the provision can be made without amendment to the Bill, I hope that my noble friend will consider the matter.
Earl Russell: In the absence of my noble friend Lady Seear, I wish to express the support of the Liberal Democrat Benches for the amendment.
Lord Henley: I hope that I can answer briefly. I can assure the noble Lord that this amendment is not necessary. Any claim under the terminally ill provisions will be able to be accepted as a claim under the normal provisions if the terminally ill criteria are not met. In view of that, I hope that the noble Lord will feel able to withdraw the amendment.
Lord Carter: I beg leave to withdraw the amendment, and thank the noble Lord very much.
Amendment, by leave, withdrawn.
Lord Carter Lord Carter moved Amendment No. 6:
"Page 3, line 5, at end insert:
("(8) In the Social Security (Attendance Allowance) (No. 2) Regulations 1975, regulation 2(1)(c) shall cease to have effect.").
The noble Lord said: This amendment deals with the residence test required for attendance allowance. Because it is a non-contributory benefit, some kind of residence test is necessary. There are three conditions, all of which must be satisfied. First, the person must be ordinarily resident in Great Britain. Secondly, he must be present in Great Britain on every day for which the allowance is claimed. Thirdly, he must have been present in Great Britain for at least 26 weeks in the year immmediately preceding the claim, again with exceptions for temporary absence. The amendment is designed to abolish the third condition. There is no question of attempting to abolish the residence test, but the first two conditions are, we feel, sufficient to prevent any abuse by people from abroad who come to Great Britain in order to claim attendance allowance.
We have received a note from the welfare rights unit of the Greater London service of the citizens' advice bureaux. It states:
"while it is entirely reasonable that people in receipt of attendance allowance should be ordinarily resident in this country, there cannot be any acceptable justification for the rule that claimants must have been present in Great Britain for 26 weeks during the year previous to the date of claim … This rule discriminates against people from abroad, no matter how legitimate their presence here may be nor how severe their need. It also discriminates indirectly against black people and other ethnic minorities, who are less likely to be able to meet the present test because of Britain's discriminatory immigration rules.
In the context of Clause 1, which we have been discussing, this condition seems to be particularly inappropriate and to raise a real difficulty.
If somebody who is normally resident in Great Britain becomes terminally ill while working abroad and returns home for what remains of his or her life, presumably it is not seriously suggested that payment of the attendance allowance should be refused on residence grounds. I am prepared to withdraw the amendment if the Government will put forward their own. It seems to us to be an obvious anomaly which should be put right in the Bill. This amendment gives the Government a chance to do that. I beg to move.
Earl Russell: There is a strong case to be made for the amendment simply on the grounds of common humanity. Becoming seriously ill is no less disabling, no less worrying, no less frightening if it happens in a strange country where one does not know one's way around. The problem is just as great. The number of people to whom it applies is likely to be small. I cannot believe that the amendment will break the Treasury and I am happy to support it.
Lord Henley: This provision, with the other tests for residence and presence in Great Britain, stands in place of contribution conditions. It is relatively straightforward to fulfil and ensures that the purpose of the benefit—to assist with the costs of long-term disablement in Great Britain—is met.
The particular test which the amendment seeks to remove for all attendance allowance claims is intended to ensure that attendance allowance is only paid to people who have demonstrated a permanent link with this country. We do not think it appropriate that a person who has a home abroad but maintains a residence here and returns to Great Britain for fairly short periods once in a while should be able to claim during those periods. A great deal of work would be involved in handling what would essentially be short term claims.
Nevertheless, I accept that the aim of the amendment is to remove the test for terminally ill people. My right honourable friend the Minister of State for Social Security and the Disabled said in another place during the Committee stage that he would look at this provision. He intends to examine the area of non-contributory benefits in general, and I hope that the Committee will accept that it would be right to look at this entitlement condition as part of that consideration. I hope therefore that the noble Lord will feel able to withdraw his amendment. I repeat the assurance that my right honourable friend has said that he will consider the matter.
Lord Carter: I shall withdraw the amendment. However, before I do so, can the Minister say whether there is any chance that we shall see an amendment at the next stage of the Bill?
Lord Henley: I do not think that I can give the noble Lord that assurance. I can only go so far as to say that my right honourable friend will consider the matter.
Lord Carter: In the light of that answer, we may wish to come back to this at the next stage of the

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Bill in order to stiffen the Government's resolution in the matter. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
4.30 p.m.
Lord Allen of Abbeydale Lord Allen of Abbeydale moved Amendment No. 7:
After Clause 1, insert the following new clause:
["Mobility allowances: severe mental handicap
.—(1) In section 37A of the principal Act (mobility allowance) at the end of subsection (1) there shall be inserted—
"or is suffering from severe mental handicap and from severe behaviour problems such that he is unable, without physical control by another person, to walk to any intended or required destination while out of doors". (2) In subsection (2) of that section leave out "physical".").
The noble Lord said: I fear that this amendment may take a little longer than the previous few that we have discussed. In speaking to the amendment—which I hasten to add was put down immediately after Second Reading—I recall that when last year's Social Security Bill was under consideration, an amendment was passed here but subsequently rejected in another place. It provided that the mobility allowance should be payable to those suffering from severe mental handicap and severe behaviour problems requiring constant physical control. The amendment that was rejected also applied to the deaf and blind.
Subsequently, the Government performed a U-turn—for which we are grateful—and conceded the allowance to that especially unfortunate group. It proved possible to achieve this by a regulation and the wording of this amendment is based largely on its phraseology.
However, I am advised that for those with whom I am now concerned, an alteration of the substantive law is required, since the condition of these individuals has no known physical cause, and since they may well be capable of walking in the literal sense. The present statutory provision is applicable to an individual who is suffering from physical disablement such that he is either unable to walk or virtually unable to do so.
Perhaps I may illustrate the problem by citing a case. It is that of a young man of 19 who, as well as being severely mentally handicapped, is deaf, suffers from asthma and epilepsy, tends to run out into the road and cannot hear anyone calling him back. He of ten needs two people to manage him when he is out of doors and he is likely to sit down and refuse to move or to grab out at passers-by. When his case came before a tribunal he walked 150 yards under his father's control. On that occasion he stumbled twice and although it was accepted that there could well be times when he was less co-operative, it was held that he did not qualify under the wording of the current regulations. I could mention other cases of individuals who are likely to lie down screaming, rush out into the middle of the traffic or attack fellow passengers. However, I do not think I need labour the point further.
MENCAP has carried out a number of studies to calculate how many people would be covered by the amendment. The criteria used in a survey carried out in Wessex for a government White Paper published in 1971 (Cmnd. 4683) made it possible to identify the numbers of those with severe mental handicap and severe behaviour problems who required constant control. Extrapolating the results for the whole country originally produced a figure of 4, 400 people. The figures have been investigated again to make sure that all possible cases are included and account has been taken of two later surveys carried out in 1988 in Gwent and Swansea where the same criteria applied. Those studies, taken together, give a suggested national total of 8, 800 people—a figure larger than the original estimate and almost certainly on the high side. It will include some people who receive a mobility allowance on other grounds. Therefore the starting point of this amendment is that it makes out a case on behalf of a group which, it can now be said with reasonable confidence, totals fewer than 9, 000 people.
Let us look at the Government's calculations. Arguing against last year's amendment, the Government said the figure was not the one we mentioned but 100, 000 people. When the amendment reached another place a week later, the figure had become 125, 000. It transpired that the Government had lumped in the mentally ill, sufferers from Alzheimer's disease and others—anyone near the top of the intellectual functioning scale and of the behaviour, communication and consciousness scales was included—selected for the OPCS survey. I hope I have got those scales right. All that occurred notwithstanding the fact that the amendment has been specifically limited to the mentally handicapped. Further, it became abundantly clear that the criteria used by the OPCS made it impossible to identify the group with which we are concerned—those who cannot walk without physical control by another person.
On 12th October last year at col. 565 of the official Report the noble Lord, Lord Henley, said that the OPCS data showed that there were about 140, 000 severely mentally handicapped people and that although the total of those who would have been covered by the amendment was smaller than that figure he did not accept that it would be as small as had been claimed. When this matter was pursued by correspondence, as the Minister will recall, he explained that those who might be in question under the OPCS criteria came to the remarkable figure of 214, 000 adults and 52, 000 children, but that by a process of discounting and trying to limit the calculations to the mentally handicapped, this enormous total had been reduced to 50, 000; that is, 50, 000 severely mentally handicapped people who would gain from any feasible attempt to extend mobility allowance on the basis of the need for accompaniment and control. The Minister emphasised that this figure was an order of magnitude and not a precise estimate.
MENCAP is now arguing an estimate of 8, 800 people while the most recent public position of the Government was a figure of 50, 000 people. That is

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certainly better than last year's figure of 125, 000 people. I know that the latter figure caused noble Lords opposite some concern when the amendment was being discussed. However, as I ventured to say in a debate on 14th March at col. 1565 of the official Report, the figure must be wrong. There is, I think, general agreement that the number of severely mentally handicapped people is of the order of 160, 000. That is not far off the figure which the Minister himself mentioned. It is simply ludicrous to suggest that nearly one in three have the characteristics covered by this amendment. It simply cannot be so. It is not borne out by anyone who has personal experience of the matter. The Minister passed over my point in silence when he replied to the debate. Somewhat uncharacteristically he did not write to me subsequently. Perhaps he was stuck to know what to say.
I am well aware that the Government have promised a £10 a week mobility component in the new disability allowance promised for 1992. Some of the people I am concerned with would no doubt qualify for that. The cost of giving them the payment could indeed be offset against the cost of the concession for which I am now pleading. However, the full rate of mobility allowance, which I believe is now £26.25, is itself hardly enough to cover the extra costs. The Government must not suppose that the £10 payment would be an adequate substitute for the allowance which these few thousand people need and deserve just as much as the 600, 000 present recipients of the allowance.
The Government can justly claim credit for the scale on which mobility allowance is now paid. The figures have increased enormously during their term of office. This amendment would add a little less than 1.5 per cent. to the total. Incidentally, it would save a good deal of money by doing away with all the appeals in this type of case. In the course of a fairly lengthy campaign involving Members of both Houses and one or two deputations, Ministers have in the past expressed sympathy for what I am now suggesting. I am not at all clear what the Government's objections to this amendment can now be. They can hardly in all conscience stick to the figure of 50, 000 people. Certainly, much of the argument and the figures which were used against us last year have fallen away. On this amendment at any rate we cannot be said to be going over the same ground that was covered a year ago.
Perhaps it is a question of drafting to make sure that the concession is strictly limited to the type of case we have in mind. I claim no pride of authorship in the draft before us and perhaps the Government can improve on our efforts before the later stages of the Bill. As regards the merits of the amendment, I recall that the noble Lord, Lord Boyd-Carpenter, made the same point on Second Reading as he has made today when he said that these regular social security Bills provided an opportunity of applying the test of which items merited priority over other admirable claims. My submission today is that this proposal passes that test. I beg to move.
Earl Russell: This amendment is the second half of unfinished business from an amendment discussed last year. I say to the noble Lord the Lord Privy Seal in response to what he said on Amendment No. 1 that I make no apologies for bringing back something which has been moved before and to which the Government have said no. That has been done for as long as parliaments have existed. I hope that it will continue to be done for as long parliaments continue to exist. The risk in bringing back business which has been discussed before is the risk of boring the Committee. Noble Lords are entitled to run that risk if they wish but at their own hazard.
The basic point of the amendment is the point made by Mary Holland of MENCAP last year. The law treats equal disabilities differently which is wrong. The amendment is concerned with people who, as the noble Lord, Lord Allen of Abbeydale, put it on 14th March—I hope that he will forgive me for quoting him—may at any moment run sideways, backwards or under a bus. If you have the job of caring for someone like that, it does not take you long to start feeling like a First Division goalkeeper. A great many people are not fit enough to sustain it for very long. It is a severe pressure on those responsible.
I understand the point made by the Secretary of State last year that there is considerable difficulty with the assessment. The noble Lord, Lord Allen of Abbeydale, whose drafting of the amendment I admire, has addressed that difficulty carefully. I should take a great deal more seriously the points made about the difficulties of assessment if I were happier about the way assessment is conducted at present. I do not think it can be said that the medical assessments, as they are conducted now, work smoothly and satisfactorily.
There was a case reported in my local paper, the Kilburn and Willesden Recorder, of someone exactly like the person in the case described by the noble Lord, Lord Allen, who might run backwards, sideways or under a bus and whose claim the medical assessment tribunal dismissed on the grounds that he was too naughty. That person was suffering from acute autism. The situation seems thoroughly unsatisfactory.
In its review of medical assessment, NACAB has found a good many similar cases. For example, a man with acute heart trouble who could not even get up to make a cup of tea was found ineligible for mobility allowance. He appealed but died before the appeal was heard. There are other cases just as startling. For example, a person who suffered a stroke, drags the left leg, has arthritis in the hips, a trapped sciatic nerve and a heart condition and who is also diabetic had mobility allowance withdrawn following reassessment. There is also the case of someone who had meningitis and a brain haemorrhage, who is paralysed on one side and has epileptic fits and who, although on occasion walking 80 yards, has several times fallen and broken bones in the process. That person's mobility allowance was withdrawn following reassessment.

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I hope that, when my noble kinsman replies, he can assure me that those assessment procedures will be looked at. I hope that he will not use the integrity of the present assessment procedure as a reason for resisting a sensible amendment.
4.45 p.m.
Lord Carter: I should like to support the noble Lord, Lord Allen of Abbeydale, who moved the amendment with his usual lucidity and clarity. It is worth re minding ourselves again of the figures which he gave the Committee and which the Government have produced over the past year. When we discussed the matter in Committee last year, the Government gave no figures of their own to compare with the lower figure of 4, 000 people and the higher figure of 8, 000 people which those of us who supported the amendment had quoted on the basis of the MENCAP research. Only three weeks later at Report stage, the Government produced the figure of 100, 000 people. We said at the time that we were sure that the Government had it wrong because the OPCS survey did not allow a calculation of the number of people who would be caught by the definition in the amendment. As the noble Lord said, about a week later the figure of 100, 000 had suddenly grown to 125, 000. By the time the noble Lord, Lord Henley, responded to my Starred Question in October, it had grown to 140, 000, but, by December, it had fallen in correspondence to 50, 000.
I must say that playing with numbers will not do. We are dealing with some of the most severely handicapped people in society. We have heard examples of the kind of people who would benefit from the amendment. They create immense and unremitting problems for those who care for them. I must say to the Government, with some sadness, that statistical juggling to meet some self-imposed, departmental ordinance or doctrine is no answer. MENCAP has checked, rechecked and updated its data. I am totally confident that the maximum number of potential beneficiaries is no more than 8, 000 to 9, 000 people, although not all of them will apply. MENCAP has given its evidence to the department which has given no satisfactory response.
The amendment is crystal clear and tightly drawn. It refers to severe mental handicap—not mental illness—and severe behaviour problems which are defined. The cost, even if everyone eligible claimed—and that certainly will not happen—is in the order of £12 million compared with a total cost for mobility allowance of £839 million. That is less than 2 per cent. Accepting the amendment would give great assistance to those few thousand severely handicapped people. We hope and trust that the Committee will recognise the force of the argument and accept the amendment.
Lord Henley: As the Committee will know, since we debated the amendments during the course of last year's Social Security Bill, there have been two significant developments. First, as the noble Lord, Lord Allen, said, the amendments which we debated included the deaf-blind. Since then we have been
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able to help that group by extending mobility allowance in the Mobility Allowance (Amendment) Regulations which came into effect on 11th April. The second development has been the statement on our proposals for the future of disability benefits in The Way Ahead which was published last January. They include the incorporation of attendance allowance and mobility allowance as a new benefit—the disability allowance.
The mobility component of the new disability allowance will be at two levels. The upper level will be along the lines of the present mobility allowance and the new lower level will be for people who are not independently mobile. I feel embarrassed about using any figures today after various criticisms have been made of me, but perhaps I should give some figures to keep the noble Lord happy. We estimate, although I should not like to break down the figure, that some 150, 000 people, including a significant number of mentally handicapped people, will receive the new lower level of the mobility component of the disability allowance when it is introduced from April 1992.
I appreciate that the aim of the mover of the amendment is to make mobility allowance and, subsequently, the higher level of the new mobility component, available to a particular group of mentally handicapped people. As has become obvious, there has been considerable discussion about the size of the group. MENCAP has supplied detailed workings, its estimate being 8, 800. However, one should note that that has increased from 4, 400. In other words, it has doubled to 8, 800. Although there might be some criticism of government figures, I believe that MENCAP's increased figure shows the difficulty of identifying the group with which the amendment is concerned.
There have been difficulties about using the findings of the OPCS survey which, while telling us more than we ever knew previously of the practical consequences of disability, do not provide definitive evidence of diagnostic cause. Nevertheless we have some broad indications of the instance of mental handicap. Here I reiterate the figure of 50, 000 which I believe was the last figure that I gave to the noble Lord, Lord Carter, in answer to his Question in October.
Lord Carter: That figure was in a letter from the department to MENCAP. The last figure that the noble Lord gave was 140, 000.
Lord Henley: It is now 50, 000. Our main concern has been the considerable difficulty of defining the group in legislation. The Committee will accept that it is very important properly to define the group because we are speaking here about government expenditure. To define it in an imprecise manner might lead to much greater expenditure than originally was intended. Because of that we believe that the number of people who would qualify would not be as low as the supporters of this amendment suggest. It would involve substantial additional expenditure over and above the £12 million a year which an extension to 8, 800 people would cost.

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I should like to apologise profusely to the noble Lord, Lord Allen, for not having answered the points that he raised during the debate on the rich and poor in society introduced on 14th March by the noble Lord, Lord Carter. No apology is needed for not answering him on that day, because a great number of points were raised, but I apologise for not having written to him. I hope that I can deal with his point now. In that debate—and I think my noble kinsman Lord Russell quoted him—he described a person who:
"May go sideways, backwards or straight under a bus or he may lie down screaming in the highway and be quite impossible to manage on public transport". [official Report, 14/3/90; col. 1565.]
There are likely to be quite a number of mentally handicapped people who need to be controlled to protect them from possible traffic dangers. The entitlement in such cases would depend on whether or not the medical authorities classified mental handicap of these persons as severe. It is not correct, as the noble Lord said in the course of that debate, that the group that he had in mind are excluded because their condition has no known physical cause. Some of those whom the noble Lord described when he gave examples as those whose walking progress is interrupted by behavioural problems may well qualify under the current rules. The reason that others may not qualify is that it has been held by commissioners and in the courts that a person who can walk but who cannot make purposeful use of this ability unless escorted by another person is not virtually unable to walk.
I have explained the current provisions which enable some people who are mentally handicapped to qualify for the mobility allowance. I have also explained that we have proposals for extending help to others through the new disability allowance and its extra mobility component from April 1992. We are still developing details of the criteria for that new disability allowance. In doing so, we take note of the representations made on behalf of particular groups. We shall also take note of what noble Lords have said in the course of the debate this afternoon.
I also want to touch briefly on the assessment procedure, which was a matter raised by my noble kinsman. We are carefully studying the NACAB report on medical assessment and shall comment on the findings and recommendations in due course. The assessment procedures, however, will be considered in preparation for disability allowance and we shall seek to eliminate both the complexity and the delays.
I do not think that I can give any further commitment at this stage in the light of what I have said about the scope of the disability allowance. Because the new disability allowance is in preparation, I do not believe that we are in a position to accept this amendment. I hope that, bearing that in mind, the noble Lord will feel able to withdraw his amendment.
Lord Carter: The Minister mentioned extension of the mobility allowance, which we welcome. Perhaps he will tell the Committee—or write to me and put
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the answer in the Library—the number of those 3, 000 deaf-blind who are likely to benefit from the extension of the allowance?
Lord Henley: I do not know the answer to that question. I gather that last year we were talking about 3, 000 or so. Is the noble Lord asking what has been the level of take-up?
Lord Carter: I am asking about the number of 3, 000. There will, for example, be some of them who are over 65. What is the number of the 3, 000 who are likely to benefit from the extension of the mobility allowance? It is not a figure I have seen anywhere. We should find it helpful to be told.
Lord Henley: If a figure is available I shall make it known to the noble Lord. I shall ensure that a copy is put in the Library and that it is not forgotten as was the response which I owed to the noble Lord, Lord Allen.
Lord Parry: The Government and the Committee will accept that many noble Lords have worked for many years with Mary Holland and have listened to the noble Lord, Lord Allen, speak of ten about the detail of these problems that he faces. We appreciate the Minister's embarrassment just as we appreciate the right to privacy in his reply. However, we are bound to say that the careful research done into these figures from the MENCAP side is much more convincing than what we have been told today or earlier from the Government side. That is said with no disrespect to the noble Lord, Lord Henley. I wish merely to point out that this complicated problem is further complicated by the fact that other initiatives in the field are taking away the support that these physically and mentally handicapped people currently have within institutions such as the specialised schools. The Government propose to put those handicapped pupils back into mainstream education. It was precisely for those reasons that many Members came to the Committee today to support the amendment of the noble Lord, Lord Allen: we hope that he will persist with it.
Lord Henley: Perhaps I may briefly reply. I believe that figures lie at the heart of this matter. It is very important when extending a benefit to get it right so that it is clear how many people will be involved. There is considerable disagreement on the figures. Whatever one feels about either the Government's figures or MENCAP's figures, the number is at the heart of the matter. Even MENCAP has had to double its estimate. It is a very difficult job and more work needs to be done on it before we go any further. I have given the Committee assurances about the new mobility component in the disability allowance. I hope that that will be enough to satisfy the Committee at the moment.
Having taken some advice, perhaps I may briefly come back to the point raised by the noble Lord, Lord Carter. It will save me having to write a letter to him and put a copy in the Library. The figure that he asked for is in fact 3, 000 and that figure takes into account those over 65.
Lord Allen of Abbeydale: Perhaps I may begin by thanking the Minister for his apology for not writing to me. Perhaps he could complete it by writing to me on the other point, about the poll tax, which I raised on the same occasion and on which I have heard nothing.
As regards the reply to the amendment, to say that I am disappointed is to put it mildly. However, I am also very surprised. The £10 promised is, for the reasons that I explained—and I shall not go over the ground again—nothing of an answer. The fact that the original calculation was increased as a result of going carefully over the figures and looking at the results of other surveys would, I should have thought, have been a mark of commendation rather than of criticism. I am interested to have confirmation from the noble Lord that the OPCS figures make it completely impossible for them to be used to identify the people about whom we are speaking.
I could hardly believe my ears when I heard the Minister say that he still stuck by the figure of 50, 000. I can hardly credit that. I do not want to repeat my earlier remarks but to suggest that one in three of the severely mentally handicapped people in this country qualify under the kind of criteria that are laid down in this amendment is so ludicrous that it leaves me speechless. It surprises me that over quite a considerable time, in deputations to Ministers and discussions with them, we were led to believe that Ministers sympathised with what we intended to do and that the difficulty was primarily one of drafting to make sure that the provision applied only to those whom we had in mind.
I have no offer this evening on any help with the drafting to improve the amendment. Although I do not like this matter to be decided by people who have not heard the rather pathetic reply of the Government, I feel that I have no option but to test the opinion of the House.
5 p.m.
On Question, Whether the said amendment (No. 7) shall be agreed to?
Their Lordships divided: Contents, 101; Not-Contents, 110.

DIVISION No. 1

CONTENTS

Addington, L.

David, B.

Airedale, L.

Davies of Penrhys, L.

Allen of Abbeydale, L. [Teller.]

Dean of Beswick, L.

Donaldson of Kingsbridge, L.

Annan, L.

Dormand of Easington, L.

Ardwick, L.

Ewart-Biggs, B.

Aylestone, L

Falkland, V.

Birk, B.

Fisher of Rednal, B.

Blackstone, B.

Fitt, L.

Bonham-Carter, L.

Gallacher, L.

Bottomley, L.

Galpern, L.

Brightman, L.

Gladwyn, L.

Bruce of Donington, L.

Graham of Edmonton. L [Teller.]

Carmichael of Kelvingrove, L.

Grey, E.

Carter, L.

Hampton, L.

Cledwyn of Penrhos, L.

Hanworth, V.

Cocks of Hartcliffe, L.

Hatch of Lusby. L.

Craigavon, V.

Hayter, L.

Darcy (de Knayth), B.

Hirshfield, L.

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Hooson, L.

Prys-Davies, L.

Houghton of Sowerby, L.

Rea, L.

Hunt, L.

Richard, L.

Jay, L.

Ritchie of Dundee. L.

Jeger, B.

Rochester, L.

John-Mackie, L.

Ross of Newport, L.

Kearton, L.

Russell, E.

Kilmarnock, L.

Ryder of Warsaw. B.

Kinloss, Ly.

Saltoun of Abernethy, Ly.

Kirkwood, L.

Seear, B.

Lawrence, L.

Seebohm, L.

Listowel, E.

Serota, B.

Lloyd of Kilgerran, L.

Shackleton, L.

Lockwood, B.

Shaughnessy, L.

Longford, E.

Shepherd, L.

McIntosh of Haringey, L.

Stallard, L.

Mais, L.

Stoddart of Swindon. L.

Masham of Ilton, B.

Strabolgi, L.

Mason of Barnsley, L.

Taylor of Blackburn, L.

Mayhew, L.

Thurlow, L.

Mishcon, L.

Tonypandy, V.

Monkswell, L.

Tordoff, L..

Morris of Castle Morris, L.

Turner of Camden. B.

Mulley, L.

Underhill, L.

Nathan, L.

Vernon, L.

Nicol, B.

Wallace of Coslany, L.

Northfield, L.

Walston, L.

Ogmore, L.

White, B.

Parry, L.

Williams of Elvel, L.

Peston, L.

Willis, L.

Phillips, B.

Winchilsea and Nottingham, E.

Pitt of Hampstead, L.

Porritt, L.

NOT-CONTENTS

Alexander of Tunis, E.

Holderness, L.

Allerton, L.

Hood, V.

Annaly, L.

Hooper, B.

Arran, E.

Jenkin of Roding. L.

Belhaven and Stenton, L.

Johnston of Rockport, L.

Belstead, L.

Joseph, L.

Bessborough, E.

Kenilworth, L.

Blatch, B.

Lauderdale, E.

Blyth, L.

Layton, L.

Boardman, L.

Long, V.

Borthwick, L.

Lucas of Chilworth, L.

Boyd-Carpenter, L.

Lyell, L.

Brookes, L.

McColl of Dulwich, L.

Brougham and Vaux, L.

Macleod of Borve, B.

Butterworth, L.

Malmesbury, E.

Caithness, E.

Mancroft, L.

Campbell of Alloway. L.

Manton, L.

Campbell of Croy, L.

Margadale, L.

Carnock, L.

Massereene and Ferrard, V.

Clanwilliam, E.

Merrivale, L.

Coleraine, L.

Mersey, V.

Cottesloe, L.

Middleton, L.

Cranbrook, E.

Monk Bretton, L.

Cullen of Ashbourne, L.

Mottistone, L.

Davidson, V. [Teller.]

Mountevans, L.

Denham, L. [Teller.]

Mountgarret, V.

Donegall, M.

Mowbray and Stourton, L.

Eccles of Moulton, B.

Munster, E.

Eden of Winton, L.

Murton of Lindisfarne, L.

Elibank, L.

Nelson, E.

Elles, B.

Norrie, L.

Elliot of Harwood, B.

Nugent of Guildford, L.

Elliott of Morpeth, L.

Oppenheim-Barnes, B.

Erroll of Hale, L.

Orkney, E.

Fanshawe of Richmond, L.

Orr-Ewing, L.

Foley, L.

Pender, L.

Fraser of Carmyllie, L.

Pennock, L.

Fraser of Kilmorack, L.

Penrhyn, L.

Gridley, L.

Portsmouth, E.

Grimthorpe, L.

Rankeillour, L.

Hailsham of Saint Marylebone, L.

Reay, L.

Renton, L.

Harmar-Nicholls, L.

Rodney, L.

Henley, L.

St. John of Bletso, L.

Hesketh, L.

St. John of Fawsley, L.

Hives, L.

Sanderson of Bowden, L.

631

Selkirk, E.

Thomas of Gwydir, L.

Sempill, Ly.

Tranmire, L.

Slim, V.

Ullswater, V.

Strange, B.

Vaux of Harrowden, L.

Strathmore and Kinghorne, E.

Westbury, L.

Whitelaw, V.

Sudeley, L.

Wise, L.

Suffield, L.

Wynford, L.

Swansea, L.

Yarborough, E.

Teviot, L.

Zouche of Haryngworth, L.

Resolved in the negative, and amendment disagreed to accordingly.
5.7 p.m.
Earl Russell Earl Russell moved Amendment No. 8:
After Clause 1, insert the following new clause:
("Severe disablement allowance
In Part III of Schedule 4 to the principal Act, for paragraph 2 there shall be substituted the following paragraph—
"2. Severe disablement allowance (section 36)
The weekly rate specified in section 6(1)(a) of the Pensions Act.".".
The noble Earl said: The purpose of the amendment is to increase the severe disablement allowance to the rate of the basic invalidity benefit; that is, by a rate of £18-70 a week. In trying to justify the lower rate the Government make a distinction between a contributory and non-contributory benefit. However, severe disablement does not cost any the less because the benefit is non-contributory.
A great deal of noise has been made over the past several years about the OPCS surveys and what the Government intend to do for the disabled. A good many of us feel that we have as yet seen very little action as a result of the talk. There is a widespread feeling of considerable disappointment. The main purpose of the amendment is to attempt to deal with that sense of disappointment and in some quarters to ease it. I beg to move.
Lord Carter: On these Benches we are pleased to support the amendment. It is intended to increase the rate of severe disablement allowance to the rate of the invalidity benefit. A severe disablement allowance (SDA) is a basic non-contributory income replacement benefit for people of working age who are incapable of work and who have not paid national insurance contributions which would entitle them to the equivalent of contributory incapacity benefit; namely, invalidity benefit. SDA is paid only at 60 per cent. of the basic rate of invalidity benefit because the Government consider that people who have not made any or the correct number and type of National Insurance contributions should receive less than those who have paid at the full rate.
Many disabled people must claim severe disablement allowance because they have never been able to work. It is inequitable that they should be considered less deserving and receive a lower-rated benefit than other people who may have similar disabilities. We believe that they should not be affected by the type of disability, the way in which it is caused and whether sufficient National Insurance contributions have been paid.
The rate of SDA is lower than the income support personal allowance which is the minimum that the Government consider necessary to live on. Some
632
people can claim means-tested income support to top up their SDA. We argue that it should not be necessary to do so. They should be paid an income replacement and benefit of right at a high enough rate to make it unnecessary for most people to claim means-tested income support as well. We are concerned that people with severe disabilities who are never able to work and therefore make the required National Insurance contributions should not be considered as being less deserving and be treated inequitably by the social security system. The amendment seeks to correct that situation.
Baroness Blatch: This amendment seeks to increase the basic weekly rate of severe disablement allowance to the basic rate of invalidity benefit. Both the benefits are available to people who are long-term sick. People who have been in recent work qualify for invalidity benefit after they have been receiving statutory sick pay or sickness benefit. Severe disablement allowance is aimed at people who do not have the necessary record of National Insurance contributions to take them on to invalidity benefit. In other words, it is a non-contributory benefit.
We are aware of the recommendation made by the Social Security Advisory Committee in its report, Benefits for Disabled People; a Strategy for Change, that the rate of SDA should be raised progressively until it is the same as for invalidity benefit. In framing its recommendation in this way, it was acknowledging that it would be necessary to move by stages to this ideal position.
In Clause 2 of the Bill we are making the first move to bring the weekly entitlement for the respective benefits nearer together. We are doing so by introducing age-related additions to SDA which are set at the same rates as invalidity allowance. The highest rates will go to the SDA recipients who have never been able to work or who have been disabled earlier in life. This is the group whom we identified, from the findings of the OPCS surveys, as having a priority for additional help which becomes available. They may not have had the opportunity to qualify for contributory or occupational benefits or to make savings because of their disability.
To align the basic levels of the contributory and the non-contributory benefits for people who are incapable of work would involve substantial additional expenditure. We estimate that the gross cost would be around £250 million a year. The net cost is also substantial at around £110 million a year. We are already committing a substantial amount of extra money to SDA by bringing in the age-related additions at a cost of £50 million in a full year. It is difficult to find a further £100 millon a year, which is what the new clause would cost when there are many pressing demands on the social security budget as a whole.
The noble Earl, Lord Russell, ended by saying that the amendment was achieving a little for this group of people. I believe that what I have said in my response goes a considerable way towards the objectives which I know the noble Earl seeks. Therefore it is a question of balance and I hope that he will agree that the increases to which I have

633
referred are to be welcomed. I hope that the noble Earl will withdraw his amendment.
Earl Russell: I thank the noble Baroness for that reply which was not altogether without encouragement. Therefore, I shall not enter at length into a long debate on the uprating statement dealing with the amount of money that the Government have in fact committed to the proposals.
The noble Baroness referred with a certain degree of sympathy to the report of the Social Security Advisory Committee and to the notion of a benefit increasing by stages. I should find it most helpful if she were able to be a little more forthcoming although I appreciate that there are difficulties in the way of anything too explicit.
Baroness Blatch: The noble Earl provokes me, but it would be difficult for me to go further other than to say that we are agreeable in principle to the particular recommendation of the Committee, as and when practicable. I believe that the measure I have mentioned is a positive first stage in that process.
Earl Russell: I thank the noble Baroness warmly for that comment. It goes that crucial bit further than her first reply. It is enough to enable me to withdraw my amendment. I hope that when she and her right honourable friends think about the matter they will find that they can implement that principle sooner rather than later. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.15 p.m.
Clause 2 [Severe disablement allowance: age related addition]:
Lord Carter Lord Carter moved Amendment No. 9:
Page 3, line 6. at beginning insert:
("() In section 36(4) of the principal Act, for paragraph (c) there shal be substituted the following paragraph—
"(c) he does not satisfy the prescribed conditions as to presence in Great Britain; or".".).
The noble Lord said: I should tell the Minister at the outset that, depending on her answer, I may not be as accommodating as was the noble Earl, Lord Russell. The amendment deals with the excessively harsh residence conditions for those receiving the severe disablement allowance. It harks back to a debate we had earlier today in relation to the residence conditions for the attendance allowance. The requirements for applicants are that Great Britain must be their normal place of residence; they must have been resident in Great Britain for 10 out of 20 years prior to the claim, or for 10 years of their lives if under the age of 20; and they must have been physically present in the country for each of the 196 qualifying days of incapacity.
We believe that to be excessively harsh. I hope that the Minister can explain the reasons for the requirements because they do not tie in with the residence requirements for invalid care allowance, attendance allowance, mobility allowance, housing
634
benefit and income support. No understandable reason has ever been given for the anomaly which appears to exist with the severe disablement allowance. When speaking at the Committee stage in another place, Mr. Nicholas Scott said:
"For perfectly obvious reasons, there are residence and presence conditions for non-contributory benefits".
He went on to admit that the period for qualification is different from the condition for benefits and so there is a lack of harmonisation between the two. He then said:
"I make no commitment to come back at a later stage of the Bill on this issue because the costs will have to be examined very close, as will some points of principle. I certainly give the undertaking that when the Committee stage of the Bill is over, I will have a look at the rationale behind the condition to see whether, so many years later, the difference between the qualifying periods for SDA and other non-contributory benefits can be sustained. I do not think I can go any further today". [official Report, 8/2/90; Standing Committee G, col. 91.]
That was understandable.
The purpose of the amendment is to ascertain whether the department has had an opportunity to consider the rationale behind the conditions and to explain why the residence conditions for the receipt of severe disablement allowance appear to be harsher than those for other non-contributory benefits. I beg to move.
Earl Russell: I support the amendment. The condition to which the noble Lord, Lord Carter, drew attention is likely to affect more people than it did 20 years ago. Economically we are increasingly living in one world. More members of our population spend a substantial proportion of their lives working outside this country. A case is being brought to the Government's attention in another place showing that a member of the Armed Forces and his family were held to be ineligible because they were stationed overseas in the service of the Crown. That appears to me to be a reductive and absurd condition.
There are many people across the Atlantic and the English Channel who cannot give loyal service to their companies, the Crown, or to any other employer without moving about regularly. If such movement is to carry this kind of penalty, it will be found that mobility of labour, which already causes enough dislocation in people's lives, will be harder to achieve. That would be economically unfortunate. I support the amendment.
Baroness Blatch: I hope that the noble Earl, Lord Russell, in his reference to the fact that we are all now living in one world is not suggesting or implying by that that everyone in the world should take advantage of the benefit system on offer in this country. I am being flippant.
I am sure that all noble Lords will agree that there must be some residential qualifying rules and that is what this amendment is about. As the supporters of this amendment have explained, the effect of this amendment would be to remove the powers to lay down residence conditions for severe disablement. This would remove the current condition that a person must have been resident in Great Britain for 10 of the past 20 years.

