Social Security (Incapacity for Work) Bill

HL Deb 10 May 1994 vol 554 cc1436-503

3.6 p.m.

Report received.

Clause 1 [Incapacity benefit: entitlement]:

Lord Swinfen moved Amendment No. 1: Page 2, line 14, leave out ("364") and insert ("196").

The noble Lord said: My Lords, the purpose of this amendment is to reinstate the payment of long-term benefit at 28 weeks as now, rather than delaying payment to 52 weeks as written into the Bill. The Bill extends the period classed as "short-term incapacity" to 52 weeks. That means that benefit entitlement is delayed for a full year resulting in a lower level of payment than is currently available under invalidity benefit. The amendment seeks to restore the current position whereby long-term benefit is payable after six months of incapacity. Redefining long-term incapacity as starting after one year represents a substantial reduction in benefit even for those passing the more stringent incapacity test who could be regarded as those genuinely incapable of work.

One of the main arguments which has been put forward for delaying benefit entitlement is that it is because the definition of long-term incapacity has been changed. During all stages of the Bill in both Houses the Government have only justified this redefinition on the basis that it is a more reasonable period than 28 weeks. In Committee my noble friend Lord Astor said: We consider that 52 weeks is a better definition of long-term incapacity".—[Official Report, 19/4/94; col. 101.] Yet since 1971, when it was introduced by a Conservative Government, invalidity benefit for long-term incapacity has been payable after 28 weeks of sickness benefit. Payments for long-term incapacity for people without a national insurance record will, however, still begin at 28 weeks. Severe disablement allowance, which will have the same test of incapacity as the new incapacity benefit, is payable in full with age additions after 196 days of incapacity. In my view, it is ludicrous to have different definitions of long-term incapacity.

Although it has been argued by Her Majesty's Government that occupational cover is available to people during these crucial weeks, it is by no means the general rule. Even the department's own figures show that fewer than one in four people on invalidity benefit have such cover. The arguments put forward so far are not convincing. I suggest that rather than designing a benefit to target the needs of disabled people, the Government are more concerned with cost cutting.

Delaying long-term entitlement means that until the 52nd week of incapacity, the basic rate of benefit is not awarded at the full rate; that there is no allowance for children; that no full allowance for a non-working partner can be paid and that no allowance based on the claimant's age is payable. In Committee, a government amendment introduced payment at 28 weeks for people with a terminal illness where life expectancy is six months or less, and I welcome that. However, other groups with considerable needs will still have to wait. Even people with severe disabilities or progressive conditions will have to wait a year for full benefit.

From weeks 29 to 52 a basic rate of £52.50 is payable —a loss under the Bill of £5.10 per week, which is £122.40 by the end of the first year. Awarding the full rate of benefit at 28 weeks would reduce the savings that the Government expect to make by £110 million in the current financial year and £150 million in 1996–97. No children's allowance is payable under the Bill. The loss of a child's allowance amounts to £11 per week for an only child; and a married claimant with two children will lose £45.65 per week, which amounts to something over £1,000 by the end of the first year.

The adult dependency increases will not be paid at the full rate. Claimants with adult dependants will not be able to receive the full dependants increase until the end of the first year. People with no dependent children in the household lose most. For a married claimant under 40 with no children, the loss is £51.75 per week, which amounts to £1,242 between the 28th and 52nd weeks of incapacity—a large sum of money.

No age allowance is payable. Age allowances, now payable from the 28th week of incapacity with invalidity benefit, will similarly be delayed. Because of the change in the age bandings, the losses will depend on the age when the claimant became incapable of work. The over-45s will lose £3.80 per week. People between the ages of 40 and 45 will lose £1.50 per week and those aged between 35 and 40 will lose £6.05 per week. The net saving resulting from delaying the payment to 52 weeks is estimated at only £10 million per year.

Delaying payment of the age allowances and dependants allowances will penalise older people who become disabled in the future. It represents a substantial reduction in benefit but without any evidence that claimants' needs have been reduced correspondingly. One of the consequences of limiting payments between 28 weeks and 52 weeks is that people could be forced to live on a level of income which is often below that of income support. Someone who is disabled with a non-working partner and two children under 11 would be entitled to only £79.40 per week. That is over £16 per week below their income support entitlement. Contrary to original intentions for invalidity benefit, for the first time in over 20 years substantial numbers of people could become reliant on means-tested support during those weeks.

Delaying full incapacity benefit for a full year will also have a knock-on effect for entitlement to the disability premium. That is payable with means-tested benefits, such as income support, housing benefit and council tax benefit. All depend on receipt of long-term benefit. At present, it is payable from the 196th day of incapacity. After April 1995, entitlement to the premium will be delayed until 52 weeks. That will mean that some people will have to pay more rent and council tax while at the same time having a lower disposable income. I beg to move.

3.15 p.m.

Baroness Darcy (de Knayth)

My Lords, I should like to give brief but warm support to the amendment which has been so comprehensively and clearly moved by the noble Lord, Lord Swinfen. He gave a very clear explanation of it and I do not need to add much. As the noble Lord explained, delaying the long-term entitlement until the 52nd week of incapacity means that claimants do not get the full rate of benefit; that they do not get child allowance; the full allowance for a dependent spouse, or the age allowance. While I very much welcome the fact that the Government have introduced an amendment which means that at 28 weeks they will pay the higher rate for people with terminal illness, it still leaves other severely disabled people with a year to wait before receiving the higher rate of benefit.

As the noble Lord, Lord Swinfen, said in Committee (col. 104 of Hansard) on 19th April—I paraphrase—the moment that a person becomes incapable of work is the time of greatest expense, with mortgage and hire purchase payments to meet, and it is the time when expensive adaptations may need to be carried out to the home. That is the point also when one becomes subject to all the extra additional daily costs of disabled life for which the disability living allowance can never fully compensate. I hope that your Lordships will give the amendment your fullest support.

Earl Russell

My Lords, the noble Lord, Lord Swinfen, has given a comprehensive account of people subjected to reductions in their disposable income. For a moment, that may appear simply as figures in a ledger. What we need to do is to translate those figures in the ledger into the actual experiences that are likely to result.

By coincidence, April's Social Policy Bulletin of the National Association of Citizens' Advice Bureaux landed on my desk while I happened to be preparing for this amendment. It reports—this is only one example among hundreds that are possible—considerable difficulties being faced by clients with health problems who are struggling meet their telephone bills. Among the numerous cases, I refer to only one. It is a case from Sussex in which BT refused to negotiate repayments for an outstanding telephone account for a client with severe epilepsy who was caring for two children while her husband was in hospital because of mental illness. The client had 24-hour emergency call-out cover arranged with the local authority for use by her children should she have an epileptic fit. She was told by BT that it was not its fault if she needed a helpline.

That is the sort of thing that reductions in disposable income on this level are likely to mean. I question whether that is in the public interest and whether it is, on the whole, likely to lead to any reduction in public expenditure.

Baroness Hollis of Heigham

My Lords, this afternoon we are all shaping social security provision for the sick and the disabled. We are making decisions that will shape their benefit and their financial support. As the noble Lord, Lord Swinfen, told the House, since 1971 invalidity benefit has been paid at the long-term rate after six months. Under the proposals, although the new incapacity benefit tests people and certifies that they are disabled and incapable of work at six months, nonetheless that benefit will not be paid at the full rate for another six months beyond that—that is, until 12 months have passed. In the intervening six months, those disabled people who qualify by the new medical test will nonetheless receive a benefit which will not only be much lower than invalidity benefit is now and much lower than unemployment benefit, but which will also be lower even than income support which has in the past, as I think we have accepted, set a minimum floor.

Perhaps your Lordships will bear with me if I quote figures to give the real incapacity benefit income for the many thousands of families with a disabled family member living with them. Allow me to round them to the nearest pound, include the disability premium, and add in or subtract child benefit, according to the benefit rules. So I am talking about net total income. A disabled married man with a 12 year-old child on invalidity benefit now receives £124 a week, and on income support £122 a week. On incapacity benefit he will receive £89 a week. That same man with two children now receives on invalidity benefit £143 a week, and on income support £130 a week. On incapacity benefit he will receive just £98 a week. That same man with three children on invalidity benefit now receives £163 a week, and on income support £145 a week. On the new incapacity benefit he will receive just £106 a week.

A married man in his fifties, whose children have grown up and left home and whose wife is not working and is perhaps caring for him, on invalidity benefit now receives £100 a week, and on income support £99 a week; in future he will receive £52.50 a week. That is what a disabled man and his wife will have to live on for a week. His benefit will be halved, falling even below the level of income support he now receives.

We are shaping that benefit. What would your Lordships say of a benefit which pays less if you are sick than if you are well; pays less if you have the higher costs of disability (diet, laundry, heating) than when you are well; and pays less when you cannot work than when you cannot for the moment find work? You would say that such a benefit was not humane, and you would be right. But what would you say of a benefit which, if you contributed to it through national insurance, pays less than if you had not contributed to it? The contributory national insurance benefit will pay less than non-contributory income support. That, you would say, is perverse, and you would be right.

What would your Lordships say of a benefit that pays the same to a single man as to a man and his wife, or pays the same to a couple with one toddler as it pays to a couple with three teenaged children, taking no account of family needs? You would say that was not decent, and you would be right. We can remedy that today. We can decide, if your Lordships please, that the point at which the tough new medical test at 28 weeks confirms that a person is genuinely incapable of work is the time at which such a person should receive the full higher rate incapacity benefit, as now, and not six months later.

The Treasury estimates that overall the Bill will produce savings of £1.5 billion. The amendment, we are told, would cost £150 million in a full year. So, instead of having savings of £1.5 billion, the Government would have savings of £1.485 billion. Your Lordships may think that that is not a large sum in terms of the total expected savings.

The Minister may argue that many disabled families need only a low benefit because they have an occupational pension. As this is a contributory benefit, for which they have paid, that should not be a relevant argument. But even if it were relevant, it is not true, because only 38 per cent. of disabled people have an occupational pension, and they tend to be white-collar workers. The majority—two-thirds—have no income other than this benefit. The Minister may argue that they can nonetheless turn to income support. They will have to, because where is the couple, disabled and with all the heating and laundry costs that that brings, who can live on £52 a week? Are we setting a contributory benefit for the disabled so low that if there are no private means, two-thirds of the disabled then have to turn to a second benefit (income support) to top it up, even to reach the minimum living standards, which requires them to apply to a second set of staff at benefit offices, go through a second bureaucracy, and experience additional stress and strain, stigma, cost and worry? If that is what we are sentencing them to, why have a disability benefit at all? Why not merely send them all off to income support and have done with it?

Our decision today is our decision and not the Treasury's. This is an all-party amendment. There are voices today from all around the House concerned about disability and benefit after someone has been certified by the new medical test as incapable of work. There are worries about that benefit being pitched below income support level. We hope on these Benches that the voices of your Lordships will be heard tonight and that we shall be asking the Commons to think again in due course.

Lord Boyd-Carpenter

My Lords, perhaps before the House comes to a decision, my noble friend the Minister will tell us what would be the cost of accepting the amendment. I do not believe that anyone disputes that most of the money spent would be going to good, excellent and indeed appealing causes. But experience, which, as your Lordships know, I had as someone responsible for administering national insurance, taught me, as I believe it has taught many of your Lordships, that the fact that benefits will do a lot of good, if granted, is not necessarily a conclusive argument for granting them.

It is always necessary for this House and another place to weigh against the benefits, which will undoubtedly be given by making this provision, the additional cost. Before making up your minds on this important amendment, which has been most eloquently moved and supported, your Lordships will want to know what would be the total cost of granting it and what repercussions that might have upon other aspects of social security.

Earl Russell

My Lords, before the noble Lord sits down, does he agree that the question should be put to the Minister net of any saving on income support which would result from carrying the amendment?

Lord Boyd-Carpenter

My Lords, it is for the Minister to decide how he puts it, but your Lordships' House—I include in particular the noble Earl—is capable of understanding, whichever way the Minister sees fit to put it. When the Minister is answering difficult questions of this sort, we should not attempt to lay down the terms in which he answers. We shall listen.

Lord Ashley of Stoke

My Lords, the noble Lord, Lord Boyd-Carpenter, asks a legitimate question, but it is my impression that it has already been answered by my noble friend Lady Hollis and by the noble Lord, Lord Swinfen, in his admirable opening speech. The Minister can decide whether to vary the figures given by both—if I may so describe them—my noble friends.

The Minister says that the Bill is about targeting. That is right. There is no doubt that the Government are targeting. They are targeting sick and disabled people, picking them off and shooting them. They are damaging them greatly. The House has heard, with some measure of incredulity, about the cuts in the income of people who can ill afford any cut and who in fact need an increase.

Punishing the needy is a poor policy for any Parliament, but that is precisely what the Government's proposals are doing. Those people are being devastated and demoralised. I hope that noble Lords will heed this important amendment. There is no doubt that to delay the benefit for six months is to deprive, because people are sick and disabled throughout the whole period. After 28 weeks, they are confirmed as having been long-term sick and disabled. If that is confirmed there should be no argument—the payment should be made. The Minister says that 52 weeks is a more realistic definition of long-term sickness. It is more ruthless but it has nothing to do with realism. We all know that the true definition is clear after six months.

To define a person as long-term sick or disabled at 28 weeks but to refuse to pay benefit until after 52 weeks is devoid of all logic. Furthermore, it is arbitrary and unfair. We should be under no illusion that the Government's proposals are an echo of the depression years when the incomes of the poorest were cut. At that time, we were ashamed of the uncaring attitude of the government and we can avoid being made to feel ashamed again by voting for this splendid amendment.

3.30 p.m.

Viscount Tonypandy

My Lords, I am reminded of the years of the 1920s when a man not genuinely seeking work—the same phrase—where there was no work would be denied his dole. This is not a matter only of arithmetic but of the kind of country in which we live. I know from my experience that among the proudest people in the land are the poorest. There is a fierce pride among the poor and this proposal will humiliate those who have enough trouble as a result of the sickness that has been proclaimed by the doctor. To humiliate them is unworthy of this House and unworthy of the country of which we are a part.

I know some of these people who struggle to live —and they struggle. As I said in Committee, none of us has to struggle to live and none of us is afraid of what is coming tomorrow. However, we are dealing with people who are not in our position and the compassion for which both sides of the House is renowned should be revealed.

I know that the Minister has a difficult job in replying. I had the privilege of being a Minister for a long time and many times I had difficult jobs to do. I do not envy the Minister if he has to rise and say, no. I say to the House only that the Minister has his job to do; his brief is prepared whatever we say in this Chamber. His answer is ready but your Lordships have an answer in the Division Lobby.

Lord Milverton

My Lords, I wholeheartedly support the amendment. My noble friend Lord Boyd-Carpenter spoke about the amendment in terms of fewer costs and statistics. However, there is another cost, as implied by the noble Viscount, Lord Tonypandy. It is the cost of human beings' health and well-being. Are we going to help the health and well-being of a man, a woman, a boy and a girl, or not? Any type of benefit is about helping and enabling a man, a woman, and their children if they are still living with them, to have a feeling of decent and reasonable security.

If the Government cannot accept the amendment they may have to provide income support, as has been suggested. They will have to provide some other kind of benefit and support to help the people who will need help. And for many of them the need is genuine. Let Her Majesty's Government try to recall the cost of goods. If a person becomes ill and cannot work as he would like, the costs increase. The Government should bear in mind the cost of children's clothes, shoes and so forth. One sees in this country money being spent freely—yes, one does—and therefore it cannot be that this country is as poor as it is supposed to be. One sees money floating about all around. Perhaps it does not come from a large majority, but I believe that the majority is larger than people think. If that is the case, surely this country can behave decently towards those who are really in need. Therefore, let Her Majesty's Government give a true and proper answer if they believe that this amendment cannot be accepted.

What are we about? Money is found for this and that but when it comes to people it seems that it cannot be found. We are concerned to help the minds, the souls and the bodies of men, women and children. What are we going to do? Let us see that we get our priorities right and, if need be, to make a sacrifice. Most of us in this Chamber have during our lifetime been prepared to make a sacrifice for one reason or another. We have made sacrifices in bringing up our children. As most people know, it is not only in war that we sacrifice—we sacrifice in believing in standards and values not only for ourselves but for our children. If we are prepared to make sacrifices for ourselves, our children and our immediate family—and if this is, as it is supposed to be, by tradition a Christian country—we should be prepared to sacrifice in a decent way for those who are genuinely in need. And the majority of claimants are genuinely in need. There may be some scroungers, but I believe that the majority are genuine. As the noble Viscount, Lord Tonypandy, said, there is a healthy pride in the British people; whether they are English, Scottish, Welsh or Irish. I hope that the Government can give a decent answer otherwise they might find a surprise in the Division Lobby.

