HL Deb 28 February 1994 vol 552 cc906-18

9.21 p.m.

The Parliamentary Under-Secretary of State, Department of Social Security (Viscount Astor)

rose to move, That the draft order laid before the House on 10th February be approved [8th Report from the Joint Committee.]

The noble Viscount said: My Lords, in moving this draft order, I wish to speak also to the other four draft orders. As a result of these orders, social security will cost over £ 83 billion in 1994– 95. It will rise to £ 88 billion in 1995– 96 and £ 92 billion in 1996– 97. That large increase demonstrates both the need to reform our system to make it affordable in the long term and our commitment to maintain a decent level of social security.

We have met our commitment to uprate benefits (at least in line with inflation). We have fulfilled our pledge to provide extra help for those most affected by VAT on fuel, and we are improving the benefit system for mothers who want to return to work. We have also provided a very generous package of extra help— over and above the normal uprating— towards VAT on fuel. This will help over 15 million people in the coming year.

The package of extra help with VAT on fuel will cost an extra £ 400 million this year alone. Over three years the cost will be £ 2.5 billion. In practice it means that people on income support will see an increase of 3.9 per cent. from April, and a further 2 million people above income support levels who receive housing benefit and family credit will get similar increases.

We also wanted to help those who have worked, saved and earned modest pensions, who often get no extra help. So single pensioners will get an extra 50p. a week and couples will get an extra 70p. this year. That is on top of the £ 1 or £ 1.60 rises in the full basic pension, in line with the retail prices index Next year the extra amount for VAT will be worth £ 1 for a single pensioner and £ 1.40 for couples. In the third year it will be £ 1.40 for single people and £ 2 for couples.

The increases for VAT will also apply to people on widows' benefits, invalidity benefit, severe disablement allowance and the disability premium. In six weeks' time people will begin to receive the extra money with their benefit, as we promised, before the higher fuel bills arrive. In addition, we are increasing cold weather payments from £ 6 to £ 7 in November, and by a further 50p. from November 1995.

To help in particular those with higher than average heating costs, we are making a further £ 35 million available through the home energy efficiency scheme. From April 1994, all pension pensioners and disabled people not on income related benefits will be eligible for grants from the scheme to insulate their homes and make them more energy-efficient. More than 200,000 extra households next year will be eligible for grants. By any standards this is a very substantial package of help.

In July last year my right honourable friend the Secretary of State for Social Security published an analysis of the growth of social security. It indicated that one of the main sources of growth, both in numbers of claimants and in expenditure, up to the end of the century would be invalidity and related benefits. That is why we are making a fundamental reform of those benefits.

Our reform to statutory sick pay will return responsibility for levels of sick absence to employers. We are improving the structure of statutory sick pay and giving extra support for small employers. At the same time we are reducing the employers' national insurance contributions by a full 1 per cent. for lower paid employees and by 0.2 per cent. for others. That will more than compensate for the increased costs on statutory sick pay. Overall, employers' net costs will be reduced by over £ 100 million a year. Those employers who accept the challenge to improve their sick absence records will benefit even more.

My right honourable friend also announced further, very substantial practical help for people with family responsibilities who want to work. Giving up benefit in favour of a low-paid job can be an unattractive proposition, especially if it involves childcare costs. So we propose from October 1994 to enable families with a child under 11 to offset up to £ 40 a week of childcare costs against their earnings before those earnings are taken into account against benefit.

Families on family credit will be up to £ 28 a week better off. This measure will help up to 150,000 families and we expect 50,000 to take up work as a direct result of this measure.

These orders achieve the full uprating of social security benefits. They go further, providing extra help on top of uprating for pensioners and other vulnerable groups with the costs of VAT on fuel. They also provide extra help for mothers wanting to work and a number of measures for disabled people. They contribute to our programme of reform which, as serious commentators on social security recognise, will lead to a better benefit system. I commend the orders to the House. I beg to move.

Moved, That the draft order laid before the House on 10th February be approved [8th Report from the Joint Committee]. — (Viscount Astor.)

9.26 p.m.