635
The current presence conditions are that to qualify for SDA a person must be present in Great Britain. The person must also have been present here for 24 weeks out of the continuous period of 28 weeks for which a person must have been incapable of work before qualifying for SDA. We would have to think about whether these presence conditions could stand on their own if the current residence conditions were removed as this amendment proposes.
The residence condition which would no longer apply is that a person must have been resident in Great Britain for 10 of the preceding 20 years (or10 years since birth in the case of a person under age 20). The removal of this condition would involve considerable additional expenditure. We estimate that at any time there are about 1, 000 people who are unable to qualify for SDA because of this residence condition. The gross cost of paying them SDA would be around £14 million a year.
We are very much aware of the difference in the residence and presence conditions between the benefits which are available for people who are disabled and we shall be considering whether changes should be made. The current residence conditions for SDA are similar to those for non-contributory retirement pension. We are considering whether this link should be sustained as the residence and presence conditions for attendance and mobility allowances are much easier to satisfy. This involves the examination of costs and consideration of points of principle and we have not yet reached any conclusion on this issue as the attendance and mobility allowance conditions need to be considered in the light of the new disability allowance which will incorporate both benefits.
We are also aware of the representations made on behalf of members of service families who have spent several consecutive tours of duty abroad. For most service families the so-called 10-in-20 test will present no difficulties. We are aware, however, that there is a very small number who cannot qualify for SDA because of the test. We have already made special arrangements to help service families to meet the presence conditions. We are looking sympathetically at finding a way of helping them with the residence test, but the extent to which this will be necessary will depend on what conclusion we reach about the residence rule for claimants generally.
In conclusion, I would also like to mention that a person can be absent from Great Britain and still be held to be resident here. A social security commissioner held that the wife of a serviceman who spent substantial periods abroad with him was held to satisfy the residence conditions because they were held to be resident here during the period for which they have been buying a house. It is for the independent adjudicating authorities which decide claims to consider whether people can be regarded as resident here, even though abroad, in other circumstances.
The noble Lord, Lord Carter, is trying to press us as to when we shall report on our considerations. I am not able to give him a very precise answer except
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to give him an absolute assurance, to concur with a promise made by my noble friend on a previous amendment, that all these matters are under consideration. When that consideration is complete, it will be reported to the House. I hope that in the light of that the noble Lord will feel able to withdraw his amendment.
Lord Boyd-Carpenter: Before the noble Lord decides what action to take on this amendment, perhaps my noble friend can say something further on the position of those who have been overseas in the service of the Crown, whether in the Armed Forces or in the foreign service.
It would seem very oppressive because of absence for those reasons—namely, serving our country in an area where they have been told to serve it—that those people should be prejudiced in any degree in an application for an allowance. Perhaps my noble friend can say a little more as to whether that is the attitude of the Government.
Baroness Blatch: I addressed the point on service families, which would include those serving in Crown positions and working out of the country. I said that for most service families the so-called 10-in-20 test will present no difficulties. However, I went on to say that we are aware that there are a small number of people who cannot qualify for the allowance because of the test and we have already made special arrangements to help those families meet the presence conditions. I went on to give a particular example of a family which had spent a number of successive postings out of the country, but nevertheless a way was found to establish residence qualifications in this country. That is a point which will be part of the review on all these matters and I assure my noble friend that the Government are sympathetic to the point that he makes.
To address a point made by the noble Lord, Lord Carter, the residence conditions for severe disablement allowance follow on from those which apply to non-contributory retirement pensions. That was the existing income replacement benefit in force at the time that the non-contributory invalidity pension, the predecessor of severe disablement allowance, came into force.
On another point, the residence and presence tests for non-contributory benefits need to be looked at carefully both on a national and international level. The rules vary between different benefits as they were introduced at different times and it would be sensible to rationalise them. Again, that is the rationale for the review. I hope that the noble Lord will bear with us while those matters are under consideration.
Lord Carter: The Committee will understand my reasons for tabling this amendment as it is very complicated. Perhaps the Minister can tell the Committee whether, when the consideration is complete—and I shall not attempt to press her on when—the changes can be enacted through regulations or whether primary legislation will be needed.
Baroness Blatch: I believe that the power exists within primary legislation and therefore it could be coped with by secondary legislation.
Lord Carter: I am grateful to the Minister and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 agreed to.
Baroness Darcy Baroness Darcy (de Knayth) moved Amendment No. 10:
Alter Clause 2. insert the following new clause:
("Income support: disabled students
The following paragraph is inserted at the end of paragraph (c) of section 20(3) of the 1986 Act—
"(cc) he is a disabled person and he is participating in a course of higher education and he fulfils the conditions in paragraphs (a) to (c) of this subsection; ".").
The noble Baroness said: I shall speak also to Amendments Nos. 11 and 12 because they form part of a package. Their purpose is to ensure that all disabled students retain entitlement to social security benefits by applying the standard definition of disability used in the 1986 disabled persons Act.
As matters stand at present deaf students and those with dyslexia will be excluded. The problem is that in the draft regulations for the Education (Student Loans) Act a disabled student is defined as one who is eligible for disability and severe disability premiums. I am sure that it was not the Government's original intention to exclude deaf students. Assurances that disabled students would retain entitlement to social security benefits were given many times at meetings, in the White Paper, in Committee in the other place on 9th January and on 15th January in a letter to the RNID. Disability organisations were, therefore, surprised and very anxious that the definition to be used excluded deaf students.
We discussed the matter during the passage of the student loans Bill in this House and it has been pursued by the all-party disablement group and by my noble friend Lord Henderson of Brompton, who cannot be here today as he has a previous commitment which he must honour.
We feel that there is a misunderstanding of the problem, which I very much hope can be resolved today. The reason for the chosen definition was given in a Parliamentary Answer on 7th March 1990 in the other place, which stated that deaf students are unlikely to have the additional weekly living expenses because of their disability that income support and housing benefit are designed to meet. That argument is totally illogical because income support and housing benefit are not designed to meet extra disability costs. That is the purpose of the mobility and attendance allowances.
We are talking about income maintenance benefits. Deaf students need to be able to claim those benefits because, like all disabled students, they find it much more difficult to obtain part-time and vocational employment while studying. Many of those jobs involve waitressing, bar-work and hotel reception work. It is surely illogical to use a definition which includes blind students but
638
excludes deaf students when they have very similar difficulties in obtaining employment.
Deaf and dyslexic students of ten take longer to study, which means that part-time work is impractical. The RNID said:
"In our experience, when other students are taking an evening off, or out earning money, many deaf students are catching up on their work. When this sort of commitment is being demanded of deaf students … it does not seem appropriate that they should in addition have to undergo additional financial difficulties".
The Government's generous package to meet extra educational costs has been warmly welcomed by all the disability organisations. It would be a great pity if deaf students—there are only currently 300 in higher education—were deterred from entering higher education because they were denied entitlement to income maintenance benefits.
I hope that the Minister will be able to respond positively to these amendments. The definition of a disabled person in the 1986 Act comes from the National Assistance Act 1948. There is a precedent for using that definition to define a disabled student in the Education Reform Act 1988. At Third Reading the noble Baroness, Lady Hooper, moved an amendment on higher education corporations and the needs of disabled students in response to one that I had moved at Report. When speaking of the definition of disabled students the noble Baroness explained:
"We believe that it would not be right to use an educational definition since that is couched in terms of special educational needs which would not necessarily apply to higher education. The general definition in the National Assistance Act fits best. That is the one that we shall rely on. The definition takes account of all physical and mental disabilities".—[official Report, 8/7/88; col. 525.]
We should continue to rely on that definition so that deaf students and those with dyslexia are able to continue to claim income maintenance benefits along with their fellow disabled students. I beg to move.
5.30 p.m.
Baroness David: I had intended that my name should be added to those putting forward the amendment. I very warmly support the noble Baroness because there is a strong case that deaf students should be looked on in the same way as other disabled students. There is a difficulty with regard to definition, and that will perhaps need to be discussed. We need a far better definition than the one which goes back to 1948. The important point is that the amendment is not asking for help with educational matters, such as extra equipment and so on. We know that grants have been allowed—and we are very grateful for those—under the Education (Student Loans) Bill. These amendments refer to help and maintenance.
Deaf students have problems which non-disabled students do not. Deaf students take much longer over their work because they cannot lip-read in a lecture. They can lip-read if they are close to somebody in a seminar or under individual tuition, but lectures are very different. They may have to copy down notes from friends and make up that time when other people are free to take an evening

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job or whatever. They therefore take longer to complete their work.
As the noble Baroness said, they have much more difficulty in obtaining work because, due to their deafness, they are not acceptable to many employers. I should like to give the Committee two examples. A deaf student was studying art for a BA in London. She received numerous rejections when applying for part-time work. Eventually she was offered a part-time job handing out magazines at Tube stations in the mornings, but was unable to hang on to that job as it involved ringing in each morning at 5 o'clock to confirm that she would be coming and to receive details of the station to which she should go. She could not cope with that so she lost that job.
Another deaf student studying English in London failed to gain any employment whatever during the summer vacation. Employers replying to his applications said that they were unable to offer him employment because they had no communications support for deaf people and the short time that he would be employed did not justify making such arrangements.
The Royal National Institute for the Deaf has many cases of deaf students failing to obtain jobs and so they cannot obtain the extra money to help with maintenance and living expenses as can able-bodied students. There is therefore that problem. There is also the problem that deaf students have to spend more time on their work. Another point made by the noble Baroness relates to the very small numbers of deaf students who will be calling for the support. I hope that the Minister will treat the amendment with sympathy or at any rate say that it will be looked at for discussions to take place.
Baroness Elliot of Harwood: Many times in the past four or five years resolutions and amendments to Bills have been passed to make it clear that we do not wish to make any distinction between those who are handicapped and those who are not, provided that they can meet the demands of their situation. Listening to the noble Baroness, Lady Darcy, we clearly have another opportunity of doing something which will keep together the non-handicapped and the handicapped; it will enable the handicapped to continue to do as much work and obtain as much help as they could if they were non-handicapped. That is something which has been very satisfactory over a number of years. Here is an opportunity to do something which will enter into the same spirit.
I hope that the Government will look at the amendment seriously and see whether or not they can agree it in some way so that the theory of non-handicapped and handicapped working together and helping the handicapped in order that they should be able to compete, could be promoted by this amendment as well as the many others to which the Government have agreed.
Lady Kinloss: I should like to support the amendment. As my noble friend Lady Darcy (de Knayth) and the noble Baroness, Lady David, have already said, deaf students not only find it harder to
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find casual employment, but any spare time they may have is fully taken up with catching up on their work. The RNID find that deaf students cannot lip-read or watch an interpreter during lectures and tutorials and at the same time make notes. That means that especially those on lecture-intensive courses spend a considerable amount of time copying notes from friends or going over notes supplied by others. As my noble friend Lady Darcy (de Knayth) said, blind students receive help and I hope that deaf students will also receive it.
Lord Addington: I should like to address most of my remarks to dyslexic students, while fully endorsing the comments on the difficulties of the deaf. Dyslexic students suffer from many of the same difficulties in that they have to take up more time and have more pressures placed upon them in completing their work units, especially if they are in units where they must rely on dictated notes or notes written on a blackboard in technical subjects. The reason is that dyslexics are invariably much worse at copying down anything which involves written symbols. It does not need to be written language; the difficulty involves written symbols. They thus have a greater commitment on their time.
Dyslexia, meaning difficulty with words, is probably an inappropriate title. The more we learn about the problem the more we know that it is all-encompassing. They have a greater problem with sequencing. I have experienced that and have seen many dyslexics with greater problems in sequencing than myself. That means that dyslexic students when applying for a job must first ensure that they do not have to do any writing in that employment and, secondly, that they do not have to record figures accurately over a telephone for any period of time. That is especially so if they are being placed in a stressful situation, for instance answering a phone and writing down numbers. Their accuracy will fall sharply and they will of ten find the emotional stress too great.
There are many situations in employment where those skills are essential. For those reasons dyslexics follow hard behind the deaf. I hope that the definition will be extended to dyslexics because if someone with dyslexia can be deemed to be disabled for work I suggest that he or she is disabled in all other spheres.
Lord Stallard: I too support this amendment. I confess that I did not fully understand the implications until I listened to the noble Baroness, Lady Darcy (de Knayth), who so ably moved the amendment. On reading the proceedings of the other place and from reading various letters since then I had thought that the assurances given there were adequate. The Minister assured the Committee in the other place at col. 223 of Hansard:
"It is important to note that disabled students will continue to retain entitlement to social security benefits".
He did not say "some" disabled students. I took that to mean all disabled students, with no distinction between the blind and the deaf, which is even further dividing the disabled into different groups.

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The Minister then wrote to the Royal National Institute for the Deaf on 15th January:
"I do rot believe that the loans scheme will penalise deaf students or those with disabilities; on the contrary, the terms of the schema—retention of benefit entitlement [for the disabled]… are designed with their needs very much in mind".
I accepted those assurances and I confess, even with my interest in the disabled, I did not go any further along the line of amending that. I thought that, the assurances being there, the Government were not going to subdivide the disabled into dyslexics, the blind, the deaf and so on when there seems to be blanket coverage for disabled students.
I believed that there must have been a mistake—and many others felt the same—until we saw a reply to a Parliamentary Question on 7th March in the other place (at col. 681) which excluded deaf students. I do not know whether the Government were afraid to admit their mistake or were trying to justify it by giving an answer in that form.
The reason given for the exclusion of deaf students from income support and housing benefit is that they are unlikely to have additional weekly living expenses; because of their disability which income support and housing benefit are intended to meet. However, we all know, and it has already been said in this debate, that income support and housing benefit are not intended as additional weekly living expenses,. They are income maintenance benefits and not just for additional living expenses. Therefore, the Answer did not make much sense. It now makes even less sense than when I first heard the explanation.
It is totally illogical to subdivide the disabled, particularly the deaf from the blind. I do not want to put one against the other in the way that the Government are doing. I have listened carefully to what has been said and I hope that the Minister has also listened. There are genuine difficulties that affect deaf people in much the same way as the blind and other disabled people. Therefore, I hope that the Minister will be able to accept the amendments—they are totally logical—or will come forward with a government amendment on these lines at Report stage.
5.45 p.m.
Lord Swinfen: I also support the three amendments spoken to by the noble Baroness, Lady Darcy (de Knayth) I can see no logical reason why my noble friend on the Front Bench and the Government in general should refuse to accept these amendments even if they need to be reworded in some way to improve them.
However, I suspect that the Government, always cash conscious, will refuse the amendments on the ground of cost. That is a short-term view. The Government are keen on training and having that training carried out quickly. Dyslexic and severely deaf students take longer in their training and because of their disabilities may find their training more difficult. It is possible that their disability may mean that they are not trained quite as well as others. Therefore, they need support to give them more time to train properly so that in due course they can be
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of even greater benefit to the communiy than they would have been without such support. Ultimately, that will bring in far more per student than is paid out to them while they are students through the greater taxes they will be paying for the rest of their lives.
Lord Carter: The arguments for these amendments have been put so well that there is very little more to say. However, one point should be emphasised. Deafness is a particularly disabling handicap, not only in obtaining vacation employment—the problems we have heard about in regard to the telephone, communications within work and so on—but also with the speech defect that of ten accompanies total deafness.
I know that those who are blind and who also have a hearing loss claim that deafness is a more disabling condition than blindness. The technology to assist the blind is much further advanced in many ways than is the assistance for the deaf. Therefore, there is a very real disablement in being deaf which should be recognised. The point about income maintenance is of course vital to the argument and has already been extremely well put.
It is extraordinary that the Government have not found a means to assist, if the figures are correct, only a small number of students. I believe there are only 300. Therefore, I hope the Minister can give the Committee some assurance on this matter.
Baroness Blatch: The student loans White Paper outlined the intention that students who are disabled will continue to be able to claim income support and housing benefit but no attempt was made to define "disabled" because there is no generally accepted definition of disability. It was intended that an appropriate definition would be developed as details of the changes were worked up.
In order to give groups access to benefits it is essential to draw up a very precise definition of the group at issue so that it can be clearly expressed in regulation and understood both by those administering the benefits and by those who might claim them. An established definition of disability for benefit purposes already exists in income support and housing benefit. The definition is manifested in the disability and severe disability premium. The Government propose that the qualifying criteria for these premiums should form the basis of the definition of a disabled student for social security purposes.
This definition will embrace a broad spectrum of disability. It will be targeted in particular on those students who face higher everyday living costs because of their disability. The introduction of the proposed new disability allowance, announced in the White Paper The Way Ahead will widen the scope of this definition still further.
Those deaf students who meet the criteria for the disability and severe disability premium will continue to be eligible for income support and housing benefit. Students whose sole disability is deafness will not be entitled to income support and housing benefit. The OPCS survey of disability

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showed that, in comparision with people with other disabilities, those who are deaf are among the least likely to have additional living expenses of the kind that income support and housing benefit are intended to meet.
The Government do not believe that it would be right to extend the disability premiums to deaf students while other claimants who are deaf do not benefit from these premiums. We are aware that deaf students can face a number of expenses connected with their attendance at educational courses. Here, having listened to the debate, I suggest that there has been some confusion. Much of what has been said related to the difficulty of students studying on courses.
However, it is not for the social security system to provide for costs of this kind. The disabled students' allowance administered by local education authorities is intended to assist in these circumstances. This scheme will not only continue under the new student support arrangements but will be considerably improved. The annual allowance is to be increased from £765 to £1, 000 per year and new and additional allowances are to be introduced to assist with the cost of non-medical helpers. That addresses the needs of dyslexic students referred to by the noble Lord, Lord Addington. This would be up to £4, 000 a year and for major items of specialist equipment up to £3, 000. Deaf students will clearly benefit from these changes.
It is important to note that, dependent upon circumstances, it is possible for a disabled student to receive up to £18, 000 over a three-year course, which would be additional to the normal grants; that is, £4, 000 per annum for help of a personal kind—the standard severe disablement allowance of £1, 000 per annum plus a £3, 000 allowance for equipment which a deaf person may require.
The needs of deaf students are best dealt with through the education support arrangements rather than through the social security system. These two sources of financial support have very different aims. It would not be right to link benefit entitlement to a particular education need. The noble Baroness, Lady David, and the noble Lady, Lady Kinloss, made reference to deaf students who take longer to pursue their studies and who then cannot get work in the vacation.
Baroness David: I know about the grant for equipment to help disabled students. However, if they take longer over their work and even if they have that kind of support, they still have not time to do odd jobs which can create the money to help with their maintenance. That is the point.
Baroness Blatch: The new and additional forms of student financial support being introduced under the education system will outweigh, and were always meant to outweigh, the benefit losses of students. They are not being introduced on the assumption that students will have to supplement their incomes by working, though we all know that many students do.
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Another point raised by many Members of the Committee was that disabled students would be unable to manage financially in the long vacation. Again, it is important to note that students who are unable to find employment in the vacation because they are disabled are eligible to apply for a vacation hardship allowance which is payable at the discretion of the local education authority under the mandatory award system. However, because the student is on a course of educational study it would be a matter for the judgment of the local education authority.
These two sources of financial support have very different aims. It would not be right to link them. Having given all those assurances about the needs of the disabled being met while they are studying and because some allowance will be made during the vacation, I hope that the noble Baroness will feel able to withdraw the amendment.
Baroness Darcy (de Knayth): In vaguely thanking the noble Baroness for her reply I am sure that she will not be surprised when I say that I am extremely disappointed. I am amazed because very little of what she has said is not contained in letters from the Minister for the Disabled and from herself to my noble friend, Lord Henderson. I am quite taken aback by her reply.
She began by saying that there was not an accepted definition of a disabled student. I do not believe that the noble Baroness heard what I was saying when I was quoting the noble Baroness, Lady Hooper, at the Third Reading of the Education Reform Act. We now have that definition in that Act, which was chosen by the noble and learned Lord the Lord Chancellor and the noble Baroness. If it is good enough for them then, it is good enough for me.
The noble Baroness still seems to think that we are talking about extra disability costs and not about income and maintenance costs. She said that much of the debate referred to the difficulties of studying on courses—a matter which the noble Baroness, Lady David, picked up. That is not what we are talking about. The noble Baroness also said that it was not appropriate to meet extra education costs from the social security system. We are not talking about that. We are extremely grateful for the lump sums. As the noble Lord, Lord Swinfen, has said, they are extremely generous sums.
It does not make sense to give these enormous sums to assist the students in their education and then to scrimp over the few (at most 300) deaf students claiming income support and housing benefit. I appreciate what the noble Baroness said about the vacation payment. However, why should one treat deaf and dyslexic students differently from other disabled students? What is the sense of subdividing them, as the noble Lord, Lord Stallard said? It is extraordinary to say that a deaf student is not a disabled student when one acknowledges that deaf students will be greatly helped by these large and generous sums.
There is a letter from the Minister for the Disabled, Nicholas Scott, to Susan Daniels, who is the education manager of the RNID. The letter was very much echoed in something which the noble Baroness

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said in her letter to my noble friend Lord Henderson. It states:
"We are proposing to use the qualifying criteria for these premiums"—
that excludes deaf and dyslexic students—
"as the basis of our definition of a disabled student".
That is quite worrying if it becomes the standard definition of a disabled student. What are the implications for repaying student loans? Is that a matter which has been thought of? The letter continues:
"We are also seeking to ensure that anyone who is treated as a disabled student under our current rules will continue to be entitled to benefits even where they do not meet the new criteria".
Therefore, we have another subdivision where a deaf student is a disabled student if he was disabled before the Education (Student Loans) Act comes in. It is really too ridiculous.
I very much hope that the noble Baroness will think again. I was not planning to divide the Committee. I hoped that she would say that she appreciated the problem, but, if she did not, I hoped that she would say that she realised there was a problem and that we could meet and have discussions. Before I decide what to do, can the noble Baroness indicate whether she has any further thoughts on the subject? Does she really appreciate the problem and has she thought about the implications of saying that a deaf student is not a disabled student?
Baroness Blatch: I hope nothing I said minimised the concern about the difficulties that a deaf student has. I pointed out the considerable range of allowances for courses of study which are available to make sure that these young people are able to study and that they are helped both by mechanical aids and by personal assistance. We are here talking about housing benefit. I also made the point that the student loan system more than made up for the loss of benefit. The same arguments apply to the normal student as to the deaf student. On that point we have to disagree. I cannot go beyond the reply that I have given to the noble Baroness.
Baroness Darcy (de Knayth): Perhaps I may press the noble Baroness: the letter states that the Government wish to use the definition there as the definition of a disabled student. Will that be used in future as the definition of a disabled student? I refer to the eligibility criteria for the disability and severe disability premiums.
Baroness Blatch: I believe that the noble Baroness is referring to a letter which states that all these matters are under consideration. It would be precipitate of me to give a definitive answer to the question which has been noted a second time. I shall return to the matter if I have more to say about it. I shall do that in writing if necessary.
Baroness Darcy (de Knayth): But can the noble Baroness reconsider the matter at the moment?
Baroness Blatch: I cannot consider it at this moment.
Lord Carter: Before the noble Baroness decides what to do about this amendment, and as my name is attached to it, I say that the Government's answer has been very unsatisfactory. A number of very strong points have been made. Very few people are involved in this matter. We have pointed out the exceptionally disabling nature of deafness compared with other handicaps. None of these points has been met. I hope that the noble Baroness will take these factors into account before deciding what to do about the amendment.
Baroness Darcy (de Knayth): If the definition is accepted for a disabled student, what implication does that have for the repayment of loans by disabled borrowers? Would deaf students not be treated in the same way as other disabled students?
Baroness Blatch: Again, that would depend entirely on the precise definition at the time. The noble Baroness knows from reading that letter that the matter is under consideration. When it is complete I believe that I shall be able to be more definitive in my answer to the question. I am advised that we currently operate different definitions for education and social security purposes. We have no plans to transfer the definition used for social security into other provisions.
Baroness Darcy (de Knayth): I am not at all happy with the situation. I cannot see that one should divide deaf from disabled students. They can all be called disabled students and then one can go into the problem of what is a deaf student. At one stage one says that the disabled include the deaf and then one asks: what is a deaf student? If there is a problem about the definition, that can be sorted out by using the clinically accepted levels at which people are considered to have a significant hearing loss.
I am not satisfied and I am deeply disappointed. I thought that we stood a chance of having discussions and perhaps accomplishing something at the next stage. I must ask for the opinion of the Committee.
6 p.m.
On Question, Whether the said amendment (No. 10) shall be agreed to?
Their Lordships divided: Contents, 87; Not-Contents, 86.

DIVISION No. 2

CONTENTS

Addington, L.

David, B.

Airedale, L.

Davies of Penrhys, L.

Allen of Abbeydale, L.

Dean of Beswick, L.

Ardwick, L.

Dormand of Easington, L.

Aylestone, L.

Elliot of Harwood, B.

Birk, B.

Falkland, V.

Blackstone, B.

Fisher of Rednal, B.

Bonham-Carter, L.

Galpern, L.

Brightman, L.

Graham of Edmonton, L. [Teller.]

Carter, L.

Cledwyn of Penrhos, L.

Grey, E.

Clinton-Davis, L.

Hampton, L.

Cocks of Hartcliffe, L.

Hayter, L.

Craigavon, V.

Henderson of Brompton, L.

Darcy (de Knayth), B.

Holderness, L.

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Hooson, L.

Raglan, L.

Houghton of Sowerby, L.

Richard, L.

Hunt, L.

Ritchie of Dundee, L.

Hylton-Foster, B.

Rochester, L.

Jay, L.

Ross of Newport, L.

Jeger, B.

Russell, E.

Jenkins of Putney, L.

St. John of Bletso, L.

John-Mackie, L.

Saltoun of Abernethy, Ly.

Kilmarnock, L.

Seear, B.

Kinloss, Ly. [Teller.]

Seebohm, L.

Kirkwood, L.

Serota, B.

Listowel, E.

Shackleton, L.

Lloyd of Kilgerran, L.

Shepherd, L.

Lockwood, B.

Stallard, L.

Longford, E.

Stoddart of Swindon, L.

McIntosh of Haringey, L.

Strabolgi, L.

McNair, L.

Swinfen, L.

Mais, L.

Taylor of Blackburn, L.

Masham of Ilton, B.

Thurlow, L.

Mason of Barnsley, L.

Tordoff, L.

Mayhew, L.

Turner of Camden, B.

Mishcon, L.

Underhill, L.

Monkswell, L.

Vernon, L.

Morris of Castle Morris, L.

Wedderburn of Charlton, L.

Nicol, B.

White, B.

Northfield, L.

Williams of Elvel, L.

Ogmore, L.

Willis, L.

Parry, L.

Winchilsea and Nottingham, E.

Peston, L.

Pitt of Hampstead, L.

NOT-CONTENTS

Ailesbury, M.

Lindsay, E.

Alexander of Tunis, E.

Long, V. [Teller.]

Allerton, L.

Lucas of Chilworth, L.

Arran, E.

Lyell, L.

Belhaven and Stenton, L.

Malmesbury, E.

Belstead, L.

Margadale, L.

Bessborough, E.

Massereene and Ferrard, V.

Blatch, B.

Merrivale, L.

Blyth, L.

Mersey, V.

Borthwick, L.

Mottistone, L.

Boyd-Carpenter, L.

Mountevans, L.

Brabazon of Tara, L.

Munster, E.

Brookes, L.

Murton of Lindisfarne, L.

Brougham and Vaux, L.

Nelson, E.

Campbell of Alloway, L.

Norrie, L.

Campbell of Croy, L.

Nugent of Guildford, L.

Carnock, L.

Orkney, E.

Colnbrook, L.

Orr-Ewing. L.

Cullen of Ashbourne, L.

Pender, L.

Davidson, V. [Teller.]

Penrhyn, L.

Denham, L.

Portsmouth, E.

Donegall, M.

Rankeillour, L.

Dulverton, L.

Reay, L.

Eccles of Moulton, B.

Renton, L.

Elibank, L.

Rodney, L.

Elles, B.

Sanderson of Bowden, L.

Elliott of Morpeth, L.

Selkirk, E.

Ferrers, E.

Skelmersdale, L.

Foley, L.

Slim, V.

Fraser of Carmyllie, L.

Strathmore and Kinghorne, E.

Fraser of Kilmorack, L.

Glenarthur, L.

Sudeley, L.

Hailsham of Saint Marylebone, L.

Suffield, L.

Swansea, L.

Henley, L.

Swinton, E.

Hesketh, L.

Teviot, L.

Hives, L.

Thomas of Gwydir, L.

Hood, V.

Tranmire, L.

Huntly, M.

Ullswater, V.

Jenkin of Roding, L.

Vaux of Harrowden, L.

Johnston of Rockport, L.

Westbury, L.

Joseph, L.

Wyatt of Weeford, L.

Kaberry of Adel, L.

Wynford, L.

Lauderdale, E.

Yarborough, E.