Lord Ewing of Kirkford

My Lords, when I took part in the debate in Committee I burdened your Lordships with personal experiences of three lengthy periods of illness in three different occupations. Your Lordships will be relieved and delighted to know that I shall not repeat those words today. Instead, I wish to tell your Lordships that only last week in the Library of this House I read the latest list of HMSO publications. One of those publications struck me forcefully—it stood out from all the others on the list. It was entitled How to Live on a Low Fixed Income and it was priced at £15. I now understand why HMSO is highlighting in its recent list of publications a document for those who have to live on low fixed incomes—in this case, £52.50 per week. The charge for finding out how on earth to make ends meet on £52.50 per week is £15!

Perhaps I may say with great respect that the noble Lord, Lord Boyd-Carpenter, asked the wrong question. The question in this debate is not what would be the cost to the Exchequer if the amendment were accepted. This debate is about a benefit which is in place at present, which is paid for by the state, as it has been for the past 23 years since 1971, and which is now being taken away. That is what the debate is all about. Therefore, with great respect, the answer that we should hear from the Minister is not what will be the cost to the Exchequer if the amendment is accepted but what will be the savings to the Exchequer if the Government's proposals are implemented. Of course it is relatively easy to define savings in financial terms. But no one can estimate the hardship, misery and worry which will be caused if this policy is introduced.

I intend to speak only briefly. Twice—the noble Lord, Lord Swinfen, in his excellent speech, and my noble friend Lady Hollis—mention has been made of the question of occupational pensions. Whether they are occupational pensions or benefits at a time of sickness is irrelevant. When occupational benefits or pensions were introduced in this country, they were not introduced, and far less encouraged, on the basis that they would be replacements for state benefit. They were introduced and encouraged on the basis that they would top up existing state benefits. If the Government are now saying that occupational benefits, be they pensions or sickness benefit, are to replace state benefits, today we are at the beginning of a very dangerous slippery path leading to the abolition altogether of state benefits for those who have contributed through their salaries towards the receipt of occupational benefits. It is a very dangerous argument for the Government to be promoting in support of their case. Therefore, I hope that they will make their position clear. Occupational benefits have always been a means of topping-up and not replacing. If the Government are saying now that those benefits, paid for by the employee, are to be a replacement for state benefits, they should make that clear so that we know where we are.

I do not wish to be too political, but this Government are perceived by the people to be adding injustice to injustice. That is why people voted in the way that they did last Thursday. I suspect that in the Euro-elections also the people will exact their price for the perception that the Government are adding injustice to injustice.

Naturally when people look at legislation they compare how we treat ourselves with how they are treated. I leave with your Lordships a thought about how we in Parliament treat ourselves. Prior to the 1987 election, a measure was pushed through another place about three or four weeks before the dissolution of Parliament to ensure that, if a Minister lost his job for any reason whatever—if he was sacked, replaced in a reshuffle or he resigned—his ministerial salary would continue for three calendar months from the date on which he left office. To put it bluntly and in stark terms, if the Prime Minister were to go this afternoon, his Prime Ministerial salary would continue until 10th August. That measure was pushed through, and I quote verbatim the reason: In order to allow Ministers to adjust to a lower level of income". Perhaps I may say as an aside that I notice that all the Ministers who left office adjusted immediately to a higher level of income. We have scene very good examples of that in your Lordships' House.

But we cannot justify, and the Government should not try to justify, what is being done in this Bill to the long-term sick, on the one hand, and then handing out these goodies, on the other. That is why people in this country are so angry about the harsh treatment of different sections of our community.

I agree with the noble Viscount, Lord Tonypandy, that the Minister's brief has already been written. He will have to stand and read it whether or not he agrees with it. I have been in that position, and I am sure civil servants have been worried stiff when they saw me rise at the Dispatch Box in case I was about to change government policy. But the Minister before us has nothing to lose and everything to gain by accepting the amendment. If the Minister indicates that the Government will not accept the amendment, I plead with your Lordships to impose this amendment upon them and vote with those of us who support it in the Division Lobby.

3.45 p.m.

Baroness Masham of Mon

My Lords, as the noble Baroness, Lady Hollis of Heigham, said, it is not reasonable to assume that most people have savings and pensions on which to draw. Incapacity benefit will be all that most people have on which to depend financially.

Life for severely disabled people is very expensive indeed. The added stress of disability and not having enough money on which to live may just be the breaking point. Is it not wise to try to keep families together? I have known some cases where, in the first few weeks of severe disability, the partner of the person who has become disabled has panicked and left. That really happens. When the disabled person then finds that he does not have enough money on which to live, that can be the breaking point.

Baroness Elles

My Lords, we have heard a great many moving speeches and many figures have been quoted. When my noble friend replies perhaps he will tell the House what is the minimum sum that a genuinely disabled man who is married, with at least one child under the age of 12, will receive. Many of us will be concerned not only about the figures that have been quoted this afternoon but also about the effect that the proposal could have on children within families where disability suddenly strikes those families. That is a factual question which I hope the Minister will be able to answer when he winds up this debate.

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

My Lords, the noble Viscount, Lord Tonypandy, said that I would have a difficult job in replying to the debate. He always makes a persuasive argument but I shall seek to be as persuasive as the noble Viscount.

The noble Lord, Lord Ewing, mentioned to your Lordships a publication which cost £15, a copy of which is in your Lordships' Library. I believe that the only point which the noble Lord made was as to the importance and success of public libraries throughout the country.

The noble Lord, Lord Ashley, said that the Bill targets the sick and the disabled and is an echo of the depression years. I do not believe that it does that at all.

My noble friend Lord Milverton said that there is a cost involved. The Bill is all about providing a benefit. I should remind your Lordships that the budget which my department has this year is £88 billion. That is the budget for the Department of Social Security, and it is not an insignificant sum. For example, it is more than the budgets of the Department of Health and the Ministry of Defence put together.

I turn now to the amendment. I believe that it would assist your Lordships if I were first to answer the question about costs. According to how we see the amendment—and my figures are different from those of my noble friend—I believe that the cost of paying long-term incapacity benefit from week 29 would reduce public expenditure savings by about £45 million in the year 1995–96 and by about £60 million in the year 1996–97. Those figures are net of income support costs and the costing assumes that payment of long-term incapacity benefit is a passport to disability premium in income support, housing benefit and council tax benefit.

The Bill introduces a new benefit payable at three rates. The longer the period of incapacity, the higher the rate. Short-term incapacity benefit will consist of a lower rate payable for the first 28 weeks of sickness which is equivalent to the current rate of sickness benefit, currently £43.45, and a higher rate payable after 28 weeks equivalent to the higher rate of statutory sick pay, which currently stands at £52.50 a week. Long-term incapacity benefit at a rate equivalent to the current rate of invalidity benefit (currently £57.60) will, with the exception of payments to the terminally ill, be payable after 52 weeks.

The restructuring will provide a basic income to those who cannot work and focus resources on those who are genuinely long-term sick. Your Lordships have asked why we need to restructure the benefit and introduce a new medical test. Our intention is to focus the benefit on those who are genuinely and medically long-term sick. That is the group which needs most support.

I make no apologies for once again pointing out that the Government must contain spending on sickness benefits. Invalidity benefit is the fastest growing contributory benefit. It is second in cost only to retirement pension. Spending on that benefit has doubled in real terms in the past 10 years, from £2.7 billion to £6.2 billion. No responsible government could let that growth go on unattended. If we did, spending would grow by a further 50 per cent. or more in real terms by the end of the decade. This Government are determined to introduce a system which is affordable and which focuses benefit on those most in need.

The amendment is at odds with the Government's strategy of providing a sustainable and well-targeted system. Your Lordships must consider whether that expenditure would be a sensible use of resources. I believe that it would not be. Many claimants will have other resources, such as occupational sick pay, occupational pension, personal savings or income from a partner who is working. To pay after 28 weeks considerably higher rates of benefit would duplicate that provision. That would not be good targeting. It is important to remember that, where other resources are not available, the income-related benefits are available to top up payments of short-term incapacity benefit.

The noble Baroness, Lady Hollis, talked about people falling below the level of income support. No one should fall below that level if they are able to claim income support. We believe that it would be irresponsible to raise the level of a contributory benefit —a non-means tested benefit—to the level at which no one would qualify for income support. The noble Baroness suggested that there was some stigma attached —:indeed, that was the word that she used—to claiming income support. I do not believe that that is right and I have to say that I find the remark somewhat insulting to those people who have to claim that benefit.

My noble friend Lord Swinfen mentioned the fact that SDA is payable at 28 weeks. However, SDA recipients are less likely to have worked and less likely to have other resources. As a consequence, we believe that it is right that the benefit should be payable from 28 weeks. My noble friend also asked whether we would consider extending the concession which the Government have agreed for the terminally ill to all groups that have been exempted from the medical test. We believe that most claimants will come on to incapacity benefit after receiving statutory sick pay for the first six months of incapacity for work. It is at that point that staff from the Benefits Agency will award the long-term rates. For many that will be the first day of state incapacity benefit. Adopting the exempt groups as a gauge of severity of incapacity would be a very crude measure. It would exclude some severely disabled people simply because their conditions range from mildly incapacitating to severe. Going on then to pay the long-term rate of benefit to exempt groups after 28 weeks on the grounds of the severity of disability would be inequitable.

My noble friend also said that 52 weeks was too long to wait for the disability premium. We believe that 52 weeks is a better definition of long-term incapacity. Indeed, long term incapacity is only one of the many routes into the disability premium paid with income support and other income-related benefits. The premium is also awarded to people who are in receipt of DLA, AA and SDA. It is also awarded to the registered blind. Those people will continue to qualify for the premium under the same rules and at the same time as now. The most severely disabled will not be affected. We do not believe that it is true that two-thirds of people will go on to income support. We estimate that, even after the changes, only perhaps a quarter will actually have to use income support.

If I understood her correctly, the noble Baroness, Lady Hollis, said that people are tested as regards being incapable of work at six months and that, therefore, is long-term incapacity. The point is that one is tested for incapacity from the first day of a claim—that is, both now and in the future—through medical certificates from a doctor. There is no link between the test and the applicable rates of benefit.

The noble Lord, Lord Ewing, talked about occupational pension schemes being a replacement for state benefit. It is not; indeed, that is not the case. It is a top up. When one considers SERPS, one contracts out of that scheme into an occupational scheme receiving a rebate on National Insurance contributions. It is not possible to receive an occupational pension and a full SERPS.

My noble friend Lady Elles asked about the average amount of money that a person could earn, whether or not he was on benefit. As I am sure my noble friend will realise, it is most complicated to calculate the various different amounts. However, if my noble friend will bear with me, I hope that my reply will make some sense to her. The information on the number of invalidity benefit recipients who are in receipt of other sources of income is not available. Estimates of the percentage of invalidity benefit recipients who are in receipt of other sources of income and the average amount of income are as follows. We believe that 38 per cent. are occupational pensions; 78 per cent. are non-income related benefits; the figure for the community charge and housing benefit is 37 per cent; and the figure for income support and family credit stands at 7 per cent. I know that that is, perhaps, a complex answer to my noble friend's question. However, it is difficult to take the example of one person to try to explain exactly what the figure might be when one does not know the exact circumstances. Indeed, those circumstances could be very different because of the many different kinds of resources involved when people claim income support.

The Government looked at what might be a more balanced definition of long-term incapacity—a definition which would minimise the extent of duplication of provision but which would reflect the needs of long-term incapacity. We concluded that one year is a more reasonable measure of long-term incapacity. Many people want to and do return to work within one year of sickness. We must remember that people do not go on to invalidity benefit and stay on it forever; indeed, many people claim the benefit but later come off it. Where other resources exist, it is reasonable to expect that they should be used to support periods of short-term sickness. It is right that the state should shoulder more of the burden through the higher long-term rate of benefit.

Of course, there is no generally accepted definition of what constitutes long and short term. It will always be a matter of judgment. By setting the definition at one year, we believe that we have struck a balance between the interests of taxpayers and contributors and the needs of long-term incapacity. I urge your Lordships to reject this amendment. It was rejected in Committee. This is exactly the same amendment as the one we dealt with then, and I urge your Lordships to reject it again today.

4 p.m.

Lord Carter

My Lords, we had no vote in Committee; how could we reject it?

Viscount Astor

My Lords, if the noble Lord will remember, it was negatived in Committee, therefore it was rejected.

Lord Swinfen

My Lords, my noble friend is quite right when he says that the amendment was rejected in Committee. He forgets, however, to tell the House that prior to Committee stage I had assured him that I would not press it to a Division, and that I was attempting to withdraw the amendment when a Member of your Lordships' House, who was so much in favour of the amendment that he thought he would be helpful, asked that I should not withdraw it. It was therefore necessary, when the Question was put, for me to shout in favour of my own amendment. In order to bring the same amendment back at this stage of the Bill, I did not appoint Tellers, so, technically speaking, the amendment was negatived. Therefore my noble friend is being a little ungenerous in what he has said.

We have had a long debate. We have demonstrated how important this amendment is by the number of speakers who have spoken. Apart from my noble friend Lord Astor and myself, there have been 10. The vast majority have spoken in favour of the amendment. One important point is that I understood from what my noble friend said when replying to the amendment that he does not know what the minimum benefit would be. It strikes me therefore that there has not been considerable effort put in to finding that out—not by him but by his advisers —and that therefore this is not a Bill, as I said at the previous stage, that has been drafted by my noble friend's own department but rather by the Treasury. That is the impression that I am given. The noble Viscount, Lord Tonypandy, said that it was a question of what sort of country we wish to live in. I think that we ought to accept this amendment. We are a civilized country. We should look after those who are genuinely incapable of work and we should do that properly. I feel I have no alternative but to ask your Lordships to agree to this amendment.

4.2 p.m.

On Question, Whether the said amendment (No.1) shall be agreed to?

Their Lordships divided: Contents, 136; Not-Contents, 138.

Division No. 1
CONTENTS
Addington, L.	Darcy (de Knayth), B.
Airedale, L.	David, B.
Allen of Abbeydale, L.	Dean of Beswick, L.
Allenby of Megiddo, V.	Dean of Thomton-le-Fylde, B.
Archer of Sandwell, L.	Desai, L.
Ashbourne, L.	Donaldson of Kingsbridge, L.
Ashley of Stoke, L.	Dormand of Easington, L.
Attlee, E.	Eatwell, L.
Avebury, L.	Ennals, L.
Baldwin of Bewdley, E.	Ewing of Kirkford, L.
Bancroft, L.	Falkland, V.
Bath, M.	Foot, L.
Beaumont of Whitley, L.	Gallacher, L.
Beloff, L.	Geraint, L.
Blackstone, B.	Glenamara, L.
Bonham-Carter, L.	Gould of Potternewton, B.
Bottomley, L.	Graham of Edmonton, L.
Brimelow, L.	Greene of Harrow Weald, L.
Broadbridge, L.	Gregson, L.
Brooks of Tremorfa, L.	Grey, E.
Bruce of Donington, L.	Halsbury, E.
Campbell of Eskan, L.	Hanworth, V.
Carmichael of Kelvingrove, L.	Harding of Petherton, L.
Carter, L.	Harris of Greenwich, L.
Castle of Blackburn, B.	Haskel, L.
Chapple, L.	Healey, L.
Chatteris of Amisfield, L.	Hilton of Eggardon, B.
Cledwyn of Penrhos, L.	Hollick, L.
Cocks of Hartcliffe, L.	Hollis of Heigham, B.
Cornwallis, L.	Hothfield, L.
Coventry, Bp.	Howell, L.
Cox, B.	Howie of Troon, L.
Cudlipp, L.	Hughes, L.

Hylton-Foster, B.	Peston, L.
Jacques, L.	Pitt of Hampstead, L.
Jay of Paddington, B.	Plant of Highfield, L.
Jenkins of Hillhead, L.	Prys-Davies, L.
Jenkins of Putney, L.	Rea, L.
Judd, L.	Richard, L.
Kennet, L.	Rix, L.
Kilbracken, L.	Rochester, L.
Kings Norton, L.	Russell, E.
Kinloss, Ly.	Sainsbury, L.
Knollys, V.	Saltoun of Abernethy, Ly.
Lawrence, L.	Sefton of Garston, L.
Listowel, E.	Serota, B.
Llewelyn-Davies of Hastoe, B.	Shannon, E.
Lockwood, B.	Soper, L.
Lovell-Davis, L.	Stallard, L.
Mackie of Benshie, L.	Stedman, B.
Mallalieu, B.	Stoddart of Swindon, L.
Mar, C.	Strabolgi, L.
Masham of Ilton, B.	Swinfen, L. [Teller.]
Mason of Barnsley, L.	Thomson of Monifieth, L.
McCarthy, L.	Thurso, V.
McIntosh of Haringey, L.	Tonypandy, V.
Merlyn-Rees, L.	Tordoff, L.
Milner of Leeds, L.	Turner of Camden, B.
Milverton, L.	Wallace of Coslany, L.
Molloy, L.	Whaddon, L.
Monkswell, L.	Wharton, B.
Mulley, L.	White, B.
Murray of Epping Forest, L.	Wigoder, L.
Nathan, L.	Williams of Crosby, B.
Nicol, B.	Williams of Elvel, L.
Ogmore, L.	Wise, L.
Oxford, Bp.	Zouche of Haryngworth, L.
Pearson of Rannoch, L.	[Teller.]
Perry of Walton, L.