Lord Dean of Harptree

My Lords, I am grateful to my noble friend the Minister for explaining these important orders and the substantial increase in benefits which are involved for many millions of our fellow citizens. I welcome in particular the uprating of benefits.

I should declare an interest as a national insurance pensioner myself and also a war pensioner. I realise that war pensions are not covered by these regulations, but the increases in war pensions which will come into effect at the same time are more than welcome because the Chancellor of the Exchequer cannot get at them. They are tax free.

Many of your Lordships will remember the time when increases of this kind were introduced by primary legislation. It is interesting that we have now reached the stage where we are so accustomed to annual increases in benefits that we find this procedure most convenient and acceptable.

There has been some criticism outside your Lordships' House that these benefits are not enough. We have not yet heard from the noble Baroness, Lady Hollis, but I do not suppose that she will use that argument because she will recollect the pledge of the leader of her party that he did not intend to propose any increases in public expenditure.

However, one has to ask who pays. It is the present working population who pay for these welcome increases in benefits under our pay-as-you-go system. Therefore, we have to balance the needs of pensioners against the increased burdens that we place on contributors. As your Lordships know, in these orders there is a 1 per cent. increase in contributions paid by employees. We also have to take into account that a substantial proportion of pensioners now have occupational or public service pensions or other forms of savings in addition to their state pensions. When one weighs all those factors I believe that in their proposals the Government have got the balance about right.

I should like to say a brief word about the statutory sick pay scheme and particularly the improvement in the small employers' relief. It is an acknowledged fact that small firms are assisting this country to move out of recession. It is therefore all the more important that we should give them every encouragement. The Finance Bill now undergoing scrutiny in another place, together with this improvement in the small employers' relief, are therefore much to be welcomed.

In bringing forward the orders, the Government have amply fulfilled their pledge to ensure that pensions and benefits on an annual basis shall be increased at least enough to compensate for the rise in the cost of living in the previous year. On that basis I warmly welcome the orders.

9.30 p.m.

Earl Russell

My Lords, today I cannot help but remember the first occasion on which I had to speak on a social security statutory instrument. The noble Lord, Lord Skelmersdale, was moving the instrument. He stated that it was couched in more than usually impenetrable language. I could not help agreeing with him. However, on this occasion, the instruments before us are couched, if I may so put it, in more than usually penetrable language. Perhaps I may express my gratitude to those responsible for the drafting. It was a great deal less hard work than usual to understand the regulations.

I shall not detain the House with my views on statutory sick pay. The noble Viscount knows them well. However, I should like to express a regret that the period for relief is still at four weeks and not, as the noble Lord, Lord Dean of Harptree, suggested, at two weeks.

I was struck by one specific piece of drafting in the minimum pensions order. The Secretary of State says that "it appears to him" that the general level of prices was greater by 1.8 per cent. I welcome that note of caution, of recognition of the subjectivity of any assessment of retail prices. In engaging with the argument that the noble Lord, Lord Dean of Harptree, raised about whether the amount is enough, one has to wonder whether the RPI always measures what pensioners are paying. Prices in supermarkets are a good deal lower than those in corner shops. Not every pensioner has the maximum amount of mobility. I have seen an estimate that in rural Wales food prices may be as much as 20 per cent. above the national average. In the end the question of whether the sum is enough is a matter for the pensioners themselves. It is no good convincing the House unless they also are convinced. Therefore I am glad to know that the Secretary of State has that little degree of caution about the assessment of prices.

I believe that there are some missed opportunities in the national insurance contributions order. I shall not develop the point. I made it on Second Reading of the Bill On 10th January.

In the main uprating order, perhaps I may ask the noble Viscount about the authority needed to bring in the changes for family credit that were recommended by the noble Baroness, Lady Hollis of Heigham, and myself on 1st February, and those which I recommended on 1st December. Could those changes be brought in by regulation and have we therefore here a missed opportunity; or would it require primary legislation? The answer to those questions might determine the best way to proceed on a matter to which we shall return.

In the light of the situation created by the changes in the child support regulations— they leave many people on family credit worse off than they were before— I was distressed by the wording of Regulation 21, which provides that the uprating shall not apply to those at present on family credit until the end of the sixth month period at which they receive their next routine reassessment. I cannot help feeling that that compounds the felony. I hope that there may be some thought about it.