Resolved in the affirmative, and amendment agreed to accordingly.
6.7 p.m.
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 11:
After Clause 2, insert the following new clause:
("Housing benefit: disabled students
The following paragraph is inserted at the end of section 20(7) of the 1986 Act—
"(d) he is a disabled person and he is following a course of higher education and he fulfils the conditions in paragraphs (a) to (c) of this subsection; ".").
On Question, amendment agreed to.
Baroness Darcy (de Knayth)Baroness Darcy (de Knayth) moved Amendment No. 12:
After Clause 2, insert the following new clause:
("Disabled person: definition
In Section 20(11) of the 1986 Act the following definition is inserted after the definition of "child"—
" "disabled person" has the same meaning as in the Disabled Persons (Services, Consultation and Representation) Act 1986".").
On Question, amendment agreed to.
Earl Russell Earl Russell moved Amendment No. 13:
After Clause 2, insert the following new clause:
("Equal rights to social security benefits
.—(1) Notwithstanding any other provision of this or any other Act, order or regulations, every person residing in any part of Great Britain, of whatever age, sex, parentage, nationality, or occupation, shall have a right to an adequate level of social security benefits.
(2) Any provision of Part II or Part III of the 1986 Act or of any regulation made or direction issued under either of those Parts which, in conferring or restricting entitlement to or availability of any social security benefit or payment, discriminates or results in discrimination between categories of persons other than on grounds of differences in needs, shall have effect as if it applied to all such categories in the same way as to the most favourably treated category.").
The noble Earl said: I have always understood, I hope not wrongly, that it was a basic principle of the social security system that no one ought to starve—not "no one except"; not "no one except those people over there"; but no one. At Second Reading the noble Lord, Lord Boyd-Carpenter, challenged us to state our sense of priorities. That challenge was addressed to a good many of us. Some of his remarks were about the language of socialism which, perhaps I may remind him, I do not speak, but I think that I am one of those from whom he would like an answer. That is my first priority and I hope to be able to return to others later. I do not assert it as a matter of natural right. I do not assert it as an absolute. But I think this country is rich enough at present to be able to afford it.
I am not asserting eligibility to be a matter of natural right. I am asserting it to be a matter of contractual right. It is a matter of the same web of responsibilities which carries with it the right to vote and the duty to pay taxes. Those are three things from all of which exclusions are extremely risky. They ought not to be undertaken lightly. They ought to be thought about very hard indeed. They ought to be justified, if at all, by cast-iron arguments.
The principle of the social security system as a safety net is one which will justify excluding people from its operation by virtue of their personal

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economic circumstances. It is perfectly legitimate to exclude someone from the system because they happen to have so much money that they do not need it. However, what I do not understand—and I very much hope that my noble kinsman will give me some explanation—is why it should be regarded as legitimate to exclude a whole category of people from the system regardless of their economic circumstances.
That is an exclusion which should be approached with grave misgivings, whether we are dealing, for example, with a proposal that "gypsies be recycled and dumped in the sea"—I assure the Committee that I am quoting—or, to take a reductio ad absurdum, a proposal to exclude Peers from the social security system. I admit that we do not think of Peers as being in the sort of category for which the social security system is designed. However, Peers, as well as other people, are capable of falling on hard times. I have not forgotten the case of the 18th century Lord Acton, who was a second under-cook. It is a case I regularly use to try to distinguish between class and status.
It seems to me that whatever group of people you belong to, if you fall on hard times and do not have the amount of money which brings you to benefit levels, you should have an equal right to receive benefit from the system. Anyone who argues to the contrary will have a very hard piece of arguing to undertake.
The basic principle of the amendment is taken from Article 10 of the European Social Charter, the social protection clause. However, for many reasons, not least of which was the problem of the Long Title, I decided that I would make no attempt to enact European law as such. However, if I find a principle in European law which I think is a good one, then I hope that I may lay it before this Chamber with the recommendation that it should become part of British law. Not for the first time I have to commend to the Committee the distinctly nourishing qualities of the diet of Brussels.
Noble Lords may say that this is an unnecessary amendment. I am almost certain that my noble kinsman is at this moment preparing to say just that. I wish it were so. In fact, we have recently witnessed several attempts to remove a category from the social security system. What first brought me to think about the question of how you can justify excluding a category is the case of the eligibility of 16 year-olds and 17 year-olds for income support and housing benefit. We shall of course be discussing that aspect tomorrow and I shall not, therefore, go any further in that direction.
It is appropriate for the type of provision made by the social security system to vary according to age—for example, care provided for children under 14 is very different from what might be appropriate for older people. However, the basic principle that one should be eligible for help if one's circumstances are poor enough should stand.
The second case where a whole category of persons have been excluded is for students. We have heard much about this already, and I shall not detain the Committee too long with what I have to say. We
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shall be hearing more on this aspect at a later stage. I should not argue if the case were simply that it was appropriate to finance the students by other means. That is a point which can be argued perfectly well. However, my noble kinsman may be interested to know that his right honourable friend the Minister for Social Security and the Disabled admitted in a letter to me dated 20th April that if the object were to float the students off benefit, it would have been necessary to provide them with a very much higher level of loan than has been granted.
The third case where the Government have excluded people for considerations other than those in relation to their means is in cash limiting the social fund in relation to regional offices. That means that a misfortune which is eligible for relief in Sandwich may not be eligible in Sheffield. As I see it, that is a failure in equality before the law.
Therefore, we have had three such cases in a relatively short space of time. It makes me ask, what next? It also makes me ask whether the Government will provide us with a general theoretical justification of why they think that they are entitled to implement such measures. When I hear that justification, I shall decide how much further I wish to take the matter. I beg to move.
6.15 p.m.
Baroness Turner of Camden: I rise to express my support for the amendment moved by the noble Earl, Lord Russell. As he indicated to the Committee, the wording of the amendment is taken directly from an article in the Social Charter. We debated the charter recently in this Chamber as a result of the report by the Select Committee of which I had the honour to be a member. It is well known that the United Kingdom Government alone of all those in the Community opposed the charter outright. Apparently they were not willing to accept it even as a basis for negotiation. However, there are surely aspects of the charter with which the Government would be in agreement. Among them is the emphasis on equality of treatment. That aspect is dealt with in the wording of the amendment.
There are many ways in which we on this side of the Chamber might argue that, despite protestations to the contrary, in practice the Government have departed from those objectives, especially those set out in the latter part of the amendment. We shall have an oppportunity to debate some of these issues, one of which was referred to by the noble Earl; namely, the withdrawal of benefit from those unemployed between the ages of 16 years and 18 years even when they are homeless. There has also been the general spread of means-tested benefits in income support or family benefits.
Those are issues about which we can and will argue our case. But as a statement of general principle, it is surely right that a Bill concerned with social security should set out in quite unambiguous terms the fact that we believe in equal rights in social security provision and that persons unable to work and without means of subsistence must receive sufficient resources and social assistance in keeping with their particular situation. I should have thought that that was what all social security programmes in

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civilised countries were about. I do not see how the Government can oppose the amendment and still maintain their insistence that they are providing the nation with a programme for social provision.
When we debated the report of the Select Committee in this Chamber I gained the impression—perhaps wrongly, but no doubt the Minister will put me right if that is so—that the Government's main opposition to the charter was based around the issue of employment rights. I refer to the employment provisions, the minimum wage or decency wage and so on. However, we are not talking about that; we are talking about basic social security provision. Therefore, it seems to me that the wording suggested by the noble Earl ought to commend itself to the Government.
Lord Boyd-Carpenter: We are told that the amendment derives from the European Social Charter. However, that does nothing to increase my enthusiasm for that somewhat controversial document. On the other hand, if we were to put what is proposed into our law, it would be a marvellous benefit to the legal pr of essions. I say that because, if it were put into law, it would give rise to an enormous possibility of litigation on the largest possible scale. I am sure that it would be of the greatest benefit to the legal professions, though perhaps not to anyone else.
Baroness Turner of Camden: The Government have not hesitated to do that in the sphere of employment, which has surely been a bonanza for the legal professions.
Lord Boyd-Carpenter: Even if the noble Baroness is right, that is no argument for extending benefits to the legal
profession although of course I know that its members would be happy to have them.
The Committee should look at the amendment. People are to:
"have a right to an adequate level of social security benefits".
What is an adequate level? Who is to decide what is an adequate level? Are the courts of law to decide what is an adequate level or is the person who decides to bring proceedings to enforce his or her rights to an adequate level of social security benefits to decide?
It has been the practice in our social security administration for a great many years to decide, of ten after prolonged debate in both Chambers, what is a proper level; what is a level that can be afforded by the British economy; and what will reasonably meet social needs. But merely to lay down, as a legal principle, that everyone is entitled to an adequate level of social security benefits is one of the most extraordinary propositions that I have ever seen. Age is to be disregarded. The amendment would appear to read as if a five year-old child is entitled to the same rate of benefit as a 50 year-old man. The whole proposal, although no doubt well intentioned and highly emotionally supported, is so unrealistic that to suggest that the Committee treat it as a serious essay in legislation is going too far.
Lord Henley: I have read carefully the new clause tabled by my noble kinsman and listened with interest to his speech. I must confess—he is aware of this, because I spoke to him immediately before he moved the amendment—to being less than clear as to the intention underlying the amendment. At times I became even more confused as he spoke. He spoke of whole categories of people being removed from the benefit system. I believe he said that neither gypsies nor Peers were entitled to benefit from it. As far as I know they are not excluded from the system. He mentioned three other categories to which I shall come later. I shall not say that I feel the amendments are unnecessary; I feel that they are worse than that. I cannot recommend that the Committee accept the amendment for two main reasons.
The first relates to subsection (1) which confers a right to an "adequate" level of social security benefit to any person in Great Britain of whatever age, sex, parentage, nationality or occupation. The question of what is "adequate" for a particular individual inevitably involves the exercise of subjective judgment and is not a yardstick which can be given legislative force. Pinning the right to a level of benefit which can be regarded as "adequate" effectively nullifies the amendment and renders it meaningless.
There is more to it than that. The Committee will know because I have given the figures before, that in the coming financial year the Government plan to spend a record £55 billion on social security. That represents a 33 per cent. increase in real terms since we came to office. It amounts to over £20 per week for every man, woman and child.
That we have felt it right to devote such an unprecedented level of resources to the social security programme is itself a recognition of the obligation owed by the state to those of its citizens who have to live on limited incomes and depend on what the state provides. Social security benefits meet many needs—some provide an income for people who have little or no earnings, because they are elderly, unemployed or sick. Others provide help with housing costs or the cost of bringing up children; pension for retirement pensions and income for widows; and assisting with the extra costs of disablement.
Our policies have done more than merely pour money into an ever-growing programme. We have sought to protect the position of those most in need. Retirement pensioners, the sick and disabled, families with children—all have had their position safeguarded and protected. Indeed, in many cases, we have been able to go further and achieve real improvements in the position of those dependent on benefits; but one of the major objectives we set ourselves in the major restructuring of the benefit system was to ensure that resources were more effectively targeted on those who need them most.
The reforms which we introduced in 1988 brought about a more flexible and responsive structure of income-related benefits which has enabled us to achieve that objective. The system of personal allowances and premiums has enabled us to target help effectively towards priority groups, reflecting the particular needs faced by those groups. To

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attempt the assessment of the individual needs in the way the amendment implies could have enormous administrative and financial implications.
I share my noble kinsman's view that people who need help should be adequately provided for, and I understand the sentiment which underlies the amendment he has moved today. My response to his concern is to point out what we have achieved in the reformed benefit sytstem is to ensure that those who need help are adequately provided for.
That takes me to the second reason for being unable to accept the amendment. Subsection (2) could effectively undermine the very structure which has facilitated the achievement of those objectives. To treat all categories—pensioners, lone parents, disabled people, families, single people, students, people in trade disputes, people who leave work voluntarily, people who care for the severely handicapped, war widows and so on—in the same way for all benefits (as the amendment would seem to imply) would be counter to all logic. To bring their benefit up to one most favourable level would be inordinately expensive and would not help those most in need. There are special, and I believe valid, reasons for treating them in the particular ways in which they are treated in the benefit system. It is misleading to suggest that the treatment of particular categories in particular ways amounts to some kind of "discrimination"—almost akin to racial or sexual discrimination.
The amendment not only runs the risk of undermining the principle of targeting help; it could also tie the hands of Ministers in a wholly unrealistic manner and to an unreasonable degree by preventing the application of special rules applying to special groups of people. It could for example, spell the end of differential disregards for different groups or any of the entirely justified special arrangements for particular groups which apply under the present system. I refer topically, for example, to the recent case made out for war widows. It could also call into question whether people's needs should be looked at, irrespective of whether they—or, in the case of a couple, the partner—work, or irrespective of the hours worked.
My noble kinsman cited three groups which he said were excluded. I know that he is concerned about the benefit entitlements of a particular group; namely students—a subject we have debated at length in this place during the passage of the Education (Student Loans) Act. We shall be coming later to amendments relating to students. I am well aware of his concern that students are being singled out by the social security system simply by virtue of their chosen occupation.
Bearing in mind that other amendments have been tabled, it may be best to leave that point until later. My noble kinsman also mentioned 16 and 17 year-olds as an example of those who are excluded from social security benefits. We have on many occasions made it clear that there is no need for 16 and 17 year-olds to be without money. If they cannot find work on leaving school, they are guaranteed a YTS place. For those who are estranged from their families, as my noble kinsman is well aware, there
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are special arrangements for them to receive benefits to avoid cases of severe hardship.
I shall turn now to the social fund, an issue which will probably arise tomorrow. Part III of the Social Security Act 1986 established the social fund. The regulations and the directions made or issued under this part provide for a system of one off payments for those in greatest need at times when additional money may be needed; for example, the birth of a child; a death in a family; a breakdown in a family relationship; or to help cope with the effects of a crisis.
In this respect the social fund is actually following the noble Earl's criterion of discriminating on the grounds of need. But however one defines need, it cannot be the only criterion. The aim of the social fund is to meet a range of needs that may occur in particular circumstances. For example, the regulated part of the scheme deals with clear-cut events in life. However, the discretionary part of the scheme is precisely designed to deal with an enormous variety of circumstances relating not just to need but to situations in which individuals find themselves. The fact that payments for community care grants, budgeting loans and crisis loans are made on a discretionary basis having regard to the circumstances of the individual case serves to highlight this. But even then, the Government believe that it is only right to provide discretionary payments within certain parameters.
The fact is that no system can meet all needs imposed upon it. Given that social fund payments are made from public funds provided by the taxpayer, it is only fair and reasonable that there is some limit on expenditure. The Government's policy is to concentrate the help that is available where it is most needed. To achieve this the scheme must have a clear structure within which it can be operated. We therefore provide a framework of directions and identify certain groups of people as eligible for help or items which we classify as high priority. However, in doing so we ensure that every case is considered on its merits. For example a vacuum cleaner may normally be an item of low priority but for a person suffering from asthma it could well be a necessity and the priority will be increased accordingly. Within the structure we make it clear to the social fund officers and inspectors who determine applications for discretionary payments and the adjudication officers who determine the claims for regulated payments that they should apply the criteria without regard to the applicant's race, sex or religion.
This has not been a straightforward amendment to speak to, since it was not absolutely clear to me what my noble kinsman had in mind. I hope that, for the reasons I have given, the noble Earl will feel able to withdraw his amendment. Failing that, I hope that the Committee will reject it.
Lord Carter: Before the noble Earl decides what to do with the amendment, the Minister and the noble Lord, Lord Boyd-Carpenter, made some play with the weakness of the phrase,
"shall have a right to an adequate level of social security benefits".

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The word "adequate" seemed to concern them. It reminded me of the National Health Service and Community Care Bill which states clearly in regard to the timetable for the implementation of community care that except where the Secretary of State is satisfied that the resources available to local authorities are adequate to secure the proper carrying out of their duties in a manner conducive to the interests and welfare of any person for whom community care services may be provided or arranged. Why is the use of the phrase "adequate for any person" acceptable in the National Health Service and Community Care Bill, but not in this amendment?
6.30 p.m.
Lord Henley: It is quite obvious that the two cases are completely different. In the case of the National Health Service Bill my right honourable friend must satisfy himself that the resources are adequate. Here, the use of the word "adequate' for a particular individual inevitably involves a subjective judgment that makes the amendment which seeks equality of treatment meaningless because adequacy will be different in different circumstances. The amendment is meaningless in the use of the word "adequate" which conflicts with the equality of treatment required because the adequacy will be different for different people.
Lord Carter: Under the National Health Service Bill it will also be different because the Bill says, "adequate for any person". Every person will have different requirements.
Lord Boyd-Carpenter: Will the noble Lord allow me to intervene? Surely there is all the difference in the world between the Secretary of State having to satisfy himself that certain provisions are adequate—he is answerable to Parliament for the decision he makes on that—and laying down in a statute that something shall be adequate. That is a matter which could only be interpreted by the courts which will be in a hopeless position to do so.
Earl Russell: This was intended as a probing amendment, but it seems that I have found a good deal of confusion. The difficulty on the Government Benches in understanding what the amendment is all about indicates that its tabling was well worthwhile and that we still need to find out why the Government think that they are entitled to discriminate. The noble Lord, Lord Boyd-Carpenter, suggested that by incorporating a general principle in legislation one might give rise to litigation. I could not help wondering whether that was what King John said about Magna Carta.
We have also heard a good deal about the word "adequate". My purpose in using it was to indicate the same level of social security benefits as for anyone else. The basic purpose of the amendment was non-discriminatory. It was an equal rights amendment. If I had specified a particular financial level, the noble Lord, Lord Boyd-Carpenter, would have pointed out, perfectly rightly, that it would
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have required an annual uprating formula that would have given rise to considerable complications. It was not the purpose of the amendment to fix a particular financial level. Its purpose was to ensure equal treatment.
The Minister went through the different categories in some detail. I shall not follow him into all of them. I was interested to notice that he admitted that students had been singled out by occupation. That was precisely the point I was making. On that, and on the 16 and 17 year-olds—the case that originally attracted me to the matter of this amendment—as the Minister said, I spoke as if it were discrimination akin to racial discrimination. I see no good reason to withdraw that. I think it is.
The same can be said about the Social Fund. My noble kinsman the Minister said that need could not be the only criterion. He will correct me if I misquote him. That was an interesting admission. It weakens all the argument about targeting. It seems to conflict with his statement later that help should be given where it is most needed.
My first desire is to find out why the Government think that they are entitled to discriminate. I have not ascertained that. Under the circumstances I beg leave to withdraw the amendment. I shall bring it back on Report when I hope to receive a better answer following which I shall decide how I wish to proceed.
Amendment, by leave, withdrawn.
Lord Carter Lord Carter moved Amendment No. 14:
Before Clause 3, insert the following new clause:
("Automatic reinstatement of severe disablement allowance
Regulations shall provide that in any case where a person was in receipt of Severe Disablement Allowance immediately before the commencement of a course of youth training and on ceasing that course fails to secure gainful employment the entitlement of that person to a severe disablement allowance shall be automatically reinstated.").
The noble Lord said: This amendment is to plck up a point which concerns many organisations for disabled people. In the White Paper The Way Ahead: Benefits for Disabled People, the Government stated that one of the objectives was to promote independence where this is feasible and sensible and in particular to help those disabled people who wish to work to do so. We can all agree with that. Youth training is an important step towards employment for some young people receiving the severe disablement allowance. However, a number of organisations—particularly the Spastics Society, and Barnardos—are concerned that the current arrangements in the SDA scheme may act as a disincentive to those who would otherwise choose to take up a youth training place.
For others who have taken up a place and who have been unable to finish training or to find paid work immediately after completion, it can prove a risk. They may consequently lose their entitlement to SDA and never have it restored. Those people most likely to be affected are young people, aged 20 or over on completion of training, who had qualified for the severe disablement allowance on the grounds that they were incapable of work before their 20th birthday. Some people under the age of 20 may also

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be affected if, after they have completed their youth training, they are reassessed as no longer being capable of work.
The net cost of this change will be very small, as most people in this age group with severe disabilities are also entitled to income support. However, it would be a step in helping to keep more young people with disabilities off exclusive dependence on means-tested benefits. In the long run, it could save the Government money if it encouraged more people to take up training places and then employment. The amendment simply proposes a rational change in line with current regulations on income support and disability premium. It is consistent with the Government's own proposals in The Way Ahead. The current regulations impose a risk and act as a disincentive to young people who might otherwise take up training. The amendment is intended to ensure a safety net which would give them added confidence and encouragement. Some may as a result of their training find paid employment which would enable them to come off social security benefits altogether. I beg to move.
Baroness Blatch: I understand and sympathise with the objective of this amendment. I have listened to the points which the noble Lord, Lord Carter, has made, and I agree that it is important to help disabled people to receive the training which will help them to obtain employment. That is the whole point of attending the training scheme in the first place. Indeed, in The Way Ahead we have brought forward proposals that will create a new disability employment credit which will make it easier for disabled people to take up jobs. It will provide assistance with low earnings similar to that given to families through family credit.
Returning to the existing system of benefits, the first point which I think we must bear in mind is that severe disablement allowance is a benefit for people who are incapable of work. It is the non-contributory equivalent of invalidity benefit for people who have not paid the necessary national insurance contributions. Accordingly, the basic qualifying condition is that the person must be incapable of work. For people who become incapable of work early in life—on or before their 20th birthday—incapacity for work is the only qualifying condition.
The effect of the new clause would be to make the severe disablement allowance available to people who finished youth training simply because they had failed to find suitable employment. The fact that they would not have to be incapable of work cuts right across the principles of the SDA scheme. The SDA scheme however, has special arrangements for people who were receiving SDA and who then undertake youth training. These arrangements help people to have benefit reinstated immediately under what are known as linking rules. For example, if a person was receiving SDA before the youth training started and is incapable of work when the training ends, either at the expected end of the course or earlier, SDA can be reinstated immediately.
These linking arrangements also help a person who registers as unemployed at the end of training
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and again becomes incapable of work before finding employment. SDA would be reinstated because the periods of training and unemployment link the new claim for SDA with the one before the training is given. There is also provision for ignoring short gaps such as a period of employment following the training. If such a gap is eight weeks or less, it will not affect the linking arrangements for SDA claims. There can be any number of such gaps. The effect of these changes therefore is that a person who is incapable of work when youth training ends or in some circumstances some time afterwards can have SDA reinstated without having to wait for the normal 28-week qualifying period. Because of the nature of SDA, however, entitlement has to be conditional upon incapacity for work.
I hope that that clarifies the position. There is no intention whatever to deny the allowance as long as the qualifying conditions are met; that is, that the person is incapable of work.
Lord Carter: I am extremely grateful to the Minister. The assurances that she has given are welcome. I shall obviously need to read what she has said with care, but I believe she has met the points we have been trying to make. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 [Reduced earnings allowance and retirement allowance]:
Lord Henley Lord Henley moved Amendment No. 15:
Page 5. line 26, leave out subsection (8) and insert:
("(8) The following provisions shall cease to have effect—
(a) in section 2 of the Social Security Act 1988, the subsection (8) originally enacted (restriction on entitlement to reduced earnings allowance); and
(b) in Schedule 1 to the 1989 Act, paragraph 8(7) (which substitutes for that subsection a subsection (8) and a subsection (8A).").
The noble Lord said: I mentioned this amendment earlier. It is a technical amendment. The subsections mentioned in the amendment have not come into force. I beg to move.
Lord Carter: I think that an amendment of this extremely important nature should have been tabled before last Friday.
Lord Henley: I apologise to the Committee but I do not consider the amendment to be quite as important as the amendment which the noble Lord tabled on Friday.
On Question, amendment agreed to.
On Question, Whether Clause 3, as amended, shall stand part of the Bill?
6.45 p.m.
Baroness Turner of Camden: I rise to oppose the Question that Clause 3 shall stand part of the Bill. On Second Reading I said that I regarded this clause, which abolishes future rights to the reduced earnings allowance, as a further attack by the Government on the industrial injuries scheme. At present the scheme provides for a reduced earnings allowance

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for loss of earnings by people whose disabilities are caused by industrial accidents or diseases. I shall no doubt be told that existing beneficiaries will not be affected and that the only people to be affected will be those who are injured at work from the autumn of this year. I shall no doubt also be told that such people will in any case become entitled to invalidity benefit.
I should like to repeat what I have said in this Chamber on many occasions in the past in defence of the industrial injuries scheme. Many industries are inherently dangerous, no matter what is done to improve health and safety. I am willing to agree that the Health and Safety Commission does a good job. However, we need people to work in unsafe environments and there should be a proper scheme of compensation for them if they are injured or become ill as a result.
The industrial injuries scheme is the only system of no-fault compensation that we have in this country. In other cases it is necessary to sue in the courts for negligence. That is a lengthy and of ten costly exercise resulting in no more than 10 per cent. of victims receiving compensation by that route. As a result of the Social Security Act that went on to the statute book last year, social benefits are clawed back from that compensation.
My view of the need for an industrial injuries scheme quite separate from other social security provision is not a new one. Beveridge himself said,
"many industries vital to the community are also especially dangerous".
He also stated at the same time that:
"it is essential that men should enter them and desirable, therefore, that they should be able to do so with the assurance of special provision against their risk".
Furthermore, those who become disabled in this manner are acting under orders.
Since the Government took office we have seen attempts to whittle down the scheme. In 1986 there were changes which restricted the payment of industrial injuries disablement benefit to assessments of 14 per cent. or more and to certain prescribed diseases. Those changes cut out 90 per cent. of new awards. The abolition of the reduced earnings allowance can be seen, as the Disability Alliance has said, as heralding the extinction of the industrial injuries scheme.
Unfortunately there is still a great deal of work-related illness and injury. In the construction industry, for example, the numbers of injuries are no longer falling and there has been an increase in the number of deaths and injuries. One has only to refer to particularly hazardous industries such as the oil industry and the building of the Channel Tunnel to appreciate that we are talking about real problems. I hope there will be an opportunity to debate health and safety questions at some time in the future in this Chamber. Unfortunately these issues only hit the headlines when there are fatalities. However, there are many injuries which are never reported and in the main the people who suffer from them do not obtain compensation in the courts either. They must rely on the industrial injuries scheme.
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It is important to realise that the reduced earnings allowance is not an earnings replacement benefit but compensation for loss of earnings. of course the Government will argue that there should not be double compensation and that such people will be eligible anyway for invalidity benefit. But that really is not the point. The Disability Alliance, which campaigns for all people with disability no matter how it is caused, opposes the abolition of the reduced earnings allowance as it believes that it is the Government's intention merely to disguise another cut under the pretence of avoiding duplication within the social security system. The alliance believes in levelling up and not down.
I understand that about 146, 000 people are likely to be affected initially. It is estimated that the figure will remain similar throughout the decade. The Government's own estimate given in the Bill is that initially there will be savings of £1 million, rising to £40 million in 1992–93. Frankly that is a paltry amount and this is a paltry proposition. I therefore oppose the Question that Clause 3 shall stand part of the Bill.
Earl Russell: I wish to join the noble Baroness in opposing this clause. I wish particularly to draw attention to the point she made that we are discussing a no-fault scheme. That is something in which there are many advantages. As I have been accused of encouraging litigation I should say that the measure could have the effect of discouraging litigation. Other things being equal, I think that is worth doing.
Much of the justification we have been given for this change concerns the encouragement of occupational schemes. I have nothing against occupational schemes. I am a member of one, I approve of it and am extremely glad that I am a member. However, the difficulty that we have found with occupational schemes, not only in this country, is that they are not universal. In her interview with the Sunday Telegraph, the Prime Minister said that she did not want to hear ever again of the phrase "underclass". She thought that it was a horrid phrase, or words to that effect. I sympathise with that, but one must make the thing go away if one is to make the word go away. The category of people not eligible for occupational pensions comprise those who easily get pushed into the status of an underclass.
If we look at where occupational schemes are and are not available, we see that they are particularly rarely available in those small firms with fewer than 10 employees—the kind of firms that the Government rightly like to encourage. For them to have adequate security at work requires state backing. It is also difficult to spread adequate occupational schemes in the particularly dangerous occupations such as construction—again, a business which is not, largely, very organised in which people move about, work for limited periods of time as the job dictates and sometimes work for small firms.
It is also becoming painfully clear that a reliance on occupational schemes works to the detriment of women. There is therefore increasingly a category of second-class workers who are women, which is extremely undesirable and likely in the end, in

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roundabout ways, to cost a great deal of money to the social security system in the form of income support.
The noble Lord, Lord Carter, drew attention at Second Reading to the proportion of our population that relies on income support. I believe that the figure 1 quoted was 17 per cent. We should think about diminishing that figure. It is a fantastically high figure. The encouragement of adequate compensation for injury received would be one of many small ways in which we might chip away at that problem. For that reason, among many others, I am happy to support the noble Baroness.
Lord Boyd-Carpenter: I have a great deal of sympathy with what the noble Baroness, Lady Turner, said. I was responsible for the administration of the industrial injuries scheme for a period of six and a half years and therefore have some knowledge of its workings. I think I can say at this time that it was remarkable how few complaints were directed against it. It was thought to be and, I believe, was fairly and sensibly administered and worked extremely well.
However, it is no use crying over spilt milk. As has been said, not only the growth of occupational schemes but the growth of new benefits since then have developed in a way which is inconsistent with the then industrial injuries scheme. Plainly, it is being replaced, whether we like it or not, by those various alternatives.
I therefore rise only to say that I personally am sorry that successive governments—Labour governments as well as Conservative—have nibbled away at the industrial injuries scheme and that there is no longer the valid scheme that there used to be. It is therefore logical to go ahead with the steps proposed in the clause and, with a rather sad heart, I shall support it.
Lord Stallard: I hope that the noble Lord, Lord Boyd-Carpenter, will accept that I appreciate the work that he did in the old days of the workmen's compensation scheme. However, I had hoped to hear him say tonight that he opposed the abolition of the reduced earnings allowance. Its abolition virtually takes us back to those days of litigation, argument, responsibility and negligence of the workmen's compensation scheme. I thought that we had moved on from that. Beveridge certainly moved a chunk from that and, as the noble Lord rightly said, he moved another piece in the right direction. We are now going right back for no other reason, so it appears, than to save more money. It will not improve anything. In the main, the abolition of the REA is another cost-cutting exercise.
The reduced earnings allowance compensates many thousands of people for loss of earnings. It is not just a question of disability in the normal way; there is a reduction of earnings capacity. There is a great and necessary difference if a man who has been capable of earning decent wages finds that, because of the loss of a finger or leg, he can no longer command the kind of earnings to which has been accustomed and entitled. He therefore relies to a great extent on the reduced earnings allowance. It
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was a great step forward. Its abolition will be a retrograde step and I had therefore hoped that the noble Lord would have opposed the Motion that the clause stand part of the Bill.
Lord Henley: I have listened carefully to the arguments of the noble Baroness and my noble kinsman in opposing the Motion that the clause stand part of the Bill. There are good reasons for introducing the clause with which I shall deal in a moment.
Perhaps I may deal first with two questions of figures. I believe that the noble Baroness said that 146, 000 people would be affected initially. That is not the case. About 14, 500 new awards of REA are made each year. As she knows, all existing recipients will continue to have their benefit reviewed and uprated as of now.
Perhaps I may also correct my noble kinsman on one of his statistics. I believe he said that women in the workforce were less likely to be covered by occupational sick pay cover for long-term sickness. I can assure him that my right honourable friend the Minister of State, in Answer to a Written Question on 19th January this year from Mr. Alf Morris, stated that out of a total workforce of 22 million, it is estimated that just under 13 million—58 per cent.—have occupational sick pay cover for long-term sickness. That figure comprises 6-5 million men, which represents 54 per cent. of the male workforce and—this will interest my noble kinsman—6 million women which represents 61 per cent. of the female workforce. The figures are therefore the reverse of what my noble kinsman suggested.
Lord Stallard: Does the noble Lord accept that, although we understand that the present participants in the REA scheme will not lose entirely, their allowance will be frozen at the 1988 level at best so that, ultimately, they will lose?
Lord Henley: I thought that I had dealt with that matter. I have given an assurance that those benefits will continue to be reviewed as of now and uprated where a decision to uprate is made.
As the Committee will know, Clause 3 provides for the removal of entitlement to reduced earnings allowance for new claimants. That benefit is payable where a person loses earnings as a result of an industrial accident or the onset of a prescribed industrial illness.
Our provision for change in entitlement to reduced earnings should not be considered in isolation. Instead it should be viewed in the light of our overall proposals to improve the balance and structure of disability benefits as a whole. We are concerned to improve the structure of benefits for disabled people; to promote their independence where that is possible and sensible; and to balance the help given by different benefits so that more is given to those most in need, including especially those disabled at birth or earlier in life.
However, as well as ensuring that we make better provision to fulfil those objectives, we also have another objective—to avoid duplication with other

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sources of help. Here I have in mind the preferential help presently given through reduced earnings allowance. Most of those who receive that allowance and who are not working also receive the normal long-term national insurance benefit—invalidity benefit—which is available to those who are unable to work as a result of sickness or disability. Reduced earnings allowance is also paid for that incapacity to work. Abolition of that allowance will remove a clear overlap between benefit provisions for the majority of those recipients.
In putting forward that provision, the occupational pension rights of people who might otherwise have received retirement allowance, following receipt of reduced earnings allowance during their working lives, have also been considered.
People such as these who, on reaching retirement age, have chosen to leave full-time employment will have been able to earn additional pension rights both for invalidity benefit and retirement pension. So there are ways in which their retirement incomes will have increased. In addition we have been mindful of the circumstances of people who receive severe disablement allowance. So a new age-related addition is included in the Bill to increase payments to them.
The noble Baroness said that many industries were inherently dangerous. The Pearson Commission of 1978 recognised that that argument cannot provide a general justification for a separate scheme for all work injuries, even those caused by safe jobs. Furthermore, in so far as the argument is based on providing an economic incentive to do dangerous work, research has shown that payment only after an accident has occurred is something that people prefer not to think about. In any case, disablement benefit still provides a significant preference for those with occupational disabilities of 14 per cent. or more.
Finally, let me remind the Committee that, as I said before, this clause relates only to new claims. Present beneficiaries and those who establish new entitlements before the Bill becomes law will be fully protected. Neither will the provisions in the clause affect claims to disablement benefit. That benefit will continue to be paid for occupational disabilities assessed at 14 per cent. or more and the benefit will continue to be uprated on the same basis as now. For those reasons I commend the clause to the Committee.
Baroness Turner of Camden: I am not surprised at the Minister's response although I am a little disappointed by it. I was gratified to learn from the noble Lord, Lord Boyd-Carpenter, that he still felt at least some emotional attachment to the Industrial Injuries Scheme. I hope that that might cause him to support the stance that we take in relation to it on this side of the Chamber.
Frankly, I am not at all convinced by the arguments put forward by the Minister. As has already been stated by the noble Earl, Lord Russell, occupational schemes do not by any means cover everybody. In my experience in the main
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occupational schemes tend to cover white collar and staff workers much more frequently than they cover manual workers. It is manual workers and particularly those in industries such as the construction industry who are most at risk and most likely to require the provisions of the Industrial Injuries Scheme.
I note that the number of people involved is likely to be rather fewer than I had thought—14, 500—but on the other hand the Minister did not quarrel with the figures as to costs, which, after all, are stated in the financial memorandum; namely, that it will save £1 million and later on £40 million. As I said earlier, that is a very paltry sum of money.
As I also indicated, although people have the opportunity if they are injured at work to go to the courts should they consider that they have been injured as a result of negligence, if they succeed all their social benefits now come out of the money that they eventually receive. To my knowledge only 10 per cent. of the people who are injured succeed with their claims in the courts.
This is a no-fault system of compensation. I emphasise that. I believe that it is the only system of no-fault compensation that we have in this country. The noble Earl, Lord Russell, has already indicated the reasons why it should continue to be maintained and supported. In the circumstances I have no alternative but to divide the Committee on this issue.
7.4 p.m.
On Question, Whether Clause 3, as amended, shall stand part of the Bill?
Their Lordships divided: Contents, 81; Not-Contents, 55.

DIVISION NO. 3

CONTENTS

Alexander of Tunis, E.

Henley, L.

Allerton, L.

Hesketh, L.

Ampthill, L.

Hives, L.