NOT-CONTENTS
Aberdare, L.	Davidson, V.
Addison, V.	Denham, L.
Ailesbury, M.	Dixon-Smith, L.
Aldington, L.	Donegall, M.
Alexander of Tunis, E.	Dormer, L.
Alport, L.	Eden of Winton, L.
Annaly, L.	Elibank, L.
Archer of Weston-Super-Mare, L.	Ellenborough, L.
Arran, E.	Elliott of Morpeth, L.
Astor of Hever, L.	Elton, L.
Astor, V.	Erroll of Hale, L.
Balfour, E.	Ferrers, E.
Barber of Tewkesbury, L.	Flather, B.
Birdwood, L.	Foley, L.
Blake, L.	Fraser of Kilmorack, L.
Blatch, B.	Gainford, L.
Boardman, L.	Geddes, L.
Borthwick, L.	Gisborough, L.
Boyd-Carpenter, L.	Goschen, V.
Brabazon of Tara, L.	Granard, E.
Braine of Wheatley, L.	Gray of Contin, L.
Bridgeman, V.	Gridley, L.
Brougham and Vaux, L.	Grimston of Westbury, L.
Bruntisfield, L.	Haig, E.
Burnham, L.	Harmar-Nicholls, L.
Butterworth, L.	Haslam, L.
Caldecote, V.	Hayhoe, L.
Carnock, L.	Henley, L.
Carrington, L.	Hives, L.
Chalker of Wallasey, B.	Holderness, L.
Chelmsford, V.	Hood, V.
Chesham, L.	Howe, E.
Clanwilliam, E.	Jellicoe, E.
Clark of Kempston, L.	Kenyon, L.
Cockfield, L.	Kimball, L.
Colnbrook, L.	King of Wartnaby, L.
Constantine of Stanmore, L.	Kinnaird, L.
Courtown, E.	Knutsford, V.
Cranborne, V.	Lauderdale, E.
Cranbrook, E.	Long, V. [Teller.]
Cullen of Ashbourne, L.	Lucas, L.
Cumberlege, B.	Lyell, L.

Mackay of Ardbrecknish, L.	Rodger of Earlsferry, L.
Marsh, L.	Romney, E.
Merrivale, L.	Seccombe, B.
Mersey, V.	Selborne, E.
Milford, L.	Sempill, Ly.
Middleton, L.	Skelmersdale, L.
Morris, L.	St. Davids, V.
Mountevans, L.	Stewartby, L.
Mowbray and Stourton, L.	Stodart of Leaston, L.
Moyne, L.	Strathclyde, L.
Munster, E.	Strathcona and Mount Royal, L.
Murton of Lindisfarne, L.	Strathmore and Kinghorne, E.
Nelson of Stafford, L.	[Teller.]
Onslow, E.	Sudeley, L.
Oppenheim-Barnes, B.	Thomas of Gwydir, L.
Orkney, E.	Thurlow, L.
Orr-Ewing, L.	Tollemache, L.
Oxfuird, V.	Torrington, V.
Park of Monmouth, B.	Trefgarne, L.
Peel, E.	Trumpington, B.
Pender, L.	Vaux of Harrowden, L.
Peyton of Yeovil, L.	Vivian, L.
Pike, B.	Wade of Chorlton, L.
Pym, L.	Wakeham, L. [Lord Privy Seal.]
Rankeillour, L.	Westbury, L.
Rawlinson of Ewell, L.	Whitelaw, V.
Reay, L.	Wynford, L.
Rippon of Hexham, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.11 p.m.

Viscount Astor moved Amendment No. 2: Page 2, line 30, leave out from beginning to ("is") in line 32 and insert: ("(2) Subject to the following provisions of this section, the weekly rate of short-term incapacity benefit").

The noble Viscount said: My Lords, in moving Amendment No. 2 I should like to speak also to Amendments Nos. 3, 4, 5, 9 and 10.

These amendments are consequential on previous government amendments in respect of terminally ill claimants. As your Lordships may be aware, I tabled an amendment in Committee to bring forward the highest rate of incapacity benefit for people who are terminally ill. As a result the rate of short-term incapacity benefit payable will be equivalent to long-term incapacity benefit from the 29th week. It will include increases based on age and increases for dependants. The amendments I am moving today deal specifically with claimants who are terminally ill and over pension age.

The Bill makes provision for short-term incapacity benefit to be paid beyond pension age for up to 52 weeks in a spell of incapacity for work. The rate of benefit payable, as with sickness benefit now, will be based on a claimant's entitlement to retirement pension. After 52 weeks of incapacity claimants will be expected to claim retirement pension. Long-term incapacity benefit will not be available beyond pension age. I believe it is reasonable to assume that someone who falls sick before they reach pension age but who could return to work at some point should be able to receive incapacity benefit. If incapacity is prolonged then retirement pension is the correct benefit over pension age.

The amendments correct a technical defect which would have meant that claimants over pension age who are terminally ill would not have been able to benefit from the concession. The amendments go further than correcting this fault and allow these claimants to receive either the long-term rate of incapacity benefit which would have been payable had they not been over pension age, or the pension age rate of short-term incapacity benefit whichever is the more beneficial. After the maximum 52 weeks of short-term incapacity benefit, terminally ill claimants over pension age will transfer to retirement pension.

The amendments also allow references in the Bill to short-term incapacity benefit at the higher rate to be construed as references to claimants who have been entitled to short-term incapacity benefit for 196 days. This will ensure that all claimants, including those who are terminally ill or over pension age, will be able to benefit from the training and disability working allowance long-linking rules.

I am sure that your Lordships will welcome these changes. The number of people affected is comparatively small but the amendments offer significant improvements in these cases. I beg to move.

Lord Carter

My Lords, I am glad to welcome the amendments. If I speak to them briefly that gives me the opportunity to thank the Minister for the very helpful letter that he sent on the point that I raised at Committee stage on the need to ensure that in the guidance, in the regulations and in the handling of the benefits the person who is terminally ill is not made aware of the fact by the way in which the regulations are explained. In his letter the noble Viscount said that: In particular, we will [be] seeking ways to ensure that claimants who are unaware that they are terminally ill, are not inadvertently made aware about the severity of their condition through the benefit system". That is the point that we tried to ensure. That is extremely helpful.

On Question, amendment agreed to.

Viscount Astor moved Amendments Nos. 3, 4 and 5: Page 2, line 38, leave out from ("age") to ("that") in line 40 and insert ("the weekly rate of short term incapacity benefit is, subject to subsection (4) below,"). Page 2, line 41, leave out ("that paragraph") and insert ("section 30A(2) (b) above"). Page 3, leave out lines 6 to 16 and insert: ("(4) In the case of a person who has been entitled to short-term incapacity benefit for 196 days or more in any period of incapacity for work and is terminally ill, the weekly rate of short-term incapacity benefit payable, if greater than the rate otherwise payable to him under subsection (2) or (3) above, shall be equal to the rate at which long-term incapacity benefit under section 30A above would be payable to him if he were entitled to it. For the purposes of this subsection a person is terminally ill if he suffers from a progressive disease and his death in consequence of that disease can reasonably be expected within 6 months. (4A) References to short-term incapacity benefit at the higher rate shall be construed as including short-term incapacity benefit payable to any person who has been entitled to that benefit for 196 days or more in a period of incapacity for work, notwithstanding that the rate of benefit is determined in accordance with subsection (3) or (4) above.").

The noble Viscount said: My Lords, I beg to move Amendments Nos. 3, 4 and:5 en bloc. I have just spoken to the amendments withAmendment No. 2.

On Question, amendments agreed to.

Lord Swinfen moved Amendment No. 6: Page 4, leave out lines 1 to 3 and insert (""incapacity benefit after 196 days"").

The noble Lord said: My Lords, this amendment seeks to reintroduce child dependant additions for the 29 to 52 week period, as is at present the position with invalidity benefit. The amendment is similar to one which was moved at Committee stage on 19th April. At that time my noble friend confirmed that the Government's approach was consistent with the long-standing arrangement whereby increases for children are paid with short-term benefits only if the beneficiary is over pensionable age. He said that prior to 1984 child dependency increases in short-term benefits were payable at a significantly lower level than with long-term benefits. Subsequent increases in child benefit had influenced the rate of child dependency increase.

My noble friend said that it had proved unnecessary to pay child dependency increases with short-term benefits and he did not believe that that would cause hardship. He went on to say that many people would be receiving additional income such as occupational pensions or sick pay from their employers, but they could claim income support if family income was insufficient.

However, when invalidity benefit was introduced in 1971 the Government—a Conservative Government—appear to have had a rather different view of the impact of disability upon a family. Speaking in the other place on 3rd May 1971 during the Second Reading of the National Insurance Bill, the Secretary of State—then Sir Keith Joseph—said: We are for the first time proposing to treat the children of invalidity pensioners more generously. After all, one of the most tragic results of chronic sickness is the strain on the standard of living of a family containing children".—[Official Report, Commons, 3/5/71; col. 1017.]

While it is true that child benefit did not exist in 1971, family allowance did. Nevertheless, that administration recognised that there was a need to provide additional help to such vulnerable families. Substantial amounts of money are involved. Between the 29th and 52nd weeks of incapacity a family would, as I understand it, lose £235 for one child, £498 for two children and £760 for three children. I am not convinced by the Government's argument that families will be cushioned during that period against the delay in receiving additions.

In a Written Answer on 24th February this year the Minister of State said: We estimate that around 25 per cent. of people awarded incapacity benefit after April 1995 will also be entitled to income support between the 28th and 52nd weeks of incapacity. This represents an average at a point in time of 20,000 in 1995–96, and 30,000 in 1996–97".—[Official Report, Commons, 24/2/94; col. 367.] How will the 75 per cent. who will not be eligible for income support manage?

On 31st March this year, the Secretary of State for Social Security was asked what estimate he made of the proportion of recipients of incapacity benefit who are likely to be receiving occupational pension payments between the 29th and 52nd week of incapacity, and after the 52nd week; and the basis for that estimate. The Minister said in a Written Answer that the information was not available.

It is an extremely important amendment. Children are the lifeblood of our society; they are our future. I beg to move.

Baroness Hollis of Heigham

My Lords, we support the amendment. A few moments ago, an amendment was lost by 138 votes to 136 which would have brought forward the benefit of all disabled people who have passed the medical test and have been certified as incapable of work to the full higher rate at six months instead of 12.

This amendment is a fallback amendment to that position. The Minister moved an amendment which the House accepted—we welcomed it—that those who are terminally ill should enjoy the higher rate of benefit at six months. The amendment ensures that those families with children should also enjoy the higher rate of benefit at six months.

Almost all of those present are either parents or grandparents. We all know—do we not?—that children are costly. Yet unless we amend the Bill no allowance for children will be built into the new incapacity benefit. Children eat food, and require school dinners. They require jeans and trainers as well as clothes for school. They live in a home which probably requires an extra bedroom because they are there. They make demands regarding the wear and tear of the furnishings. A child wants to take part in school trips. He yearns for a bike and hopes to go occasionally with friends to the cinema or the swimming pool. None of that is unreasonable. Yet all the research shows that to maintain a child in the most modest way costs an additional £25 a week per child. That factor is recognised in the scales paid to foster parents. According to the age of the child the amount paid ranges from £45 a week to upwards of £80 a week for older, teenage children. The cost of a child is also recognised in the estimates made by the Child Support Agency for child maintenance of £40, £50 or £60 a week.

The cost of a child is even recognised within that most minimal of calculations, income support, where child allowance is worth between £16 and £36 a week, from which child benefit is deducted according to the age of the child. It is recognised in foster parent payments, through the Child Support Agency and in income support that children are costly; yet in this benefit no such recognition is made. No such allowance is built in until a disabled person has survived 12 months on lower rates of benefit. As a result, between the sixth month and the twelfth month incapacity benefit will be paid at the same rate where the family has one toddler or three teenage children. The only difference is that the family receives extra child benefit of £10 for the first child, and £8 for subsequent children. How can one bring a child up on £8 a week? We know that one cannot. That is why we seek support for this very modest fallback amendment which says that where there are families with children the higher rate of benefit should be paid from the sixth month as opposed to the twelfth, thus doubling from £10 to £20 a week the amount on which one brings up a child.

Children with a disabled parent already live in a family that is stressed. The parent is often in pain, unable to take walks, play football or engage in the activities that most families enjoy together. Disabled families already face higher outgoings for diet, laundry, food and heating. Let us not press those disabled families even further into poverty by denying the very existence of their children in the way that this benefit is constructed.

We narrowly lost the amendment which would have brought all people forward for receipt of higher benefit at six months. At the very least let us protect those families with children. We support the amendment.

Earl Russell

My Lords, if I may anticipate the argument of the noble Lord, Lord Boyd-Carpenter, I believe that he was about to raise the issue of cost. If so, he is quite right to do so. I entirely agree about the need to consider costs. However, the noble Lord will agree that if we are to consider costs we must take into full account the unintended consequence and the spin-off. We must consider costs in a full way.

We are proposing to leave children short of income. I was not privileged to hear the noble Lord, Lord Joseph, make his original speech on the cycle of deprivation. When he initiated a debate on the family, I think in 1991, I was privileged to hear him repeat some of those arguments. As always, I did not agree with every conclusion that the noble Lord drew, but, as always, I could not listen to him without being compelled to think.

If we deprive children, we create problems for the next generation, the generation after that, and perhaps even beyond. For a small saving we may be creating costs which continue from generation to generation. That does not sound to me like a prudent way to handle public money. Perhaps the Government consider that they will be out of office by then and that it will be nothing to do with them. If so, I hope that this House, which is fair minded, will take a more enlarged view of the matter and will support the amendment.

Lord Milverton

My Lords, I support the amendment to which I have put my name. I believe that it is a right, good and proper amendment. I leave the figures and other arguments to others. As the noble Earl, Lord Russell, said, the amendment specifically concerns children. As he said, our children are the future generation. How they have been treated, cared for and looked after while children will reflect on the country when they are older. I urge Her Majesty's Government to accept the amendment.

If the Government defeat the amendment, they will have to find resources from somewhere to help those in need. As has been said, in the long run the amendment represents a sensible policy. To make provision in any other way would not be sensible and might cost far more. Therefore nobly, rightly and properly, the amendment should be supported. It is a pity that there are not more Peers in the Chamber. If more Peers had been present my noble friend Lord Swinfen might have won his amendment. The honour of the House depends a lot on how many Peers are in the Chamber when important amendments are being discussed. Far more Peers should be present when certain amendments are discussed, and I do my best to attend. I hope that Her Majesty's Government will have some sense; otherwise I hope that my noble friend Lord Swinfen will be successful.

4.30 p.m.

Lord Boyd-Carpenter

My Lords, with his usual percipience, the noble Earl, Lord Russell, suspected, what point I would raise and, as so often, he is right. I. ask the Minister to tell us what the cost of the amendment would be to public funds and to the social security system by way of benefits, and the overall cost of administration.

I hope that the noble Earl does not think it unworthy to ask that. In truth and in fact, if he had been involved as long as I was in the administration of social security, he would know that every decision taken by a responsible Minister in charge of social security must be taken in the light of its cost. In my time, many delightful proposals would have been extremely popular but, frankly, they were too expensive. For that reason, they had either to be watered down or put in their place and phased in later.

It is always the fact that when your Lordships' House, another place or the Government consider any social measure, we consider its merits, its sentimental aspects and such matters as the possible effect on children. Then we must weigh against that the cost to the taxpayer or the national insurance contributor, or both. Therefore, because he is such an effective debater that he can easily make the worst case appear the better, I beg the noble Earl in future not to take the view that to ascertain the costs of a proposal is somehow unworthy. On the contrary, I suggest that it is utterly irresponsible for a Minister of any kind to advocate further expenditure unless he has worked out fully what the expenditure would be, how much it would cost and how it would be possible to fit the cost into his departmental budget or the Treasury accounts.

Therefore, I shall keep an open mind on the amendment until I have heard the cost. I hope that, in his usual efficient way, the Minister will tell us the full costs of the proposal.