I heard what the noble Viscount said about compensation for VAT on fuel. I am glad that there is compensation; but in the end, again, whether it is enough will be a matter for the fuel users themselves to decide. I hope that the noble Viscount is justified in his optimism on this question. I heard what he said about the £ 35 million for home energy efficiency for insulation. I am glad that that sum has been granted, but again, I cannot help wondering whether its sufficiency is quite as great as he suggested.

In Schedule 2, on the rates of income support, I notice the division between the rates for younger people and those for older people. I notice also a characteristic effect of percentage increases: that if they apply over a long period, the gap between the top and the bottom begins to widen. Whenever one is using percentage increases, one must be prepared for an occasional adjustment to prevent the process from becoming too extreme. I am sorry that the Government did not choose to do that on this occasion and I should like to know what their justification is today for the lower rates of income support for younger people.

On housing benefit, I am sorry that there is no adjustment of tapers, as recommended in the report by Shelter and NACAB, of which we shall hear a good deal more. On Schedule 8, which deals with reductions and disentitlements, I wish to know— if the noble Viscount can tell me— how many people are at present affected by all those various deductions which are set out in the schedule.

I should like to draw attention to a general problem. People on benefit occasionally do things, like all the rest of us, which appear to attract a penalty. But a financial penalty on those who are at subsistence level tends to have damaging effects. If that is not suitable, what is? There is here a problem about what means of punishment for those on benefit could be suitable or appropriate without doing undue damage. I do not know the answer to that problem. I hope to hear, when the noble Viscount replies, that he at least sees that there is a problem even if, like me, he does not see the answer to it.

9.37 p.m.

Baroness Hollis of Heigham

My Lords, the Minister has outlined what are in many ways a routine set of draft statutory instruments embodying the DSS proposals outlined by the Secretary of State at the beginning of December. At that time they were debated in this House. Statutory sick pay and national insurance have recently been taken through the House and the up-rating of the rest of the benefits is in line with the Rossi index, together with some partial off-setting of the additional cost of VAT on fuel for some benefit recipients.

Like the noble Earl, Lord Russell, I shall not spend much time on either national insurance or statutory sick pay, as we debated both Acts at some length. On national insurance, we have already aired our concern that national insurance is rising at a time when the benefits which it was supposed to fund are, over time, being eroded. We were especially concerned about the situation of the 500,000 people, mainly women, who did not earn enough to pay tax but were nonetheless facing an increase in national insurance. That indicated an increasingly regressive method of funding our benefit system.

On statutory sick pay, I am sure that the Minister will continue to welcome the additional protection offered to small businesses, but I hope that he will share with us a concern that continues that statutory sick pay will represent an additional negative dowry which the disabled will have to bring with them to work. The Government insist that there is no evidence that that will be the case, but it is hardly surprising that there is no evidence since the Government consistently refuse to collect it.

As to benefits, the Rossi index obviously ensures that people are no better or worse off in real terms than they were a year ago. But it is worth reminding ourselves that people on benefits do not exactly enjoy a princely income. A couple with two children under 11 will have an income of some £ 113 a week plus housing benefit. That is not much with which to join the mainstream of our society.

Similarly, the state pension now represents 15 per cent. of earnings. It is likely to fall to 7 or 8 per cent. in the next 20 years or so. While the Chancellor assures us that it is the cornerstone of the welfare state and will not be allowed to become vestigial, his own Chief Secretary expects its value to be nugatory in the future. We would welcome the Minister's comment on what role he sees the state old age pension performing in future years.

The compensation for VAT on fuel will partly compensate those on some benefits. It may meet perhaps half of the expected cost of the VAT increase. But it is worth emphasising that many people will experience real hardship and will gain no protection. Low paid families with young children, for example, will not receive any protection because it does not come through to family credit; nor will recipients of unemployment benefit receive any protection against VAT on fuel; nor — and this is most worrying— will many of the disabled. Yet it is those with young children, those who are at home, unemployed, and above all those who are disabled, with high heating and laundry costs, and sometimes electric wheelchair costs, who most need protection against the VAT increase and who will not get it.