Arran, E.

Hooper, B.

Auckland, L.

Hylton-Foster, B.

Belhaven and Stenton, L.

Jenkin of Roding, L.

Belstead, L.

Johnston of Rockport, L.

Blatch, B.

Joseph, L.

Blyth, L.

Lindsay, E.

Borthwick, L.

Long, V.

Boyd-Carpenter, L.

Lucas of Chilworth, L.

Brabazon of Tara, L.

Lyell, L.

Brookes, L.

Mackay of Clashfern, L.

Brougham and Vaux, L.

Mackintosh of Halifax, V.

Buckinghamshire, E.

Macleod of Borve, B.

Caithness, E.

Malmesbury, E.

Campbell of Alloway, L.

Margadale, L.

Carnock, L.

Merrivale, L.

Cullen of Ashbourne, L.

Monk Bretton, L.

Davidson, V. [Teller.]

Mottistone, L.

Denham, L. [Teller,]

Mountevans, L.

Donegall, M

Munster, E.

Dulverton, L.

Murton of Lindisfarne, L.

Eccles of Moulton, B.

Napier and Ettrick, L.

Elliot of Harwood, B.

Nelson, E.

Elliott of Morpeth, L.

Norrie, L.

Ferrers, E.

Orkney, E.

Fraser of Carmyllie, L.

Orr-Ewing, L.

Gardner of Parkes, B.

Pender, L.

Hailsham of Saint Marylebone, L.

Penrhyn, L.

Portsmouth, E.

665

Reay, L.

Swinton, E.

Rodney, L.

Teviot, L.

Saltoun of Abernethy, Ly.

Thomas of Gwydir, L.

Sanderson of Bowden, L.

Ullswater, V.

Selkirk, E.

Vaux of Harrowden, L.

Skelmersdale, L.

Vinson, L.

Stokes, L

Wise, L.

Strathmore and Kinghorne, E.

Wyatt of Weeford, L,

Wynford, L.

Sudeley, L.

Yarborough, E.

Suffield. L.

NOT-CONTENTS

Addington, L.

McNair, L.

Blackstone, B.

Mason of Barnsley, L.

Bonham-Carter, L.

Mayhew, L.

Carter, L.

Monkswell, L.

Cledwyn of Penrhos, L.

Morris of Castle Morris, L.

Clinton-Davis, L.

Nicol, B.

Darcy (de Knayth), B.

Northfield, L.

David, B.

Pitt of Hampstead, L.

Davies of Penrhys, L.

Raglan, L.

Dean of Beswick, L.

Richard, L.

Dormand of Easington, L.

Ritchie of Dundee, L.

Feversham, L.

Rochester, L.

Fisher of Rednal, B.

Ross of Newport, L.

Graham of Edmonton, L. [Teller.]

Russell, E.

Ryder of Warsaw, B.

Grey, E.

Seear, B.

Hampton, L.

Serota, B.

Harris of Greenwich, L.

Shackleton, L.

Hatch of Lusby, L.

Stallard, L. [Teller.]

Hooson, L.

Stoddart of Swindon, L.

Houghton of Sowerby, L.

Taylor of Blackburn, L.

Jay, L.

Tonypandy, V.

Jeger, B.

Tordoff, L.

Jenkins of Putney, L.

Turner of Camden, B.

John-Mackie, L.

Underhill, L.

Kirkwood, L.

Wedderburn of Charlton, L.

Lloyd of Kilgerran, L.

Williams of Elvel, L.

Lockwood, B.

Willis, L.

Resolved in the affirmative, and Clause 3, as amended, agreed to accordingly.
7.12 p.m.
Baroness Blatch: I beg to move that the House do now resume. In moving the Motion, perhaps I may suggest that the Committee meet again not before ten minutes past eight.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Employment Bill
Brought from the Commons; read a first time, and to be printed.

Australian Constitution (Public Record Copy) Bill
7.13 p.m.
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I beg to move that the Bill be now read a second time.
On 5th April this year I informed your Lordships' House that the Government intended to make it possible to hand over to the Commonwealth of Australia, as a gift, one of the two vellum copies of
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the Act of Parliament which brought Australia into being as an independent nation. The introduction of this Bill in another place on Anzac Day was a first step towards the fulfilment of that undertaking. I am pleased to be able to inform your Lordships that on the occasion of its Second Reading on 3rd May, this modest Bill was unanimously welcomed by all sides, and that on that day it completed all its remaining stages in the other place.
The Public Record copy of the Australian Constitution Act 1900 is already in Australia on loan. The effect of this Bill will be to release that copy from the provisions of the Public Records Act 1958, thereby enabling Her Majesty's Government to accede to the Australian Government's request that it should remain there permanently.
It may be helpful to your Lordships if I explain that there are two copies of the Australian Constitution Act 1900, which were printed at the time on vellum. One is held in the Record office of the House of Lords as the official record of Parliamentary proceedings. The other is the Public Record office copy, which has, as I say, been on loan to Australia for the past two years. The Act established the framework for the Commonwealth of Australia, including the powers of its Government and judiciary, and its provisions have remained relatively unchanged since its enactment. The Act was drafted by Australians and was endorsed at the time by a majority of Australians and by each of the Australian parliaments and governments.
The Australians already hold a duplicate original of the Royal Proclamation, signed by Queen Victoria, which brought the Act into force on 1st January 1901: and a duplicate original of the Commission of Royal Assent to the Act, which was also signed by Queen Victoria. The provision of the Public Record office copy of the Constitution Act on a permanent basis will, therefore, complete the trinity of documents which, taken together, represent Australia's birth certificate as a nation. Far from being a dimly remembered historic document, the Act is regarded by Australians as the embodiment of Australian nationhood, containing provisions which remain as relevant now as they were 90 years ago.
There has been a great deal of interest shown in the document by the Australian people. Since the Public Record copy of the Act was lent to Australia for the Bicentennial in 1988, over 2 million visitors have had the opportunity to see it on display in Parliament House in Canberra. On a personal note, it gave me great pleasure to be able to view the document when I visited Australia in 1988 on the occasion of the inaugural sittings in the new Parliament House. I had the chance to witness, at first hand, the great interest shown by the Australian people in the copy of the Act. I am sure that there can be no doubt of the depth of feeling which lies behind the request to hold a copy of the Act permanently.
The Government recognise of course that the arguments against the disposal of any of our public records are also strong. Among my various duties as Lord Chancellor, I have ministerial responsibility for the supervision and care of our nation's public records under the provisions of the Public Records

667
Act. I take those responsibilities very seriously. Public records are an important part of this country's heritage and form an integral and unique collection which go back a very long way. The dispersal of material from our national archive is therefore not a step that can be lightly agreed to. But, in view of the special circumstances of the Australians' request, including the fact that the people of Australia have become accustomed to having easy access to the document, and the fact that minds are presently focused on old ties between our countries, the Government have decided that it would be right to find a way to offer the document to the Commonwealth of Australia as a gift, and I so informed this House by Written Answer on 5th April. My right honourable friend the Prime Minister has now written to Mr. Hawke offering a gift of the document and that offer has been warmly accepted.
As things stand at present, the copy of the Act is a public record selected for permanent preservation under the terms of the Public Records Act 1958. The provisions of that Act do not allow for gifts or permanent loans of records to be made. This Bill will make it possible for the document to be released to the Commonwealth of Australia by providing that this vellum copy of the Act alone ceases to be among the United Kingdom public records to which the Public Record Act applies. The Bill has been drafted in such a way as to make it clear that this change in status refers, and is intended to refer, to this one particular document alone. The preamble refers to Her Majesty's Government's willingness to advise Her Majesty to accede to the Australiam Government's request.
This Bill will not technically make the gift but will rather make it possible. Subject of course to Parliamentary approval for the course of action the Bill proposes, there will be—as my right honourable friend the Solicitor-General said in another place—an ideal opportunity formally to hand the document over when my right honourable friend the Lord President of the Council visits Australia on offical business this summer. To make sure that proper arrangements can be made in time for that visit, the Bill will proceed rapidly, I hope so that Royal Assent may be obtained before the Summer Recess. It is also desirable that the Bill should come into force without the usual two-month interval after Royal Assent.
The effect of this short Bill will be to make possible a gesture which means a great deal to the people and Commonwealth of Australia, a nation with close and long-lasting legislative and constitutional links with our Parliament. We at Westminster should welcome this opportunity to recognise the Australian commitment to Parliamentary democracy which endures within a framework that the 1900 Act set up. I am sure that we in this House will wish to reiterate the many warm tributes paid in another place to the respect, friendship and high regard which we feel for the people of Australia. They are among our closest neighbours in all but the geographical sense. The gift of a copy of the Act is a symbol of the history, heritage and traditions which we share
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and of our friendship. I therefore commend the Bill to your Lordships' House.
Moved, That the Bill be now read a second time.—(The Lord Chancellor.)
7.20 p.m.
Lord Cledwyn of Penrhos: My Lords, we are grateful to the noble and learned Lord for explaining the Bill. I can say at the outset that we on this side of the House support it most warmly and will do everything to expedite its passage. It is entirely appropriate that the Commonwealth of Australia should receive one of the two copies of the Act of Parliament that gave birth to Australia as an independent nation. We know how much the Australian Government and people appreciate the gesture. Someone called the Act "the nation's birth certificate". To give the copy to Australia will strengthen the links between our two countries and not weaken them.
The noble and learned Lord gave the House some interesting information in his speech. The more one reads about the Act—which was drafted by the Australians and endorsed by a majority of Australians—the more one appreciates the importance of the presentation. The participation of Australia in the processing of the Bill was unique in the history of the Commonwealth. When he expressed his gratitude for what he referred to as "this unique gift", Mr. Bob Hawke, the Australian Prime Minister, said that it followed six years of negotiation. It is curious that it should have taken so long but, as we know only too well, few things are more difficult to unravel than constitutional problems.
As the noble and learned Lord has explained, one of the copies of the Act belongs to the Public Records office; that is, to the state. The other copy belongs to Parliament. Furthermore, it was feared by some that a precedent would be created which might in due course involve other countries. Parliament's copy, which is kept in the Record office of this House, forms part of an unbroken archive going back to the 15th century. The noble and learned Lord quite properly stressed the historic importance of that archive.
Those and other obstacles had to be overcome before the Bill made its appearance. That was achieved with good will on all sides. However, many people were involved in the negotiations and I should like to thank them warmly for their persistence and congratulate them upon their success.
On the Australian side, the Prime Minister, Mr. Hawke, and his colleagues, including the Australian High Commissioner in London, made plain their aspiration that one copy should rest in Canberra. Mr. Hawke's address to the parliamentary ANZAC group last June and an article he wrote for The Times in February underlined the strength of the case and the feeling which existed in Australia.
On the British side a number of our parliamentary colleagues in both Houses played their part in the achievement. But none has been more enthusiastic or determined than my right honourable friend Mr. Alf Morris. He is the chairman of the parliamentary

669
ANZAC group and we owe him a debt of gratitude for the skilful way in which he prepared his case. As we know, in February in another place he introduced a Private Member's Bill supported by a number of distinguished colleagues. It could well be called the "Australian Constitution (Alf Morris) Bill".
Finally, I wish to pay tribute to the noble and learned Lord the Lord Chancellor. Throughout he has been a sympathetic supporter of the Australian aspiration. From the moment that he was apprised of the problems the noble and learned Lord sought constructively for solutions. The Bill is largely a result of his work.
We are privileged to live in remarkable times when people throughout the world are yearning for freedom and for stable, democratic institutions. The Bill does more than authorise the handing over of an historic document; it teaches the world a lesson because it demonstrates how dedicated nations can be to these great principles and how determined they are to preserve them. We wish the Bill a speedy passage through the House.
7.25 p.m.
Lord Donaldson of Lymington: My Lords, I rise conscious that I am about to strike a slightly discordant note. I must express my dismay at the Bill and make it clear that in doing so I speak not as a serving judge but as the 69th Master of the Rolls. That office came into existence in or about the 13th century when the Master of the Rolls was the Royal Archivist and, if I am not mistaken, the Lord Chancellor's predecessor was the Royal Chaplain. However, since those times successive holders of my office have always had a primary responsibility for public records which has been shared with the holder of the office of Lord Chancellor since 1958.
I am not alone in my dismay. When in 1958 the custody of records was transferred from the Public Records office to the noble and learned Lord the Lord Chancellor, Parliament in the statute established an advisory council on public records to advise him. As Master of the Rolls I am the ex officio chairman of that council. At a recent meeting of the council, all members present, with one exception, expressed the view that the principle of the inviolability of the public records should be defended and that objections should be made both to the particular intention embodied in the Bill and to the general implications of it. That advice was conveyed to the noble and learned Lord the Lord Chancellor but was rejected by the Government. It is not for me to express any view as to the public interest; and considerations of Commonwealth unity and so forth, although I full appreciate those aspects. My concern is with the public records as such. A similar view was expressed by the National Archives Council. I know of no body concerned with public records and archives which, despite the special circumstances, does not believe that the Bill is a mistake.
Since time immemorial Acts of Parliament have been recorded in two separate copies. As the noble and learned Lord has said, one copy is kept in the Houses of Parliament and it is Parliament's own
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copy. The other copy is kept in the Public Records office and it is not too fanciful to describe that as the people's copy. It was the people's copy which was sent to the Commonwealth of Australia on temporary loan in connection with the bicentennial. Such a loan is authorised by Section 2(4) of the Public Records Act 1958. The Commonwealth was also supplied with two very high quality facsimile copies, but it' now wishes to retain the original.
I understand that the Commonwealth was offered an exemplification of the Act under the Great Seal and attested by the Signed Manual but that the offer was not acceptable. I should explain that exemplification is not a new-found gimmick to get out of the difficulty. It was common during the Middle Ages and the exemplification of public Acts of Parliament continued until the reign of Queen Anne who died in 1714. If it was revived it would be the most prestigious version possible after the original. Indeed, unlike the original it would be unique.
I fully appreciate the importance which the Government and the people of Australia attach to their Constitution Act. I support fully everything that was said by the noble and learned Lord the Lord Chancellor about the greatness and importance of Australia and the naturalness of its desire to have the document. However, it should also appreciate the importance which we attach to maintaining an unbroken collection of our records. Although drafted in Australia it is a United Kingdom Act. As far as I am aware never before in our history have we parted with such a record.
We are assured that the Bill will not set a precedent, but I ask, why will it not? Other nations which used to have colonial status may not be able to make a special case this year. However, I am sure that they will be able to do so in years to come.
There are some 107 United Kingdom statutes in force which relate to Commonwealth and other territories. If we are talking about national birth certificates—and I take only those of the 107 which have the word "independence" in their title—we are faced with those relating to the Bahamas, Barbados, Botswana, Burma, Ceylon, the Federation of Malaya, Fiji, Gambia, Guyana, India, Jamaica, Kenya, Lesotho, Malawi, Malta, Mauritius, Nigeria, Sierra Leone, Swaziland, Tanganyika, Trinidad and Tobago, Uganda and Zambia. That leaves out constitutional Acts relating to Canada, New Zealand, South Africa, Bangladesh, Pakistan, Zimbabwe and a host of other new independent nations.
It is clear from what the noble and learned Lord the Lord Chancellor said that it is too late to persuade the Australian Government to accept an exemplification. However, all else failing, perhaps the noble and learned Lord the Lord Chancellor in his reply could undertake to arrange for an exemplification of this Act to be included among our own public records, although that will not overcome the problem of a break in those centuries old records. If that is asking too much, perhaps the people of this country will be allowed to have a high grade facsimile for inclusion in those records.
As I say, I realise that I am a lone voice crying in the wilderness. However, I hope that if anybody is

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minded to reform this House, a little place will be left for the lone voices crying in the wilderness from the Cross-Benches.
7.31 p.m.
Lord Shackleton: My Lords, I thought that I was here to welcome a Bill. I feel singularly ill-equipped to start debating this issue with the Master of the Rolls. I am happy to leave that to the noble and learned Lord the Lord Chancellor. However, this is a sovereign Parliament and we can do what we judge is right. We shall override precedents.
The noble and learned Lord the Lord Chancellor has played a crucial part in this issue, as has my right honourable friend the honourable Member for Wythenshawe, Mr. Alf Morris, in bringing this to our attention. I should like to point out the support which he had in another place. When he introduced his Bill, which was rather longer than this, the following Members were signatories to the Bill—and it would be difficult to find a group of supporters more representative of a British Parliament: Sir Bernard Braine, the right honourable Denis Healey, the right honourable Sir David Steele, Sir Richard Body, the right honourable Merlyn Rees, Margaret Ewing, the right honourable Jack Ashley, Neil Hamilton, the Rev. Martin Smyth, Robin Corbett and Dafydd Wigley. Those Members are a splendid cross-section of the House of Commons. I hope that we shall show our enthusiasm for a Bill which is clearly thought to be important by the Australians.
Nobody in this House speaks for anybody but himself of herself but I speak as a former chairman of the Britain-Australia Society and a former chairman of the Cook Society of which the noble Viscount, Lord Caldecote, who had hoped to be present this evening is the present chairman. That is a British Australian society both in Australia and here. We are shortly due to have a meeting, which we have every year or two, to discuss issues of common interest. Many of us can remember Australia during the war. I can still remember an air crew coming in which would be wearing RAF blue and one would then see the dark blue uniform of an Australian. Very of ten, the navigator was an Australian. Whether that was because they were intellectually superior I do not know. However, they were a great moral strength to us.
We are very conscious of that and it is so nice to see Australians in this House. We remember Dick Casey who was a regular attender and we are lucky to have the noble Baroness, Lady Gardner, and the noble Lord, Lord Willis, here. Indeed, I wish that there were more Commonwealth representatives in the House of Lords; perhaps the noble and learned Lord the Lord Chancellor might care to bear that in mind.
Those of us who know Australia are deeply devoted to it. We had Australian friends during the war and we knew how important they were to us. It is a marvellous country. In the Kimberleys one finds the crocodiles which are fairly fierce but not as fierce as some of the animals around the coast. We remember the wonderful surf. I went surfing on a day which was too cold for the Australians on a
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beach in Perth and acquired the title of "Lord of the Board". Australia has everything. If I were not living in England that is where I should choose to make my home. So many of us feel the same way.
The importance of this Bill cannot be overrated. I believe that the noble and learned Lord the Lord Chancellor took a brave decision on this matter because it was open to criticism. I do not believe that the noble and learned Lord, Lord Donaldson, need worry about being alone. He had the backing of his council which advised him, but Parliament decided otherwise.
The fact that the Prime Minister and so many Australians attach so much importance to this matter justifies us taking this step. I do not believe it is too political to congratulate Mr. Hawke on winning another election. He is a fair competitor to our Prime Minister on these matters. I hope that it would be proper through the High Commissioner Doug McClelland, who is a popular figure, to send good wishes for a rapid recovery to Bob Hawke who has recently had quite a severe operation. I am sure that the House of Lords will pass this Bill although we do not dismiss lightly the view of the noble and learned Lord the Master of the Rolls. The fact that we have chosen to override his opinion makes greater the gift.
7.37 p.m.
Lord Auckland: My Lords, although my family symbol represents the kiwi rather than the koala bear, I give this Bill a very warm welcome. We are very much obliged to my noble and learned friend the Lord Chancellor for his very clear exposition of the Bill.
I was in Australia three years ago as a guest of the Commonwealth Parliamentary Association. Anyone who has been to Canberra and who has seen the war grave cemetery will realise how much we owe to the Australians for the sacrifices they made in two world wars and elsewhere. I should like to associate myself with the tributes paid to the right honourable Member for Wythenshawe as chairman of the ANZAC parliamentary group of which I have the honour to be a member. He has contributed a great deal to Australia and to New Zealand where he was deservedly decorated recently.
It may be said that this Bill breaches certain conventions. Public records are not always given to another country. I suppose that one might facetiously say that New Zealand might want back the Treaty of Waitangi in due course although I believe that that is unlikely. This is a special case and, as I understand it, there will still be an original copy in this country besides the copy going to Canberra. It is true that as the Commonwealth becomes increasingly self-governing, Australia is entitled to an important document of this kind.
There is no doubt that the ties between Australia and ourselves remain very strong; certainly when I was there three years ago, with five colleagues from the House of Commons, that was made quite clear. It is absolutely right that the copy of the Australia Constitution Act should be returned to Australia. I should like to pay a particularly warm tribute to the

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High Commissioner, whom I first met in Canberra when he was president of the Senate.
Far from creating problems over our links with Australia, the Bill will further closer relations between ourselves and a country to which we owe so much.
7.40 p.m.
Lord Willis: My Lords, my noble friend Lord Shackleton was kind enough to link me with two Australians, the late Lord Casey, and the noble Baroness, Lady Parkes. I wish I were an Australian. I feel that I have been there so of ten that I am one; alas, I am not.
Last year I was fortunate enough to go for the second time to Parkes, the little town where the noble Baroness was born. When I heard of this Bill I felt that if Australia were kind enough to give us the noble Baroness, Lady Parkes, the least we could do was to return their constitution. That is a fair swap.
I should like to welcome the Bill. I add my congratulations to Alf Morris, the Member for Wythenshawe, for his work on the Bill, and to the noble and learned Lord the Lord Chancellor who cut through a few Gordian knots to achieve the result that we all seek.
This morning I received a phone call from the third member of the team that worked so hard for the Bill, Doug McClelland, the High Commissioner. He asked me to convey his greetings to the House. He is sorry not to be listening to the debate: but he is at a function in London trying to promote Melbourne as host either for the next Olympic or Commonwealth Games. I hope that those efforts are not successful; I believe we have other plans.
I warmly welcome the Bill and congratulate all those who have made possible its coming before the House.
7.42 p.m.
Lord Stoddart of Swindon: My Lords, I too should like to give a warm welcome to the Bill, the passing of which will give great pleasure and satisfaction to the people and Government of Australia. I have a particular interest in the Bill for two reasons. First, I am treasurer of the ANZAC group. This is a case where the Commons needs the consent of the Lords before expending any money. Secondly, my daughter and son-in-law emigrated to Australia where they and their family have enjoyed 22 happy years.
I should also like to refer to the role of my right honourable friend Alf Morris in bringing the Bill to fruition. When Bob Hawke was in Britain last June he came to a meeting of the ANZAC group and asked for its help in obtaining one of the two vellum copies of the 1990 Act for his country on a permanent basis. Alf Morris, who is the chairman of the ANZAC group, took immediate steps to comply with that request.
He first approached Sir Robin Butler, the Cabinet Secretary, but the response from Sir Robin was not encouraging. Many lesser men would have decided to proceed no further in the light of the dusty answer from the most senior civil servant. However, my
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right honourable friend is well known for his quiet determination. He subsequently produced his own Bill to facilitate the transfer to Australia of one of the original copies of the Australia Constitution Act 1900.
However, Alf Morris wanted the Bill to have unanimous support—and that is important. He, together with Sir Richard Body, the vice-chairman of the ANZAC group, saw the noble and learned Lord the Lord Chancellor to discuss the matter, with the result that we now have before us a Government Bill which has the near unanimous support of Britain's Parliament. I am sure that we all wish to thank the noble and learned Lord the Lord Chancellor for his courteous consideration and sheer common sense in bringing the Bill to fruition.
This country and its people should feel pleased and gratified that the people of Australia—two million of whom have already taken the trouble to have a sight of the 1900 Act—want to have in their own country the Act which, while giving independence to Australia, nevertheless bound our countries closer together in freedom and amity.
It is my wish, and that of most British people, to preserve our relationship with Australia and to strengthen ties rather than loosen them. Seventeen years in the alien EC have not altered our feeling of kinship with Australia nor for that matter with other countries of the Commonwealth. The present High Commissioner—His Excellency Doug McClelland—has done a great deal during his term of office to build new relationships and rebuild old ones. Above all he has convinced British people in all walks of life that Australia is not going to walk away from our special relationship but will instead seek to extend that relationship through increased trade and other ways.
Finally, Bob Hawke, to whom we all wish a speedy recovery from his recent operation, said in his Times article of 22nd February 1990:
"When the constitution was enacted, Australians became one people. It would be fitting if by 2001—Australia's centenary of federation, the first major celebration of our constitutional nationhood—the Act had a permanent home in Australia to serve as the focal point for the celebrations".
All I can say is, "Bob, we've done yer proud, cobber—you've got it 10 years early."
7.47 p.m.
Lord Monkswell: My Lords, I rise as a humble Back-Bencher with no official relationship to Australia to welcome this Bill and this Second Reading debate. It is interesting that we had the contribution from the noble and learned Lord, Lord Donaldson of Lymington. It is important that we listen to the information that he has given and take it on board. The historical continuity of records is important.
As the noble Lord, Lord Shackleton, pointed out, we are a sovereign Parliament. We can make decisions and change precedents that existed before. In the opening remarks of the noble and learned Lord the Lord Chancellor there was one aspect which jarred a little because it impinged on the sovereignty of Parliament. I shall have to read the record

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tomorrow in Hansard, but I thought I heard him say that the Prime Minister had told Bob Hawke that he was to receive the copy of the Australia Constitution Act permanently. That was before Parliament has considered the Bill. It is not very constructive for a Prime Minister effectively to presume what Parliament will do. The Government may propose but it is Parliament that disposes.
That is one reason that I rise to support the Bill. It is an example of democracy in action. It is an example of our responding to the wishes of the people of Australia, through the persistence and the good offices of Alf Morris, MP, regarding something which is obviously important to them.
Here I should like to say a few words about Alf because I am a councillor in his constituency. I know him as a dedicated constituency Member of Parliament. The nation knew him as a Minister for the Disabled. It is curious that, although in opposition, Alf sometimes has more clout in matters concerning the disabled than even government Ministers. However, in this respect we see him playing an international role. It is a role that we should recognise as significant.
The noble Lord, Lord Shackleton, said that all parties were represented in the list of supporters that Alf Morris had for his original Bill on the subject. It is worth pointing out that not only were all parties represented but all the countries of the United Kingdom were represented. That is also significant. Therefore, we have in front of us a Bill promoted by the noble and learned Lord the Lord Chancellor and I pay tribute to him for, as was said earlier, cutting the Gordian knot and bringing the Bill before us.
We must all pay tribute to Alf Morris and recognise that in giving the Bill a Second Reading—I am sure that it will receive no impediment in its passage through Parliament—we are effectively acting in a democratic fashion. It is perhaps curious to use that sort of language in this House, but we are listening to the will of the people, expressed clearly by the Australian people and their Government, and we are acting on it. I am sure that there will be no impediment to the passage of the Bill through Parliament.
7.52 p.m.
Lord Teviot: My Lords, my name is not on the list of speakers but the authorities have been informed that I intend to speak. It has been a most enjoyable debate. I agree with every point made by the noble and learned Lord, Lord Donaldson of Lymington. I must qualify that, but before doing so I should explain that I have been to Australia three times in the past decade. If I was given an excuse to go again I could not go immediately; it would have be tomorrow evening because the planes do not leave until then or perhaps slightly earlier, at lunch time. It is a most delightful country. However, that is not an important point to make.
I was on the Advisory Council of Public Records between 1974 and 1982. I had one meeting with the noble and learned Lord, Lord Donaldson, but that was only personal and one must forget that.
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Whatever excellent arguments have been offered, whatever time and whatever the circumstances, in a highly disciplined area, if one visits as a breeder, one must have all the documents correct. It is one of the most disciplined areas, even more than the law, with respect to the noble and learned Lord, Lord Donaldson, and my noble and learned friend.
Excellent arguments have been put forward in regard to this document of 1901, but I feel that, when it was struck it should have remained in this country. However, the Bill went through all its stages in the other place and we are fortunate to have it before us on Second Reading. I see that I am being looked at rather severely. of course I absolutely approve of Australia but I hope that this Bill, although a precedent, will not be repeated for other constitutional documents.
7.55 p.m.
Baroness Gardner of Parkes: My Lords, my name is not on the list of speakers because I thought that I would still be in Australia and I have only just returned. Knowing that the Bill was coming forward for Second Reading I thought that it would be wrong if I did not add my voice to the debate, because it is a significant matter.
I thank the officers of the ANZAC group for bringing this matter to Parliament in the first instance and for moving matters along in the way that they have. I echo the tributes paid to Doug McClelland. He has been oustanding.
This has been a valuable debate. It is fascinating to notice the speakers in the debate. I first refer to the noble Lord, Lord Shackleton, who earlier this year was given the highest award, the Order of Australia. He spoke of what he had done as if it were nothing, but he has done an enormous amount to cement relations between our two countries.
Noble Lords: Hear, hear!
Baroness Gardner of Parkes: My Lords, the noble Lord, Lord Willis, referred to Australia and I thank him for his nice remarks. The noble Lord is almost an honorary Australian. I wish that I could spend as much time in Australia as he does. He makes regular trips. I am sure he will know what I mean when I say that the one advantage Parkes feels that it has over Forbes is having a Baroness. There is much rivalry between those two small country towns.
Sir Henry Parkes, after whom Parkes was named, was one of the fathers of the federation and was very much involved in the early work in that respect. That makes this Bill of special significance for me. My own father, Greg McGirr, who was born in 1879, in Parkes, as I was, was one of the very first candidates for the federal elections. Being a dutiful daughter I never questioned that when he told me, but apparently he stood on a combined ticket with several members being elected at the same time. They were not one-member constituencies. I think he may have stood for the Senate, but some day I must check the accuracy of all that. Nevertheless, I believed what he said. He was very young—he said that he was one of the youngest candidates—for the

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very first federal elections. Unfortunately, he was unsuccessful. I know that within about 10 years he was a member of the state parliament so I have no reason to doubt what he said. As I said, I must check that one day.
I was also interested in the speech of the noble and learned Lord, Lord Donaldson, the Master of the Rolls. I hope that the noble and learned Lord the Lord Chancellor will give the House an undertaking that the Public Records office will be made complete again. It is important to realise that in giving this gift to Australia—I thoroughly approve of it; it is a marvellous action which I know will be much appreciated—we should not overlook the fact that for some Australians it is easier to get to London than to Canberra. Therefore, the Public Records office, which has been described as being the people's office, should contain a complete record. It would be a loss for Australia too if a copy in some form is not kept in the Public Records office.
The suggestion of a good photocopy—if that is the best that can be done—would at least keep the records, complete. Perhaps the Lord Chancellor will tell the House whether the House of Lords copy would automatically be available for people to view or whether ordinary members of the public can only see such documents at the Public Records office. I do not understand the detail of that point. However, if we ended up with only one original in this country and no copies, that would be a loss. I am very much in favour of a copy being held in Australia. I welcome that. I am glad that circumstances brought me back to London early enough to join in the debate tonight. I feel privileged to be a Member of this House. I support the Bill.
7.59 p.m.
The Lord Chancellor: My Lords, I say at once that there is no question of ignoring the advice of the advisory council, to which my noble and learned friend the Master of the Rolls spoke and to which my noble friend Lord Teviot also drew attention. I was, and have been all along, extremely conscious of the importance of our public records and the completeness of its archives with these prepared vellum copies; one of which goes to the Record of Parliament—which is not so readily accessible to the public—and the other to the Public Records office.
We are anxious, if possible, to meet the Australian desire and at the same time to preserve intact our public records. That was the reason we thought of the exemplification to which my noble and learned friend has referred. It would bear a very special authentication. It would be an extremely high quality copy of the original Act. In a sense there is no such thing as the original because they are all copies. It is only a question of which copy one wants.
It was made clear to me—and I took some time indicating to the Prime Minister of Australia—what was involved in exemplification and how good it was. The emotional appeal of the copy which had been loaned built up and nothing would be quite like that in the estimation of Australians. It was in the light of that and after carefully weighing what had been said by the advisory council that we gave
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effect to what the advisory council said to the following extent: we made it absolutely plain that the legislation refers only to the single Act and the Bill is restricted to that Act. We shall certainly discuss with the advisory council the appropriate form of copy. It will be very simple to provide one. We shall decide the precise nature of it and we shall certainly discuss what it will be. As far as possible I shall endeavour to meet that point.
In a sense the signatures of Her Majesty Queen Victoria to the Royal Proclamation bringing the Act into force and her signature on the original copy, if I can use that expression, of the Royal Assent, which itself is unique, constitute original documents. Australia wished to have that and in all the circumstances we thought it right that it should do so. That conclusion was reached only after giving the most careful consideration to what the advisory council said, bearing very much in mind the interests of our public archives.
The noble Lord, Lord Monkswell, was right when he thought I said that the Prime Minister had written offering a gift to the Commonwealth of Australia, subject to the legislation going through. It was absolutely apparent to Mr. Hawke that it was impossible for us to give outright the Public Record office copy without legislation. There was some suggestion that we could provide what is sometimes called "a permanent loan". I have never been clear what that is. I took the view and also received advice that it was not possible for me, on my own initiative, to make a permanent loan under the terms of the Public Records Act.
This matter has been the subject of negotiation with Australia. The Prime Minister told Mr. Hawke that we had reached the conclusion that the best way forward was by way of a gift and that the necessary legislation for that would be put before Parliament.
I am extremely grateful for all the kind things that have been said about me. I have simply endeavoured to do what seemed right in the circumstances, including considering carefully the advice tendered to me by my noble and learned friend the Master of the Rolls as chairman of the advisory council. His office puts him in that position. I carefully considered not only the thrust of what was said but also the details. As far as possible I endeavoured to give effect to it in the wording of the Bill.
I join also in thanking all those who have participated. One great advantage of the Bill proposed in the other place by the right honourable gentleman Mr. Alf Morris is that it was made apparent how strong and widespread was the support for this legislation. That was a factor in deciding how we should take it forward. I also thank the High Commissioner and his staff. It is also fair to say that at the time he approached Sir Robin Butler negotiations were proceeding. It may be that their precise nature was such that it was right to pursue them in the way that he ultimately did.
It was very clear that the Prime Minister of Australia was very anxious to secure this document. I am very glad that, subject to the approval of Parliament, we shall be able to accede to his request. I am sure that all noble Lords will join the noble

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Lord, Lord Shackleton, in wishing him a very speedy recovery.
Therefore, it is with some confidence, though fully appreciating what my noble and learned friend the Master of the Rolls has said, that I invite your Lordships to give this Bill a Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
Viscount Ullswater: My Lords, I beg to move that the House do now adjourn during pleasure until 8.10 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 8.7 to 8.10 p.m.]