Lord Zouche of Haryngworth

My Lords, wish to add my support for the amendment of my noble friend Lord Swinfen. One of the fundamental flaws of the Bill is that those who will be hardest hit will be families with children. The more children, the more benefit entitlement a family has to lose between the period of 29 weeks and one year. That is surely a situation we need to avoid.

The amendment will maintain the present position, at least for children. I believe that that is important for all children, but one group of families which has been particularly brought to my attention is where there is a disabled child. They will be particularly hard hit. Research published at the end of April by the NCH Action for Children shows that nearly two in three families with disabled children find that they are not managing well financially. More than four in five have extra costs because of their child's disability and say that those costs are not met in full by the benefit.

Although a disabled child is entitled to benefit in its own right, the evidence shows that the family budget is used to meet many of the additional costs. One in 10 families said that they had gone into debt in order to meet those additional costs. So, for a family with a disabled child and a breadwinner who becomes incapable of work, life becomes financially very difficult indeed. The emotional stress of the breadwinner becoming ill or disabled so that he or she cannot work will be compounded by the financial stress. It is only right that we do all we can to protect the children in that situation. Is there not perhaps a special case for a family with a disabled child or children? I urge the Government to accept the amendment because 1994 is the Year of the Family and this is essentially a measure that will help families in time of great hardship.

Baroness Darcy (de Knayth)

My Lords, perhaps I may add a word of support for the amendment. In his masterly introduction of it, the noble Lord, Lord Swinfen, quoted Keith Joseph's comments on the strain that chronic sickness puts on the standard of living of a family containing children. I remember Alf Morris saying, probably in 1970 at the time of the passing of the Chronically Sick and Disabled Persons Act, that when one member of a family becomes disabled, the whole family becomes disabled. I warmly support the amendment which would take some strain off the family, with the problems which can stem from disablement, as the noble Earl, Lord Russell, said. In the end, the problems can cost much more, not only in human but in financial terms.

The Lord Bishop of Coventry

My Lords, the noble Lord, Lord Boyd-Carpenter, asked us to consider the cost of the amendment to the taxpayer. I am glad that other voices have been raised to ask Her Majesty's Government to consider more deeply the human cost, the social cost or—if it were a matter of self interest —even the cost to the Government in people's attitudes and disposition towards the Government in the places from which we come. I can tell the Government that many people working with the sick, working in institutions, those involved in the experience which has been described of caring for the sick, and those who seek benefit, have assured me strongly that the amendments we are considering today will have a sharper and deeper effect on some of the poorest and most vulnerable people in our community than almost anything we have discussed in the House for a long time.

I am deeply concerned that we should accept the amendment and do all that we can to modify the Bill to protect those who will be damaged by it.

Baroness Masham of Ilton

My Lords, on Thursday we shall discuss juvenile prisons for 10 to 14 year-old children. I ask noble Lords to think for a minute that some of the children about whom we are talking under this amendment may be put at risk. They may end up in prisons because of the pressure put on families where parents are unable to work. As the right reverend Prelate said, we need to consider all the social problems which go much deeper than the mere cost. I too will be interested to hear how much the amendment would cost. It is extraordinary that the Government do not have the information at hand when they are trying to draw up a budget.

Viscount Astor

My Lords, I am delighted to tell the noble Baroness that I have exactly that information to hand and have had it for all the amendments moved in your Lordships' House as the Bill has gone through. Perhaps I should answer straight away that the cost of the amendment would be £5 million a year. But, of course, there is no estimate of administrative costs as the proposal would be expensive to administer, bringing one of the increases in benefit out of line with all the others.

It is important that although we establish the cost we should ascertain whether there are sound reasons for the amendment. My noble friend and the noble Baroness, Lady Hollis, seemed to want the amendment to succeed as a consolation prize for losing the Division on an earlier amendment. The noble Baroness appeared to suggest that because on the last amendment the vote was close, that was a good basis for this amendment to be accepted. I do not think that that is a sound basis for good argument, good judgment or good government.

The right reverend Prelate said that people will be damaged. I hope to explain to him that such will not be the case and to deal with his concern. As I explained in Committee, it is the Government's intention that these increases should not be paid with incapacity benefit until 52 weeks of incapacity have elapsed except in cases where the beneficiary is over pension age or terminally ill. Our proposals simply follow the long-standing arrangement whereby increases for children are not paid with short-term benefits unless the beneficiary is over pensionable age. Currently, the period for which short-term benefit is paid is 28 weeks. In future, the short-term benefit will be paid for 52 weeks. It follows that child dependency increases for people under pensionable age should be available from that 52-week point also. If they became payable after 28 weeks, as proposed, the structure of dependency increases and that of the new benefit would be out of step.

Noble Lords have expressed concern that the new benefit will, in some cases, be paid at lower rate than income support before the 52-week point is reached and that this will lead to increased reliance on that benefit. It must be remembered that incapacity benefit is a non-means-tested contributory benefit. It has no regard to savings, occupational pensions or other income.

My noble friend Lord Swinfen asked what happens to people if they are not eligible for income support. Those people who are not eligible for income support, because they have other means, do not need income support.

It would be an irresponsible government who raised the levels of a non-means-tested contributory benefit to the extent that everyone on the contributory benefit was better off than on the means-tested benefit. If we wished to ensure that income support was never needed during periods of incapacity, we would need to increase the contributory benefit by an enormous margin. Successive governments have never seen that as a practical proposition, particularly as those who have resources of their own and are in least need would benefit the most.

Incapacity benefit will provide a basic level of income paid regardless of means to those who are incapable of work. Over 75 per cent. of people between the 28th and 52nd week of incapacity will not need income support because they will have additional resources such as occupational pensions and savings. Equally, there will be a proportion who will claim income support. Under the current arrangements many families on invalidity benefit have cause to rely on the additional help provided by that benefit for a variety of reasons. The fact that in future more families with children may qualify for income support is not a reason for paying CDIs (child dependency increases) in all cases before the 52nd week of incapacity.

Child poverty is not the issue. Child benefit forms the major plank of state help for bringing up children. Where the person is working, earnings will supplement child benefit. But when earnings are interrupted for a length of time, we recognise the need for extra help. For short-term contingencies, we maintain that it is right that claimants should look first to their own resources or, if necessary, to the income-related benefits. However, for long-term contingencies, child dependency increases will be available.

The fact is that the income-related benefits provide a much more effective means of helping families who are in financial need as a result of short-term incapacity than would child dependency increases. That is reinforced by the fact that we have used these benefits very successfully in recent years to target additional resources on families in need. Since 1988, significant extra help has been made available for this group, now amounting to some £1 billion a year. Cash benefits for poorer families are now among the highest in the EC.

My noble friend Lord Zouche suggested that the new arrangements will have a particularly damaging effect on families where there is a disabled child. But invalidity benefit and, the child dependency increases that are payable with it have never been designed to meet the extra costs arising out of disability. Specific benefits exist for that purpose. Since taking office we have in real terms more than trebled spending on benefits for disabled people.

The rates of child dependency increases that will be paid with incapacity benefit compare unfavourably with the applicable amounts for children in the income-related benefits. In fact, the child dependency increase rates compare well with their equivalents in income support. Currently, CDIs of invalidity benefit are paid at the rate of £9.80 in the case if the eldest eligible child and £11 for other children. These rates are paid on top of child benefit, providing an overall level of support of £20 and £19.25 respectively. In income support, the applicable amount for a child aged under 11 is £15.65, but child benefit is deducted from that amount, making the overall level of support less than for a child of the same age for whom a CDI is payable. In the case of children over 11, the balance shifts and income support becomes the more generous benefit. However, those comparisons show that child dependency increases, when viewed correctly as a supplement to child benefit, provide a very reasonable level of support for children.

Unlike the income support scheme, it would be inappropriate to provide a range of different child dependency increase rates tied to the age of the child. Such precise targeting would be out of place in the context of a contributory benefit, which is only designed to provide a broad measure of support.

My noble friend Lord Boyd-Carpenter told your Lordships that we have to weigh the consequences, the costs and the benefits of the amendment. I believe that this amendment should not be accepted for the very good reasons that I have given. I hope that my noble friend will be satisfied with my explanation and will feel able to withdraw the amendment.

4.45 p.m.

The Countess of Mar

My Lords, before the noble Viscount sits down, can he tell the House what evidence he has to substantiate his statement. that the vast majority of people have alternative savings or pensions? Is it not the case that a great deal of research shows that the highest incidence of illness occurs among low paid and poorly housed people—people with very little money? Many of those people are also shown to have huge debt problems. Can the noble Viscount say whether it is definite that the vast majority of the people who are certificated as being ill will have alternative incomes?

Viscount Astor

My Lords, my point was that if they do not have alternative incomes, they may well qualify for means-tested income support. Therefore they are supported by the state on that basis.

Baroness Hollis of Heigham

My Lords, before the noble Viscount sit down, will he confirm a figure that he gave in a previous debate to the effect that only 38 per cent. of the disabled have occupational pensions and the rest have to go elsewhere, either to savings or income support? That is my first question.

So that we get this matter into proportion, will he also confirm that the figures for a disabled man with a wife and three children (say, 14, 12 and 10 years-old) who is now on invalidity benefit has a total net income of £162.75, to be precise? That is what the family gets on invalidity benefit now. On income support now, that same family gets just under £145 a week. But in future, with incapacity benefit, that same family will get £106 a week. So they would drop from £163 to £106 a week. How can the noble Viscount justify that?

Viscount Astor

My Lords, the noble Baroness seeks to bandy figures with me.

Baroness Hollis of Heigham

My Lords, I take exception to that remark.

Viscount Astor

I do not know whether or not the noble Baroness's figures are correct. Off the top of my head I cannot say that her figures are, or are not, correct. I do not know. The noble Baroness did not raise this matter in her speech and we are at Report stage. She can stand up and ask me a question before I sit down but I must say that the question did not seem to relate to what I said earlier. She also asked whether the figure that I used in Committee was correct. I do not have in front of me at this very moment the Hansard which records the figures I gave in Committee. I shall certainly look to see whether those figures are correct. I am sure that they are.

Lord Swinfen

My Lords, I do not want to argue about figures because I am not very good at them. However, because someone does not qualify for income support it does not mean that they will not suffer hardship. They may have nothing in savings but be one penny over the income support weekly amount limit and therefore not qualify. I realise that there must be cut-off points. However, I would much rather that they were tapered.

It is extremely important that families with children should have their income sustained, as my amendment requires, because they are extremely vulnerable at a time when someone is incapable of work. It affects the family as a whole, including the children whose school work may be affected by the worry. The amendment will help to alleviate that problem. It will help those children to go on to be properly qualified and to generate income for the country later. I do not accept the arguments of my noble friend. I must therefore ask the opinion of the House.

4.51 p.m.

On Question, Whether the said amendment (No. 6) shall be agreed to?

Their Lordships divided: Contents, 133; Not-Contents, 127.

Division No. 2
CONTENTS
Addington, L.	Desai, L.
Airedale, L.	Donaldson of Kingsbridge, L.
Allen of Abbeydale, L.	Dormand of Easington, L.
Allenby of Megiddo, V.	Eatwell, L.
Archer of Sandwell, L.	Elis-Thomas, L.
Ashley of Stoke, L.	Ennals, L.
Attlee, E.	Ewing of Kirkford, L.
Avebury, L.	Falkland, V.
Baldwin of Bewdley, E.	Fitt, L.
Bancroft, L.	Foot, L.
Barnett, L.	Gallacher, L.
Bath, M.	Geraint, L.
Beaumont of Whitley, L.	Glenamara, L.
Beloff, L.	Gould of Potternewton, B.
Blackstone, B.	Graham of Edmonton, L.
Bottomley, L.	Greene of Harrow Weald, L.
Brimelow, L.	Gregson, L.
Broadbridge, L.	Grey, E.
Brooks of Tremorfa, L.	Halsbury, E.
Campbell of Eskan, L.	Hanworth, V.
Carmichael of Kelvingrove, L.	Harding of Petherton, L.
Carter, L.	Harris of Greenwich, L.
Castle of Blackburn, B.	Haskel, L.
Chatteris of Amisfield, L.	Healey, L.
Chichester, Bp.	Hilton of Eggardon, B.
Cledwyn of Penrhos, L.	Hollick, L.
Clinton-Davis, L.	Hollis of Heigham, B.
Cocks of Hartcliffe, L.	Hooson, L.
Cornwallis, L.	Howell, L.
Coventry, Bp.	Hughes, L.
Cox, B.	Hunt, L.
Darcy (de Knayth), B.	Hylton-Foster, B.
David, B.	Jacques, L.
Dean of Beswick, L.	Jay of Paddington, B.
Dean of Thomton-le-Fylde, B.	Jeger, B.

Jenkins of Hillhead, L.	Prys-Davies, L.
Judd, L.	Rea, L.
Kennet, L.	Richard, L.
Kilbracken, L.	Rix, L.
Kinloss, Ly.	Rochester, L.
Lawrence, L.	Russell, E.
Listowel, E.	Sainsbury, L.
Llewelyn-Davies of Hastoe, B.	Sefton of Garston, L.
Lockwood, B.	Serota, B.
Lovell-Davis, L.	Soper, L.
Mackie of Benshie, L.	Stedman, B.
Mallalieu, B.	Stoddart of Swindon, L.
Mar, C.	Strabolgi, L.
Masham of Ilton, B.	Swinfen, L. [Teller.]
Mason of Barnsley, L.	Thomson of Monifieth, L.
McCarthy, L.	Thurso, V.
McIntosh of Haringey, L.	Tonypandy, V.
Merlyn-Rees, L.	Tordoff, L.
Milner of Leeds, L.	Turner of Camden, B.
Milverton, L.	Wallace of Coslany, L.
Mishcon, L.	Weatherill, L.
Molloy, L.	Whaddon, L.
Monkswell, L.	Wharton, B.
Mulley, L.	White, B.
Murray of Epping Forest, L.	Wigoder, L.
Nathan, L.	Williams of Crosby, B.
Nicol, B.	Williams of Elvel, L.
Ogmore, L.	Williams of Mostyn, L.
Palmer, L.	Winchilsea and Nottingham, E.
Pearson of Rannoch, L.	Wise, L.
Peston, L.	Zouche of Haryngworth, L.
Pitt of Hampstead, L.	[Teller.]

NOT-CONTENTS
Addison, V.	Goschen, V.
Alexander of Tunis, E.	Granard, E.
Annaly, L.	Gray of Contin, L.
Archer of Weston-Super-Mare, L.	Gridley, L.
Arran, E.	Grimston of Westbury, L.
Astor of Hever, L.	Haig, E.
Astor, V.	Harrowby, E.
Balfour, E.	Haslam, L.
Barber of Tewkesbury, L.	Hayhoe, L.
Belhaven and Stenton, L.	Henley, L.
Blake, L.	Hesketh, L.
Blatch, B.	Hives, L.
Borthwick, L.	Holderness, L.
Boyd-Carpenter, L.	Hood, V.
Brabazon of Tara, L.	Hooper, B.
Braine of Wheatley, L.	Howe, E.
Brougham and Vaux, L.	Kenyon, L.
Bruntisfield, L.	Kimball, L.
Buckinghamshire, E.	King of Wartnaby, L.
Burnham, L.	Knollys, V.
Carnock, L.	Knutsford, V.
Chalker of Wallasey, B.	Lauderdale, E.
Chelmsford, V.	Long, V. [Teller.]
Chesham, L.	Lucas, L.
Clark of Kempston, L.	Lyell, L.
Colwyn, L.	Mackay of Ardbrecknish, L.
Constantine of Stanmore, L.	Mancroft, L.
Cork and Orrery, E.	Marsh, L.
Courtown, E.	Merrivale, L.
Cranborne, V.	Mersey, V.
Cumberlege, B,	Miller of Hendon, B.
Davidson, V.	Morris, L.
Denham, L.	Mountevans, L.
Dixon-Smith, L.	Mowbray and Stourton, L.
Donegall, M.	Moyne, L.
Dormer, L.	Munster, E.
Eccles of Moulton, B.	Murton of Lindisfarne, L.
Eden of Winton, L.	Nelson of Stafford, L.
Ellenborough, L.	Onslow, E.
Elles, B.	Oppenheim-Barnes, B.
Elton, L.	Orkney, E.
Ferrers, E.	Orr-Ewing, L.
Flather, B.	Oxfuird, V.
Foley, L.	Peel, E.
Geddes, L.	Pender, L.
Gisborough, L.	Peyton of Yeovil, L.