It is worth reminding ourselves again just how aggressive that VAT increase will be. The poorest 20 per cent. spend 11 per cent. of their budget on fuel. The average family spends only 5 per cent.

The Minister may talk about the "green" effects of such VAT. Only 3 per cent. of the money raised by VAT on fuel will be recycled back into the total energy efficiency programme; and on the Government's own figures carbon dioxide emissions will be cut by less than 1 per cent. It is about raising revenue, not saving energy. I am sure that the Minister will not want to revisit that territory when he comes to some of his conclusions.

When dealing with the rise in benefit levels, it is also an occasion to reflect on the adequacy of those benefits, their reach and the extent to which the areas of need to which the Minister referred have been created by the Government's own policies.

I should like to come first to the implication for the disabled. It is obvious that the severely disabled are increasingly unable to be self-supporting. Over and beyond the fact that they are three times more likely to be unemployed, they face the problems of statutory sick pay. We had feared that they would also face the problems of returning to work, or being in work and becoming disabled, and asking employers to bear the cost of their access to work. I should like to pay compliments to the Government and to the Minister today on the fact that they have thought it right— I am sure that they are right— to think again about the access to work proposals. It appears that now, for the first year at least, the whole of the access to work programmes will be funded by government and not shared between employer and government. We are very pleased about that.

However, the problem of the Independent Living Fund and the complications of interlocking services in kind from the local authorities with services in cash from the ILF remain to such a degree that barely 20 per cent. of the ILF budget for this year will be spent. One could add to that the incapacity Bill which is wending its way through the other place. The Bill will not only remove invalidity benefit from some 200,000 people in poor health, pushing them on to unemployment benefit and then on to income support, but will at the same time reduce the value of the benefit itself— for example, by curtailing the additional allowances for other members of the families. Taken together, the Government's benefit policies for disabled people make it harder for disabled people to obtain work while simultaneously punishing them more fiercely for failing to get it. That still remains immoral and perverse.

I ask the Minister when the Government will also reconsider their position on the carers' rule, which means that only if one cares for one person for more than 35 hours a week is one entitled to allowances; whereas if one cares for two people for a total together of 35 hours a week there is no entitlement. I hope that the Minister will tell us or give us some guidance about that.

The second area of social policy where problems have in part been created by the Government's policies is the issue of child support. As we repeated in the debate on this matter which was so eloquently and elegantly introduced by the noble Earl, Lord Russell, none of us doubts that absent parents— usually fathers — have a duty to maintain all their children and it may necessitate a decline in the standard of living of second families as maintenance replaces benefits for first families.

But did the Government intend that the parent with care who was on benefit— not just the absent parent— and whose benefit is being replaced by maintenance should be worse off? Women who lose passported benefits to free school meals and the like will be worse off, as will be the group referred to by the noble Earl, Lord Russell: those 250,000 women on family credit who receive their family credit for six months at a time.

Quite rightly, the Government have modified maintenance payments by absent fathers, increasing protected income from some £ 8 per week to £ 30 per week for all absent fathers and introducing transitional arrangements for those absent parents who are now in a second family, thus phasing it in. As a consequence, some men will find their maintenance payments to former partners who are now on family credit dropping by some £ 50 a week. Yet, because family credit is fixed for some six months at a time, as though the carer were receiving full maintenance entitlement, that drop of £ 50 in a man's maintenance contribution cannot, as the law stands, be offset by any floating up of family credit.

On a previous occasion the Minister talked about swings and roundabouts. That vocabulary is simply rubbish. The Government have unilaterally altered every maintenance award — I do not object to that. But they have unilaterally altered every maintenance award which goes to women on family credit, apart from those cases where the men themselves are on benefit. I fear that many women will find themselves on incomes at less than income support level should they be foolish enough to remain in part-time work. In other words, men in second families have been helped— I do not begrudge that at all— but helped at the direct cost of women in the first families who are unable to have their family credit renegotiated because of the six-month rule.