Social Security Bill
House again in Committee.
Clause 4 [Computation of additional pension for purposes of invalidity pension etc.]:
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 16:
Page 6, line 29, at end insert:
("(4) The Secretary of State shall lay before both Houses of Parliament a report on the expected long-term increase in the balance of the national insurance fund resulting from the provisions of this section and his proposals for applying that increase for the purpose of improving benefits for people with disabilities and those caring for them.").
The noble Baroness said: In moving this amendment, I should like to speak also to Amendment No. 16A, as the two amendments are grouped. Clause 4 is probably the biggest benefit cutting provision in the entire Bill. It amends Sections 14 to 16 of the Social Security Pensions Act 1975, whch relate to the computation of the earnings related additional pensions payable with invalidity pension.
Section 14 of the Social Security Act 1975 provides that the weekly rate of invalidity pension is calculated according to a formula similar to that used for calculation of Category A retirement pension. Clause 4(1) of the Bill inserts a new subsection specifying that the relevant tax year used in the calculation is any tax year between 1978-79 and 1990-91 in a period in which a person is over 16 and which ends with the tax year before the tax year in which the person qualified for invalidity pension. This has the effect of ensuring that no year after 1990-91 will count towards the calculation of the earnings related addition, while preserving rights accrued between 1978–79 and 1990–91.
By the end of this century the Government think they will have saved around £350 million. It may very well be a great deal more than that, depending on what the rise in wages will be, as this is an earnings related supplement. If fact some of the organisations looking after the disabled calculate that the savings may well be £2 billion a year in the long run and about £1 billion in 20 years from now.
The money is being taken away from the long-term sick and disabled. The Government claim that they are improving benefits for those disabled early in life. In doing so, however, they are making those pay for it who become disabled at a later age. That is not acceptable. It is the usual game of making the already disadvantaged pay for the very poor or those even worse off. If there are savings to be made they should not be achieved in this way.
Amendment No. 16 would bind the Secretary of State to report on what is being done with the savings and would in a sense earmark the savings for the use of the disabled and those caring for them. Incidentally, these would be savings on the National Insurance Fund. The record of the Government in regard to the National Insurance Fund is open to a good deal of question. The orginal Beveridge conception was that this should be funded from contributions from employers, employees and the Treasury. In 1979 the Treasury supplement accounted for about 18 per cent. Since then it has been gradually reduced and in the most recent Social Security Act was discontinued altogether on the grounds that the fund was in surplus and the Treasury contribution was no longer required. Then the Government used the surplus by way of bribes to encourage people to leave SERPS and to take up private personal pensions. Now savings are to be made from the fund at the expense of the long-term disabled.
Perhaps I may say a little about the reasons for Amendment No. 16A. The object of the amendment is to establish whether the Government are correct in claiming, as they do in their paper The Way Ahead, that there has been a rapid growth of long-term occupational sick pay schemes and that the coverage is now nearly 60 per cent. However, this is not altogether borne out by independent research. According to a survey conducted in 1988, while it is apparently true that 56 per cent. of employees are covered by some form of formal long-term sick pay scheme, the spread of such schemes is very uneven. Nearly everyone in the public sector is covered in some way or other but only 39 per cent. of employees in the private sector are covered. For those working for firms with fewer than 10 employees the proportion covered falls to only 10 per cent.
Coverage is particularly low among private firms in what are described as hazardous industries, a matter with which we dealt in the previous amendment. I refer to hazardous industries such as construction, mining and quarrying. Only 4 per cent. of those firms have formal long-term sick pay schemes and only another 3 per cent. say they might make discretionary payments. Those people are most likely to be in need of long-term sick pay and yet they are least likely to get it.
Even where a firm has a scheme, it does not automatically follow that all employees will benefit from it. The survey to which I referred found that 38 per cent. of schemes excluded recent employees. The qualifying period of service was typically six months to 12 months. Manual workers were frequently excluded altogether—that was the case in 18 per cent. of large manufacturing establishments—while another 25 per cent. excluded

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non-salaried staff. Part-time workers were also excluded by 13 per cent. of the schemes. The noble Earl, Lord Russell, made reference in the previous debate to that and to the effect upon women workers.
There is also the question of amount. Levels of long-term sick pay are normally lower than short-term levels. Only 12 per cent. of schemes paid full basic salary, while 25 per cent. of private sector schemes paid only a flat rate benefit. Among private firms in hazardous industries, none provided full pay and 36 per cent. paid only a flat rate. Nor is there any indication that this flat rate is indexed. If it loses its value over the years because of inflation, it is of very doubtful value anyway.
Unlike national insurance invalidity benefit, which continues for as long as it is needed or is replaced by retirement benefit, almost all occupational schemes have time limits. When all these limitations are taken into account it seems quite wrong for the Government to state that it is all right to introduce the provision in Clause 4 because the intention is to encourage occupational provision and this encouragement has succeeded so well that the benefit will no longer be required. There may be a case for a small minority where occupational provision is exceptionally generous. I know from my own experience that such situations exist. If the Government wanted to pursue this line, there could be a contracting out arrangement for people in that position.
However, the proposed amendment would give an opportunity to have another look at the whole position, as a report covering these issues would have to be laid before Parliament before the provisions could be enacted. It is a sensible proposition and I hope that the Government may feel disposed to accept it. I beg to move.
Lord Henley: The Government have already provided, in The Way Ahead, which we published last January, details of our proposals for improving benefits for people with disabilities and their carers. The proposals improve the balance and structure of help for disabled people by providing better coverage with the extra costs of being disabled; creating a better balanced structure of help for disabled people who cannot work, particularly those disabled from birth or early in life; and giving better help and incentive for disabled people who wish to increase their independence by working.
We have also provided details of the costs of our proposals—both in the short and in the long term—in response to parliamentary questions. In particular, the reply my right honourable friend the Minister of State for Social Security and the Disabled gave in a Written Answer in another place on 26th January sets out estimates of costs and savings. I take the opportunity to stress, however, that estimates for the later years, contained in that reply, especially those for the year 2025-26 are subject to considerable margins of uncertainty.
Our proposed improvements will result in increases in expenditure on social security help for disabled people in every remaining year of this century. This increase is on top of the increase in spending on benefits for people who are sick or
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long-term sick and disabled of nearly 100 per cent. since 1978–9. Not only are we now spending £8.3 billion, but by the year 2000 we expect that spending to increase to over £12 billion. To speculate on benefit initiatives beyond the year 2000 would seem to be a somewhat fruitless exercise as it will be for the Secretary of State of the day to decide on his priorities at that time.
Over the last 15 years the growth of occupational sick pay schemes has been impressive. Nine out of ten employees are now covered for short-term sickness. Just under 60 per cent.—approaching 13 million employees—worked for employers providing longer-term cover when the IFF Research Ltd. research into occupational pension was conducted in January and February 1988. We have seen coverage for long-term sickness triple in 15 years. There is every prospect that it will continue to rise. I believe that a tighter employment situation in the 1990s will lead to employers continuing to develop sick pay packages to attract people into their employment. They are likely to take into account the restriction on further accrual of entitlement to the additional pension part of invalidity benefit. No doubt employees and their organisations will not be slow to negotiate such packages.
It is against this background of increased occupational sick pay coverage that we have moved to restrict future entitlement to the growing earnings related element of invalidity benefit, which will avoid duplication of provision. However, it would be wrong to look at the question of occupational sick pay replacing the additional pension part of invalidity benefit in isolation. This measure is a major plank in our proposals for restructuring the range of benefits available to the disabled. Our purpose is to balance the help given to those in employment with the help for those most in need, especially, as I said earlier, to those disabled at birth or early in life. The average payment for additional pension is currently £9 a week with a maximum of £41 per week. This costs £450 million a year. If the scheme was not changed these payments would rise by 1998 to £21, £84 and £1-6 billion respectively. Growth on this scale would serve only to widen the gap between those who have worked and those who have not. We are instead concentrating resources on the two completely new benefits—the disability allowance and disability employment credit—which will give substantial extra help to disabled people. I am sure that this is the right approach.
I wish to be as helpful as I can and I will summarise for the Committee the findings in the IFF Research report that relate to this amendment. As I have already said, the report indicated that almost 60 per cent. of employees had long term sickness cover. of those covered by long term schemes 7 per cent. would receive full basic salary, whilst 57 per cent. would receive a percentage of salary and a further 19 per cent. a scale rate. In so far as duration is concerned, in the private sector 42 per cent. of long term sickness schemes continue until retirement and a further 40 per cent. have early retirement schemes. In the public sector these figures are 23 per cent. and 63 per cent. respectively. In about a third of schemes entitlement to state benefit is taken into

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account in determining the amount of occupational sick pay that an employee will receive. As far as employees being excluded from schemes is concerned 32 per cent. of employees would not be excluded on any grounds. of the remaining 68 per cent. 37 per cent. would have to be with the company for periods between three and 12 months and 26 per cent. would be excluded on grounds of part-time work.
In the light of the significant improvements which I have outlined in occupational sick pay cover and the potential for further growth and improvements and of the importance of this measure to our improved benefit structure, I consider that to commission the further research which would be needed to satisfy this amendment would not be a sensible use of resources. I hope, therefore, that the noble Baroness will feel able to withdraw her amendment.
Baroness Turner of Camden: Before the noble Lord sits down, can he say whether the Government will be prepared to look at the possibility of instituting some form of contracting-out arrangement in respect of schemes which meet a certain minimum standard. We still have 40 per cent. of employees not covered by adequate schemes. It seems to me that if one were to pass the proposals in the Bill, those people would still suffer. On the other hand, in order to meet the Government's point—that is, that there are now numerous schemes which offer a good standard of occupational provision—would it be possible to have a contracting-out arrangement so that if, as I said, the scheme met a certain standard it contracted out and people did not receive entitlement to the benefit.
Lord Henley: I cannot give the noble Baroness that assurance. However, if she will allow me, I shall look again at the matter between now and the next stage of the Bill's proceedings. I cannot go any further.
Baroness Turner of Camden: I am most grateful to the Minister. We are anxious to protect people who have no cover. There are still many people in that position, especially in the manual industries. For example, people who have a chequered work pattern, who do not work for an employer for very long and who move around. of course that is a feature of the construction industry. However, if the Minister will at least look again at the matter I shall be most willing not to press the amendments. I look forward to hearing what he has to say on Report.
Lord Henley: I was not giving the noble Baroness an assurance that the Government would bring forward an amendment. I imagined that she would wish to return to the matter on Report. I said that we would look again at the matter and, if necessary, discuss the matter further at that stage.
Baroness Turner of Camden: In the circumstances, I shall withdraw the amendment and consider it
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further with a view to returning to the matter on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 16A not moved.]
Clause 4 agreed to.
8.30 p.m.
Clause 5 [Retrospective effect of Section 165A of the principal Act]:
[Amendments Nos. 17, 18 and 19 not moved.]
Lord Henley Lord Henley moved Amendment No. 20:
Page 8, line 6, leave out (" and 165B" ") and insert (" to 165D" ").
The noble Lord said: I think that, although I am to move this amendment and speak also to Amendments Nos. 175 to 189, somewhere in that grouping there is an amendment tabled in the name of the noble Lord, Lord Carter.
Lord Carter: Amendment No. 175 is tabled in my name and that of the noble Earl, Lord Russell, on the Marshalled List. I think that the Minister's grouping should commence with Amendment No. 176. This may be a mistake on the grouping list.
Lord Henley: That is why I am confused. For some reason I thought that the amendment tabled in the noble Lord's name and that of my noble kinsman would be included in this grouping for discussion. I do not know whether that is correct.
Lord Carter: I think perhaps that I should formally withdraw the amendment tabled in my name from this particular grouping. In that way the Minister will be able to speak to the government amendments.
Lord Henley: In that case, we shall discuss Amendment No. 175 some time tomorrow evening.
In introducing these amendments I should like to explain why we consider it right to bring forward this measure at this particular time. There have been statutory restrictions on payment of benefit arrears since the inception of the present social security scheme in 1948. The reasons are essentially administrative: to avoid the requirement to retain records for immensely long periods of time and to discourage hopeless requests for reviews for periods in the distant past.
As part of the social security reform programme a revised set of adjudication regulations came into force on 6th April 1987. They included a new provision, Regulation 72, which was designed to allow the statutory payment of arrears of benefit in full where there had been an underpayment of benefit that was solely attributable to a mistake on the part of an official, including an adjudication officer. This provision was widely welcomed by informed social security practitioners and avoided the previous cumbersome and administratively expensive procedure of late appeal as a way of effecting the payment of such arrears.
However, legal advice revealed that Regulation 72 had an unintended side effect in that, where a social

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security commissioner or higher judicial authority overturned the prevailing interpretation of the law, adjudication officers' decisions given prior to that reinterpretation fell to be described as errors of law, even though they were made in good faith and in accordance with the interpretation of the law at the time. In the light of that unlooked-for effect, Regulation 72 was amended from 1st September 1987 to re-impose the 12-month limitation on arrears where adjudication officers review decisions in consequence of a reinterpretation of the law by a commissioner or higher appellate body. The Parliamentary Commissioner for Administration, however, criticised that provision as inequitable in that, when the law is reinterpreted and an affected case is not identified and reviewed immediately, the claimant will effectively lose one week's arrears for each week of the delay before a review decision is given. We have therefore decided to amend the provision accordingly.
Paragraph 7 of Schedule 6 will provide that, where a decision is reviewed on the grounds that it was erroneous in point of law by virtue of a subsequent determination of a commissioner or higher appellate authority, no benefit will be payable for any period which falls before that determination. That arrangement provides an equity of treatment that the existing backdating provisions lack. Any arrears which because of a reinterpretation of the law become payable on review of claims which were previously disallowed will in every case be backdated to a common date irrespective of how long after that reinterpreation such a case may come to light. That means that if someone had previously had their benefit claim disallowed but had come into benefit following a reinterpretation of the law, he would under this amendment have his arrears paid back to the date of that reinterpretation irrespective of how long it takes for his case to come to light. I am sure that noble Lords opposite will agree that that is a more satisfactory arrangement than that provided under the existing rules.
That caters for reviews, but what about claims? Having provided equity in the treatment of the backdating of arrears on review application, it would be illogical if we did not introduce a similar limitation on cases where a person makes a claim following a reinterpretation of the law where he is relying on that reinterpretation to give him title to benefit. This we are doing in paragraph 7 of Schedule 6, thereby providing a common start date for payment of benefit whether it be by way of a review of a claim previously disallowed or on a new claim. The difference between claims and reviews though is that for claims we are providing that the maximum amount of benefit arrears payable is limited to the absolute time limit for claiming the benefit at issue.
I should explain that an absolute time limit for claims has been an integral part of the scheme since 1948 when the limit adopted was six months. A 12 months absolute time limit, which applies to most benefits came into force in March 1969. Several benefits—child benefit, guardian's allowance, increases of benefit for a child or adult dependent—are subject to an absolute time limit of six months. It is considered that those limits give
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suitable protection to the rights of beneficiaries while maintaining the need to provide efficient administration. Following that through, we see no justification for extending the normal absolute time limits for making claims.
I should explain that attendance allowance and mobility allowance claims are not included in those arrangements: such claims are not currently backdated and we see no justification for introducing what would amount to a relaxation here.
In summary, we believe it to be eminently desirable that, where there is a reinterpretation of the law which brings payment of benefit to any number of people, a common date should in the interests of equity be chosen from which arrears are paid irrespective of whether the claimant has previously claimed and been disallowed or whether he is now claiming for the first time.
Subject to normal time limits on claiming, the amendments provide for this, and along with Amendment No. 20, which is a consequential of this provision and of Clause 6, I commend them to the Committee. I beg to move.
Earl Russell: Perhaps I may take it that my noble kinsman has spoken to the extent that he intends on Amendments Nos. 176 and 180, which are the ones that I wish to address. I must confess that I am somewhat concerned about those amendments. The phrase which especially concerns me is the one dealing with the treatment of court judgments. The provision that is being made by the amendments is that, when there has been a case which was unexpected to the department, other cases:
"shall be determined as if the decision referred to in subsection (7)(a) above had been found by the Commissioner or court in question not to have been eroneous in point of law".
If I understand correctly the effect of what the Government are doing—I should be grateful to be corrected if I am wrong because I should be relieved to be told so—the purpose of the amendments is to provide that, when the Government lose a test case in the courts, the effect of that case shall stand in relation to the individual claimant in whose name the case was brought but shall not affect all the other claimants in the pipeline at the time, who are to be treated, if I understand correctly what the Government propose, as if that case had not taken place.
That is unduly diminishing the scope and the role of the courts. We are familiar, because Clause 5 familiarises us forcefully, with the fact that court cases can for future effect be reversed by legislation. The amendment provides that in relation to current cases in the pipeline the effect of the court judgment can be rendered nugatory by making it cease to apply to current cases as well as reversing it for future cases. The effect of the court judgment, if I have correctly understood, is entirely confined to the single, individual claimant. It appears to me, if that is correct, that that is driving a coach and horses through the rule of law. I should be grateful for a little more information before we leave the subject.
Lord Henley: It is a complicated matter. In Clause 5 and the amendments we are attempting for the

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second time to secure the policy intention that has been accepted down the years by administrations of both complexions: that is, that a person is not entitled to a benefit for any period unless in addition to any other conditions relating to it he makes a claim for it in the prescribed manner and the prescribed time. To that extent, we accept that the provision is retrospective; but we believe that it is necessary to re-establish the policy position that existed previously. We see no justification for leaving what one might call a window of entitlement between the date of the Cartwright decision, the most recent case, and Royal Assent which would remain if we were not to provide for the clause to have that retrospective effect. It is a period in which claimants could claim payments when it was not intended that they should.
Earl Russell: I understand the explanation given. I should be grateful for some reassurance about how narrow the effect of the amendment may be. It seems to be setting a precedent which I do not wish to see followed too of ten. I understand that it can be frustrating to any Administration if it finds that a case comes before the court and the statute does not mean what it thought it did. However, are there not circumstances in which one has to accept defeat? Is not losing a case in the courts normally one of them?
Lord Henley: I hope that my noble kinsman will not mind repeating his last remark; I am sorry that I did not catch it. I was talking to my noble friend.
Earl Russell: I was saying: are there not circumstances in which one has to accept defeat? Is not losing in the courts normally one of them?
Lord Henley: No. There are occasions when it is important to try to re-establish the policy intention. We tried once and we are making a second attempt. I do not think it right that there should be a situation where claimants receive windfall payments when it was never intended that they should.
Baroness Seear: As my noble friend said, surely we must consider the implications of what the Government are doing. If the courts have shown that the statute does not mean what the Government intended it to mean, the right process would be to amend the statute. That is not to say that because the courts have given a decision that the Government do not like, they will disregard it. The precedent for that is extremely dangerous.
Lord Henley: I understand what the noble Baroness is saying. However, there always was this policy intention; it existed for years and the courts in later years said that we were wrong. We changed the law. The situation continued for some time and then the courts said that we were wrong again. I know what the noble Baroness is saying, that we are changing the law. However on this occasion, in order to prevent large numbers of what one could call "windfall" payments, with people receiving payments when it was never intended that they
688
should, we are perfectly justified in making the legislation retrospective.
Baroness Seear: Because the Government get it wrong, they legislate badly, they lose in the courts and say, "We shall take no notice of the courts". Can the noble Lord not see how dangerous that could be? One day we might have a benevolent government—and a benevolent government is perfectly possible—who, because the Government have done it on this occasion, would be delighted to apply the rule every time the court said something that they did not like. It is extremely dangerous to adopt that course. Surely the Government must change the legislation. If they get it so badly wrong that they get it wrong twice then, for goodness' sake, they had better find somebody else to draft the Bill.
Earl Russell: I understand what my noble kinsman means about windfall payments. I understand that this is how it appears from inside the department. I also understand that the Government intended to take away the concept of entitlement. However, the courts found that there was an entitlement. This provision takes away people's property rights, something which parliaments have regularly viewed with some misgiving.
Lord Henley: I accept what the noble Baroness said about the danger of retrospective legislation. We are trying to put the statute right, as the noble Baroness says that we ought. She then complains that it is retrospective. I believe that on this occasion quite a number of claimants would receive windfall payments in a manner that Parliament never intended. One has a duty to the Treasury and public funds to see that on this occasion there is justification for a small degree of retrospection.
Baroness Seear: The moral of this whole sad story is that the Government should get their legislation right in the first place. They should not cheat when they get it wrong, which is what they propose. Because they have lost on this, they must ensure that the legislation is properly drafted, bring it back to the House and alter the law. They should not say they will not do what the court says. Anybody can say that they do not wish to do what the court says. What a precedent to set!
Lord Henley: I hoped that I had given justification for a small degree of retrospection on this one occasion.
Baroness Seear: It is no argument to the Committee that it is only a small amount. That really will not do.
Lord Henley: I am not sure that I can take this any further. I moved Amendment No. 20 and spoke to the other amendments. I commend the amendment to the Committee.
On Question, amendment agreed to.
[Amendments Nos. 21 and 22 not moved.]
Clause 5, as amended, agreed to.
[Amendments Nos. 23 and 24 not moved.]
8.45 p.m.
Baroness David Baroness David moved Amendment No. 25:
Before Clause 6, insert the following new clause:
"Exemption for full-time students
In section 20(12)(h) of the 1986 Act, at the end there shall be inserted the words "provided that no person shall be so treated solely on the ground that he is a full-time student." ").
The noble Baroness said: In moving Amendment No. 25 and speaking to Amendment No. 26 I wish to make a few introductory remarks. Those Members of the Committee who were here for debates on the student loans Bill will be familiar with the arguments, but I wish to give the picture before I move on to the amendments.
It is the Government's intention to disentitle fulltime students from social security benefits—namely, income support, unemployment benefit and housing benefit—from the beginning of the academic year 1990-91. The regulations making the amendments have not yet been laid before Parliament. On 26th April this year the Education (Student Loans) Bill received the Royal Assent. Throughout the passage of the Bill, Opposition Peers tabled a series of amendments which, if passed, would have retained entitlement to social security benefits for full-time students. These amendments covered all the issues which were raised here: income support, employment benefit during the summer vacation, housing benefit for undergraduate and postgraduate students, and regional housing costs.
During the debates on these issues in the House of Lords, concern was repeatedly expressed by Peers from all parties and none on the financial difficulties that students will suffer as a result of disentitlement to social security benefits. We all know the arguments. That contrasts with the situation in the House of Commons where there has not been a proper opportunity to discuss students' entitlement to benefits on the Floor of the House. In addition, it is not the Government's intention that this debate should take place. The amendment regulations will be laid before Parliament and are subject only to the negative procedure, even though many Conservative MPs have expressed concern about the Government's proposals to disentitle the majority of students from social security benefits.
For instance, during the Second Reading of the Education (Student Loans) Bill, Mr. Alistair Burt—and I remind Members of the Committee that he was PPS to Mr. Kenneth Baker—
"we should look carefully at housing costs and the abolition of benefits are a worry, particularly in some regions. It will do the Government no harm to examine that carefully".—[official Report, Commons, 5/12/89; col. 212.]
At the Report stage in another place there was no debate on social security issues. Amendments tabled were not discussed. The Social Security Advisory Committee gave advice earlier when it learned that the DSS intended to stop students being eligible for social security benefits. The committee stated:
"As the grant has declined in value, students have come to depend on benefits and we do not believe that this trend should be reversed by a transfer of resources to the grant system in which payments are made without reference to individual need".
The Social Security Advisory Committee has now made its report on the proposals to the Secretary of
690
State. It has been substantially leaked. On 13th and 14th May newspapers covering that report warned of,
"student poverty and administrative chaos in universities and polytechnics as thousands of undergraduates apply for special hardship grants".
According to the newspapers, the committee is particularly concerned about the wholly inadequate amount of money that has been allocated to the access fund. The sums are £5 million for futher education students, £14 million for undergraduates and £6 million for postgraduates. They describe the intention to withdraw unemployment benefit from those students who have paid to acquire national insurance contributions as a "breach of natural
In an unprecedented move six members of the committee, according to the newspapers, have produced a minority report demanding that the proposals be dropped. They argue that the withdrawal of social security benefits will reduce the number of students from lower income backgrounds. The committee's report is based on a calculation that many students will lose up to £560 per academic year in housing benefit. That is £140 more than the loan they will receive.
When the amendment to the Education (Student Loans) Bill on housing benefit was sent to the House of Commons, that Chamber invoked its financial privilege and disagreed to the amendment because it involved a charge on the public revenue. It is understood that that was decided within the context of the Education (Student Loans) Bill and that it is appropriate to raise it here as a matter relating to social security. If this set of amendments were passed, they would not require additional expenditure. Rather, they would retain existing students' entitlement to social security benefits. The noble Lord, Lord Boyd-Carpenter, has gone but I believe he made that point when we were discussing this matter in relation to the student loans Bill. This Bill raises a different issue to the one we discussed on that Bill. The amendments argue simply that students as a body of persons should not be disentitled to social security benefits solely on the basis that they are full-time students. The question of Commons privilege does not arise.
The purpose of Amendment No. 25 is to ensure that students are not disentitled to claim housing benefit simply because they are full-time students. The draft amendment regulations that were published in February in relation to the Social Security Act 1986 substantially affect students' housing benefit entitlement. They
"A full-time student shall be treated as if he were not liable to make payments in respect of a dwelling".
That is also extended in another regulation to include the partner of a student. Therefore students and partners of students are to be treated as if they do not pay rent for their accommodation. That is clearly not the case. Approximately 60 per cent. of students nationally find their accommodation in the private rented sector. They usually pay substantial sums in respect of a dwelling. Furthermore, students living in halls of residence are not entitled to claim housing benefit at the moment. Therefore the proposed changes will not have any effect on them.
The purpose of Amendment No. 26 is to ensure that the 1986 Social Security Act stipulates that full-time students cannot be excluded from eligibility for housing benefit purely on the grounds of being postgraduate students. Students undertaking postgraduate courses will not be eligible to receive a loan. Therefore disentitlement to housing benefit represents an even greater loss of income for those students. A postgraduate student is deemed to be on his or her course of study for 52 weeks a year. Therefore a postgraduate student over 25 years of age living outside London, with an average rent of £25-40 per week, will lose out by £448-24 a year. Postgraduate students will be particularly impoverished as a result of being disentitled to housing benefit. We also have to remember that many of those students are self-financing.
Disentitlement to housing benefit will be detrimental to most sections of the student population. As approximately 60 per cent. of students nationally find their accommodation in the private rented sector, many students will be substantially worse off, particularly as a result of the establishment of market rents resulting from the so-called deregulation of the private sector by the Housing Act 1988. Under the proposed scheme of student financial support, a student with an average rent in London is left with £18.6 on which to live after paying for his or her accommodation. A student ouside London with an average rent will have £26-33 left on which to live. Both of those figures are less than the Government's own personal allowance for a single person aged between 18 to 24 of £28–80. In the case of a student in London it is over £10 below that level.
This measure is being taken simply on the basis that students should be treated as if they are not liable to make payments in respect of a dwelling. As I said before, the access funds will not be nearly enough to make up for this. The universities and polytechnics, which are being asked to administer those funds, are worried about the difficulty they will face in delivering loans and choosing who will have them, who will not have them and how much they will get. They are also worried about the administrative burden they will be landed with. I beg to move.
Earl Russell: If the Government had simply said that they did not consider the social security system the most appropriate way of supporting students, I would not have felt the need to argue with them. The appropriate response to that belief, if they had held it, was to increase student support to a level which raised students above benefit levels; in fact to float them off benefit. The right honourable friend of the Minister, Mr. Scott, admits that the Government have not done this. In a letter he was kind enough to send to me on 20th April he stated:
"this is not simply a case, as you suggest in your letter, of raising student support above benefit levels and therefore making our proposed regulations redundant. The taper system in Housing Benefit for example means that only a proportion of income above benefit levels (65 per cent. for rent allowance assessment) is taken into account when calculating benefit entitlement. Therefore it would require a maximum loan considerably higher
692
than currently envisaged in order to float all current student claimants off benefit".
I am grateful to the right honourable gentleman for that admission. It seems to me a rather important one.
The Government are leaving students below benefit level and denying them social security support in that situation. That is why I argued earlier this afternoon that the Government's policy is discriminatory. I do not withdraw that phrase. Even if the Government were providing a large enough loan to raise students in principle above benefit levels, they are well aware—I have heard the noble Baroness, Lady Blatch, say this at the Dispatch Box—that a high proportion of parents fail to pay their full parental contribution. As there is still a substantial parental contribution in the assessed student support, the Government will not, I think, deny that those students who do not receive that contribution are well below the level that they assess for their needs, even though that level is itself below benefit level. So we have here cases where people, through no fault of their own, are put well below social security benefit levels, which God knows are low enough in the first place. Those people are then told that they are not entitled to any further support.
This is a discriminatory measure and I do not see the justification for it. I do not think that the Government have got their sums right on this either. We have been given figures which result from a very small sample survey conducted by a contract research firm. It gives results which most of us find quite incredible. I beg the pardon of the Government for saying this, but it seems to me to illustrate the disadvantage of not having research done by academics. If the Government thought that British academics were interested parties, there are others in foreign countries who would have been impartial and willing to help.
I have noticed in replies given by Ministers in another place a steadily diminishing confidence among them that they have their sums right. With the leave of the Committee I shall quote a few replies that have been given recently. On 5th March Mr. Meacher asked the Secretary of State
"total cost of housing benefit paid to students in each region and in Great Britain during the summer vacation of 1989".
Mrs. Shephard replied:
"Information is not available in the form requested".
Mr. Meacher asked what was:
"the total number of claims paid, the average length, and total cost of unemployment benefit paid to students in each region and in Great Britain during the summer vacation of 1989".
Mrs. Shephard replied:
"I regret that this information is not readily available and could be obtained only at disproportionate cost".—[official Report, Commons; 5/3/90, col. 535.]
Mr. Battle asked the Secretary of State:
"the average amount of benefit or support, of each kind, received by a student in full-time higher education".
That is the crucial question. Mrs Shephard replied:
"Information about the amount of benefit claimed by students is not routinely collected and is not therefore available in the form requested".—[official Report, Commons, 22/2/90; col. 893.]
The starting point of our case is that the Government simply do not know what the correct

693
figures are. In our opinion, because it coincides with our daily experience, the figures collected by the NUS are much closer to the truth, save only that the NUS has slightly undersold its case. It gives an average figure, for example, of rent being paid in London of £45. In my experience, most of our undergraduates pay £50 or occasionally a little over, but, although the NUS understated its case, it has come close to the truth. It calculates that students in London lose up to £1, 000 a year. That is a substantial amount of loss.
There is also substance in the point made by the Social Security Advisory Committee that, if students are taken out of social security, there must be some form of benefit directed to need. The loan is flat rate except for the London allowance—£40, or 20 tube journeys a year in from Zone 2. There is no regional evidence in that. As we know that regional housing costs vary grossly, some people will be much worse off than others.
With regard to residential homes, the Secretary of State has admitted that there is a strong case for local limits. I am glad that he has done so, but, if that case has substance for residential homes, it also has substance for students.
There is a particularly strong case to be made on behalf of postgraduate students, who are scandalously underfinanced. The supply is diminishing. In some subjects, particularly the sciences, the position is becoming increasingly difficult. As the Government are so worried about completion rates, they might take on board the fact that it is a great deal more possible to complete your work quickly if you are adequately financed.
However, the main reason for pressing the case for postgraduates is that the logic of the Government's case simply does not apply to them. The logic of the Government's case is that, because students have the loan, they do not need social security. Postgraduate students will not receive the loan, so I simply cannot understand the logic of taking them out of social security. It looks like a determination of principle to argue that students should not receive social security benefits. If there is a reason of principle behind that, I hope that, before tonight's debate is finished, we shall know what it is.
Finally, I shall beg the noble Baroness when she replies not to rely once again upon the access funds. In proportion to the needs, those sums are Maundy money.
9 p.m.
Baroness Blatch: Student support should be provided through a single source. The educational maintenance system is that source which is advocated by the Government. The administrative burdens on local authorities should also be reduced. Despite the noble Earl's description of the sums as derisory, the introduction of top-up loans and access funds has a real purpose. During our debates in this Chamber, those funds were substantially increased. Contrary to the assertions that have been made, that will not be at the expense of students. We firmly believe that the vast majority of students will find
694
that the new resources available to them will outweigh any loss of benefit entitlement.
The Government have taken careful account of the impact of housing costs and the impact that they can have on students' income. The mandatory grant system acknowledges the exceptional costs faced by students in London, for example. The loan scheme will do the same. The allocation of the access funds will take account of variations in students' housing costs. The access funds will be able to target resources more effectively on local needs than other forms of educational support have been able to do in the past. The educational institutions themselves will administer the funds according to local demands and, in distributing the funds to the funding councils, the Government have had due regard to the differences in relevant accommodation costs between their respective sectors, the numbers of students in each sector and the proportion of those students living in private sector accommodation.
The amendments would not simply overturn our proposed policy on housing benefits for students. As I understand it, contrary to what the noble Baroness, Lady David, said, they would also, by allowing students in halls of residence to claim, create entitlements where currently none exists. As the student grant includes an element to cover such accommodation costs, there would be a double provision. Moreover, many fruitless claims are likely to result, putting a pointless burden on local authorities.
The public expenditure implications of allowing students to have recourse to the benefit system on top of the other means of student support are substantial. We are putting well in excess of £10 million additional resources into the educational system, creating a new system of student support. It would not make sense to leave the housing benefit arrangements as they are, much less to extend them.
The noble Earl, Lord Russell, referred to the fact that there was no increase in the additional moneys being put in by the Government through both the access funds coupled with the loan scheme which would outweigh the amount of loss of benefit. The figures are absolutely conclusive in that respect—£178 million is to be made available through the loan scheme and an additional £25 million is to be made available through the access funds. The loss of benefits totals only £68 million. That leaves more than £100 million excess funds available to students. From an independent survey carried out on students' income and expenditure, we estimate that in 1990–91 those students who actually claimed benefits would have received on average £315 in a full year. Instead of that level of benefit, students will have available to them a loan of £420 in most cases.
The total amount available to students in loans and access funds will outweigh what would have been available in benefits. We estimate that in the first year of the scheme expenditure on loans will, as I have just said, be £178 million compared with savings on social security expenditure of only £68 million for those within the scope of the loans. Additionally, and I continue to repeat it, we are making available £25 million through the access

695
funds and the Government will be spending well over £100 million more on students next year as a result of the new support system. Indeed, students in this coming year will have available to them an increase of 25 per cent. Of funds over the previous year.
However—this point was raised by the noble Earl, Lord Russell, and the noble Baroness, Lady David—we acknowledge that there is concern in some quarters about the effect on individual students of the loss of benefit entitlement. We accept that a few students might have been able to claim more in benefits than they would have had available to them in loans. I can reassure the Committee that the Government have not neglected the position of such students. It is a relatively small number but if a small number of students are in financial difficulty as a result of the withdrawal of benefit entitlement, they will be able to apply for assistance from the access funds.
The calculation has been made that if access funds were made available to all students they would be derisory. It is our intention that they should be made available to those students who particularly need them and where the decision and determination for their use is made at a local level.
The noble Earl, Lord Russell, made reference to the discrepancies in statistics. Evidence from a survey commissioned by the Department of Education suggests that a high proportion of students claimed housing benefit and income support. However, the Department of Social Security's statistics suggest that the figures are substantially lower. Those statistics are based on actual caseload counts or, in the case of housing benefit, on a 1 per cent. sample of claims. Therefore we believe those figures to be more reliable. They bear out our view that only a minority of students in practice will lose benefits.
A further point mentioned by the noble Earl concerned the problems raised for postgraduate students. Grant provision is intended to cover postgraduates throughout the year. Noble Lords should also bear in mind that postgraduates have an access fund specifically to deal with any financial problems which may arise from withdrawal of benefits. Proportionately, the access fund for them is significantly greater than that for other students.
There was one other point which I believe was raised by the noble Baroness in relation to the partners of students. I can assure her that income support benefits will be available to partners of students but in assessment the student's income will be taken into account.
I believe that the total amount of funds available to students more than outweighs the loss of benefit. The Government have gone a very long way to meet the needs of postgraduate students, disabled students (about whom we spoke earlier) and those particular students who live in high cost rented areas.
With that explanation, I hope that the noble Baroness will feel able to withdraw the amendment.
Baroness David: I thank the noble Baroness for her reply. However, she still ignores the evidence that has been collected about the way in which students will be worse off when the situation develops, as it will, next year.
With regard to the access funds, there are no guidelines about the administration, which is bound to be chaotic. Universities and polytechnics do not know how they will manage. Various promises have been made that access funds will be available not only to compensate for benefits but also to include child care costs, mature students, special education equipment, special travel costs and part-time students—and that is only £14 million for undergraduates.
I am assured that the amendments as they stand do not affect the present arrangements for halls of residence. They would not mean that students in halls of residence would have housing benefit available. I still believe that the situation has been totally badly assessed by the Government. I shall have to test the opinion of the Committee. The answer was not satisfactory.
9.12 p.m.
On Question, Whether the said amendment (No. 25) shall be agreed to?
Their Lordships divided: Contents, 86; Not-Contents, 53.