Pike, B.	Strathclyde, L.
Prentice, L.	Strathcona and Mount Royal, L.
Pym, L,	Strathmore and Kinghorne, E.
Rankeillour, L.	[Teller.]
Rawlinson of Ewell, L.	Sudeley, L.
Reay, L.	Swansea, L.
Rippon of Hexham, L.	Tebbit, L.
Rodger of Earlsferry, L.	Thomas of Gwydir, L.
Romney, E.	Tollemache, L.
Seccombe, B.	Trefgarne, L.
Selkirk, E.	Trumpington, B.
Sempill, Ly.	Vaux of Harrowden, L.
Skelmersdale, L.	Vivian, L.
St Davids, V.	Wade of Chorlton, L.
Stewartby, L.	Wakeham, L. [Lord Privy Seal.]
Stodart of Leaston, L.	Whitelaw, V.
Strange, B.	Wynford, L.
Strathcarron, L.	Young, B.

Resolved in the affirmative, and amendment agreed to accordingly.

5 p.m.

Clause 3 [Incapacity benefit: supplementary provisions]:

Viscount Astor moved Amendment No. 7: Page 5, line 19, leave out (", in such cases as may be prescribed,").

The noble Viscount said: My Lords, in moving this amendment perhaps I may speak also to Amendments Nos. 18 and 32. These three amendments are of a technical nature and deal with three regulation-making powers. These powers allow modification of what constitutes a spell or period of incapacity for work.

Generally a spell or period of incapacity would arise only where a person has four or more consecutive days of incapacity for work. These three powers allow a period of two or more days, whether consecutive or not, within a period of seven consecutive days to form a spell or period of incapacity for work. Regulations made under these powers cater for people who require regular treatment for their condition but are absent from work for only two or three days each time; for example, someone undergoing renal dialysis. The superfluous wording being removed is, in such cases as may be prescribed". This wording was intended to allow the regulations to be focused specifically on the relevant group of people.

However, if I may refer noble Lords to another part of the Social Security Contributions and Benefits Act 1992., Section 175(3) states that, any power under this Act to make regulations … may be exercised … in relation to any specified cases or classes of case". Noble Lords will see therefore that the wording used in each of these powers is unnecessary. With that explanation I hope the House will accept the amendment. I beg to move.

On Question, amendment agreed to.

Viscount Astor moved Amendment No. 8: Page 6, line 22, at end insert ("or training of such other description as may be prescribed").

The noble Viscount said: My Lords, in moving this amendment perhaps I may speak also to Amendments Nos. 28, 30 and 33. As your Lordships may recall from our discussions during the Committee stage of the Bill, concern was expressed over the scope of the—

Lord Carter

My Lords, Amendment No. 8 is grouped with Amendment No. 32, not Amendment No. 33.

Viscount Astor

My Lords, the noble Lord is quite correct. As I said, noble Lords may recall from our discussions during the Committee stage that concern was expressed over the scope of the long training linking rule introduced as part of the incapacity benefit structure. I said then that we were looking at this issue again and undertook to try to respond by Report stage on the outcome. I can now inform noble Lords that we have completed our deliberations and I am pleased to be bringing forward these four amendments which give effect to the changes we propose.

As noble Lords may already be aware, this training linking rule is intended to provide an incentive for people receiving incapacity benefit or severe disablement allowance to try to make a return to work. The training linking rule provides the safeguard that if their attempt fails because of their incapacity they can return to the same benefit they were previously receiving within two years. Additionally, it protects the position of those people who are assessed as callable of work and begin, or are already undertaking, a training course. if their condition deteriorates again within two years, these people could also return to their previous benefit.

To set these amendments in context I should perhaps explain what will happen when a person receiving incapacity benefit undertakes a course of training. As with the existing incapacity benefits, if attendance on a training course attracts a training allowance, payment of incapacity benefit will cease. However. where a person undertakes a course of training and a training allowance is not payable, his incapacity benefit will remain in payment so long as he continues to satisfy the test of incapacity for work. If at any stage during the person's course of training he was assessed as no longer satisfying the test of incapacity, as one would reasonably expect, his benefit would cease. These rules will, as now, apply equally to severe disablement allowance.

Anyone undertaking a non-employment department course who continues to be incapable of work will have no need for the linking rule—their benefit will continue in payment. However, the amendments I am bringing forward will benefit those people who on undertaking a course of training fail the test of incapacity and those who begin a training course on leaving benefit. The amendments will ensure that where training for work is specified in the Bill it will include, training of such other description as may be prescribed". This will apply to the long linking rule on both incapacity benefit and severe disablement allowance. The other two amendments relate to incapacity benefit. The final amendment relates to severe disablement allowance. The broader definition will also apply to the new qualifying benefit rule on disability working allowance. This is the rule which allows a person to undertake a period of training between leaving his qualifying benefit and making his claim to disability working allowance.

We feel it is essential to use regulations for this provision. I am sure noble Lords will agree that training provision has changed dramatically over the past 20 years and will no doubt continue to do so in the future. It is important therefore that the legislation is sufficiently flexible to allow us to keep it up to date when any relevant new initiatives arise.

We have not as yet finalised the drafting of regulations that are to be made under these powers but I can tell the House what we intend that they should cover. Regulations will specify both additional Employment Department programmes and the types of non-government training courses that should be covered. We expect three Employment Department programmes to be included: Employment Rehabilitation; Community Action; and North Norfolk Action—similar to Community Action. With non-government training we are intending to include full-time courses the sole or main purpose of which is the acquisition of occupational or vocational skills (full-time being defined as 16 hours or more). The issue of funding through the European Social Fund was raised during Committee. I can assure the House that where the sole or main purpose of the course funded by the European Social Fund is the acquisition of occupational or vocational skills these courses would be covered.

I hope that these changes will be welcomed. I apologise for the rather complicated explanation of them but I thought it important that your Lordships should understand the changes that we have made. I beg to move.

Lord Campbell of Croy

My Lords, it was I who moved the amendment at the Committee stage concerning the European Social Fund. At that time it looked as though training courses which were being financed by the fund would not be eligible. I was glad to hear what my noble friend has just said. It would be churlish of me not to say thank you, having made that point.

On Question, amendment agreed to.

Viscount Astor moved Amendments Nos. 9 and 10: Page 6, line 31, leave out ("and"). Page 6, line 34, at end insert (", and (d) section 30B(4A) (construction of references to short-term incapacity benefit at the higher rate),").

The noble Viscount said: My Lords, we debated these amendments with Amendment No. 2. I beg to move.

On Question, amendments agreed to.

Clause 4 [Power to provide for the transition to incapacity benefit]:

Viscount Astor moved Amendment No. 11: Page 9, line 26, at end insert: ("( ) Regulations under this section may provide, in relation to transitional cases where the rate of incapacity benefit falls to be calculated by reference to the rate of dependency allowance paid or payable before commencement, that any old saving provisions shall have effect subject to the regulations or shall cease to have effect in accordance with the regulations.

For the purposes of this subsection—

• "dependency allowance" means an allowance of the kind provided for in Part IV of the Social Security Contributions and Benefits Act 1992, and
1466
• "old saving provisions" means provisions of any description, including administrative provisions, in connection with a previous change affecting entitlement to or the amount of dependency allowances, preserving a person's position in any respect.").

The noble Viscount said: My Lords, this amendment will provide for regulations to be made which will enable existing forms of transitional protection for dependency increases of invalidity benefit to be rationalised from April 1995. The objective is to align these old provisions with new forms of protection that we intend to create at the inception of incapacity benefit. I should say at the outset that acceptance of this amendment will not lead to cash losses for those whose circumstances remain unchanged.

During the 1970s and 1980s the structure of dependency increases changed in a number of ways. I need not detain your Lordships with a detailed account of those changes; suffice to say that one of the results was the creation of six separate forms of transitional protection. Although the numbers of beneficiaries involved are very small, these forms of protection do not operate on a uniform basis, and it seems sensible, therefore, to use the opportunity presented by incapacity benefit to place them on the same footing.

The key difference between these forms of protection is that some operate on the basis of an ongoing entitlement to a dependency increase but others are linked to the continuation of payment. One might expect these terms to be synonymous, but the courts have made it clear that there is an important difference. Payment of a dependency increase may cease for a variety of reasons, but where cessation is due to receipt of earnings in excess of a prescribed limit or a personal benefit, entitlement to the increase can continue. The result is that for some beneficiaries protection can be reactivated despite the fact that payment of the increase may have ceased many years before. We think this somewhat bizarre effect is difficult to defend.

By contrast, in the case of the other forms of protection that would be affected by this amendment, protection is lost if payment of the increase ceases for just one day. This can produce harsh effects. While payment of a Christmas bonus or even a few hours' overtime would ordinarily lead to just a brief pause in payment of the increase, in these cases it can lead to permanent cessation of protection.

We propose that all these existing forms of protection will continue on the basis of new rules. These rules were initially developed with the transition to incapacity benefit in mind, but we think it entirely logical to apply them to these old forms of protection too. The new rules will mean more favourable treatment for some beneficiaries and less advantageous treatment of others when compared with the current arrangements. However, no one will experience any losses at the point of change, and since the normal linking rules of eight weeks or two years for disability working allowance or training for work cases will apply, the disadvantage will be no more than theoretical in the vast majority of cases.

Finally, I should mention a further proposed change. One existing form of transitional protection relates to the introduction in 1985 of the current earnings rule for adult dependency increases of invalidity benefit. The current rule operates on an all-or-nothing basis, with payment ceasing when earnings exceed a prescribed limit. By contrast, the old rule provides for tapered withdrawal of the increase. So when the dependency increase itself is uprated each year the amount of earnings necessary to extinguish it also rises. We think this is illogical because rather than merely preserving the position of those affected by the change back in 1985, this form of protection has actually increased in generosity over time and will continue to do so at each subsequent uprating. We therefore propose that an overriding limit is placed on this form of protection which equates to the point at which protection currently ceases. When earnings exceed this limit for more than eight weeks, protection will be lost. This will preserve the existing advantage conferred by this form of protection but will not add further to it.

I hope that your Lordships will agree that these proposals are both logical and reasonable and will feel able to support my amendment. I beg to move.

On Question, amendment agreed to.

Clause 5 [Test of incapacity for work]:

Lord Carter moved Amendment No. 12: Page 10, line 2, at end insert:

("Code of Practice

171ZA—(1) Before laying before either House of Parliament a draft instrument containing the first of the regulations to be made under sections 171 A to 171 G below, the Secretary of State shall lay before Parliament a draft Code of Practice setting out how he intends to proceed with the matters covered by the regulations to be made under each of those provisions.

(2) The draft Code of Practice laid under subsection (1) above shall, in particular, set out how the Secretary of State intends, in preparing any of the medical tests to be established by the provisions listed in subsection (1) above, to take account of—

1. (a) non-medical factors including an applicant's age, education, experience and training;
2. (b) the applicant's general state of physical and mental health and the intermittent nature of illness;
3. (c) personal factors, including the likelihood of an applicant obtaining work, his capacity to deal with pain and stress, and his capacity to work more than 16 hours per week; and
4. (d) the subjective nature of mental illness.

(3) Before laying the draft Code of Practice under subsection (1) above, the Secretary of State shall consult representatives of the medical profession and of groups representing disabled people, and such other persons as seem to him to be appropriate.

(4) The Secretary of State shall not proceed to lay any regulations under any of the provisions listed in subsection (1) above until—

1. (a) forty days on which both Houses have sat have passed since the laying of the draft Code of Practice under subsection (1) above, and
2. (b) the draft Code of Practice has been approved by a Resolution of each House of Parliament.").

The noble Lord said: My Lords, this amendment introduces a subject which we did not discuss in Committee. It is an attempt to deal with a problem which we certainly discussed at some length in Committee, in that this Bill, as we know, gives the Government the power to introduce by regulation matters to deal with the medical test. But the House will of course have no chance to discuss the thinking behind the regulations. The assessment will not be completed until August, I believe, and the regulations will be brought in. As we know, they cannot be amended; they can either be accepted or rejected. When the Minister replies I hope that we do not get the argument that this House can always reject the amendment. That is not the point. We want to have the chance to discuss these very detailed matters to do with the extremely important medical test. I am sure that everyone will be aware of the anxiety which there is about the way in which the test will be implemented.

The effect of the amendment is that no regulations to do with any of the test can be laid, even in draft, until consultation has taken place—I emphasise that—and a draft code of practice has been laid before and approved by each House of Parliament. I shall go through the amendment, but not at length. It contains all the points which we wish to be considered—all the factors which have to be taken into account, including the non-medical factors, the applicant's general state of physical and mental health and the intermittent nature of illness—all subjects which we discussed in Committee.

This is an attempt to get round the rigidity of the approach by regulation and to introduce flexibility of approach by code of practice. As I have said, we all know the problem with regulations: they cannot be amended and the only power we have is to reject them. It seems to me that this is the proper way to deal with this case. I hope that the 'Government will accept the strength of the argument.

We all want to see, as the Government do, the test working properly. We had the very useful presentation by the medical advisers which was made to a number of us before we came to Committee stage. From that presentation we can all agree just how complicated the matter will be. We believe it right that Parliament should have the chance to discuss the way in which the test will be conducted and the rationale behind it, with the chance, if necessary, to amend the code of practice.

Perhaps I may quote from a very helpful letter which the Minister sent me. It was addressed to the noble Earl, Lord Russell, and I was kindly sent a copy. his about carers and incapacity benefit. In fact, it can be adapted to anyone who has to go through the test. The letter reads: Because the test is focused towards work, the assessment will take into account the fact that a person capable of work must be able to repeat activities over a period of time … If pain, fatigue or stress accompany or are consequent on a particular activity, then the person is effectively incapable of performing the activity. We shall continue to develop the test on this basis, and the training and guidance to BAMS doctors will make clear that pain, fatigue and stress, and conditions subject to variation, fluctuation, remission and exacerbation of their symptoms and signs are taken fully into account in assessing capacity". I have quoted that letter to show the number of factors which will have to introduced and covered by these regulations. Therefore it is extremely important that we have the chance, as I say, through the code of practice approach to discuss these matters in some detail, if necessary, to amend them and to require the approval of both Houses if these important medical tests are to be accepted with a proper code of practice.

The amendment also deals with an important point which is set out in subsection (3): Before laying the draft Code of Practice under subsection (1) above, the Secretary of State shall consult representatives of the medical profession and of groups representing disabled people, and such other persons as seem to him to be appropriate". That gives the Government wide discretion, but when the code of practice comes back to both Houses, it will enable Parliament to be told what is the nature of the consultation which has taken place and the representations which have been received. That is much more flexible than the approach through regulations.

I believe that a code of practice is a very useful device in the circumstances of this Bill when there will be a gap between the Bill, if it receives Royal Assent, and the ending of the assessment period. Then we shall see the regulations with no chance of amending them.

The amendment has been widely drafted. I am prepared to accept that the Government may wish to take it away and redraft it. It is the principle which we wish to establish at this stage of the Bill. I shall be extremely interested to hear whether the Minister feels that this is a useful way to get round a problem which the Government recognise as much as we do. I hope that this amendment is helpful in that sense. I beg to move.

5.15 p.m.

Earl Russell

My Lords, I congratulate the noble Lord, Lord Carter, on an ingenious and extremely helpful amendment. I believe that it is no secret that, for me, the medical test as it stands at present is entirely unacceptable. I believe that any chance of it sorting the sheep from the goats is very remote indeed. In fact, the connection between not passing the test and unfitness for work will be purely coincidental.

I am not dividing the House against Clause 5 because we have been told, to my great relief, that the test in its present form is not final. It would be contrary to the spirit of this House to try to vote down the power while, I hope, attempts are still being made to reach a consensus. But at some stage the House must have the power to say that this is not acceptable.

When we were in Committee the Minister tried to argue that the House should not concern itself with the details of the test. The Minister said exactly that. I do not have the reference to hand, but I shall write to the Minister with it if he likes.

It has been suggested that we should leave the details of the test to the experts. But the alleged panel of experts is not by any means entirely happy with what is going on. In fact some of them have written to us to say that the full panel of 80 has not met on any occasion and that many of them have exactly the same complaints as we have. In fact they are not satisfied with it either.

I was very grateful to the Minister for sending me a copy of his letter to the noble Lord, Lord McColl. But I was very disappointed to hear him once again repeating the formula that age is not a disability. I thought that we had made it clear that we were not alleging that it was. But it does make a difference to what sort of work you are suited for. If that is not taken into account, the test will not be testing suitability for work. It will not be testing suitability for any work which, if fit, you could have done.

I have received a letter from the Chair of the North London M.E. Network which makes a number of those points extremely well. Ms. Muller points out that, M.E., like M.S. and other illnesses is a fluctuating condition". Although I know that the Minister thinks that it is going to be possible for Benefits Agency medical service doctors with the aid of one letter from a claimant's GP to assess a fluctuating condition, it is something about which I have a good many doubts. Ms. Muller also points out, as we have been saying from the beginning, that the test is, inappropriate for assessing illness, as it is a functional assessment of disability". It seems inherent in the choice of a functional impairment test to assess illness and disability together. I think that that decision was fundamentally misguided. In addition, it seems entirely misguided to attempt to assess mental health by asking people to fill in a form.