There are 250,000 women at risk of serious cuts in their income by virtue of the Government's across-the-board policy. That is not swings and roundabouts. It is about the impoverishment of women by an all male department. We ask the Minister to permit women who are in receipt of family credit to represent themselves as of right for that family credit to be recalculated, given the new circumstances in which they find themselves, which are not a consequence of their actions or their former partner's actions but a consequence of the Government's actions. That is only fair; otherwise the Government's generosity to fathers is being paid for at the cost of women and their children. Clearly, over six months the problem will drop away. It need not be an expensive one over time. But did government not know that such women might fall below family credit levels? Or did they merely not care because such women tend not to shout as loudly as men and tend not to have such sharp elbows?

There is one final problem encountered by women with children on family credit. The whole House welcomed the introduction of child care disregards worth, £ 40 gross and £ 28 net to women and families on family credit. But it is worth reminding ourselves that it is a disregard and lot a payment. It cannot therefore benefit those families who are already on maximum family credit. Clearly maximum family credit cannot be pushed higher by a disregard. By definition therefore those on maximum family credit, who are those on the lowest incomes who most need help, will not receive a penny out of the child care disregards. That too is perverse and the opposite of what any sane and decent humane policy should seek to do.

If our first area of concern is the disabled and our second the situation of children and mothers receiving child support, our third area is that of the Social Fund. The Government changed the system to a discretionary Social Fund so that it should be better targeted. The research that the department commissioned and which we obtained last summer from York university showed that the Social Fund was failing on every count. People receiving help from the fund were shown to be in no greater need than those who were refused it. Those who were eligible for grants and loans were shown to be in virtually identical situations to those who were not. The better off were receiving grants; the poorer were receiving loans; and the poorest of all were receiving nothing because they were neither entitled to grants nor could afford to repay loans. That is unbelievably perverse, to say nothing of the lottery of the timetable.

The research that the department funded showed that the Social Fund is not targeted; it is not helping the most needy and, incidentally, it is extremely expensive. Something like 40 per cent. of its expenditure goes towards the funding of its own administration. The Government's Social Security Advisory Committee, in its 9th report, said that it was, convinced … that structural changes are required before long". Can the Minister tell us when we can expect to see such structural changes?

Fourthly, we still have the problem of the withdrawal of benefits from 16 to 17 year-olds who are assumed either to be in education, in work or in training; but certainly not on income support. Yet at the last count, given the shortfall in training places, we calculated that something like 80,000 youngsters— many had come out of care but 80,000 in all— were not in education; were not in work; were not in training and were without any visible means of support. Can the Minister tell us how many youngsters still fall into the forgotten group of those who are expected to support themselves without any visible state benefits by which to do so?

Fifthly, can the Minister help us in regard to the income support regulations 1992? They withdrew hardship payments from those single people or couples who were deemed not to be actively seeking work. They were targeted at travellers but we feared at the time that they would hurt women in refuges facing domestic violence; that they would hurt people with disabilities and people for whom English was not the first language. At the time the noble Lord, Lord Henley, promised an uneasy House of Lords that he would monitor the situation. Can the Minister tell us what was the consequence of that monitoring and how many people have had such hardship payments withdrawn?

In his opening remarks, the Minister made much of the fact that social security expenditure was rising and threatening to go out of control. We must keep challenging him on those assertions. At the moment social security spend in this country, as a percentage of GDP, is currently 12.3 per cent. — well below the average in Europe and lower than in most European countries. As the Social Security Advisory Committee said: It is right to keep the system under review but we do not start from the viewpoint that the cost of the social security system is out of control and that real cuts must therefore be made". Quite so, my Lords, and those are the words of the Government's own Social Security Advisory Committee.

On the projections it gives, if the Prime Minister is correct and the present Budget forecasts are correct in showing growth rising to 2.75 per cent. in 1995– 96 and to 3 per cent. in each of the following two years, social security expenditure will remain virtually constant and could even fall as a percentage of GDP. If it does not do so it will have everything to do with the levels of unemployment and mismanagement of the economy and nothing at all to do with the levels of benefit and the number of people who are scrounging and whose benefits need to be cut.

Poverty is growing in this country. A quarter of Europe's poor are now in Britain. Inequality is growing in this country and the gap between the bottom 10 per cent. and the top 10 per cent. is now wider than since records were first kept in the late 19th century. There is a real crisis out there. But it is a crisis not of benefits but of poverty.