DIVISION NO. 4

CONTENTS

Addington, L.

Kennet, L.

Adrian, L.

Kirkhill, L.

Blackstone, B.

Kirkwood, L.

Boston of Faversham, L.

Lockwood, B.

Briginshaw, L.

Lovell-Davis, L.

Bruce of Donington, L.

McIntosh of Haringey, L.

Butterfield, L.

McNair, L.

Callaghan of Cardiff, L.

Mason of Barnsley, L.

Carmichael of Kelvingrove, L.

Mayhew, L.

Milner of Leeds, L.

Carter, L.

Mishcon, L.

Cledwyn of Penrhos, L.

Molloy, L.

Clinton-Davis, L.

Monkswell, L.

Darcy (de Knayth), B.

Morris of Castle Morris, L.

David, B.

Mulley, L.

Dean of Beswick, L.

Nicol, B.

Donoughue, L.

Northfield, L.

Dormand of Easington, L.

Ogmore, L.

Ewart-Biggs, B.

Oram, L.

Falkender, B.

Park of Monmouth, B.

Falkland, V.

Peston, L.

Fisher of Rednal, B.

Pitt of Hampstead, L.

Gallacher, L.

Prys-Davies, L.

Galpern, L.

Rea, L.

Graham of Edmonton, L. [Teller.]

Richard, L.

Ritchie of Dundee, L.

Grey, E.

Rochester, L.

Harris of Greenwich, L.

Ross of Newport, L.

Hatch of Lusby, L.

Russell, E. [Teller.]

Hirshfield, L.

Seear, B.

Hooson, L.

Serota, B.

Houghton of Sowerby, L.

Shackleton, L.

Howie of Troon, L.

Stallard, L.

Hughes, L.

Stoddart of Swindon, L.

Irvine of Lairg, L.

Strabolgi, L.

Jay, L.

Taylor of Blackburn, L.

Jeger, B.

Tordoff, L.

Jenkins of Putney, L.

Turner of Camden, B.

John-Mackie, L.

Underhill, L.

Kagan, L.

Walston, L.

697

Wedderburn of Charlton, L.

Wilson of Rievaulx, L.

Whaddon, L.

Winchilsea and Nottingham, E.

White, B.

Williams of Elvel, L.

Winstanley, L.

Willis, L.

NOT-CONTENTS

Arran, E.

Johnston of Rockport, L.

Belhaven and Stenton, L.

Joseph, L.

Belstead, L.

Long, V. [Teller.]

Blatch, B.

Lucas of Chilworth, L.

Borthwick, L.

Lyell, L.

Brabazon of Tara, L.

McColl of Dulwich, L.

Brookes, L.

Mackay of Clashfern, L.

Brougham and Vaux, L.

Macleod of Borve, B.

Buckinghamshire, E.

Monk Bretton, L.

Butterworth, L.

Mottistone, L.

Caithness, E.

Mountevans, L.

Carnock, L.

Reay, L.

Cullen of Ashbourne, L.

Saltoun of Abernethy, Ly.

Davidson, V. [Teller.]

Sanderson of Bowden, L.

Denham, L.

Skelmersdale, L.

Donegall, M.

Strathmore and Kinghorne, E.

Downshire, M.

Eccles of Moulton, B.

Suffield, L.

Elliot of Harwood, B.

Swinton, E.

Elliott of Morpeth, L.

Teviot, L.

Ferrers, E.

Thomas of Gwydir, L.

Fraser of Carmyllie, L.

Ullswater, V.

Henley, L.

Vaux of Harrowden, L.

Hesketh, L.

Vinson, L.

Hives, L.

Wise, L

Hooper, B.

Wynford, L.

Jenkin of Roding, L.

Yarborough, E.

Resolved in the affirmative, and amendment agreed to accordingly.
9.20 p.m.
Baroness David Baroness David moved Amendment No. 26:
Before Clause 6, insert the following new clause:
("Exemption for postgraduate students
In section 20(12)(h) of the 1986 Act, at the end there shall be inserted the words "provided that no person shall be treated solely on the grounds that he is a postgraduate student, " ").
The noble Baroness said: I spoke to this amendment when speaking to Amendment No. 25. I beg to move.
On Question, amendment agreed to.
Baroness David Baroness David moved Amendment No. 27:
Before Clause 6, insert the following new clause:
("Housing Benefit: students
In section 21 (6) of the 1986 Act, at the end there shall be inserted the words "and may provide for the regional or local level of housing costs and any payment for the purpose of meeting such costs to be taken into account in determining the maximum housing benefit where the claimant is a full-time student." ").
The noble Baroness said: This amendment deals with housing benefit but tackles a slightly different aspect of the problem. It ensures that the variations in local and regional housing costs are taken into account when determining the amount of benefit payable.
Everyone knows that the amount of housing benefit a person receives is dependent among other factors on the level of rent. As is well known, there are vast differences in rent levels across the country because of issues of supply and demand. That is particularly so since the Housing Act 1988 came into effect, with some rents in the private sector in
698
London doubling. The noble Earl, Lord Russell, mentioned the different rents in London and elsewhere. However, even students outside London with an average rent of £25.40 would lose out by £173.10. Therefore, again a student is using all of his loan to pay his rent. Students on courses of more than three years' duration—some are of four, five and even seven years—will lose out to a much greater extent.
The Government justify their case in terms of increase in resources to students, but we know that the figures are far from accurate and were not thoroughly researched. Therefore, it is easy to foresee a situation in which students vote with their feet and give up going to colleges in high-cost areas. The depression in the demand for places in London has been noticed. The withdrawal of housing benefit will mean that colleges in London and the South East will face major falls in applications. The Government may mistakenly believe that loans will tempt more students into college but surely they cannot believe that making them worse off will be an incentive. I beg to move.
Earl Russell: I am happy to support the amendment. As the noble Baroness said, it does not merely relate to London. Throughout our debates on the subject there has been a chorus of concern about regional housing costs in many areas other than London. The Committee may recall the speeches made on the subject by my noble friend Lord Addington. They may also recall the speech made on the Second Reading of the Student Loans Bill by the noble Baroness, Lady Faithfull, about housing costs in Oxford. The concern is widespread and something more than merely the London allowance is needed to deal with it. I support the amendment.
Baroness Blatch: The housing benefit entitlement is calculated on the basis of the individual claimants' eligible housing costs. Therefore, the benefit will reflect regional and local levels of rent.
When speaking to Amendments Nos. 23 and 24 the noble Baroness, Lady David, spoke also to this amendment, as did I, because I addressed the regional variations in housing costs. I am happy to repeat what I said then.
The Government have taken careful account of the impact which housing costs may have on students' incomes. The mandatory grant system acknowledges the exceptional costs faced by students, particularly in London. The loan scheme will do the same. The allocation of the access fund will take account of a variations in students' housing costs. In fact, the access funds will be able to target resources more effectively on local needs than other forms of educational support have been able to do in the past.
It will be for the educational institutions—and this is very important—to make the determination. They will administer the fund according to local demand. In distributing the funds to the funding council, the Government have had due regard to the differences in relevant accommodation costs between the respective sectors, the number of students in each sector and the proportion of those

699
students living in private sector accommodation. I also made reference to the individual student who would be in particular difficulties; that is, a student who would lose more in benefit than would be available to him or her in loans.
I should make the point that the assessment of housing benefit for students differs only in so far as the amount of rent on which benefit is payable is reduced by a specified weekly amount. That rent deduction is made only during the period of study, so that a student grant payable for that period includes an amount towards accommodation costs. The amount of the deduction made mirrors the provision made in the grant and is set at one of the two levels—one for students in London receiving a higher grant and one for students elsewhere. If the aim of the amendment is to seek to remove that rent deduction, it is misplaced. It is only right that the deduction should be made, as the student grant includes an element for accommodation costs. Not to take that into account would create a wasteful duplication of provisions and would place students who live in privately rented accommodation in a more advantageous position than those living in halls of residence and other college-provided accommodation who do not have access to housing benefits.
I have been repetitious, but this point has been addressed by the noble Baroness and myself in speaking to the previous amendment. I hope that she will feel able to withdraw it.
Baroness David: My disbelief on this amendment is just as great as it was on the previous amendments. I do not believe that the Government have their figures right and I shall again divide the Committee.
9.28 p.m.
On Question, Whether the said amendment (No. 27) shall be agreed to?
Their Lordships divided: Contents, 77; Not-Contents, 53.

DIVISION NO. 5

CONTENTS

Addington, L.

Graham of Edmonton, L. [Teller.]

Adrian, L.

Blackstone, B.

Grey, E.

Briginshaw, L.

Harris of Greenwich, L.

Butterfield, L.

Hatch of Lusby, L.

Callaghan of Cardiff, L.

Hirshfield, L.

Carmichael of Kelvingrove, L.

Hooson, L.

Howie of Troon, L.

Carter, L.

Hughes, L.

Cledwyn of Penrhos, L.

Irvine of Lairg, L.

Clinton-Davis, L.

Jay, L.

Darcy (de Knayth), B.

Jeger, B.

David, B.

Jenkins of Putney, L.

Dean of Beswick, L.

John-Mackie, L.

Donoughue, L.

Kennet, L.

Dormand of Easington, L.

Kirkhill, L.

Ewart-Biggs, B.

Kirkwood, L.

Falkender, B.

Lockwood, B.

Falkland, V. [Teller.]

Lovell-Davis, L.

Fisher of Rednal, B.

McIntosh of Haringey, L.

Gallacher, L.

McNair, L.

Galpern, L.

Mason of Barnsley, L.

700

Mayhew, L.

Russell, E.

Mishcon, L.

Seear, B.

Monkswell, L.

Shackleton, L.

Morris of Castle Morris, L.

Stoddart of Swindon, L.

Mulley, L.

Strabolgi, L.

Nicol, B.

Taylor of Blackburn, L.

Northfield, L.

Tordoff, L.

Ogmore, L.

Turner of Camden, B.

Oram, L.

Underhill, L.

Park of Monmouth, B.

Wedderburn of Charlton, L.

Peston, L.

Whaddon, L.

Pitt of Hampstead, L.

White, B.

Prys-Davies, L.

Williams of Elvel, L.

Rea, L.

Wilson of Rievaulx, L.

Richard, L.

Winchilsea and Nottingham, E.

Ritchie of Dundee, L.

Rochester, L.

Winstanley, L.

Ross of Newport, L.

Winterbottom, L.

NOT-CONTENTS

Arran, E.

Hooper, B.

Belhaven and Stenton, L.

Jenkin of Roding, L.

Belstead, L.

Johnston of Rockport, L.

Blatch, B.

Joseph, L.

Borthwick, L.

Long, V.

Brabazon of Tara, L.

Lucas of Chilworth, L.

Brookes, L.

Lyell, L.

Brougham and Vaux, L.

McColl of Dulwich, L.

Buckinghamshire, E.

Mackay of Clashfern, L.

Butterworth, L.

Macleod of Borve, B.

Byron, L.

Monk Bretton, L.

Caithness, E.

Mottistone, L.

Carnock, L.

Mountevans, L.

Cullen of Ashbourne, L.

Reay, L.

Davidson, V. [Teller.]

Sanderson of Bowden, L.

Denham, L. [Teller.]

Skelmersdale, L.

Donegall, M.

Strathmore and Kinghorne, E.

Downshire, M.

Eccles of Moulton, B.

Suffield, L.

Elliot of Harwood, B.

Swinton, E.

Elliott of Morpeth, L.

Teviot, L.

Ferrers, E.

Thomas of Gwydir, L.

Fraser of Carmyllie, L.

Ullswater, V.

Grantchester, L.

Vaux of Harrowden, L.

Henley, L.

Vinson, L.

Hesketh, L.

Wise, L.

Hives, L.

Wynford, L.

Resolved in the affirmative, and amendment agreed to accordingly.
Clause 6 [Late claims for widowhood benefits where death is difficult to establish]:
[Amendment No. 28 not moved.]
Clause 6 agreed to.
Clause 7 [Recovery from damages etc. of sums equivalent to benefit: further provision]:
9.36 p.m.
On Question, Whether Clause 7 shall stand part of the Bill?
Their Lordships divided: Contents, 58; Not-Contents, 69.

DIVISION NO. 6

CONTENTS

Adrian, L.

Brougham and Vaux, L

Ampthill, L.

Buckinghamshire, E.

Arran, E.

Butterfield, L.

Belhaven and Stenton, L.

Butterworth, L.

Belstead, L.

Caithness, E.

Blatch, B.

Carnock, L.

Borthwick, L.

Cullen of Ashbourne, L.

Brabazon of Tara, L.

Davidson, V. [Teller.]

Brookes, L.

Denham, L. [Teller.]

701

Donegall, M.

Mackay of Clashfern, L.

Downshire, M.

Macleod of Borve, B.

Eccles of Moulton, B.

Monk Bretton, L.

Elliot of Harwood, B.

Mottistone, L.

Elliott of Morpeth, L.

Mountevans, L.

Ferrers, E.

Reay, L.

Fraser of Carmyllie, L.

Saltoun of Abernethy, Ly.

Grantchester, L.

Sanderson of Bowden, L.

Greenway, L.

Skelmersdale, L.

Harmar-N cholls, L.

Strathmore and Kinghorne, E.

Henley, L.

Hesketh, L.

Suffield, L.

Hives, L.

Swinton, E.

Hooper, B

Teviot, L.

Jenkin of Roding, L.

Thomas of Gwydir, L.

Johnston of Rockport, L.

Ullswater, V.

Joseph, L.

Vaux of Harrowden, L.

Long, V.

Vinson, L.

Lucas of Chilworth, L.

Wise, L.

Lyell, L.

Wynford, L.

McColl of Dulwich, L.

NOT-CONTENTS

Addington, L.

Lovell-Davis, L.

Birk, B.

McIntosh of Haringey, L.

Blackstone, B.

McNair, L.

Callaghan of Cardiff, L.

Mason of Barnsley, L.

Carmichael of Kelvingrove, L.

Mayhew, L.

Mishcon, L.

Carter, L.

Monkswell, L.

Cledwyn of Penrhos, L.

Morris of Castle Morris, L.

Clinton-Davis, L.

Mulley, L.

David. B.

Nicol, B.

Dean of Beswick, L.

Northfield, L.

Donoughue, L.

Ogmore, L.

Dormand of Easington, L.

Oram, L.

Ewart-Biggs, B.

Peston, L.

Falkender B.

Pitt of Hampstead, L.

Falkland, V.

Prys-Davies, L.

Fisher of Rednal, B.

Rea, L.

Galpern, L.

Richard, L.

Graham of Edmonton, L. [Teller.]

Rochester, L.

Ross of Newport, L.

Grey, E.

Russell, E. [Teller.]

Harris of Greenwich, L.

Seear, B.

Hatch of Lusby, L.

Shackleton, L.

Hirshfield, L.

Stoddart of Swindon, L.

Hooson, L.

Strabolgi, L.

Howie of Troon, L.

Taylor of Blackburn, L,

Hughes, L.

Tordoff, L.

Irvine of Lairg, L.

Turner of Camden, B.

Jay, L.

Underhill, L.

Jeger, B.

Whaddon, L.

Jenkins of Putney, L.

White, B.

John-Mackie, L.

Williams of Elvel, L.

Kennet, L.

Wilson of Rievaulx, L.

Kirkhill, L.

Winchilsea and Nottingham, L.

Kirkwood, L.

Lockwood, B.

Winstanley, L.

Resolved in the negative, and Clause 7 disagreed to accordingly.
9.45 p.m.
Lord Cledwyn of Penrhos: Before we proceed further with the Committee stage of the Bill, I point out that we have reached a position where the Government have been defeated in the Division Lobby on four occasions on matters of considerable importance. They have been defeated on disability and on the victims of road accidents. We take the view that such defeats on one of the central Bills of the Government's manifesto must give Ministers reason to pause for a moment. On this side of the Committee we regard it as an extremely serious position. I must call on the noble Lord the Leader
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of the House to state the Government's intentions against that background.
Lord Belstead: The Government intend to continue with the Bill this evening to the point that it was agreed through the usual channels we should reach. We shall of course as a government be considering the result of these Divisions in the usual way.
[Amendment No. 29 not moved.]
The Deputy Chairman of Committees (Lord Grantchester): I am advised that as Clause 7 does not stand part of the Bill I cannot call on Schedule 1 and the amendments thereto.
Schedule 1 [Amendments relating to the recovery from damages etc. of sums equivalent to benefit]:
[Amendments Nos. 30 to 33 not moved.]
Clause 8 [Liability to maintain dependants]:
Earl Russell Earl Russell moved Amendment No. 34:
Page 10, line 19, at beginning insert:
("() In section 22 of the 1986 Act, at the end of subsection (8A) there shall be inserted the words "and shall provide for £10 of any payments made to that person in any week by another person for the maintenance of that other person's child or children to be disregarded.").
The noble Earl said: Clause 8 relates to maintenance for single parents. The object of the clause is to assist in recovering maintenance from fathers, an objective supported from these Benches. The object of the amendment is to create a £10 disregard on income support for the first £10 of maintenance recovered. The purpose of such an amendment is to create an incentive to operate the system as this is one case where we think the Government are doing something which on the whole is sensible. We should like to help them to succeed. The amendment is offered in that spirit.
The proceedings for recovering maintenance are necessarily tedious and may possibly be painful. If there is not some advantage in doing it people will not do it. This applies to the business of persuading the father to pay, as the father is always liable, if he is the somewhat irresponsible person that the system envisages. He may say, "Why should I pay all this money just to save the Treasury? They have plenty anyway". It will assist in recovering maintenance if we can assure him that his child will be receiving a slightly larger total sum than would be the case if he paid nothing at all.
The position is similar for the mother. She has some disincentive to operate a system which involves a great deal of argument, a great deal of hassle and possibly a certain amount of discontent. There have been cases where the mother has been afraid to call on such a system. If she is not a penny better off at the end of it she may well suffer a disincentive to bother. That could defeat the effects of the clause.
A disregard of the kind we propose in the amendment is in use in both the Australian and the United States benefit systems. Both have found that

703
it is a considerable help in trying to get people to operate the procedure of recovering the money. I know that it would cost the Treasury a certain amount of money but the sum would be neglible. The assistance which it could bring in the form of recovering more money from fathers than would otherwise be the case would produce the possibility that it would result in a net saving to the Treasury. I hope that the amendment will not be objected to on the ground that it would involve cost to public funds. Any such cost would be negligible. In our view, what is put forward would make the system proposed by the Government a little more effective. It is offered in an altogether sympathetic spirit. I beg to move.
Lord Carter: On these Benches we think that this is a very sensible amendment. It is a disregard which would provide a strong incentive for the payment of child maintenance. We believe that the argument put forward by the noble Earl is a good one. In our view there is a longer-term benefit in encouraging the lone parent to claim maintenance. There may come a time when the lone parent may be able to seek employment. The mere fact of having a maintenance order may make the difference between whether the lone parent can afford to take up that employment or finds that the family would be poorer, after paying the child care costs, than if they stayed on benefit. The disregard would help to overcome that situation.
Baroness Blatch: Amendment No. 34 does not address anything in Clause 8, but rather it seeks to amend the way in which maintenance payments are treated for the purposes of income support. More specifically, this amendment proposes that £10 of any maintenance payments made in any week in respect of one or more children should be disregarded. Currently, in assessing the amount of income support payable, and indeed also for assessment of supplementary benefit previously, any maintenance received is taken fully into account. In this respect it is similar to most other types of income.
In considering this amendment, we need to remember what is actually happening. Income support is available to lone parent families who need it, and it is absolutely right that it should be so. But support for these families should not be left to the social security system. Absent parents have a clear legal duty to maintain their families. Yet for three quarters of lone parent families dependent on income support, the absent parent pays no maintenance at all. That is the situation for some half a million families. They should not leave it to the benefit system. Income support for lone parent families costs £1-9 billion a year. It is right that the benefit system should receive some recompense from absent parents for the support it provides for their families.
Maintenance is still extremely important for the lone parent family receiving income support. It is income which the lone parent can take if he or she leaves benefit and takes up work. It is also vital that the absent parent should not get into a habit of
704
non-payment, so that regular maintenance is available to help the lone parent who wants to work. It is clearly right that the wider review which has been undertaken should look at all the factors involved in decisions about paying or not paying maintenance, and this is one aspect which we shall consider in this context. But we also have to look at the balance of costs and other aspects.
I move on now to Amendments Nos. 35, 36, 37, 38 and 40. These together seek to ensure that when a claimant leaves income support, then the rights to receive all payments under a Section 24 maintenance order can be transferred to the claimant, not just those payments in respect of the children. A consequential amendment is made to the provisions for transferring an order back to the Secretary of State or the lone parent reclaiming benefit.
Clause 8 includes a number of measures to improve the action taken by DSS to obtain maintenance under the current maintenance system. At present, where parents are divorced or were never married, we can only seek to recover the benefit paid because of the children. In these situations, the new Section 24A empowers courts to consider the cost of caring for the absent parent's children, and to have regard to the income support personal allowance paid for the caring parent when making a DSS order for maintenance. Courts already have powers to have regard to the mother's costs in caring for children under family law.
Provided that there is no private maintenance order, Section 24A also allows the Secretary of State to transfer rights under a DSS order to a claimant who leaves income support. When the parents are divorced, or were never ever married, this will not apply to any amount for the caring parent's personal allowance. We considered transferring rights to receive the personal allowance as well, but after careful thought rejected that idea. Although, as I have said, under family law the courts can award an amount for the children which includes an element for the caring parent's own costs as carer, it is possible that that may be less than the income support personal allowance. of course, the fact of leaving benefit itself implies a change of circumstance.
In practice many absent parents cannot afford to pay the full amount of the children's allowances and we anticipate only a small number paying a contribution for the caring parent; but, where they do, a move off income support by the caring parent would be likely to trigger an application from the absent parent to reduce the amount that has to be paid. There is much less acceptance by the absent parent of the need to recognise the caring parent's costs than of the responsibility to support the children. One of the objectives of seeking transfer is to secure continuity of maintenance income for the caring parent and to avoid the need for her to return to court. If transfer were instead to provoke variations the measure would be counter-productive. That would be the likely effect of this amendment.
We recognise the concern that has been expressed on this point and will look at the issues raised as part of our wider review of the maintenance system.

705
For the reasons and because of the promises I have just given, I recommend to the Committee that both amendments are rejected.
Earl Russell: I must confess to a little disappointment in that reply. We do not propose that the maintenance of children be left entirely to the social security system. I had thought that I had made that clear in my speech. We propose a £10 disregard, which is a limited fraction of total income support, to encourage people to use the system of recovering the sum involved from the father. I do not see that that is a proposal to leave it to the social security system. I understand that the Minister is worried about that. I was not offering the amendment in any such spirit. I hope that that can be understood.
I entirely agree with the Minister that it is necessary to look at the balance of costs, but when she looks more closely at it the Minister may find that the balance of costs is a fine one, and that in any case, on the worst interpretation, the amount the amendment would cost the Government would
706
be small. There is the possibility that it could save the Government some money if it made the machinery for recovering money from fathers more effective than it would otherwise be.
I do not intend to divide the Committee at present. The amendment was not offered in that spirit, but there is a possibility of returning to the matter on Report. I hope that by the time we reach that stage, the Government may have thought a little further about what is being proposed here, which does not seem to me in any way to conflict with their objectives. I would be grateful if between now and Report they would consider the matter in the light of that remark. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 35 not moved.]
The Deputy Chairman of Committees: If Amendment No. 36 is agreed to, I cannot call Amendment No. 37.
[Amendments Nos. 36 to 38 not moved.]
10 p.m.
Lord Henley Lord Henley moved Amendment No. 39:
Page 11, line 25, leave out ("subsection (6)") and insert ("subsections (6) and (6A)").
The noble Lord said: The amendments are primarily tidying-up amendments to ensure that the interim improvements we are making to our maintenance arrangements under the current system work in the way intended.
First, we are clarifying the position regarding any arrears that may be outstanding at the time of any transfer of rights under a DSS order to the lone parent or any transfer back to the Secretary of State. If there are any arrears at the time of transfer to the lone parent, and those arrears relate to the period when the order was held by the Secretary of State, then he retains the right to take enforcement proceedings in respect of those arrears. Similarly, when an order is transferred back to the Secretary of State, the lone parent retains the right to take enforcement proceedings on any arrears accrued during the time she held the order.
Secondly, we are setting out precisely when the transfer of rights takes place. When the transfer is to the lone parent on her leaving benefit, the intention is that the transfer should take effect from her ceasing to receive income support. While there will be a small element of backdating we believe it is right to ensure continuity of payment and it will simply be a question of forwarding any money received by the Secretary of State following a transfer which should properly be made to the lone parent. Where it is a question of transferring rights back to the Secretary of State the transfer can be made when benefit recommences or at a later date where a transfer is not immediately necessary because payments continue to be made regularly for a period. In such cases the date of transfer would be specified in the notice itself.
The next two amendments are technical corrections and do not affect the policy at all. The final amendment is a new provision introduced to safeguard the interests of the Legal Aid Board. Where the lone parent was legally aided for the original proceedings, the Legal Aid Board can recover any money still outstanding in respect of the costs of that action from an award of arrears of maintenance ordered to be paid as a lump sum. Where the lone parent has taken her own proceedings both she and her solicitor have a duty to notify the board. The solicitor will usually do this and will arrange payment. Special arrangements are needed where the Secretary of State has taken action to obtain arrears. This amendment will provide for the Secretary of State to notify the board in any case where arrears of maintenance are awarded as a lump sum following action he has taken to enforce a claimant's order and legal aid costs are outstanding.
There is no change of principle here; the provision merely helps give practical effect to the Legal Aid Board's existing claim on lump sum payments for outstanding legal aid costs. I commend these amendments to the Committee and beg to move Amendment No. 39.
Earl Russell: Perhaps I may ask my noble kinsman to explain a little further the thinking behind Amendment No. 45. I have been trying to work out exactly what it is getting at. I am not quite sure that I have understood it. The provision is clearly concerned with the recovery of money for legal aid costs, but I am not entirely sure that I follow the legislative prose carefully enough to understand exactly who is recovering what from whom. I should be grateful if my noble kinsman could enlighten me a little.
Lord Henley: It is rather complicated. The final amendment, Amendment No. 45, is to safeguard the interests of the Legal Aid Board. Where the lone parent is legally aided for the original proceedings, the Legal Aid Board can recover any money still outstanding in respect of the cost of that action from an award of arrears of maintenance ordered to be paid as a lump sum. The provision safeguards the interests of the Legal Aid Board. Does that satisfy my noble kinsman?
Earl Russell: I apologise for taking the matter further but this makes me begin to wonder whether we are entering the area of Schedule 1 and the discussion which has just taken place. Is this a case where one recovers money from the father? Will that money pay the costs of the Legal Aid Board and not support the child? Is the money deducted from what would otherwise go to the child?
Lord Henley: I did not notice that we had discussed Schedule 1. Sadly, by odd procedural moves of the noble Baroness opposite, we have been prevented from discussing it. The noble Lord, Lord Byron, had some amendments down and I am sure we would all have taken a great interest in considering them but he was unable to move them. It is in the interests of the Legal Aid Board. I do not think that the child will lose out, just as the noble Earl knows full well that under Section 22 of last year's Act, which would have been affected by Schedule I, it would not be a case where the individual lost out.
Earl Russell: Is this a case where a government amendment applies the same principle as Section 22 of last year's Act? That is what I was trying to find out.
Lord Henley: I think I had better come back in detail on that. I do not think that that is the case but perhaps the noble Earl will accept my assurances to that extent and allow me to press the amendments. I shall write to him to make sure that I have got the position right and to make sure that he understands what I have been saying. I commend the amendments to the Committee.
On Question, amendment agreed to.
The Deputy Chairman of Committees: Amendment No. 40 contains a misprint. The Marshalled List should state:
Page 11, line 44, leave out from ("rights") to end of line 49.
[Amendment No. 40 not moved.]
Lord Henley Lord Henley moved Amendment No. 41:
Page 11 line 49, at end insert:
("(6A) The giving of notice under subsection (3) or (6) above does not transfer or otherwise affect the right of any person—
(a) to receive a payment which fell due to him at a time before the transfer took effect; or
(b) to exercise the relevant rights in relation to any such payment;
and, where notice is given under subsection (3), subsection (5) above does not deprive the Secretary of State of his right to receive such a payment in respect of any personal allowance element or to exercise the relevant rights in relation to such a payment.
(6B) For the purposes of this section—
(a) a transfer under subsection (3) above takes effect on the day on which the dependent parent ceases to be in receipt of income support in consequence of the cessation referred to in paragraph (c) of that subsection, and
(b) a transfer under subsection (6) above takes effect on—
(i) the first day in respect of which the dependent parent receives income support after the transfer under subsection (3) above took effect, or
(ii) such later day as may be specified for the purpose in the notice under subsection (6),
irrespective of the day on which notice under the subsection in question is given.").
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Mottistone Lord Mottistone moved Amendment No. 42:
Page 13, line 10, at end insert (", provided that a court shall only exercise the power to make a maintenance order within the meaning of the Attachment of Earnings Act 1971 (power to attach earnings) if the liable person consents to the making of such an order.").
The noble Lord said: New Section 24B of the Bill was introduced by the Government fairly late in another place. It reflects, as I see it, their concern, shared, I believe, by most Members of the Committee, that people should not be allowed to walk away from their family obligations. The provisions of the new section allow the DSS to step in and seek enforcement of maintenance orders in order to recover what it is paying out in family income support where an order already exists but is not being enforced by the man, or usually the woman, concerned.
One means of enforcement which the Government seem to favour is an attachment of earnings order. That has two basic problems. As the Committee will know, I am advised on this matter by the CBI. The CBI informs me that employers have grown accustomed to handling the small volume of attachment of earnings orders currently made by the courts for civil debts. They have accepted the burden as a public duty although the charge they may levy on their employees offers no realistic compensation for the administrative cost. One company has worked out that the cost per transaction can be as much as £5 whereas the most that is ever charged is 50p. Most companies do not even charge that amount because they do not think it is reasonable to make a charge on their employees.
A sideline to what I am discussing in the amendment but a point worth making is the fact that companies are doing the Government's job for
710
them in the same way as they do with the pay as you earn scheme. If they are to obtain compensation for that, it seems to me that it should come from the Government and not from the employee. However, I make the point in passing. That is one of the snags of using attachment of earnings orders as a means of enforcement.
Generally the quantity of orders has been kept within reasonable limits because the magistrates' courts have moved forward in a sensible manner, always obtaining the individual's acquiescence before imposing an attachment order. However, the Government are now showing growing enthusiasm for the use of attachment orders for debts where acquiescence may not be present.
My amendment seeks to ensure that an individual's acquiescence is obtained before the courts enforce an attachment of earnings order. If the Committee cares to think about that, it will appreciate that if people are called upon in relatively large numbers by their employers to hand over money which does not concern the employer—he is merely acting as an agent—it could lead to quite serious industrial relations troubles. Companies are extremely worried about the possible implications. Provided that the person who is liable for the attachment of earnings order has been persuaded by the court that he should consent to it voluntarily, everything will be perfectly all right. If it is done voluntarily, it will not lead to trouble. However, if it starts to be imposed without the voluntary feature, the industrial relations problems might be very great.
Under the present arrangements, employers must actively institute the recovery of the administrative charge rather than apply for it automatically—that relates to applying for it from the employee's point of view—but they will be reluctant to do so where the debt is not accepted by the debtor. That comes back again to the problem of collecting the expenses for running the scheme. Companies will not want to do that. They will be even less inclined to do it. There has been no offer on the Government's part to cover those administrative costs.
Companies are concerned that it will cost them money which they can ill afford these days. As we all know, they must be competitive in world markets, so anything which unreasonably inflicts extra costs on companies is not in the interests of the country, let alone the Government. In addition, companies might possibly be put in the position of experiencing industrial relations problems at a time when many have managed to achieve a much happier industrial relations climate than they had some 15 or 20 years ago.
I hope that the principle of the amendment will be accepted by the Government, although the way in which it is presented may not. I hope that I shall receive some encouragement. During the course of the passage of the Bill through this place, we may arrive at a solution which reflects the Government's undoubtedly right decision to try to ensure that people who walk away from their families should not be allowed to get away with not contributing to their support. At the same time, I hope that that will