We have in this allegedly "objective" test—of course, it is no such thing—a sickness which is extremely widespread throughout government. I should like to quote from a document which reached me this afternoon. The report in question states: The major concerns … are over the policy of making judgements on … documentation; on the criteria in use, … and on the usefulness of the ensuing reports". That sounds familiar. It comes from a report carried out for the Higher Education Funding Councils for England and for Wales on the assessment of university teaching. It shows the same sickness.

If the tests are to be in any way acceptable, we must increase the medical input and decrease the allegedly objective element. How then can this House satisfy itself, before allowing the tests to be passed into law, that they are all right? We cannot do it now because the work is not finished. There are many procedural devices that we can use, but if we are to do it, we need a procedure under which all parties in this House will be happy to go through the Lobby. If we do not have that, we shall have what we have had already with the Child Support Act: this House vilified outside because it has agreed to something which, with proper scrutiny, it should never have accepted. That will not do us any good any more than it will do the country any good. If the amendment will allow us to reach a vote on the test, it will also encourage a process of consultation. I do not think that it is right that a test of medical unfitness should be acceptable to only one side of the House. If we want to assess medical fitness, we should be looking for something which is, at least in a rudimentary way, acceptable to people of all political persuasions, and that is something that we do not have here.

I should like to point out to the Minister one danger of the test which I do not think that he has spotted but which may concern him more than many of the dangers that we have pointed out. We have been anxious throughout that people will be pronounced fit for work who are not, but there is another danger. The test concentrates on a functional limitation. It concentrates on all work rather than work that the person could have done if fit. That means that because of one physical disability, such as in my case the inability to touch my toes, I might be pronounced incapable of all work when I believe that not to be the case.

If enough allowance is given to one functional limitation which would prevent a person from doing the job for which that functional ability is essential, a lot of other people who simply do not need that function to do their work will be pronounced unfit for work, taken out of work and paid benefit at the taxpayers' expense when it is entirely unnecessary. So much for any idea that the test is objective.

Baroness Darcy (de Knayth)

My Lords, despite my quailing voice, I should like to support the amendment wholeheartedly. I participated last night in a very good debate approving the code of practice for children with special educational needs. That draft was subject to very wide consultation and was considerably improved and changed. That was the first time that I had taken part in such an exercise and I was very impressed by the whole process. I think that the noble Lord, Lord Carter, has come up with an excellent solution and I hope that the Minister will either accept it or come back with a draft code of his own.

Lord Swinfen

My Lords, I shall not detain the House, but I wish to state that I am fully in support of the amendment. As the noble Baroness, Lady Darcy, has just said, if the Government cannot accept the wording, perhaps they will give an undertaking to come back on Third Reading with another amendment.

The Countess of Mar

My Lords, I too should like to support the amendment of the noble Lord, Lord Carter. When I spoke on Second Reading I spoke specifically of people who suffer intermittent symptoms with their illness. I know those effects only too well. I am worried that the Government appear to be relying on a note from a GP as well as the questionnaire which has to be filled in. It was three years before my GP realised what I was suffering from. He could very well have said in the intervening period that I was suffering from imagination and might not have been supportive. I should therefore be grateful if the Minister could look again at the amendment.

Lord Campbell of Croy

My Lords, many of us consider that the nature of the medical test proposed is crucial to the purpose and effect of the Bill. The Government have been engaged in a very wide-ranging consultation process involving everyone they felt had views or a right to comment. That is perfectly right and I am glad that they have done so, but unless there has been a change, it means that the particulars of the medical test will not be known before the Bill completes its passage through Parliament. That is my understanding. I should have preferred the timing to have been the other way round and the medical test to have been worked out before the Bill was introduced. However, I know all the difficulties with legislation and that the Bill is needed in general.

The proposal in the amendment seems a novel one. As the noble Lord, Lord Carter, indicated, the amendment has appeared on the Marshalled List only today. The noble Lord said that it is a way of trying to probe the Government's thinking and how they will deal with this dilemma—and it is a dilemma. When the Bill finally leaves Parliament, there will still be a great questionmark over the nature of the medical test. I hope that the Government will take that point on board. I shall be interested to hear their response to the amendment.

Baroness Masham of Ilton

My Lords, I too would like to support the amendment. It is well known in the field of disability that medical students do not receive any training at all on some disabilities and very little on others, yet the field of disability is wide and varied. I hope that the Government will take the amendment seriously because a GP's note might not mean very much. As a paraplegic, I have sometimes been examined by doctors who have said, "I have never seen a paraplegic before". I hope that the Government will take the amendment seriously.

Viscount Astor

My Lords, the amendment seeks to ensure that your Lordships debate and consider the regulations relating to the medical test. I hope that you will forgive me if I do not go into the details of the test now. It is not that I do not want to, but we shall consider later on amendments concerned with the details of the medical test. It is better that we deal with those points then and that I deal now with the regulations and their scrutiny by the House.

The noble Earl, Lord Russell, said that I either said or implied that your Lordships should not concern yourselves with the details of the test. I did not intend to give that impression. I hope that I did not use those words. What I said in Committee, and I shall repeat it, is that it is important that your Lordships consider the test and the regulations. The regulations will come before your Lordships as affirmative resolutions, and you will have the opportunity to debate them.

This amendment attempts to go further than that. It introduces other subjects, which I am not sure is what the noble Lord, Lord Carter, intended. It may help if I explain. We have already promised that we intend to publish a report in August this year which will summarise the results of the consultation exercise, the work of the expert panel and the evaluation exercise, all of which we have undertaken on the development of the all-work test. The report will also set out the proposed test and details of the proposed procedures for the administration and adjudication of the new benefit It will be freely available, and we shall seek views on the details of the new test and the procedures. We intend to consult disability organisations on the proposals and on the guidance. We shall take account of any comments that we receive in deciding the final detail of the test that will be set out in the regulations and the proposed procedures.

Like other social security benefits, it will be necessary to draw up detailed procedures for all aspects of the administration and adjudication of incapacity benefit. That will include guidance to our staff in Benefits Agency offices; for example, on the handling of claims and answering inquiries about the benefit. The chief adjudication officer will issue guidance to adjudication officers. The department will issue guidance to GPs about their role in the new benefit. In addition to any necessary training, BAMS doctors will be given written guidance on the operation of the all-work test.

There will be a great deal of written material available on the application of the new benefit. All that guidance will be available publicly so that everyone with an interest will be able to see in detail how the benefit will be administered.

Perhaps I may deal with matters that the amendment seeks to include in the draft code of practice. I have already explained how the own-occupation and the all-work test of incapacity will operate. I do not propose to go through those details again. Different criteria apply to the different tests. The own-occupation test obviously assesses a person's incapacity against his ability to do his own job. When considering whether a person should refrain from doing his own job, his own doctor will take account of relevant factors such as the person's general state of physical and mental health, his disabilities and his capacity to cope with pain and stress.

The all-work test will take account of medical factors only, but the amendment seeks to take account of non-medical factors, in effect, by the back-door. That is the debate we shall be having when we come to the next amendment. We shall not need to consider how to take account of non-medical factors such as age, education, experience, training or the likelihood of the person obtaining work. The test will take full account of the person's state of physical and mental health, the intermittent nature of certain medical conditions and the variability of their effects and factors such as pain, stress and fatigue. In designing the all-work test we are using the definition of—

Earl Russell

My Lords, I am grateful to the Minister for giving way. Does he accept that fit people are not always capable of all work?

Viscount Astor

My Lords, I accept that there are people who might be fit but find that when they come to do a job they can do it for only a day and then have to have a rest for a week afterwards or whatever it may be. In that sense, the noble Earl is right. When we come to discuss the amendments on the medical test, we shall explain in more detail how such issues are affected.

In designing the 'all-work test, we are using a definition of work of more than 16 hours a week. That is in guidance that we have issued to the expert panel which is helping us with the design of the test.

Many of the matters covered by the proposed draft code of practice will feature in the application of the new test that we are designing. The amendment seeks also to introduce into the all-work test by, in effect, the back-door, other factors that we debated in Committee when we explained why they are not acceptable. Both Houses can debate the regulations. I agree with the noble Lord, Lord Carter, that they should be debated, but the amendment goes much further than that. It does not say just that there should be a debate in your Lordships' House, which we are having anyway. It seeks to include in the medical test things such as non-medical factors that we have already discussed and would be at variance with the medical test itself. I hope that I have been able to reassure your Lordships that we shall consult widely; that everything will be made public; and that you will be able to debate the regulations when they come before the House.

Lord Carter

My Lords, there is a Citizen's Charter and a Patient's Charter. The more I listen to the Government, the more I think that there should be a Parliamentarian's Charter. It seems that everyone is to be allowed to have their say on this and to affect the code of practice except those in Parliament. Of course we can debate regulations, but the Minister—I think deliberately—completely ignored my point that we cannot amend regulations. All we can do is reject them.

If the Minister is saying that the best way to handle the problem is to give Parliament the chance to reject the regulations outright, with all the chaos that that would cause, I think that that is a ridiculous argument. The amendment arose because I was sitting here in Committee listening to the problem of how to deal with the medical test which is subject to a great deal of debate and criticism. We shall have no chance to deal with them except by debating the regulations and then rejecting them. It occurred to me then that the code of practice was a way for the Government to meet those concerns. I was prepared for the Minister to say that he did not like the drafting of the amendment, that it goes too wide, or whatever, but that he accepted the principle and that the Government would come back with their own amendment which accepted this proposal as a way around the problem.

The noble Baroness, Lady Darcy (de Knayth), gave us an example when she said that only last night there was a debate in the House on the code of practice for special educational needs. So what is the difference? It is a device which is useful in these circumstances. I have done a great many social security Bills. We always hear about all the wide consultations and the fact that reports will be available, but in the end the Government will say what they intend to do and Parliament will not be able to amend the regulations. It can only reject them. That is the weakness of the whole argument.

We heard from the noble Earl, Lord Russell, that the consultative panel is unhappy about the way the matter is being conducted. The Minister said that we shall have a chance to discuss amendments to the tests. We cannot discuss amendments to the tests. As I have said, we shall not see them until the Bill receives Royal Assent and they are presented to us in regulations as, "Take it or leave it". That is the Government's motto: take it or leave it. We are not going to take it. I intend to ask the House for its opinion.

5.38 p.m.

On Question, Whether the said amendment (No. 12) shall be agreed to?

Their Lordships divided: Contents, 129; Not-Contents, 139.

Division No. 3
CONTENTS
Addington, L.	Bath, M.
Airedale, L.	Beaumont of Whitley, L.
Allenby of Megiddo, V.	Blackstone, B.
Archer of Sandwell, L.	Bonham-Carter, L.
Ardwick, L.	Bottomley, L.
Ashley of Stoke, L.	Brimelow, L.
Attlee, E.	Carmichael of Kelvingrove, L.
Avebury, L.	Carter, L. [Teller.]
Bancroft, L.	Castle of Blackburn, B.
Barnett, L.	Charteris of Amisfield, L.

Chichester, Bp.	Kinloss, Ly.
Cledwyn of Penrhos, L.	Listowel, E.
Clinton-Davis, L.	Llewelyn-Davies of Hastoe, B.
Cocks of Hartcliffe, L.	Lockwood, B.
Cornwallis, L.	Lovell-Davis, L.
Coventry, Bp.	Mackie of Benshie, L.
Craigavon, V.	Mallalieu, B.
Crook, L.	Mar, C.
Darcy (de Knayth), B.	Masham of Ilton, B.
David, B.	Mason of Barnsley, L.
Davies, L.	McCarthy, L.
Dean of Beswick, L.	McIntosh of Haringey, L.
Dean of Thomton-le-Fylde, B.	Merlyn-Rees, L.
Desai, L.	Milner of Leeds, L.
Donaldson of Kingsbridge, L.	Mishcon, L.
Dormand of Easington, L.	Molloy, L.
Eatwell, L.	Monkswell, L.
Elis-Thomas, L.	Mulley, L.
Ennals, L.	Murray of Epping Forest, L.
Ewing of Kirkford, L.	Nathan, L.
Ezra, L.	Nicol, B.
Falkland, V.	Ogmore, L.
Fitt, L.	Palmer, L.
Gallacher, L.	Peston, L.
Geraint, L.	Pitt of Hampstead, L.
Glenamara, L.	Prys-Davies, L.
Gould of Potternewton, B.	Rea, L.
Graham of Edmonton, L.	Richard, L.
Greene of Harrow Weald, L.	Rix, L.
Gregson, L.	Rochester, L.
Grey, E.	Russell, E.
Haig, E.	Sefton of Garston, L.
Halsbury, E.	Serota, B.
Hanworth, V.	Shaughnessy, L.
Harris of Greenwich, L.	Stedman, B.
Haskel, L.	Stoddart of Swindon, L.
Healey, L.	Strabolgi, L.
Hertford, M.	Swinfen, L. [Teller.]
Hilton of Eggardon, B.	Thomson of Monifieth, L.
Hollick, L.	Thurso, V.
Hollis of Heigham, B.	Tonypandy, V.
Holme of Cheltenham, L.	Tordoff, L.
Hooson, L.	Turner of Camden, B.
Howell, L.	Walpole, L.
Hughes, L.	Whaddon, L.
Hunt, L	Wharton, B.
Hylton, L.	White, B.
Irvine of Lairg, L.	Wigoder, L.
Jay of Paddington, B.	Williams of Crosby, B.
Jeger, B.	Williams of Elvel, L.
Jenkins of Hillhead, L.	Williams of Mostyn, L.
Jenkins of Putney, L.	Winchilsea and Nottingham, E.
Judd, L.	Wise, L.
Kennet, L.	Zouche of Haryngworth, L.
Kilbracken, L.

NOT-CONTENTS
Addison, V.	Chalker of Wallasey, B.
Alexander of Tunis, E.	Chesham, L.
Annaly, L.	Clark of Kempston, L.
Archer of Weston-Super-Mare, L.	Clitheroe, L.
Arran E.	Colwyn, L.
Astor of Hever, L.	Constantine of Stanmore, L.
Astor, V.	Cork and Orrery, E.
Balfour, E.	Courtown, E.
Barber of Tewkesbury, L.	Cranborne, V.
Barber, L.	Crickhowell, L.
Blake, L.	Cumberlege, B.
Blatch, B.	Davidson, V.
Borthwick, L.	Denham, L.
Boyd-Carpenter, L.	Dixon-Smith, L.
Braine of Wheatley, L.	Donegall, M.
Brigstocke, B.	Dormer, L.
Brougham and Vaux, L.	Eccles of Moulton, B.
Bruntisfield, L.	Eden of Winton, L.
Burnham, L.	Elibank, L.
Campbell of Alloway, L.	Elles, B.
Campbell of Croy, L.	Elliott of Morpeth, L.
Carnegy of Lour, B.	Ferrers, E.
Carnock, L.	Gisborough, L.

Glenarthur, L.	Onslow, E.
Goschen, V.	Oppenheim-Barnes, B
Granard, E.	Orkney, E.
Gray of Contin, L.	Orr-Ewing, L.
Greenway, L.	Oxfuird, V.
Gridley, L.	Pender, L.
Grimston of Westbury, L.	Perry of Southwak, B.
Harding of Petherton, L.	Peyton of Yeovil, L.
Haslam, L.	Prentice, L.
Hayhoe, L.	Prior, L.
Henley, L.	Pym, L.
Hesketh, L.	Rankeillour, L.
Hindlip, L.	Rawlinson of Ewell. L,
Hives, L.	Rennell, L.
Holderness, L.	Renton, L.
HolmPatrick, L.	Rippon of Hexham, L
Hood, V.	Rodger of Earlsferry, L.
Hooper, B.	Romney, E.
Howe, E.	Saltoun of Abernethy, Ly.
Hylton-Foster, B.	Seccombe, B.
Kenyon, L.	Selkirk, E.
Kimball, L.	Skelmersdale. L.
King of Wartnaby, L.	St. Davids, V.
Kinnoull, E.	Stewartby, L.
Knollys, V.	Stodart of Leaston, L.
Knutsford, V.	Strange, B.
Lauderdale, E.	Strathcarron, L.
Lindsay, E.	Strathclyde, L.
Liverpool, E.	Strathcona and Mount Royal, L.
Long, V. [Teller.]	Strathmore and Kinghorne, E.
Lucas, L.	[Teller.]
Lyell, L.	Sudeley, L.
Mackay of Ardbrecknish, L.	Swansea, L.
Mancroft, L.	Thomas of Gwydir, L.
McAlpine of West Green, L.	Tollemache, L,
Merrivale, L.	Trefgarne, L.
Mersey, V.	Trumpington, B.
Miller of Hendon, B,	Vaux of Harrowden, L.
Milverton, L.	Vivian, L.
Morris, L.	Wade of Chorlton, L.
Mountevans, L.	Wakeham, L. [Lord Privy Seal.]
Mowbray and Stourton, L.	Walker of Worcester, L.
Moyne, L.	Westbury, L.
Munster, E.	Whitelaw, V
Murton of Lindisfame, L.	Wolfson, L.
Nelson of Stafford, L.	Wynford, L.
Norrie, L.	Young, B.

