Social Security Bill (Hansard, 21 May 1990)

HL Deb 21 May 1990 vol 519 cc597-665 597

§ 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 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 598 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.] 599 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, 600 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 601 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.
602 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.

603

§ 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 604 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.

605

§ 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 606 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 607 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.
608 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 609 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 610 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 611 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 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 612 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 613 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 614 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 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 615 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 616 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.

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§ 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, 618 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 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".

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§ 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 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.

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§ 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 621 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 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.

622

§ 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 623 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.

624

§ 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.
625 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 626 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.
627 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 628 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.

629

§ 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.

631

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.

630

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 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 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 636 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.

637

§ 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 (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 639 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 640 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.
641 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 642 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 643 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.
644 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 645 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.

646

§ 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.

647

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.

647

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.

648

§ 6.7 p.m.

§ 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) 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 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 649 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 650 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 651 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.

652

§ 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 653 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 654 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". 655 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 656 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 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 657 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 658 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 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 659 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.
660 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 661 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 662 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 663 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 664 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.

665

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.