711
not put a great strain on industry. Such a strain might well arise for quite the wrong reasons and reasons which are not connected with the main purpose of this part of the Bill. I beg to move.
Lord Carter: I shall be extremely interested to hear the Minister's reply. At first sight, it appears that the amendment is concerned to look after companies and their administrative cost at the expense of lone parents. Perhaps I have misunderstood the noble Lord's explanation.
Lord Mottistone: Perhaps I gave the wrong emphasis. The amendment tries to save companies having problems with industrial relations. The administrative costs are part of the problem, but they are not the main reason for the amendment. The main reason for the amendment is that, until now, in the relatively few cases for which an attachment of earnings has been required, courts have been able to obtain acquiescence from the person concerned before making the order for attachment of earnings. Everything has been all right because it has been agreed to.
Under the Bill, if my amendment is not accepted, it will be possible for courts to order people to pay through attachment of their earnings what they should pay in any case. However, if that is to happen on a relatively large scale within a company, people in the workforce will start to say, "Look, what on earth is my employer doing collecting that money which has nothing to do with the company?". The worry is an industrial relations worry, not a money worry.
Lord Carter: I am grateful to the noble Lord for that explanation. I shall withdraw what I said and say instead that the amendment looks after the company's industrial relations at the expense of lone parents. Surely, if the liable person does not consent to the making of such an order, the lone parent will suffer. The Government will have to make that balance of judgment. I shall be interested to hear the Minister's response.
Lord Harmar-Nicholls: I find it difficult to go along with my noble friend because, as I read the amendment, it removes the principle which supports an attachment of earnings at any time.
Some people objected to PAYE being introduced as part of the tax system of this country. It was justified on the grounds that everybody must make his or her contribution according to his or her means in order that the country's bills could be paid. If we start moving away from the need in urgent cases for the ultimate sanction of attachment of earnings, we remove one of the weapons which enable us to get people to pay their just dues.
I understand exactly what my noble friend means. As an employer of labour I have a lot of sympathy with employers who have the onus of having to do things which are not their business. They have to do the Government's job. However, we accept it as a principle, as I said, with regard to PAYE and in
712
other cases. I do not think that at this stage we should start in a separate way to undermine the force of the principle of justice in having attachment of earnings as a way of sorting out matters.
Lord Mottistone: My noble friend misses the point, which is that hitherto in applying attachment of earnings the courts have always sought and obtained the acquiescence of the people who have to pay. My amendment simply preserves the status quo. Without it we fear that the status quo may not be maintained.
Baroness Seear: While I understand some of the objections that the noble Lord, Lord Mottistone, raises, it is of overriding importance to get the money to the woman. There are two reasons. In the first place she needs it and we know that in many cases she does not receive it. Secondly, if she does not receive it, the burden falls on the taxpayer.
If the Government can find some way of getting round this problem without troubling the employers, all well and good. But it is difficult to see straightaway how that can be done. The point made by the noble Lord, Lord Mottistone, is that one has to have the consent of the people concerned. The very people who most need attachment to be applied are those who do not consent to it. Those who are willing to have the money sent might even send it without the employer having to do anything. That does not necessarily follow but it is more likely. The people who emphatically will not pay unless the employer does something about it are those who will not give consent if they are asked.
Employers are landed with doing all sorts of things which are the state's job. It is too bad but it is one of the many burdens that they have to put up with. If the Government can find a way round the difficulty, that will be even better.
10.15 p.m.
Baroness Blatch: My job has almost been done for me. This amendment seeks to reduce the scope for action available to the courts in proceedings taken by the Secretary of State to enforce a claimant's private maintenance order when it has fallen into arrears. We understand that employers may be concerned about the possibility that an increase in the number of attachment of earnings orders may increase their role in this sensitive area. But the changes proposed by Clause 8 will not have that effect. In addition, we think that the option that the court has of making an attachment of earnings order in cases where the debtor repeatedly defaults is too important a tool of enforcement to be given up lightly.
Clause 8 includes a number of measures to improve the action taken by the Department of Social Security to obtain maintenance under the current maintenance system when income support is claimed. These are interim steps while the Government examine the working of the maintenance system as a whole and possible alternatives. No decisions have yet been made.

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While some maintenance payments are made fully and regularly without any special measures, unfortunately it is true that many fall into arrears. The new Section 24B enables the Secretary of State to take enforcement action on behalf of claimants whose private maintenance orders have fallen into arrears. The intention is that the Secretary of State should be able to take whatever action the lone parent could take to have payment enforced. That includes the possibility of an attachment of earnings order when the court thinks that it is appropriate to make one.
An attachment of earnings order can be made either with the debtor's agreement, or without it if 15 days have passed since the making of the maintenance order and the debtor has failed to make one or more payments due under the order and it appears to the court that default was due to wilful refusal or culpable neglect. Clause 8 does not change that. The court cannot make an attachment of earnings order unless arrears have built up.
The Government appreciate the co-operation given by employers in acting upon attachment of earnings orders. The present arrangements enable employers each time to deduct from salary 50p—as has been mentioned by my noble friend—which they retain themselves in recognition of the extra administrative costs they incur. The procedure is straightforward. They merely have to tell the employee in writing. I understand that arrangements for the charge are being reviewed and employers are being consulted.
It would obviously be preferable for absent parents to pay maintenance voluntarily without the need for courts and employers to be involved. But many absent parents do fail to meet their responsibilities. The cos: therefore of supporting their families falls on the taxpayer. That is wrong. It is precisely such a case where the amendment proposes to restrict the powers of the court. But it is also precisely such a case where the need for firm and effective action arises.
I must remind the Committee that attachment of earnings orders were introduced as a way of dealing with debt without resorting to imprisonment. Clearly that must remain a priority.
I should also point out to my noble friend that the drafting of the amendment itself does not serve his intentions. That is because maintenance orders—which are not the same as attachment of earnings orders—are not made under powers contained in the Attachment of Earnings Act but under other legislation.
While we understand the concern of employers we think it is important to achieve a proper balance between individuals' rights and their responsibilities. That was a point raised by Members of the Committee. This amendment does not do that.
My noble friend Lord Mottistone made reference to compensation from the Government for costs. In 60 per cent. of cases an attachment of earnings order is made because payments have fallen into arrears. It is therefore right that any administrative costs should fall to the debtor and not to the taxpayer.
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The amendment is imperfectly drafted. If for no other reason I hope that my noble friend will feel able to withdraw the amendment. I hope that he will also feel that the case against the amendment has been made.
Lord Mottistone: I am not altogether happy with what I regard as a "curate's egg" answer. I shall certainly come back at a later stage. At this stage I shall not bore the Committee by plcking to pieces what we have just been told.
I am not happy. I believe that there may be other ways round such provision. It is important to realise that if one makes companies charge the debtor (as he is seen by the state) the proper rate for the cost of administration he is not a debtor to the company. That is absolute nonsense in industrial relations terms. We must have another think on that. I am unhappy, but at this stage I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 1 [Amendments Relating to the Recovery from Damages etc of Sums Equivalent to Benefit]:
The Deputy Chairman of Committees: I have to revert back to Schedule 1 to the Bill. I am advised that, following the failure of the Motion that Clause 7 stand part of the Bill, it was correct not to call Amendments Nos. 30, 31, 32 and 33, which were amendments to Schedule 1, but that I must still put the Question on Schedule 1. A note reads that the Question must be put on Schedule 1, the schedule left out as a consequence of leaving out Clause 7. In those circumstances I now put the Question.
Schedule 1 negatived.
Lord Henley Lord Henley moved Amendments Nos. 43 to 45:
Page 13, line 22, leave out ("20") and insert ("17").
Page 13, line 40, leave out ("this section applies, the Secretary of State shall") and insert ("by virtue of this section, the Secretary of State commences any proceedings to enforce a maintenance order, he shall, in relation to those proceedings").
Page 13, line 45, at end insert:
("(6A) Where, in any proceedings under this section, the court makes an order for the whole or any part of the arrears due under the maintenance order in question to be paid as a lump sum, the Secretary of State shall inform the Legal Aid Board of the amount of that lump sum if he knows—
(a) that the primary recipient either—
(i) received legal aid under the Legal Aid Act 1974 in connection with the proceedings in which the maintenance order was made, or
(ii) was an assisted party, within the meaning of the Legal Aid Act 1988, in those proceedings; and
(b) that a sum remains unpaid on account of the contribution required of the primary recipient—
(i) under section 9 of the Legal Aid Act 1974 in respect of those proceedings, or
(ii) under section 16 of the Legal Aid Act 1988 in respect of the costs of his being represented under Part IV of that Act in those proceedings, as the case may be.").
The noble Lord said: I spoke to the amendments when speaking to Amendment No. 39. I beg to move Amendments Nos. 43 to 45 en bloc.
On Question, amendments agreed to.
On Question, Whether Clause 8, as amended, shall stand part of the Bill?
Baroness Macleod of Borve: At this late hour I shall be brief. I gave notice of my intention to oppose the Question that Clause 8 should stand part of the Bill because it was not fit and proper when only two amendments had been tabled. Since then we have had a reasonable debate which will continue at length on Report. I thank the Minister for a most helpful and comprehensive letter which I received today.
Although Clause 8 was not discussed in another place it is most important. For more than 25 years I have tried to administer the law in separation orders and so forth. One of the problems related to the amount of money that should be paid by a father whether through an attachment of earnings order or any other means. During that time so much has changed in this country. No longer do we have married couples separating and divorcing but we have young people living together and then separating. That is one of the problems. To my certain knowledge a number of mothers do not know or remember the fathers of their children. They then live with someone else and have other children by that liaison.
The clause is most complicated and when I read it I thought that the drafting was almost impossible to follow. However, having heard the debate tonight, having read the Minister's letter in which he says that the whole maintenance system will be investigated, and despite the fact that there will be many anomalies, I can do no better than to sit down. The night has been long and if I continue I shall be tedious.
Baroness Blatch: My noble friend is never tedious. I am grateful not only for her remarks about the long and involved letter but also for agreeing not to oppose the Question that the clause shall stand part of the Bill. Clause 8 is complex but, as my noble friend has said, very important. The measures form a practical package of short-term improvements to our arrangements. The Government are looking more widely at the whole system and later this year will be bringing forward proposals. In the meantime I hope that the Committee will accept the fact that Clause 8 makes a worthwhile contribution and I commend it to Members of the Committee.
Clause 8, as amended, agreed to.
10.30 p.m.
Earl Russell Earl Russell moved Amendment No. 46:
After Clause 8, insert the following new clause:
("Earnings from employment
In section 22(8) of the 1986 Act, at the end there shall be added the words, "provided that, in calculating a person's earnings from any employment, including self-employment, there shall be deducted the amount of any expenses reasonably incurred by him without reimbursement, to enable him to carry out his duties in connection with that employment, in respect
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of the making of reasonable provision for the care of another member of the family".").
The noble Earl said: The effect of Amendment No. 46 is to introduce a child care disregard for income support for single parents who work part time. I am sorry that the noble Lord, Lord Boyd-Carpenter, is no longer in his place because earlier I promised him a further answer to his questions about priorities.
The second priority which I wish to follow throughout this Bill is that it seems to me important to use the benefit system in ways which help people to get back into employment. It is a necessary conclusion from our income support figures that too high a proportion of the population is not in productive employment. In many ways the consequences of that are unfortunate.
By giving a little help at the crucial moment, it is of ten possible to make it easier for people to work if they wish to do so. No one says that single parents must work. We agree with what Mrs. Shephard said in another place on that. The point is not to push people into work but to make it easier for them to work if they so wish. It is to be strictly a matter of choice.
In this amendment we are arguing that the way in which the benefit system is working at present is creating a disincentive to single mothers to work. That is unfortunate. It is keeping people out of productive employment and creating a new poverty trap. The cost of child care is inescapable. If the mother is working the child must be cared for. The proportion of our population who have grandmothers on tap is regrettably lower than it was. That is a necessary result of the mobility of labour and cannot be reversed.
Because the cost is there and because there is inevitably a loss of income when child care costs are to be paid, the result can be that a woman is worse off working part-time than if she were not working at all. I take an example. A woman has part-time earnings of £40. She spends £16 on child care. That is not a particularly generous estimate and it may well come to more. She spends £5 on fares. That estimate was probably arrived at before the latest round of fare increases. There is also a loss of benefit because of earnings. The result is that the woman is £11 worse off because she is working.
The Government do not like poverty traps. We do not like poverty traps. We think that the effect of discouraging people from working is unfortunate and something should be done to change it.
We have discussed the matter in this Chamber before and we have received the reply that this is uncomfortably like the old single payment system. I hope that the Government are capable of thinking beyond that. Here we have a more general way of thinking about tax and benefits which we have come across in other debates in the past.
This Government have an avowed hostility towards allowances. Also, they have an avowed hostility to provisions like single payments which take account of special circumstances. That results from a philosophical hostility to the principle of distorting the market. I can understand what the Government are getting at, but it is worth thinking about who is distorting the market. It seems to me

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that if you are assessing peoples' incomes, you really should be thinking about the disposable income, the net income, the amount which is free to be spent. That is what makes the difference.
Therefore, if you take necessary expenses out of the calculation, you end up taxing unequally people who have equal incomes. That is a distortion of the market and has unfortunate effects. We have an example of that here. Therefore, I hope that the Government will go somewhat beyond the philosophical framework and look at what is happening.
One can quantify what is happening. Married women rely on their husbands for child care, as I remember. Some 36 per cent. of married women work part-time. Widows do not lose benefit if they work part time. If we compare widows with single parents we have a controlled experiment. Forty-two per cent. of widows work part time, but in the case of single parents who lose benefit, only 24 per cent. work part time. That is a significant discrepancy. It marks the extent to which current policy keeps people oat of employment. That may be costing the Treasury money, which one hopes might concern it. I beg to move.
Baroness Turner of Camden: We on these Benches support the amendment moved by the noble Earl, Lord Russell. I do not intend at this time of night to add to the arguments that he advanced in such detail, so specifically and so well, except to point out to the Government that a number of their own statements and documents recently before both Houses indicate that they are concerned about the provision of child care and wish to encourage women back into the labour market on a part-time or even a full-time basis where appropriate. One of the objectives of the amendment is to put flesh on the bones of that intention. I hope that the Government accept it.
Baroness Blatch: This amendment does not address anything in the current Bill; rather it seeks to amend the way in which certain employment expenses, are treated across the income-related benefits. More specifically, the amendment proposes to disregard any costs of caring for a child or another member of the family if these are reasonably incurred in connection with employment.
The Committee will be aware that the current earnings rules were thoroughly debated in both Chambers when the reforms were introduced, and again last year during the Committee stage of what became the Social Security Act 1989. On both occasions Parliament decided that it was sensible for the income support scheme to be in line with the housing benefit and family credit schemes, neither of which has ever had a statutory disregard of any employment expenses.
That was the proper approach then and it remains so today. People in work who do not receive any income-related benefit are not generally protected from employment expenses. To make such provision for people receiving benefit could create
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disincentives for them to leave benefit and move into work. For example, a claimant on income support might be tempted to limit the hours he or she works, and so their wages, to remain on income support. Similarly, on family credit, such a disregard could have a negative effect, discouraging independence and improvement so as to remain within the benefit system. That would be taking a backward step.
I suspect that Members of the Committee are particularly concerned about the position of lone parents as they may be the most likely to incur child care costs if they were to take up work. The Government are concerned that lone parents who want to work should be helped to do so. We believe the current structure of benefits goes a long way to achieving that by giving special help to lone parents. The present structure of disregards in income support, housing benefit and in community charge benefit helps lone parents by disregarding the first £15 of their earnings. That gives them a sizeable lead over other claimants, most of whom receive a £5 disregard on their earnings if they are on income support.
In addition, as we have already announced, for lone parents receiving housing benefit or community charge benefit the earnings disregard will be increased from £15 to £25 a week from October. We also increased the lone parent premium in housing benefit and community charge benefit in April, as part of the uprating, from £8.60 to £9.70 a week. For lone parents on family credit there are also special measures. They receive the same adult credit as a two parent family, and their one parent benefit is ignored in the calculation of their income.
I should also mention one other very important issue for lone parents, which is maintenance. Absent husbands and fathers are liable to maintain their dependants and it is quite unfair that the burden so of ten falls upon the taxpayer. Regular payments of maintenance can give a substantial measure of help to lone parents wanting to work and facing perhaps child care costs. Maintenance payments may be the boost that many lone parents need to take up work. Members of the Committee will know that we have announced a review of the maintenance system as a whole; and we are also taking action in the meantime to improve the amount of maintenance recovered. We believe this is good news for lone parents.
The various provisions I have mentioned within the benefit system help all lone parents who wish to work, including those with child care costs. On child care itself, we believe parents are the ones best placed to make decisions and choices about the care of their children. The Government's role is to help them have the greatest possible choice of child care provision and to ensure standards. Voluntary organisations and employers have an important role to play here and employers are increasingly recognising that help with child care can help them recruit and retain staff. The Budget measure recently announced by my right honourable friend the Chancellor which exempts from tax nursery places provided by employers should help to improve availability of child care.

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The Committee will also be aware that the Ministerial Group on Women Issues, of which my department is a member, has shown particular interest in child care and has announced a set of proposals to promote the provision of good quality affordable child care. These included the encouragement of partnerships between employers, the voluntary sector and others and encouragement of employers to use the tax reliefs available to provide child care.
Some examples will help to show what is actually happening. First, as the Committee will be aware, the Children Act has now received Royal Assent. The Act should lead to a general improvement in child care standards. The Department of Health is giving £2 million over three years to voluntary organisations to set up and run new projects for pre-school children.
I should also mention here the interest shown by the private sector in child care, including, for example, the Midland Bank. The private sector is probably the fastest growing sector in child care at the moment and a new national association for commercial child care provision has recently been set up.
There is also the Budget measure of my right honourable friend the Chancellor which exempts workplace nurseries from tax as a benefit in kind. This will remove what many employers have argued is an obstacle to the growth of nursery provision by employers. It will help increase the supply of good quality nursery care by employers. That in turn will make it easier for parents at all income levels to combine parenthood and paid employment should they wish to do so. My department too is making headway. In March its first nursery for the children of staff at our local office in Hertford was opened by my honourable friend the Parliamentary Under-Secretary for Social Security.
For all those reasons, the Government believe this amendment is neither necessary nor helpful. It would hinder, not help, claimants who want to move from benefit to greater independence. The benefit system already contains a number of provisions to help lone parents who work and we believe that improvements in the maintenance system will help them further. The Government are active in promoting choice for parents of child care of proper standards. In addition, this amendment would introduce a complexity into the benefit system which needs to be as simple as possible. It would also have considerable benefit and administrative costs. I invite the Committee accordingly to reject the amendment.
Earl Russell: I should deceive the Committee if I said other than that I am disappointed by that reply. Perhaps I would not deceive the Committee but I would certainly surprise it. I am perfectly aware of course that this amendment has previously been debated. I thought that a very powerful case had been made out of it and I brought it back to see whether it might seem a little more persuasive for the Government with the passage of time.
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The noble Baroness made a considerable issue of the point of disincentive; that at the ceiling level—the cut- off point, wherever it is—there might be a disincentive to working those few extra hours which involve coming off benefit. Does not that involve conceding the point I made that the loss of money by going to work at all could act as a disincentive? That is a most important point.
The most important point is the first step back into the labour market. It is a step which takes a certain amount of courage and there is the temptation to have cold feet. That is particularly so if the mother has any reason to doubt whether the care the child is receiving is thoroughly adequate. It is something which any responsible mother will thoroughly question.
The noble Baroness also made a great deal of the issue of leaving the matter to employers. I know that employers are doing more than they were and I warmly welcome that fact, but it is still not very much. I also remind the Committee that we are discussing part-time work. Most employers who are concerned to lay on child care are thinking first and foremost of their full-time workers. Here we are thinking of people who, just because they are single parents, are not of ten in a position to undertake full-time work in the labour market particularly in the first few years. They are people who are likely to be moving in and out and who may be undertaking short periods of work. For them it would not be efficient for employers to organise child care. That does not meet our concern in relation to the present case.
The noble Baroness also complained that the burden falls on the taxpayer, and of course it does. However, the argument that I am offering here is that the Government are cutting off the taxpayer's nose to spite his face and that they are actually making it harder for people to come off benefit.
There is another real philosophical difference here. The Government regard benefit very much like smoking in that once one has started one wants to go on. We on this side of the Committee are much more inclined to think that benefit is in the category of a leg up; it gives one the opportunity to get out of an awkward situation; to get moving again; to get back on one's feet and to start looking after oneself. That is a very big difference in our attitudes towards benefits.
We shall have to discuss the matter further, but at this time of night I do not think it is worth pushing it further now. I hope that the Government will think about the matter again. Meanwhile I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10.45 p.m.
Clause 9 [Income support in respect of accommodation charges for certain persons in residential care and nursing homes]:
Lord Carter Lord Carter moved Amendment No. 47:
Page 14, line 24, at end insert ("and shall ensure, as far as is practicable, that the amounts prescribed by him are sufficient to meet the cost of any such accommodation which would be met by a local authority in the case of persons other than qualifying persons".)
The noble Lord said: In moving this amendment, with the leave of the Committee, I shall speak to Amendments Nos. 48 and 202 which are also in my name and that of other noble Lords. Amendments Nos. 49 to 53 are grouped with these amendments. They are government amendments and I am sure that the Minister will speak to them when he responds.
These amendments seek to address the problems which we now know are being faced by many elderly and disabled people in homes where the charges are in excess of the income support limits. The amendments seek to provide a structure for ensuring that the department has power to make additional payments to individuals to top up the current income support limits where it is reasonable to do so. The debate will have echoes of the debate that we had on the community care aspects of the NHS Bill.
Clause 9 of this Bill was introduced in response to the significant level of concern expressed about the inadequacy of income support limits to meet the charges of many residential and nursing homes. Although the National Health Service and Community Care Bill alters the funding arrangements for residents entering homes after April of next year, it does not address the problem faced by existing residents who are excluded from the provisions of the Bill and who will continue to have to meet the charges from income support.
We know that Clause 9 will help to address this omission by ensuring that the Secretary of State, when setting income support limits for existing residents, will take into account information from local authorities about the level of fees which they have negotiated with homes for residents entering under the new arrangements.
That is a broad-brush approach and, while we think that it will prevent many residents being faced with a shortfall, it is not adequate to ensure that no elderly or disabled person already resident in a home will be faced with receiving a lower standard of care and/or the fear of mounting arrears and perhaps eviction because his or her income support is inadequate to meet the fees charged. We know that Clause 9 will not address the very real problem faced by residents in the period up to April of next year.
The amendments seek to refine the mechanism proposed in Clause 9 to allow for individual assessments to be made, if requested, of the sufficiency of the benefit to pay a reasonable charge. We have been briefed by the National Association of Citizens Advice Bureaux which has quoted to us details of some harrowing cases of elderly or disabled people who face very real problems. I do not propose to take up the time of the Committee by reading out details of these cases although they indicate the very serious situation which exists in certain instances.
We feel that the Government's approach will not do and that they should not be able to shirk their responsibilities to existing residents who are trapped between the effects of market forces on the costs of residential care and the Government's current policy on the containment of public expenditure. As we have said on a number of occasions, if nothing is
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done, from April of next year these residents will be trapped and forgotten in the cul-de-sac of what is termed preserved rights, which in fact is preserved insecurity.
We know that the residents we are talking about are the poorest of the poor. They qualify for income support because they have low incomes and savings under £6, 000. Many are using up their small savings to meet the shortfall or are relying on family or friends for top-ups. They are terrified of what will happen to them if they can no longer meet the shortfall or if the charges increase still further. We feel that the amendment provides a mechanism which would enable the Government to keep the limits more or less at their current levels and thus avoid the increase in prices about which I know the Government are concerned. In addition, it would provide a mechanism that allowed individuals who were in hardship because their fees were well above the limits to apply to the local Department of Social Security. We feel that that it is a good way to meet the problem.
I know that the Government are aware of it but I fear that their answer will be to leave it to the local authorities as they have a residual authority. I expect that that is what the Minister will say when he comes to reply. The Government know that after April next year the local authorities will be forced to pick up the pieces and accept the financial responsibility for distressed and evicted residents. We feel that that is not the right way to go about it. The amendments are intended to deal with that problem. I beg to move.
Lord Hylton: It is a pity that these important amendments are being discussed in a thin Chamber at a late hour. I know that they affect, for instance, Cheshire Homes and also Servite House, a housing association rather well known to me. There is about the country quite a substantial volume of residential homes and nursing homes. They have been provided over a long period of years. They have been upgraded consistently to meet fire regulations and so on. It would be a great waste of resource, if, because of the financial provisions in respect of them, they were running at much less than capacity. We have to remember also that they cater particularly for the frail elderly and for people with a whole variety of disabilities. The sums provided by local authority top-up payments are still not sufficient to meet the necessary level of charges even when income support has been taken into account. I hope very much that the Government will not brush aside these amendments.
Lord Henley: As the noble Lord, Lord Carter, said, we are on familiar territory. Members of the Committee will remember the important debate on this very subject during consideration of the National Health Service and Community Care Bill only 10 days ago. On that occasion the Committee decided quite rightly not to go ahead with the amendments. I hope that, as before, I shall be able to persuade the mover of the amendments to withdraw them because. I believe that the measured steps the Government are taking in this matter are the right and proper response. In doing so I should like to

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repeat that the Government share the concern shown by the noble Lord who moved the amendment and recognise the importance of protecting the position of those who will not be covered by the new community care arrangements.
The Committee will by now be familiar with the reasons why the Government have decided to continue the income support system for people who are resident in homes at the point of change to the new arrangements. This decision has met with the approval of most, including the representatives of the local authorities. The Committee will also be familiar with the separate themes in the Government's response to concerns expressed about the position of those with a preserved entitlement. With the leave of the Committee and for the benefit of those who perhaps were not present during our earlier debates, I shall briefly reiterate what we are doing.
First, we have increased the weekly benefit of virtually all existing claimants in homes by £10 a week, at an additional cost of £100 million. Secondly, we have also decided to introduce a second stage to the increase in the limits in 1990-91. So, in addition to the changes already made, there will from 13th August be further targeted increases to all the income support limits to help maintain their value during the coming year. More than 200,000 people will benefit from these additional increases. Thirdly, we have been considering how to carry out future upratings of the income support limits. We aim to get more and better information on the true costs of running residential care and nursing homes.
The fourth part of our strategy is, of course, Clause 9 of this Bill itself. We want to be able to use the information that will become available as a result of practical decisions and negotiations by local authorities after 1991. The new provision confirms powers to set local limits for income support taking into account evidence supplied by local authorities about the charges they will be meeting for residents in homes under the new arrangements.
As I have explained, for real and sensible practical reasons we shall not be able to use this new source of information from April 1991 but we shall want to start to use this in reviewing and setting the limits as soon as it is sensible to do so. We are mindful of the burden that could be imposed on local authorities and of the time it may take to obtain proper information from them. The noble Lord obviously feels that we cannot wait until this provision comes into effect.
My right honourable friend the Secretary of State has been considering how he should carry out future upratings of the income support limits, including the next one. He has undertaken to make a thorough assessment of the position and to look carefully at the levels and structure of income support limits as they would apply from 1991. He expects to approve the commissioning of the necessary research in the near future. Moreover, I have announced the interim upratings which take effect in August. I repeat what I stated on a previous occasion: they do not in any way pre-empt the usual upratings which will be considered in October to take effect, presumably, next April.
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I shall turn now to deal with the amendments in detail. The government amendments tidy up the drafting of Clause 9 to include Scotland by referring to the provisions to be introduced by Clause 54 of the National Health Service and Community Care Bill. They also extend the scope of Clause 9 to ensure that my right honourable friend is able to prescribe income support limits for those people who are also being helped by local authorities, in the same manner as for all other existing residents. I am sure that Members can accept that these amendments are necessary.
The first amendment tabled in the name of the noble Lord would require the Secretary of State to ensure when prescribing income support limits for people in homes that the amounts are sufficient to meet the same cost as would be met by a local authority for any such accommodation.
The second amendment would require the adjudication officers who decide on social security claims to refer claims in homes to a social security appeal tribunal for a review on the grounds that the amount payable was insufficient to meet a reasonable charge. The social security appeal tribunal would then have to adjudicate on what was a reasonable charge in the case in question and, possibly, authorise a higher amount. Adjudication officers could dispense with referral to a tribunal if the question could be settled based on previous tribunal decisions in the same home or by seeking advice of the local authority with knowledge of the home in question. The effect of the third amendment would be that Clause 9 would come into effect on Royal Assent and hence be operative before April 1991.
The first of these two amendments is impractical and would place undesirable restrictions on future decisions of the Secretary of State when he sets the income support limits. As the Committee will know, my right honourable friend is committed by Clause 9 as it stands to take account of information supplied to him by local authorities. What this amendment would do would be to force him to structure the income support system so as to match fairly and precisely the actual amounts paid by local authorities in individual cases. For every income support case we would have to find a more or less perfect twin among cases being funded by local authorities.
I must stress that there cannot be this direct read-across between the levels of support given under the new and the old systems because the two are so very different. Local authorities will be tailoring the amount of support they give to the needs of individuals. They may, for example, pay different amounts for people in the same home. There is in fact no way in which the DSS will be able to mirror all the differences and disparities in treatment that will be a feature of the new arrangements. Moreover, the new system will take some time to settle down. That is why the Secretary of State needs to be able to make judgments about the information he receives from local authorities. He will need to ensure that the system of different limits that results is actually workable by DSS local offices. He will need to watch for possible anomalies between local authorities.