Resolved in the negative, and amendment disagreed

5.47 p.m.

Lord Swinfen moved Amendment No. 13: Page 10, line 6, at end insert: ("( ) A person is not to be treated as incapable of work except in respect of work for which he is suited by education. training or experience.").

The noble Lord said: My Lords, Amendment No, 13 seeks to restore consideration of some non-medical factors of relevance to incapacity and to ensure that these factors appear in primary legislation rather than in regulations. The new so-called "objective medical test" will assess only physical and mental functions, which is a measure of impairment but not of incapacity. The proposed test, which is based on adding up points from a score of functional limitations, is not the same as incapacity. Ability to undertake work is not synonymous with ability to perform a standard set of activities. Other factors are also relevant.

The test currently used in respect of invalidity benefit includes factors such as education and experience, which interact with disablement. A person can be considered incapable of work if, having regard to his age, education, experience, state of health and other personal factors, there is no work or type of work which he can reasonably be expected to do. The amendment is designed to ensure that people are considered capable only of work which is realistic, given their disability. The availability of such work is not taken into account and nor are personal factors which have no bearing on incapacity; for instance, domestic commitments.

A person who becomes disabled after a lifetime of manual work, and with no educational qualifications, can be found incapable of work if factors such as educational and employment background are taken into account when looking at the type of work that he could reasonably be expected to do. The Government estimate that the new test will exclude 200,000 people from invalidity benefit. That reference can be found in Commons Hansard of 9th February at col. 369. Therefore, it is likely that, under this new test, disabled people who are nevertheless incapable of work will be regarded as fit for work and will lose benefit.

The amendment does not seek to reintroduce all the factors considered with the present test. It attempts to reinstate consideration of the range of work which someone can reasonably be expected to undertake given factors such as education and training. It is inaccurate to view incapacity for work in stark all-or-nothing terms. Potentially there is a wide gap between "own work" and "all work", which the proposed test ignores. The amendment addresses the Government's aim to develop an objective definition of incapacity for work but with a more realistic approach.

It introduces a formula which provides a realistic and reasonable way to assess the work which someone could be capable of undertaking. Clearly, in order to ascertain what work a person is suited for, consideration must be given to education, training and experience. That approach is taken at present in the private sector.

For the purposes of permanent health insurance, someone can be regarded as incapable of work if there is no work for which a person is suited by training, education or experience. It is a definition which is less severe than "any work" and normally means that a company could establish whether or not a claimant could do a similar job for which he is suited. Thus, it avoids the absurd situation of an executive recovering from a nervous breakdown being considered fit for work as a storekeeper. Indeed, the insurance ombudsman's report for 1993 stated on page 23 There is no point in expecting a man who has been a labourer all his life to be able to do clerical work … it must be taken as implicit that there is a reasonable chance of the policyholder being acceptable to an employer in that field".

This particular amendment was not tabled in Committee, although a similar amendment was tabled which aimed to reintroduce the concept of reasonableness into the "all work" test. That amendment was debated and withdrawn. In Committee my noble friend Lady Cumberlege stated that that amendment undermined the aim of the new incapacity test, which was intended to move away from the subjectivity of the current system. In particular, she indicated that, despite its objective of reasonable work, the current system often produced unreasonable outcomes.

She said that: Currently, the adjudication officer may be asked to give a list of jobs that a claimant could do: this is an unreasonable demand, as an adjudication officer is not an employment rehabilitation adviser".—[Official Report, 21/4/94; col. 325.]

My noble friend went on to suggest that employability and incapacity were becoming blurred and therefore produced unfairness. She went on to state that: two people with precisely the same degree of incapacity may be treated differently because one has retrained and the other has not".

The method of specifying alternative jobs, as it is undertaken in the current system, is a reasonable way of assessing whether or not someone can undertake a particular job. It is only by specifying the jobs which the claimant is considered capable of undertaking that the range of activities and abilities relating to that particular job, and therefore someone's ability to do it, can be considered, although in practice there is evidence of peculiar careers advice given by the Benefits Agency. That is more as a result of an incorrect functional emphasis than inappropriate use of job descriptions.

If the Government consider that adjudication officers are at a disadvantage compared with disability employment advisers, there are practical ways in which to address that; namely, through collaboration or retraining of staff of the Benefits Agency or the employment department. Furthermore, a similar method is used in the private sector for deciding claims under permanent health insurance. Indeed, the insurance ombudsman stated that insurers should not repudiate claims on the grounds that the policyholder could undertake some other type of work without specifying what he could do.

In case law, which was referred to by my noble friend in relation to the point at which alternative work should be considered, it was held that someone's incapacity should be assessed by reference to their present work capacity without regard to whether they would become capable of work following training. It is a present rather than a future test. Only when someone has retrained could that capacity be reviewed. I beg to move.

Lord Carter

My Lords, I was pleased from these Benches to add my name to the amendment which has been so ably spoken to by the noble Lord, Lord Swinfen. Therefore, I can be brief.

I have two points to make. It is ironic that, in the work market, when any employer looks at a potential employee, he will look at three factors: education, training and experience. Those are the three attributes mentioned in the amendment. However, the Government wish to move away from that in the "all work" test. We all know why; they are playing the numbers game. The subjectivity of the existing test, which was mentioned by the noble Baroness, Lady Cumberlege, in Committee, has meant that too many people are receiving the present benefit. Therefore, the Government have devised a test to make sure that 200,000 people will be taken off the benefit.

As we discovered in Committee, the problem arises with regard to the definition which the Government are using when they refer to "all work" on the open market. I made the point in Committee and I repeat it now: the market becomes more and more open as jobs become less and less skilled. I gave two extreme examples; namely, envelope stuffers and Concorde pilots. There is an extremely open market for envelope stuffers but a closed market for Concorde pilots.

The Government's intention is to reduce the number of claimants for this new benefit. By doing that, they are creating an area of increasing injustice to people who are entitled to benefit. The rigidity and weakness of the test, which we have discussed, mean that large numbers of people who are receiving the benefit will be taken off it.

Earl Russell

My Lords, when the Minister replies, I am sure that he or she—I do not know who is to reply —will say that this amendment attempts once again to introduce non-medical factors. I would say that it brings the test into the real world, because we are not, any of us, merely a collection of medical symptoms. We are people. Our capacity for work involves our ability as people to fit into certain environments and perform certain jobs in those environments.

That cannot possibly be tested except in relation to work for which we should otherwise have been fit. I have referred already to the letter from some of those who have worked on the tests. They said: Some of us have been unable to complete the exercises", that is, working out possible tests— and have indicated our reasons why to the department. Those of us who have undertaken the tasks have found that the exercises themselves have reinforced the potential difficulties we perceive as inevitable in the measurement of incapacity such as this. In particular we are concerned about the arbitrariness of scoring according to mechanical functions without reference to other factors such as age or employment history. The concentration on functions to the exclusion of all else is contrary to the whole person approach which so many of us advocate". If that is the view of those who have actually been working on the compilation of the tests, who is there left to believe in what is coming out as a result? That is a very telling comment.

I imagine that the Government will insist that we are trying to reintroduce labour market factors. We are not. We accept that they should be excluded, and there is no question about that; but always in the Government's arguments we find an undistributed middle. They take an alleged alternative to what we are saying and say, "If not one, then the other". In the Official Report of the Committee stage, that phrase appeared as an "undistributed niggle". I did not correct it because I decided that it represented my meaning rather better than what I had originally intended to say. What we have here from the Government is a series of undistributed niggles.

I have with me a copy of the Minister's letter to the noble Lord, Lord McColl, which he has very kindly copied to me. In it the Minister says that he is trying to work on a collection of 100 occupations. One may be unfit for all of those 100 occupations, but not for one that one can do. Alternatively, as in the case of Professor Stephen Hawking who was mentioned by the noble Baroness, Lady Darcy (de Knayth), in Committee, one might be unfit for the 100 occupations and yet, nevertheless, one might find work for which one is fit, and fit with some distinction. That illustrates the extent to which one cannot discuss fitness for work independent of the person and the skills involved. The attempt to exclude anything but functional limitations works severely against illness. What we have here is a test for disability; it is not a test for illness. Disability is not absolutely synonymous with unfitness for work, as anyone who has suffered from ME or glandular fever knows perfectly well.

In his letter to the noble Lord, Lord McColl, the Minister said: The new medical test is designed to assess a person's capacity to perform the activities involved in work". I wonder what the Minister meant by that remark. What exactly are, the activities involved in work"? I do not have the first idea as to what they can be. Indeed, I would have to be told what work before I could even begin to answer that question. Between the own-occupation test and the all-work test there is an undistributed middle and it is to that undistributed middle that I am constantly trying to bring the Government back: fitness for work that one would otherwise have been capable of doing. That is what we need. I cannot see that anything else is really serving any useful function.

On the question of age, the Minister said: We do not wish to condone the actions of any employers who make the age of a job applicant the critical factor in deciding whether to employ him". If the Minister means what he says, he is promising legislation. Is that the case?

6 p.m.

The Parliamentary Under-Secretary of State, Department of Health (Baroness Cumberlege)

My Lords, the amendment seeks to define the factors to be considered both in the own-occupation test and the all-work test and to prescribe them on the face of the Bill. As my noble friend Lord Swinfen said, the amendment surfaced in a slightly different form in our debates in Committee. However, as I said then, the amendment is contrary to the Government's intention.

The own-occupation test will be a factual test of whether or not a person is well enough to do his own job, and can take into account both medical and non-medical factors. The own-occupation test of incapacity which will apply to most people for the first 28 weeks of sickness will be a test similar to that which applies under the current system. It will assess a person's capacity to do his normal job. Training, education and work experience are unlikely to be important factors at this stage, as the person will evidently be sufficiently experienced, educated and trained to perform his own job.

The primary evidence for incapacity during the first 28 weeks will be provided by the claimant's own doctor. Like any other doctor, he will exercise his independent clinical judgment in deciding whether or not the person concerned should refrain from his own occupation. It will be the GP who will advise a claimant to refrain from doing his job, and that advice will be the evidence on which the adjudication officer bases his decision. As the test is whether a person is fit enough to do his own job—that is, the job he was doing up to 21 weeks previously—experience, training and education are simply not significant. I hope that noble Lords will accept that point.

The application of the amendment to the all-work test raises different issues. The all-work test does not take into account factors like training, employment history or educational qualifications. We firmly believe that that is right. Of course, there are people who, through their medical condition, become unable to do their own job. Such people will be entitled to be measured against the own-occupation test of incapacity for the first 28 weeks. However, we do not think it is right that they should continue to receive incapacity benefit for evermore simply because they are physically incapable of performing one particular job. That is why the all-work test will apply.

Perhaps I may interject a comment here. I know that some noble Lords seem to feel that, in the current situation, once people receive benefit they continue to do so. However, I am sure that noble Lords will realise that will change once people who have previously been receiving benefit are found to be capable of work under the current system. The new all-work test will not be the first time that people have been found to be fit and taken off benefit. In the year ending September 1993 over 920,000 cases were referred to the medical service of the Benefits Agency for a second opinion on incapacity, and over 123,000 of those people were either found capable of work or the person terminated his claim before he was examined. I believe that under the current arrangements that shows a significant number of people are found capable of work.

The all-work test will be applied after six months. We intend incapacity benefit to go to people who are sick and disabled, not to people who cannot find a job because they are untrained, insufficiently educated, unskilled, or inexperienced. It is not a benefit awarded on grounds of employability. The new medical test is designed to assess a person's capacity to perform the activities involved in work, not his likelihood of employment. Our development work on the test—for example, in the 100 jobs exercise—is ensuring that the activities in the all-work test are related to the job requirements of nearly three-quarters of occupations in the UK economy.

Education is not relevant to an assessment of incapacity. Many people complete their formal education before they reach a level that they are truly capable of attaining. Many are not offered the opportunity to go as far in their education as they might like. They may go back in later life to complete their formal education. It would be wrong to assume that incapacity benefit claimants are not capable of further education. Quite often, formal education is less of a requirement than aptitude and potential. Again, it would be wrong to enshrine in legislation a system which is at odds with what does and should happen in reality.

We do not think it is right that people should continue to receive incapacity benefit because they are trained only for one job and no other. Unemployed people are expected to consider all work after a certain period. If a person cannot find work because he lacks training, assistance is offered by the employment department. A range of options exists to help with training and rehabilitation.

People can retrain. If I may say so, it is a little arrogant to suggest that certain categories of people—for example, those who have previously done manual jobs—cannot retrain. In fact, we know that they can do so. I see that the noble Earl wishes to intervene. I give way.

Earl Russell

My Lords, I beg the Minister's pardon, but can she tell us when we suggested that those people could not retrain for work for which they would otherwise have been fit?

Baroness Cumberlege

My Lords, I am sure that your Lordships will appreciate that I have been trying to draw the distinction between the provision and the amendment which seeks to include other factors that we feel are irrelevant to a person's ability to do a job because of his sickness or his disability. That is what I am trying to establish.

In a recent survey of employment training we were able to show that 56 per cent. of trainees were training to do a new type of work; and we all know that in the north Nottinghamshire area alone, around 600 people who worked in coal mines or related industries have undergone or are undergoing retraining. As with training, it is completely fair that a person who cannot find work because he has experience of only one job and is now medically incapable of doing that job should be tested for his medical capacity to perform a range of jobs. Why should someone be expected to restrict his employment to only one type of work? A person who has no medical incapacity but whose job in, for example, a fading industry ceases to exist must consider a range of jobs. In the first case, the person cannot perform his old job because of a particular health problem; in the second, because the job no longer exists. It is only fair that both people should equally be expected to consider themselves against other work. Of course, if the person in the first case is not fit to do other work, he will receive incapacity benefit. But I do not see how anyone can argue that he should not even have his medical capacity to do other work measured.

This amendment seeks to reintroduce into the all work test the element of subjectivity that was such a problem in the old system. We are trying to get away from the subjective "supposedly-reasonable job" approach, with its lists of appropriate jobs, sometimes —as your Lordships illustrated on Second Reading—bizarre. We know there are problems consequent on the structure of the current system; many of the problems have been raised by noble Lords opposite. Current case law on "reasonable work" requires adjudication officers to take account of all sorts of factors including the non-specific "other social factors". These are just not relevant to incapacity. With this test we are aiming at a fairer and more objective test of incapacity. For these reasons I hope that my noble friend will withdraw his amendment.

Lord Carter

My Lords, before the noble Baroness sits down, I should say, with the leave of the House, that I believe she quoted some figures from the existing system in the year to September 1993. I believe she said that something like 900,000 people are referred back —presumably by benefit officers—and of these eight out of nine are still found to be unfit for work. I think she said that 120,000 were found to be fit for work. Is this the example that she gives of the subjectivity of the present system—not doing the job that the Government want the test to do, which is to take people off benefit?

Baroness Cumberlege

No, my Lords. It was really to try to redress the view I think your Lordships have that the present system is working well and that people, once they are on sickness benefits, remain on those benefits. But what I am trying to point out is that they are tested and that many of them actually do go back to work.

Lord Carter

My Lords, I am sorry to insist, but I believe the noble Baroness said that eight out of nine are found to be unfit for work.

Baroness Cumberlege

My Lords, I was only trying to make the point that once a person is on a benefit they do not necessarily always stay on that benefit; that there are tests and some of them go back to work.

Earl Russell

My Lords, does the noble Baroness understand that the argument on this side of the House is that the objectivity which is being claimed here is on a level such that it is not a human attribute?

Baroness Cumberlege

My Lords, I think, if I may say, that that is perhaps rather an unfair comment. We are seeking very carefully to produce a test that is objective. Your Lordships, in this amendment, are trying to make it much more subjective by introducing factors other than the person's present condition in terms of disability or health. I believe that training, education and experience bring in a whole range of subjectivity which we are seeking to exclude, bearing in mind that there are elements within our social security system which will take care of those people.

Lord Swinfen

My Lords, the noble Baroness has given a long and detailed response. However, I am not sure that I agree with it. My amendment is not seeking to say that people are incapacitated if they are not capable of one particular job or a range of jobs. Nor does it say that people who will receive incapacity benefit are incapable of further education or retraining. My noble friend brought out the case of miners who have been retrained after their colliery closed down. That is totally irrelevant because they are not disabled. They are not incapable. They are fit. There are lots of different kinds of jobs they can get. This amendment deals with people who are already physically or mentally incapacitated and then asks that other aspects that affect them personally should be taken into account. I understand that at present those found incapable of work constitute only two out of 10 claimants. That is not a great number. Why throw the baby out with the bath water because that is what the Government are trying to do? I am sorry, but I am not satisfied with my noble friend's response. I feel that I must ask the opinion of the House.