9.56 p.m.

Viscount Astor

My Lords, I am grateful for the support of my noble friend Lord Dean of Harptree as I know that all noble Lords have waited rather longer than we expected for these orders to be debated; some of us some three hours longer. I am grateful to my noble friend for his support for the up-rating. He is right when he says that we have the balance about right, particularly when we look at the statutory sick pay scheme and small employers' relief, which we discussed during the proceedings on the recent Bill. I am grateful to the noble Earl, Lord Russell, for his compliments to the parliamentary draftsman and to the officials who, I am sure, try to make everything as clear as possible.

The noble Earl asked some questions about regulations that he talked about in two previous speeches and whether there was a need for primary or secondary legislation. I should like to study what the noble Earl said in those speeches and write to him to make that point clear.

The noble Earl and the noble Baroness asked about women on family credit losing out through the new arrangements with regard to the Child Support Agency. The recent package of changes has shown that we can respond to constructive proposals for reform. It is inevitable that if absent parents keep more of their income and pay less in maintenance some parents with care will get less. Because family credit awards are not normally affected by changes of circumstances, recipients will benefit from any increases of income during the award period. The £ 15 maintenance disregard in family credit means that families with maintenance are able to get family credit at much higher levels of income than would otherwise have been the case. The new phasing arrangements will allow absent parents with second families more time to adapt to their new increased financial responsibilities. We will continue to keep the scheme under close scrutiny and we will monitor the effects of the changes closely.

The noble Earl also asked about 18 to 24 year-olds being paid less in income support than those who are 25 years and older. Lower rates reflect the lower earnings expectation of this age group. In April 1993 the new earnings survey showed that the average earnings of the 18 to 24 group to be £ 202.90 and of all adults to be £ 330.30. Average earnings for the 18 to 24 age group are more than one-third less than the average for all adults. We think it would be wrong for the benefits system to offer an attractive alternative to seeking work or training or to act as a perverse incentive to young people to leave home unnecessarily.

The noble Earl also asked about the RPI. Historically, the RPI has been considered to be the best indicator of the movement in prices. The Secretary of State for Social Security uses the RPI less housing for up-rating income-related benefits as this more closely reflects the movement in the costs of that group.

The noble Earl also asked me about the numbers affected by Schedule 8 reductions. I am unable to obtain up-to-date figures. However, I can give him the figures which we do have available. In May 1993 income support deductions at 20 per cent. for voluntary unemployment affected less than 1,000 people; 40 per cent. affected 25,000. Income support urgent cases at 90 per cent. of the normal adult rate were awarded to 55,000 people and direct mortgage interest payments were made for 463,000.

The noble Baroness spoke about the state pension falling in value. The state pension remains the cornerstone of the Government's policy on pensions. Of course, the state pension is by no means the pensioner's only resource. However, I must point out that overall the income of pensioners has grown by 42 per cent. since 1979. She also spoke about the independent living fund. I have to admit that the start has been disappointingly slow. The noble Baroness will remember that when it originally started it was also slow in exactly the same way. These new arrangements will need time to settle down. Community care, of which the 1993 fund forms a small part, is an agenda for change over many years. The budget for the fund will be increased from £ 4 million to £ 11 million in 1994– 95. I expect the level of successful applicants to be substantially higher next year.

The Government's funding for independent living has increased from £ 750,000 in 1988– 89 to an estimated £ 121 million in 1993– 94. In addition there is £ 64 million provided for local authorities on top of the core community care funding in recognition of their role in independent living provision.

The noble Baroness was also concerned about the disabled and VAT. About five million out of six million disabled people in Britain will be helped with VAT on fuel. Extra help for IVB and SDA recipients and people on income support in receipt of a disability premium, will be 50 pence for single people and 70 pence for couples per week from April 1994. Only a million disabled people are not helped. One has to accept that these must be the younger and less severely disabled who are in work or who are better off. Disabled people receiving income support will receive similar increases in April 1994 and April 1995.