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He will need to ensure that other factors, such as evidence from home owners, are also given due weight. I hope that the noble Lord will feel able to withdraw the amendment.
The second of these amendments would place serious difficulties before social security appeal tribunals. They will have to ask, what is a reasonable charge? Is "reasonable" whatever is the going rate in a particular area? The amendment allows proprietors to seek reviews on behalf of their residents. That is merely a further variant on the blank cheque signed by the taxpayer to which I referred previously. I made the point then that DSS offices were not staffed by accountants; nor are the appeal tribunals.
With this proposal, homes would merely be able to increase fees knowing that there is no workable definition of "reasonable". Meeting all "reasonable" fees will lead to a huge escalation of costs with very little control, and we must remember our responsibilities towards all the groups of elderly and disabled people needing care, not just those in homes.
That brings me to the third amendment. I recognise the concern which prompted it: it is to help people who have a shortfall now. However, the new provision in Clause 9, which confirms my right honourable friend's powers to set local limits for income support, is designed to allow him to use, if need be, the information that will become available from local authorities after April 1991. Clearly such information will not be available until after then. The amendment therefore cannot help now. As I have said previously, the upratings announced, together with the new clause in the Bill, constitute a substantial and proper response to the anxieties that have been expressed. The Government's approach is the best way forward. The amendments are unnecessary and impractical.
11 p.m.
Lord Hylton: The Government's reply is depressing and unacceptable. The Minister did not once refer to voluntary bodies providing residential or nursing homes. They are by definition not-for-pr of it organisations. To put them together with commercial operators is unfair and unreasonable. I hope that we can have something better.
Lord Henley: I touched upon that matter in the previous debate, at which the noble Lord may not have been present. It was put to me by one of the noble Lards opposite that evidence provided by the voluntary sector was by definition, because it was not provided for pr of it, evidence of the true cost. I do not necessarily accept that point. Merely because a body does not make a pr of it does not mean that it provides the most efficient and cost-effective service. That is not necessarily the evidence that we need. We must seek proper evidence after April 1991 when local authorities will be negotiating not just with the voluntary sector but with the private sector and any other sector that there happens to be. At that stage we shall obtain the true costs.
Lord Carter: I am obviously disappointed by the Minister's reply. He referred to the measured steps that the Government are taking. Some people feel that the steps are not just measured; they are funereal.
The uprating in April and the proposed uprating in August will merely reduce the shortfall—which can be between £30 to £60 against increases of £15—between income support levels and the fees charged. The Minister said that 200,000 people will benefit. of course they will if they receive some benefit. But in many cases it will merely reduce their shortfall. When we debated this point on the other Bill I asked when the information would be available. We heard again tonight that there will be some research as soon as is sensible in the near future. I propose to finish there.
On the last reply the Minister gave about evidence, I must quote from the briefing we received from the citizens advice bureau. It states:
"A CAB in Yorkshire undertook a survey of 55 residential and nursing homes in the area, asking about fees charged, of service and projected levels of service for income support claimants. The CAB concluded from the evidence that unless action were taken, homes with a large proportion of income supported residents would be forced to close, particularly those newly established with large mortgages. Some homes would respond by refusing to take in income support claimants. Alternatively, homes would develop the already existing practice of providing different levels of care according to residents' ability to pay, with income support claimants receiving a more basic provision such as shared rooms".
That is the kind of evidence which is now available to the Government if they are prepared to act on it. I found the Minister's answer deeply disappointing. I feel that we shall have to return to this at Report stage. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 48 not moved.]
Lord Henley Lord Henley moved Amendment No. 49:
Page 14, leave out lines 27 and 28 and insert: (" "local authority"—
(a) in relation to areas in England and Wales, has the same meaning as it has in Part III of the National Assistance Act 1948; and
(b) in relation to areas in Scotland, has the meaning given by section 1(2) of the Social Work (Scotland) Act 1968; ").
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Henley Lord Henley moved Amendments Nos. 50 to 53:
Page 14, line 29, leave out ("such as is mentioned in") and insert ("who falls within—
(a)").
Page 14, line 30, leave out ("that Act") and insert ("the National Assistance Act 1948").
Page 14, line 34, at end insert ("or
(b) subsection (1) of section 86A of the Social Work (Scotland) Act 1968 (the corresponding provision for Scotland),
or who would fall within either of those subsections apart from any regulations under subsection (3) of the section in question; ").
Page 14, leave out lines 35 and 36 and insert:
(" "relevant premises"—

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(a) in relation to areas in England and Wales, has the meaning given by section 26A(2) of the National Assistance Act 1948; and
(b) in relation to areas in Scotland, has the meaning given by section 86A(2) of the Social Work (Scotland) Act 1968.").
On Question, amendments agreed to.
Earl Russell Earl Russell moved Amendment No. 54:
Page 14, line 36, at end insert:
("(2) In paragraph 6 of column (2) of Schedule 7 to the Income Support (General) Regulations 1987, after the words "regulation 17(l)(a)" there shall be inserted the words "and (d)".").
The noble Earl said: With this amendment I should like also to speak to Amendments Nos. 73, 192 and 197. The common factor in these amendments is that they deal with board and lodging for people in hostels for the homeless. Amendments Nos. 173 and 192 deal with the amounts available for meals. Amendment No. 197 deals with charges for breakfast.
We debated this at length last year. The noble Lord, Lord Skelmersdale, on behalf of the Government, said that he had accepted that the problem existed. We have heard no more about it since; nothing has been done. Like many other noble Lords, I regret that we have to continue so late at night on this Bill, but if year after year we bring out major problems which are accepted as such and nothing is done about them, it has the effect of clogging up the parliamentary timetable. If it happens again this year, it may put some pressure on the time set aside for the Bill next year.
The situation in hostels for the homeless is thoroughly unsatisfactory at present. In 1989 the Department of the Environment found that 90 per cent. of those in bed and breakfast accommodation either had no cooking facilities or inadequate sharing facilities. There used to be an eating out allowance, which was abolished from April 1989. In addition, people in these hostels normally face a collection of amenity charges. They are told by the Government that this is because they must learn to budget like everyone else. However, if they were like everyone else they would not have the heating on unless they wanted it, they would not pay for it when it was not working and they could send for somebody to repair it if it was not working. But these matters are not under their control. They cannot limit their expenditure in that way.
The effect of the amenity charges is to leave people in board and lodging on average £11.75 per child below income support levels. That does not provide for an adequate diet, particularly in a situation where they find they are eating out regularly. The British Medical Association has reported adults and children suffering from malnutrition—not, one would think, a situation that the Government would wish to continue.
The Government tell us regularly that they are monitoring the effect of changes under the Social Security Act 1986. However, there comes a point beyond which, if nothing is done, one finds this claim increasingly hard to take seriously. I know we shall be told that some people have cooking facilities. But the sharing arrangements are on a scale which
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is not really very practical. I shall take two typical cases. One concerns 39 families sharing 12 gas rings. That means a round-the-clock shift system. It is quite difficult to get children in particular to wait for their lunch until five in the afternoon. They tend to fuss. Another case involves 35 families sharing one cooker and one fridge.
On the question of cost, the money available simply is not adequate. I shall take a typical case of two adults and five children receiving £112 income support plus £36 child benefit minus £15-90 for amenity charges. That comes to £132 all told which equals £18-91 per week per head. Would any Member of the Committee set out to live, eating out in London, on that amount of money and can he imagine how hungry he would be? The money is not adequate.
On the question of charges for breakfast, a good many complaints are made on the lines of breakfast consisting of rancid eggs. People report regularly that even when they are in a state of extreme hunger they cannot eat such breakfasts. To force people to pay extra charges in that situation when they do not have much money available in the first place does not seem to me to be entirely reasonable. It seems to be an exploitation of a captive market.
We shall, of course, be told about cost. I have tried to do my own costings on this. I am sure they are not entirely accurate and I am sure I shall be cut down for that. However, as far as I can calculate, the cost of the provision is unlikely to be over about £2 million. One has to set that against the cost of not accepting it. Malnutrition is not good for health. If the Government are determined to save these sums on the cost of board and lodging, they will probably find themselves spending those sums and a great deal more on the health service. Malnutrition, high blood pressure, particularly in the case of pregnant women, children born with low birth weights and possibly also clinical depression are things which are likely to cost the Government considerable sums of money.
There is also a concealed loss of money in that such things make it more difficult to float people off benefit and get them back into employment. That has to be the long-term object of the exercise. Floating the water-logged is a very difficult operation. There is also, in not accepting this provision, the possibility of a concealed cost through crime. I have not forgotten that St. Thomas Aquinas, with whom I am not sure I agree, said that it is no sin for the destitute to steal from the rich in order to support themselves. I am not encouraging anyone to do any such thing and I would not dream of doing that. But mothers with very hungry children tend to feel that they have to get them food by hook or by crook.
Anything that encourages crime is unfortunate and expensive. Keeping someone in one of Her Majesty's prisons no doubt means that that person is fed adequately. However, I believe that it costs in the region of £16, 000 a year. That is a great deal more expensive than income support. I think there is a real possibility that if the Government accepted this amendment they might find it a net economy. I beg to move.
Lord Carter: The noble Earl has described the situation extremely well and has drawn attention to the harrowing cases that we all know about which lie at the root of the problem. This amendment is designed to try at least to reduce the number of those cases. I hope that the Government will feel able to accept it.
11.15 p.m.
Lord Hylton: The noble Earl, Lord Russell, is greatly to be congratulated on moving this amendment in addition to the many others to which he has his name attached. It deals with one of the most deprived sections of the population. Anyone who has thought about the problem would readily agree that no family with children should be placed in bed and breakfast accommodation. We are not in an ideal world. It does happen. Therefore, the only way to approach the problem is for the Government to adopt a generous policy on allowances and benefit;. That is what the amendments seek, and that is why I support them.
Lord Henley: Perhaps I may start with the question of costs. My noble kinsman estimated costs at about £2 million. I am not sure how he arrived at that figure. Obviously, it would depend on the additional amount to be paid, but I suggest that costs could be considerably higher.
Amendments Nos. 192 and 73 both suggest increasing income support allowances for people who have to buy meals prepared outside their accommodation. Amendment No. 192 is widely drawn while Amendment No. 73 specifically concerns homeless people housed by their local authorities in bed and breakfast accommodation without self-contained cooking facilities.
The Committee may recall that the matter of allowances for meals for people in board and lodging was debated at some length at both Committee and Report stages of last year's Social Security Bill. I do not propose to rehearse again all the arguments put forward by my noble friend Lord Skelmersdale. It was clearly right for the Government to introduce changes last year to remove the perverse incentives which existed under the old scheme. The changes brought boarders into line with the majority of other claimants who looked to housing benefit for help towards their accommodation and income support for help with normal day-to-day living expenses.
Amendment No. 73 refers particularly to the position of homeless families living in bed and breakfast accommodation. However, I must make it clear that responsibilities in that area lie fairly and squarely in the hands of local authorities. Guidance issued to local authorities by my right honourable friend the Secretary of State for the Environment makes it clear that local authorities should place homeless families in bed and breakfast accommodation only as a last resort when other more suitable accommodation is not available and, if they must, to keep them there for as short a time as possible. It has been possible for some local authorities to avoid using bed and breakfast accommodation altogether.
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I have every sympathy for the problems found by homeless families. But the answer to their difficulties lies in the hands of local authorities and the steps which the Government have taken to make additional funds available for a concerted programme of action to get families out of bed and breakfast accommodation.
Amendment No. 73 is more tightly drawn than Amendment No. 192, but it would nonetheless reintroduce the complications and anomalies of the old system. Even if I were predisposed to accept Amendment No. 192 in principle, I could certainly not accept it in practice. I wonder, for example, on what basis the adjudicating authorities would be expected to decide when someone is in the position of having to buy meals outside the home. Would it be the complete absence of cooking facilities or the fact that those facilities were considered inadequate? If the latter, I should be interested to know exactly how one might judge what is or is not to be regarded as adequate in any particular case.
Earl Russell: If that is so difficult, how could it be that the Department of the Environment has already done it?
Lord Henley: Would the noble Earl care to elucidate?
Earl Russell: I referred at the beginning of my speech to the survey of cooking facilities in homes for the homeless carried out by the Department of the Environment. The department found that 90 per cent. of them were inadequate. We are quite happy to accept the department's criteria.
Lord Henley: I was asking whether it would be purely a question of the complete absence of cooking facilities or of cooking facilities being available but inadequate. The noble Earl said that the Department of the Environment spoke of 90 per cent. being inadequate. Obviously there would still be borderline cases where someone would have to judge what was adequate and what inadequate. The noble Earl said that on that occasion it was 90 per cent. There is the other 10 per cent. There will be cases which are borderline between the two.
I am sure that the Committee will appreciate that this amendment would not only be unworkable in practice but would introduce into the benefit system all the complexities and perverse incentives which existed under the old arrangements.
Turning to Amendment No. 197, this would have the effect of preventing local authorities from making any deduction from housing benefit on account of meals for people living in board and lodging accommodation where the only meal provided is breakfast. It is an established principle of the social security system that housing benefit is designed to help meet reasonable accommodation costs, whereas, as I said before, income support is available to help with day-to-day living expenses. For that reason, the cost of meals included in a board and lodging charge has always been ineligible for housing benefit.

731
As the Committee is no doubt aware, until April last year the majority of people living in board and lodging accommodation had their rent and living expenses met through special rates of income support. But boarders who were not entitled to income support, such as those in full-time work, could not get help with their housing costs through housing benefit on the same basis as anyone else. In those cases local authorities had to make a judgment about the value of the meals included in the boarding charge and deduct that amount from the rent eligible for housing benefit.
Because of the wide variation in the nature of meals provided by landlords and to help local authorities in the administration of benefits, it was decided to introduce standard weekly amounts to be deducted from housing benefit where meals are provided. For a person over 16 these currently range from £13.15 a week for full board to £1.60 where breakfast only is provided. That £1.60 weekly deduction for breakfast in hardly draconian. But it makes proper recognition of the fact that people living in accommodation on a bed and breakfast basis receive, as part of their rent, a service for which most people have to pay out of their earnings, income support or other benefit income. It is not unreasonable to expect people in bed and breakfast accommodation to pay £1.60 weekly from their income support or other income for the breakfasts that they receive. It would be inequitable and illogical to give double provision for the cost of meals by allowing housing benefit to meet bed and breakfast charges in full.
Turning to Amendment No. 54, successive governments have taken the view that people without accommodation should be entitled to basic benefit to provide for their immediate needs. In April 1988 those without accommodation became entitled to claim the personal applicable amount of income support instead of a meals allowance. Most gained financially from the change. They are not entitled to premiums nor indeed were they entitled to additional requirements under the pre-1988 system.
Premiums replaced the plethora of additional requirements allowances which so complicated supplementary benefit. Premiums are appropriate for the special extra needs of particular groups, such as pensioners, when they are in a settled environment. They are inappropriate for people without a fixed pattern of expenditure and might militate against resettlement efforts. Vulnerable people, such as the disabled and the elderly, generally fall into the priority category for rehousing under the homelessness legislation and would then be entitled to claim premiums.
For those reasons and those I outlined earlier, I hope that the noble Lords will be able to withdraw their amendments.
Lord Carter: Before the noble Earl decides what to do with the amendment, perhaps I may refer to an answer given by the Minister which I found extremely puzzling. The noble Earl referred to a survey conducted by the Department of the
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Environment which found that 90 per cent. of the facilities were inadequate, which presumably implies that 10 per cent. were adequate. The noble Lord said that a borderline existed between them. Would he agree that such a borderline would fall somewhere between 90 per cent. and 90.1 per cent?
Lord Henley: The noble Earl, Lord Russell, quoted a Department of the Environment report which stated that 90 per cent. of services were inadequate. One still has to decide as regards the others whether or not the facilities are inadequate. There is always a borderline. That is all. The noble Lord may try to be clever with percentages. I am trying to suggest that it is a difficult matter of judgment.
Earl Russell: I become very puzzled by this doctrine of perverse incentive. If my noble kinsman suggests that the homeless have faced a perverse incentive in putting themselves in such accommodation, he is crediting them with a good deal more masochism than is the norm. What evidence do the Government have that anybody has voluntarily chosen to go into board and lodging accommodation rather than remain in their own home? We have a large theoretical superstructure erected on a foundation of evidence that has not been made known to us. I should like to hear it.
I also find it surprising to blame local authorities for the housing shortage. Local authorities which could perfectly well provide accommodation for some of these people are not allowed to spend their capital receipts for that purpose. Local authorities are subject to capping. They are subject to spending limits.
This is not the moment to discuss those matters. However, the Government should not reproach local authorities for not doing what they have stopped them doing. That is what John Stuart Mill described as "the inability of the unanalytic mind to recognise its own handiwork".
The Minister spoke at great length about difficulties of administration. That applies to income tax; it costs a great deal to administer. I do not believe that the Government propose to withdraw it for that reason, although I sometimes wonder.
We were told that proper recognition must be given to the cost where breakfast is provided. That is fair enough if breakfast is genuinely provided. In that case there must be a mechanism of regulation. There must be an equivalent mechanism to that with regard to the National Rivers Authority. However, that would be immensely cumbersome. It seemed to us simpler to remove the charge for breakfast.
We have heard a great deal about how difficult the position is for the Government. I do not think that we have heard much in the reply about the difficulties for the families concerned who live in board and lodgings and who are not getting enough to eat. I thought that the system was in place to prevent that.

733
It would not be an answer simply to divide the Committee. However, I warn my noble kinsman that the issue will not go away. It will take up a great deal more of our time until we get something done about it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 9, as amended, agreed to.
11.30 p.m.
Baroness Seear Baroness Seear moved Amendment No. 55:
After Clause 9, insert the following new clause:
("Carer's premium. In section 22 of the 1986 Act, after subsection (9) there shall be inserted—
"(10) In respect of a carer, the applicable amount shall include a carer's premium.
(11) For the purposes of subsection (10), a "carer" is a person—
(a) who is entitled to invalid care allowance ie including a person who would receive invalid care allowance except for the provisions of the Social Security (Overlapping Benefits) Regulations 1979; or
(b) who would be entitled to invalid care allowance if he were not of pensionable age".").
The noble Baroness said: In moving this amendment, I speak also to Amendment No. 56. I am very sorry indeed that these amendments are being discussed at this hour of the night with so few people in the Chamber. The amendment raises a large issue. I hope that the Government—if they are listening to what I am saying—will say that they are prepared to give the issue of the invalid care allowance very serious consideration.
The Committee will be aware that the Crossroads organisation—a very responsible and valuable body—has only today produced a very alarming report about the conditions under which carers are trying to do the job of caring and the extremely devastating situation in which a large number of carers find themselves. I do not wish to exaggerate. Many carers are coping. But far too many are operating under very great restraints and limitations which put a quite unbearable burden on them.
It is important that the Government consider this issue. The burden will become a great deal heavier as the Government's policy of emptying the institutions and sending people into community care is carried out. It is clear that those who will carry the burden are the families, people in their own homes and of ten women on their own, attempting to cope with people who are unable to look after themselves. Presumably the individuals coming out of institutions will be more difficult to look after and a greater burden on the carers than the kind of people they are looking after at present, because one must assume that they are more seriously handicapped.
The Crossroads report has reemphasised the fact that one of the greatest difficulties—by no means the only one—under which carers operate is sheer shortage of money. Looking after infirm, frail and confused people in an expensive business. It is expensive in terms of money, energy and stress. As Joad said, money does not make for happiness but it does ease the pain. It would ease the pain of a number of
In the past the attitude towards a community care allowance was that it was to some degree a replacement for the lost earnings of the carers. Behind the amendments is the claim that carers are entitled to remuneration for their work. It is not just a matter of income replacement. I recognise that, if accepted, the amendment would mean a change of policy. However, if the Government are serious about community care and accept the burden that they are putting on the carers, it is a change about which they must think seriously.
The amendments propose that in cases where benefits are already paid—that is, income support, housing benefit, community charge rebates and so forth—there should be a carer's premium, say, of £10. That would ease the burden laid on the carer and give a larger spending power to people operating under such extreme difficulties. It is also suggested that the invalid care allowance should be made available to any carer and that the limitation which was previously placed on it—that they should not receive it if they are over pension age—should be removed. Carers over pension age are not losing earnings. We are asking for a return for the work being done and not merely compensation for the loss of earnings. Therefore, carers over pension age who do not at present receive any invalid care allowance can be in straitened circumstances. They may be receiving a pension or some form of income support but they will receive nothing more. The costs and the additional payments that they must make are the same, whether they begin caring when they are over pension age or younger. In our view, the question of age should not be taken into account.
In tabling the amendments, we take the view that the well-established principle, much beloved of governments, that it should not be possible to benefit from two kinds of state payment should be ignored in this case. Certain people will not be eligible for a premium on additional benefits because they are above the income support or housing benefit level. However, they too have heavy costs. In Amendment No. 57 we ask that the invalid care allowance should be uprated along the lines suggested for those who are not eligible for any other kind of benefit. I beg to move.
Lord Carter: I am pleased to support this amendment, which is also in my name. The noble Baroness referred to the survey which has only been published today, Caring for Carers, conducted by the Sunday Times and Crossroads Care and which highlights the urgent need for better support facilities. The survey was of 1, 000 carers. It says that carers want a decent income on which to live. They want to be heard and to have the resources to care. Two-thirds of the respondents felt that no one ever listened to them or cared for them. Nearly all wanted extra resources to continue to care and care effectively for their loved ones. They were pessimistic about obtaining those vital resources. These amendments go some way towards overcoming that pessimism and dealing with the problem of income and resources. I hope that the Government will accept them.
Lord Henley: I have not yet had an opportunity to read the report which has been referred to but I shall do so as soon as possible. I hope that the noble Baroness will feel able to withdraw the amendments, but I should like to say something about the Government's proposals for carers. The new carers premium worth up to £10 per week will provide significant extra help for less well off carers. As the sponsors of this amendment propose, the money will go to people entitled to receive invalid care allowance or who have a more valuable benefit which overlaps it.
However, it is not possible to support the second string to this amendment which would provide the premium to people who start caring after pensionable age. The significance of that proposal is that such carers cannot obtain invalid care allowance. The reason for this is that invalid care allowance is an income maintenance benefit intended to compensate carers of working age who have lost earnings opportunities. Once people reach pension age the relevant income maintenance benefit is of course retirement pension. Once people have already claimed and received that benefit, they cannot then obtain in addition another income maintenance benefit such as ICA. The carers premium will not be available to people who start caring after they reach pension age.
We will of course be monitoring the impact of this new premium once it is introduced and will listen to what people say about it. In the meantime, I hope that the noble Baroness feels able to withdraw Amendment No. 55.
Amendment No. 56 seeks to increase the weekly rate of invalid care allowance to the basic rate of retirement pension. It seems to me that this amendment is seeking an independent income for carers to be achieved by a substantial increase in invalid care allowance. Aligning non-contributory invalid care allowance with contributory retirement pension would mean an increase in the rate of invalid care allowance of 40 per cent. The problem is one of cost. With 120, 000 people currently receiving ICA, the cost of accepting this amendment could be very high indeed. In the current year the net cost, even after allowing for savings on other benefits, would be over £100 million. That sort of expenditure is not an option given the competing priorities in the area of social security benefits. Bearing that in mind, I hope that the noble Baroness will feel able to withdraw her amendments.
Lord Hylton: I ask the Government to think rather more deeply about the situation of elderly parents of pensionable age who are continuing to care for sons and daughters who are either physically or mentally handicapped.
Lord Henley: As I said, we shall continue to monitor the situation.
Baroness Seear: I am extremely disappointed by the Government's reply. I said that I had no intention of pressing the amendment at this hour. I beg the Government to think again. It is a basic
736
principle which I was asking the Minister to reconsider. An invalid carer premium should not be regarded as a replacement for earnings but should be seen as a payment made to those who are doing the caring. I repeat that it will be an extremely heavy burden, especially as the community care programme of emptying institutions becomes more of a reality. I do not wish to be dramatic, but if we leave carers with extremely limited resources, we shall be killing them. They will not be able to continue under the new additional burdens being imposed upon them.
As I said at the beginning, I ask the Government to look again at their attitude that it is only replacement of earnings. Will they not recognise that the people caring are doing a substantial job? If these frail, infirm, confused, difficult, and elderly people were in institutions, the taxpayer would be paying for them. Surely some of that taxpayers' money can be diverted to the people who are doing the work of caring in their own homes. It would not be full payment or anything like it; but there could be something.
I have no intention of moving Amendment No. 56, but I assure the Minister that I shall return to it. I beg leave to withdraw Amendment No. 55.
Amendment, by leave, withdrawn.
[Amendment No. 56 not moved.]
Lord Carter Lord Carter moved Amendment No. 57:
After Clause 9, insert the following new clause:
("Disregard of income support
.—(1) Section 22 of the 1986 Act (calculation of income related benefits) shall have effect subject to the amendments specified in subsection (2) below.
(2) Where a person has been provided with accommodation under Part III of the National Assistance Act 1948 in premises managed by a local authority or a person other than a local authority or is a patient in hospital or nursing care but it is reasonable to consider that he may at some future date be able to return to his previous home, the Secretary of State shall prescribe that the following shall be disregarded in calculating his entitlement to income support
(a) the capital value of that previous home;
(b) a sum of income equivalent to such charges as are necessary for the retention of that previous home, as the authority considers appropriate;
(c) a sum of income equivalent to any proportion of a personal or standard community charge which remains payable by that person after all community charge benefits and any exemptions from payment have been obtained for such period as the local authority deems appropriate.").
The noble Lord said: This amendment seeks to ensure that when people enter hospital or go into residential care, they have sufficient income to cover the overheads on their home in the community until it is clear that they will never return to that home. When people are away from home temporarily they can claim housing benefit to cover rent payments. There are also a number of charges on their home for which they continue to remain liable—water rates and other fixed charges. Those weekly charges can be quite substantial, particularly when the individual lives in sheltered accommodation. They can amount to as much as £15 or £16 per week.
Without the amendment the income support regulation will act as a disincentive to the Government's objectives on community care. It is

737
essential that where elderly or disabled people are admitted into residential care or hospital, every step is taken to ensure that if possible the individual will be able to return to independent life in the community. It is important therefore that their home in the community remains available to them.
I turn to subsection (2) of the proposed new clause. When someone claims income support the value of any home which they no longer occupy is taken into account and treated as a capital asset. While someone is in a home or hospital on a temporary basis the value of their home is disregarded, because it is assumed that they will want to return there. The difficulty arises when someone who owns their own home needs the care to be permanent. In that case the home is immediately treated as a capital asset which will push the assets of the person over the limit. That can be a tremendous problem if a carer is living in the home. The carer may be a friend or relative who has given up their own home to live with and care for the person.
The income support and the present legislation allows the home to be disregarded as a capital asset if it is occupied by the claimant's spouse or someone who is elderly or incapacitated. That disregard, however, does not apply to a carer who is under pension age and is neither chronically sick nor disabled. The practical effect is that the value of the home prevents the carer from receiving any income support. The carer is faced with either providing financial support for the resident or moving out of the home so that it can be sold and the value realised.
The amendment is intended to ensure that the value of the home is ignored when it is owned by a claimant but a carer living there had been caring for the claimant before the admission into care or into the long-stay hospital. I beg to move.
Earl Russell: I should like to add a brief word in support of the amendment. A house is a capital asset, but the point about the asset is that it is extremely difficult to realise. The amendment is abbreviated in my notes to "not selling house" which is really what it is all about.
If carers who have perhaps given up a good deal of their life looking after a relative, saving the state a good deal of money in the process, are forced to sell the house, then they are put into a position where they are more likely to become dependent. I do not believe that that is in the Government's interests. A house is a notional asset. Its financial value comes into effect only after one's death. It is of value to your descendants but not to yourself.
On Amendment No. 58, I should like to remind the Committee that local authorities are trying to draw up their public expenditure bids for community care without knowing how the system involving housing benefit is to be calculated and with the distinct possibility that it may result in something very like the old rateable value; a notional market rent which, like every other spending limit fixed by this Government, is a great deal too low to be useful. There is a problem which needs to be addressed with some urgency. I am happy to support the amendment.
11.45 p.m.
Lord Carter: As the noble Earl has spoken to Amendment No. 58 and said all that I had intended to say, perhaps it would assist the Minister if he replied to Amendments Nos. 57 and 58 together.
Lord Henley: Provided my voice survives I shall reply to both amendments. I listened carefully to what the noble Lord and the noble Earl had to say on the amendment which seeks to introduce further concessions for people in income support. I say "further concessions" because I think the Committee will want to know the full nature of the help already provided to people in these circumstances. I can assure the Committee that people entering this type of accommodation are not immediately required to give up their previous home. Indeed many, if not all of them, will have every intention of returning home to take up where they left off before they moved. Quite understandably they or their relatives on their behalf may not want to commit themselves too quickly to living permanently in residential accommodation, so for some their stay in that accommodation may at first be temporary.
During this period their property can continue to be regarded as their home and as such it is fully disregarded for income support purposes. Only when the adjudicating authority has evidence that their stay has become permanent does this particular disregard cease to have effect. Even then the value of the property can be ignored under other provisions; for example, where it is occupied by a partner. Meanwhile, if they are responsible for any charges on the property help can be given towards their mortgage interest and certain other housing costs for up to 52 weeks provided they intend to return home and have not sublet that part of the home they normally occupy.
I believe these concessions are both generous and sensible. The amendment before us today seeks to extend those concessions. Its starting point is to impose on adjudicating officers a test of reasonableness to decide whether the resident may be able to return home some time in the future. I am sure the Committee will agree that this test is itself a difficult one which can only complicate the present scheme and perhaps give rise to uncertainty and dissatisfaction especially among the elderly.
The suggestion is also that the charges on the previous home should be set off against any other income the person may have provided the adjudicating authority considers these appropriate. The Committee is asked to compare this suggestion with the current rule which enables the outgoings on the property to be met for up to 52 weeks.
There is another reason why the disregard is not a good idea, and that is one of equity. I do not think it would be right to treat some people living in Part III accommodation, hospital or a nursing home more favourably than others sharing that same accommodation but with no income to cover the outgoings on their previous home, or more favourably than people in similar circumstances but living with friends or relatives. Nor would the

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amendment be fair to the taxpayer, who would have to pay for these disregards and subsidise empty housing for what could be an indefinite period.
Many of the arguments heard today apply equally to the proposal that people's liability to community charge should also be offset against any other income they may have. It is a fundamental principle of the community charge that almost all adults should make a contribution to meeting the costs of local services and in that way local authorities should be made more accountable to the whole electorate. Exemption is granted only where accountability clearly cannot work—in the case of severe mental impairment, for example, or where particular groups of individuals have for one reason or another no income and no access to state benefits and so could not be expected to pay the community charge.
The effect of this new clause would be to exempt anyone on income support from the personal community charge. That would run counter to the principle of the community charge and it is wholly unnecessary. I hope that I have said enough on that amendment. I am sure that noble Lords would not wish to press it at this time of night.
I now turn to Amendment No. 58. An amendment identical to this new clause was debated recently during the Committee stage of the National Health Service and Community Care Bill. Its purpose is to prescribe the way in which housing benefit should be calculated after April 1991 in cases where people are provided by the local authority with a place in a private or voluntary residential care or nursing home.
Housing benefit helps to meet reasonable accommodation costs. Broadly, that means rent and any compulsory service charges which are clearly related to the provision of accommodation. If the rent includes ineligible items such as meals, fuel or personal care, their value must be deducted to work out how much benefit is payable. Where a claimant occupies accommodation, such as a residential care home, which provides a wide range of services that are ineligible, calculating the amount of benefit payable can become a complex operation requiring a detailed apportionment of the fee between eligible and ineligible items.
The Government made a commitment in the White Paper Caring for People to consult with the local authoritiy associations on the way in which housing benefit should be calculated for this new category of cases from April next year. Those consultations are still under way. Bearing in mind the complexity of assessing housing benefit for this type of accommodation under the normal rules, we propose that housing benefit for people in residential care and nursing homes should be based on a notional rent. That means that maximum housing benefit in such cases would be a fixed sum, perhaps based on the average cost of rented accommodation in the area. There would be considerable administrative advantages in such an approach. The amendment before the Committee prescribes a way of arriving at a notional rent for homes not run by a housing association. For the housing associations the normal rules would continue to apply.
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I appreciate the concerns behind this amendment. Housing associations are anxious about any discrepancy between the basis on which housing benefit is awarded to their tenants and their actual rent costs. We are aware of these concerns and intend to address them in our final decision on this subject.
The method proposed for assessing housing benefit in other residential care homes is to place a notional rent on average eligible rent and services for all residential area and nursing homes in the relevant area. I still believe, as I did when we last discussed this proposal, that that approach will not be viable in practice.
I appreciate the continuing concern that the housing benefit paid to people in residential care and nursing homes should reflect the actual rent charged. But many of the examples cited by critics of the concept of notional rents concern extra costs connected with things which clearly relate to care rather than accommodation.
As I said during the Committee stage of the National Health Service Bill, we are currently considering all these points as part of the process of consultation with the local authority associations. That is still the position and I do not think that I can go further at this stage. I hope that in the light of what I have said the noble Lords will feel able to withdraw the amendments.
Lord Carter: I am grateful to the Minister. He is aware that as regards the second amendment the main purpose is to bring home to the Government the urgent need for the housing authorities and associations to plan for the resources that they have to provide after April of next year. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 58 not moved.]
Earl Russell Earl Russell moved Amendment No. 59:
After Clause 9, insert the following new clause:
("Unemployment, Sickness and Invalidity Benefits
Regulation 7(1)(o) of the Social Security (Unemployment, Sickness and Invalidity Benefit) Regulations 1983 shall cease to have effect.").
The noble Earl said: I shall not detain the Committee for very long on this amendment, which concerns the unemployment benefit means test. It deals with the regulation by which anyone earning more than £46 a week is not eligible for benefit. That sum is not a living wage. The effect is to create a disincentive to part-time work. As I have been reiterating all evening, our concern is for floating people off benefit and getting them into employment. It is unfortunate that we have a benefit system which thrusts people back into benefit, but it is something that can be changed.
There is a point of some importance here. We do not believe, as the Government seem to believe, that people are going to run around trying to get benefits because they crave them. The Government overrate the attractiveness of their benefits. It is worth while giving people a leg-up because we believe that they are capable of taking advantage of it and getting back into work. I beg to move.
Baroness Turner of Camden: At this time of night I do not intend to say any more than that we on these Benches fully support the amendment.
Baroness Blatch: The effect of this amendment would be to remove the weekly earnings rule from unemployment benefit. The purpose of the rule is an important one. It is to ensure that unemployment benefit is paid only to those who are unemployed. That is a reasonable proposition and one which I think commands general support.
In order to establish whether or not a person is unemployed it is necessary to have a measure of that person's return to employment. There has to be a point at which a person is considered to have returned to work and is no longer entitled to unemployment benefit. That measure should be fair, objective and easily understood. Prior to the introduction of the weekly earnings rule a person's return to work was established using the "full extent normal" rule—known in the jargon as FEN. This was a clumsy rule which could result in some very unfair disallowances. It was widely criticised by a number of authorities, including noble and learned Lords. I refer, for example, to the case heard by Lord Justice Templeman of Blunt v. Chief Adjudication officer and to two cases heard by Lord Justice Glidewell—Whelans v. Chief Adjudication officer and Worthy v. Chief Adjudication officer.
This rule relied on establishing at what point a pattern of work had become normal for a particular person and paid no regard to the level of earnings. This meant that some people earning very little could be disallowed benefit while others earning larger sums could continue to receive benefit. Earnings, on the other hand, provide an objective measure of return 1o work and allow different people to be treated in a fair and consistent manner. The level at which earnings affect benefit is aligned with the National Insurance lower earnings limit. This again is consistent and means that a person is regarded either as employed and liable for contributions or unemployed and able to claim benefit.
We are aware that this rule is not the complete answer to the complex problems involved in the relationship between unemployment benefit and work. We are continuing to monitor its effects and to consider options for a more complete solution. It has, however, been a step forward and I would therefore urge the Committee not to accept the amendment.
Lord Hylton: Is the £46 weekly earnings rule reviewed annually; and, if not, will it not very soon become out of date and obsolete?
Baroness Blatch: Yes, it is.
Earl Russell: The noble Lord, Lord Hylton, has raised the point that I was just about to make. At the next up-rating order I shall ask the Government to think very hard about this limit. With those words, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 60 not moved.]
Lord Denham: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Greater Manchester (Light Rapid Transit System) (No. 4) Bill [H.L.]
Committed to an Unopposed Bill Committee.
Hasmonean High School Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.

London Local Authorities (Miscellaneous Provisions) Bill [H.L.]
Reported from the Select Committee with amendments, and recommitted to an Unopposed Bill Committee.
House adjourned at one minute before midnight.