The noble Baroness asked me about the social fund. That is not the subject covered by these orders tonight so we must not get distracted by that. She also asked me about tightening up of the actively-seeking-work provisions and whether other groups have been affected. I have studied what my noble friend Lord Henley said to the noble Baroness. I am able to tell her that there is no evidence at all that the removal of access to hardship payments for fit childless claimants of income support who fail the actively-seeking-work test has had an adverse effect on vulnerable groups which was feared by some people at the time.

The child care disregard provision has obviously been welcomed. It was welcomed when we brought it in. It will help about 150,000 families to combine work with family responsibilities. It is a positive incentive to help families to get back into work. A £ 40 disregard makes a substantial contribution to child care costs.

Perhaps I may say a word more about the 16 and 17 year-olds. There is a higher proportion of young people than ever before staying on at school. A sum of £ 844 million is to be spent on youth training this year. That represents a considerable investment in the future. The number of 16 and 17 year-olds on government training increased from 7,000 in 1978 to 270,000 in June 1993.

These orders implement the full uprating of social security benefits, keeping our pledges to pensioners and to families. We have gone further than that, providing extra help over and above the cost of living rise, with the cost of VAT on fuel, to the least well-off— those on income related benefits— and to pensioners and disabled people. We have been able to provide a very substantial disregard for child-care costs, helping parents on benefit who want to work. This demonstrates again this Government's commitment to maintaining the benefit system.

We are equally committed to necessary reform which will ensure that we have a benefit system which is affordable and sustainable as we enter the next century. The recent changes to the statutory sick pay scheme help to achieve that goal. I commend these orders to the House.

Baroness Hollis of Heigham

My Lords, before the Minister sits down, there were a number of points in his winding up speech which I should have liked to press him on, but the one which I am most concerned about is family credit. I took down the Minister's words and I believe he said that the Government were monitoring the situation. This is a six-month problem. For how long do the Government: propose to monitor the situation — seven months? Of course, by then the problem will have disappeared. In the meantime, many women may find that their incomes are below income support level as a result of a government policy. Can the Minister tell us why women in that situation simply cannot have their family credit reassessed?

Viscount Astor

My Lords, I explained this point to the noble Baroness when we dealt with the child support regulations in a recent debate. I made clear to her that family credit awards were not normally affected by change of circumstances. Recipients will benefit from any increases during an award period. The position is exactly the same as if they receive extra money from any other source during the period. The system does not change. As the noble Baroness knows, the system is based upon 26 weeks. We tried to look as carefully as we could at those who were affected by the child support regulations, and we brought in new regulations in the light of all the points put to us. Obviously, we must see how they work. We will closely monitor the effects of those changes. I am afraid that I cannot go further than that. I cannot satisfy the noble Baroness on the point that she has raised, but I am able to say that we will look at the matter very closely.

Baroness Hollis of Heigham

My Lords, I thank the Minister for his courteous reply. Can he tell the House how he will monitor it? Will he be reporting back and, if so, on what basis?

Viscount Astor

My Lords, the department monitors the many benefits for which we are responsible, in the same way that it monitors the business which the department is in, which is the giving of benefit to those who are in need.

Baroness Hollis of Heigham

My Lords, perhaps I may ask the Minister how he will know what is happening if these women cannot re-present themselves.

Earl Russell

My Lords, before the noble Viscount sits down perhaps I may ask him to convey two messages to the department. The first deals with the 1992 actively seeking work regulations. Perhaps he will offer my thanks to his colleague Mr. Burt, for his efforts to ensure that those regulations do not do undue harm to women in refuges. The other matter relates to the point raised by the noble Baroness, Lady Hollis. I am afraid that his answers give no more satisfaction on these Benches than they have on those.

Viscount Astor

My Lords, I address first the point raised by the noble Earl. I will pass on the contents of his remarks to my right honourable friend. I am afraid that I can go no further than I have been able to go. I realise that the noble Baroness and the noble Earl have a different point of view on this subject. It is a point of view that I respect. However, I am unable to give them any further satisfaction. We do not feel that it is right to implement the changes that have been suggested, but we will monitor the situation, as we will monitor all the changes in the regulations that have been made under the Child Support Act.

On Question, Motion agreed to.