6.15 p.m.

On Question, Whether the said amendment (No.13) shall be agreed to?

Their Lordships divided: Contents, 107; Not-Contents, 124.

Division No. 4
CONTENTS
Addington, L.	Hylton, L.
Airedale, L.	Irvine of Lairg, L.
Archer of Sandwell, L.	Jay of Paddington, B.
Ardwick, L.	Jeger, B.
Ashley of Stoke, L.	Jenkins of Putney, L.
Attlee, E.	Judd, L.
Bancroft, L.	Kagan, L.
Barnett, L.	Kilbracken, L.
Bath, M.	Kilmarnock, L.
Beaumont of Whitley, L.	Kinloss, Ly.
Blackstone, B.	Listowel, E.
Bonham-Carter, L.	Llewelyn-Davies of Hastoe, B.
Bottomley, L.	Lockwood, B.
Brimelow, L.	Mackie of Benshie, L.
Bruce of Donington, L.	Mar, C.
Carter, L.	Masham of Ilton, B.
Cledwyn of Penrhos, L.	Mason of Barnsley, L.
Clinton-Davis, L.	McCarthy, L.
Cornwallis, L.	McIntosh of Haringey, L.
Coventry, Bp.	Mellish, L.
Crook, L.	Merlyn-Rees, L.
Darcy (de Knayth), B.	Milner of Leeds, L.
David, B.	Molloy, L.
Dean of Beswick, L.	Monkswell, L.
Dean of Thornton-le-Fylde, B.	Nicol, B.
Desai, L.	Ogmore, L.
Donaldson of Kingsbridge, L.	Palmer, L.
Dormand of Easington, L.	Peston, L.
Eatwell, L.	Pitt of Hampstead, L.
Elis-Thomas, L.	Prys-Davies, L.
Ennals, L.	Rea, L.
Ewing of Kirkford, L.	Richard, L.
Faithfull, B.	Rix, L.
Falkland, V.	Rochester, L.
Gallacher, L.	Russell, E.
Geraint, L.	Saltoun of Abernethy, Ly.
Glenamara, L.	Sefton of Garston, L.
Gould of Potternewton, B.	Serota, B.
Graham of Edmonton, L.	Shannon, E.
Greene of Harrow Weald, L.	Stedman, B.
Gregson, L.	Stoddart of Swindon, L.
Grey, E.	Strabolgi, L.
Halsbury, E.	Swinfen, L. [Teller.]
Harris of Greenwich, L.	Thurso, V.
Harrowby, E.	Tordoff, L.
Haskel, L.	Turner of Camden, B.
Hertford, M.	Walpole, L.
Hilton of Eggardon, B.	White, B.
Hollick, L.	Wigoder, L.
Hollis of Heigham, B.	Williams of Crosby, B.
Holme of Cheltenham, L.	Williams of Elvel, L.
Hooson, L.	Williams of Mostyn, L.
Howell, L.	Zouche of Haryngworth, L.
Hughes, L.	[Teller.]

NOT-CONTENTS
Addison, V.	Campbell of Alloway, L.
Annaly, L.	Carnegy of Lour, B.
Archer of Weston-Super-Mare, L.	Chalker of Wallasey, B.
Arran, E.	Chelmsford, V.
Astor of Hever, L.	Chesham, L.
Astor, V.	Clanwilliam, E.
Balfour, E.	Clark of Kempston, L.
Barber, L.	Constantine of Stanmore, L.
Blake, L.	Cork and Orrery, E.
Blatch, B.	Courtown, E.
Boyd-Carpenter, L.	Craigmyle, L.
Braine of Wheatley, L.	Cranborne, V.
Brougham and Vaux, L.	Cranbrook, E.
Bruntisfield, L.	Crickhowell, L.
Burnham, L.	Cross, V.

Cumberlege, B.	Mountevans, L.
Davidson, V.	Mowbray and Stourton, L.
Denham, L.	Moyne, L.
Dixon-Smith, L.	Munster, E.
Donegall, M.	Murton of Lindisfarne, L.
Eccles of Moulton, B.	Nelson of Stafford, L.
Elibank, L.	Onslow, E.
Elliott of Morpeth, L.	Orkney, E.
Ferrers, E.	Orr-Ewing, L.
Flather, B.	Oxfuird, V.
Gisborough, L.	Pender, L.
Glenarthur, L.	Prentice, L.
Goschen, V.	Rankeillour, L.
Gowrie, E.	Rees, L.
Gray of Contin, L.	Renton, L.
Greenway, L.	Rippon of Hexham, L.
Gridley, L.	Rodger of Earlsferry, L.
Grimston of Westbury, L.	Romney, E.
Haig, E.	Seccombe, B.
Harding of Petherton, L.	Selborne, E.
Harmar-Nicholls, L.	Sharples, B.
Haslam, L.	Skelmersdale, L.
Hayhoe, L.	Slim, V.
Henley, L.	St. Davids, V.
Hesketh, L.	Stewartby, L.
Hindlip, L.	Stodart of Leaston, L.
Hives, L.	Strange, B.
Holderness, L.	Strathcarron, L.
HolmPatrick, L.	Strathclyde, L.
Hood, V.	Strathmore and Kinghorne, E.
Hooper, B.	[Teller.]
Howe, E.	Sudeley, L.
Hylton-Foster, B.	Swansea, L.
Jeffreys, L.	Tebbit, L.
Kenyon, L.	Teviot, L.
Kimball, L.	Thomas of Gwydir, L.
Kinnoull, E.	Tollemache, L.
Lauderdale, E.	Trefgarne, L.
Liverpool, E.	Trumpington, B.
Long, V. [Teller.]	Vaux of Harrowden, L.
Lucas, L.	Vivian, L.
Lyell, L.	Wade of Chorlton, L.
Mackay of Ardbrecknish, L.	Wakeham, L. [Lord Privy Seal.]
Mancroft, L.	Whitelaw, V.
Merrivale, L.	Wolfson, L.
Mersey, V.	Wynford, L.
Miller of Hendon, B.	Young, B.
Milverton, L.

Resolved in the negative to accordingly.

6.23 p.m.

Lord Swinfen moved Amendment No. 14: Page 10, line 6, at end insert: ("() A person shall be treated as incapable of work by reference to the point at which his ability to undertake work-related activity is substantially reduced, not the point where work becomes impossible.").

The noble Lord said: My Lords, Amendment No. 14 has two aims. The first is to place a definition of the nature of incapacity on the face of the Bill. The paucity of detail about the proposed test of incapacity within the Bill itself and the leaving of the details of the new test of incapacity to regulations not yet drafted was debated at length during the Committee stage. However, with no definition on the face of the Bill it is impossible to have an adequate debate on incapacity for work.

The second aim of the amendment is to use a definition of incapacity which has been put to the expert panel considering the new tests. I am told that the experts are attempting to score and rate functional limitations. That definition was revealed to selected Members of your Lordships' House at a presentation on the test three weeks ago. It has been incorporated in guidance sent to panel members with each exercise for scoring functional limitations.

In that guidance panel members are expected to set a threshold of incapacity by reference to the point at which a person's ability to perform work-related activities is substantially reduced, not the point where work becomes impossible. That concept of incapacity is designed to assist the Department of Social Security to define a threshold above which a person should be regarded as incapable of work for the purpose of assessing benefit entitlement. It is important because it means that someone can be entitled to benefit without being totally immobile.

I understand from the Disability Alliance, which has some members on the panel, that the panel itself has not met in its entirety. I should be grateful if my noble friend, when replying, will say how the panel is working and whether it will be meeting in its entirety so that proper discussion between all members can take place. I also understand that a number of the panel members are not in favour of a functional test.

The concept of substantial reduction in work capacity is important recognition that incapacity for work is not absolute but a continuum. If this definition of incapacity is being used by the panel, there seems no reason why it should not appear on the face of the Bill itself.

At Committee stage the matter was debated as part of a longer amendment, which was withdrawn. My noble friend Lady Cumberlege when replying on 21st April stated that the relevant part of the amendment was unnecessary. She went on to say: The principle behind the proposal is one on which we already operate. The thresholds in each category of functional limitation and the combinations of those limitations will be set at the point at which a person's capacity for work is substantially reduced… The development of the new medical test therefore is proceeding exactly along the lines suggested by this House. This part of the amendment is unnecessary because what it proposes is exactly what we intend to do'"—[Official Report, 21/4/94; cols. 304–5.] However, as the amendment accords with the Government's intentions, there is no reason why it should not be on the face of the Bill. It is important to include pointers for the interpretation of incapacity in practice. In recent months there have been numerous examples reported by the citizens advice bureaux and welfare rights advisers of Benefits Agency staff taking an over-zealous approach to incapacity where claimants have had their benefit withdrawn only for it to be reinstated on appeal.

Placing such a definition in the Bill would emphasise to staff that incapacity for work can be established with reduced capacity, not total immobility. I beg to move.

6.30 p.m.

Lord Carter

My Lords, I was pleased to add my name to the amendment. It is an important point. On moving the amendment so ably, the noble Lord, Lord Swinfen, quoted the noble Baroness, Lady Cumberlege, at Committee stage. I believe that this passage should be added to the quotation. The noble Baroness stated: It may reassure the Committee if I read a passage from the instructions on setting thresholds which we sent to the panel which is working on the medical assessment". I thought it was a little odd to send instructions to an advisory panel. The instructions are as follows: 'We want to define a threshold at which a person should be regarded as incapable of work for the purpose of deciding benefit entitlement. This means we are interested in the point on the scale of increasing severity of disability at which a person should not be expected to work, not the point where work becomes impossible"'.—[Official Report, 21/4/94; cols. 304–305.] Those words are included in the amendment. I cannot understand why the Government should resist an amendment which places on the face of the Bill a definition of the extent of incapacity which is the definition to which they already work. At Committee stage and earlier today we discussed the reluctance of the Government to allow Parliament to put on the face of the Bill words which help to clarify important definitions. The amendment includes the definition which is being used. I hope that the Minister will feel able to accept it.

Lord Boyd-Carpenter

My Lords, if the Bill were to contain those words, it would go too far. If such words were on the face of the Bill, they would indicate that where there is a reduction but not an elimination of capacity to work then benefit will be payable. The difficulty is that if one takes a man or woman of considerable ability one can quite substantially reduce his or her working capacity and yet leave him or her with considerable capacity for earning a living. That seems to be covered exactly by the amendment. I believe it to be a great mistake either to put the provision into the Bill or to put its equivalent into regulations.

Lord Carter

My Lords, perhaps I may respond. I quoted from the instructions which the Government have given to the medical panel. If those are the instructions to which the Government are working, would it not help to define "incapacity" in the Government's own words on the face of the Bill?

Baroness Cumberlege

My Lords, this amendment specifies that incapacity should be interpreted as the substantial reduction of ability to perform work. I hope I can satisfy your Lordships by saying that this is exactly what we intend the medical test to do. The amendment seeks to specify on the face of the Bill that a person shall be treated as incapable of work where his ability to perform work-related activities is substantially reduced, not where work becomes impossible. The test will do precisely this. The principle behind this proposal is one on which we are already operating: the thresholds in each category of functional limitation, and the combinations of those limitations, will be set at the point at which a person's capacity for work is substantially reduced.

We are developing the new all work incapacity test on this basis, and have instructed the assessment panel accordingly. It is our panel. If I may say so, I think that it is quite fair that we should instruct it. The instructions on setting thresholds which we sent to the panel reveal our intention. As has already been said, they state: 'We want to define a threshold at which a person should be regarded as incapable of work for the purpose of deciding benefit entitlement. This means we are interested in the point on the scale of increasing severity of disability at which a person should not be expected to work, not the point where work becomes impossible'". This amendment was raised in a similar form in Committee, and our discussions were helpful and wide-ranging. The test, as we have been developing it, incorporates the definitions of work and incapacity raised in this amendment and on which I shall expand. However, we consider that it is inappropriate to place the structure of the test on the face of the Bill: the test is simply too detailed and, more importantly, still open to development through the consultation exercise. To put only some elements of the test into primary legislation would have dangers, and could prevent the implementation of changes to the test, as my noble friend Lord Boyd-Carpenter said.

As noble Lords are aware, we have convened the special panel of occupational health specialists, rehabilitation experts and physicians. A question has been asked as to their total agreement on every issue. Clearly when one has 80 experts together there is room for some differences. The panel is considering the impact of the functional limitations in our disability scales against each of the hundred jobs. The results will serve as a check on the findings of the main assessment exercise, and help to ensure that the scales reflect the impact of disability on capacity to perform the activities involved in work in the open market. For example, the exercise may reveal that some functional limitations are particularly important when assessed against the requirements of particular jobs, and so the scores for the assessment should be re-weighted accordingly.

My noble friend Lord Swinfen, and earlier the noble Earl, Lord Russell, asked whether the panel had met. I understand that it has met on two occasions, when it received instructions on how it was to work. I was also asked whether it was working well. I have to say that we are very grateful to the panel for the amount of work that it has done.

Noble Lords may know that we are also conducting an evaluation study to assess and check the operation of the new test. This will cross-check the relationship between the activities and the levels of activity in the assessment and those required for work. When the evaluation exercise is over, we will issue a report which will summarise all the work that we have undertaken and present our proposals for the test on which we will be seeking views. Only after all this will we present our final proposals on the test to Parliament for approval, in the form of regulations.

We are developing a test which will be a significant improvement on the current arrangements for the assessment of incapacity. In adapting the OPCS disability scales to measure incapacity for work rather than disability, we are aiming at a more objective test of incapacity. Noble Lords will, I hope, agree that, while the consultation and development period is still incomplete, it would be foolish to set down details of the test in the Bill. I can certainly assure your Lordships that our intention is as set out in the amendment. The report which we shall publish in late summer will confirm and further explain this.

I agree with my noble friend Lord Boyd-Carpenter that it would not be appropriate to accept the amendment as worded at present. But we are willing to have a look at it. I have explained that we are developing the new all work test on the basis as set out in the amendment. We do not consider that it is appropriate to amend the Bill. As I have said, however, I am willing to consider the matter again in the light of the discussions we have had today. I am also willing to meet my noble friend Lord Swinfen and the noble Lord, Lord Carter, before Third Reading, to see whether we can agree on a way forward. I hope that, in the light of that offer, my noble friend will withdraw the amendment.

Earl Russell

My Lords, before the noble Baroness sits down, perhaps I may thank her for confirming that the panel has met. However, perhaps I may ask her also to clarify one phrase that she used, referring to the panel receiving instructions about how it was to work. I hope that I have referred to it correctly. To an incautious ear, that might suggest that the panel itself has never agreed to the possibility of such an objective test.

Baroness Cumberlege

My Lords, we sought to instruct the panel on the method of working and how we expected it to exercise its judgment, not how it should exercise its judgment in terms of the results. Clearly it would be pointless for us to have a panel of 80 experts if in the end we did not rely on their judgment and how they were going to assess the particular disabilities and where they were going to put them on the scale.

Earl Russell

My Lords, perhaps I may clarify the matter a little further. Was the panel instructed to produce an objective test, or was it asked whether an objective test was possible?

Baroness Cumberlege

My Lords, within the framework that we have set, we were asking the experts to exercise their judgment in terms of the ratings of disability. I think that I explained that fully at Committee stage. However, if the noble Earl wishes further explanation, I shall be happy to give it to him.

Lord Swinfen

My Lords, I thank my noble friend for her response. I am grateful for her undertaking to have a look at the amendment and what I seek to do. I shall be delighted to meet her between now and Third Reading to discuss the matter. I have not had an opportunity of discussing it with the noble Lord, Lord Carter, but I am sure that he too would be delighted to meet my noble friend Lady Cumberlege. She said that the panel had met twice. My understanding is that the panel is 80 strong and met in two groups of 40 to receive instructions some time before Christmas. To my way of thinking, that does not mean that all the members of the panel have had an opportunity of discussing the matter together. It seems to me that if a panel is to come forward with serious advice to my noble friend's department, all its members should have an opportunity of meeting together, so that the matter may be properly thrashed out.

I note the suggestion of my noble friend Lord Boyd-Carpenter that my amendment would be too inflexible to take account of possible changes in the future. I appreciate that and will examine it. My noble friend Lady Cumberlege said that some functions may have to be re-rated in the context of certain kinds of jobs. I shall not ask her to respond now, but perhaps at a later stage or in discussion we can go into the question of whether or not that means that the Government concede that some types of work make a difference to the assessment. If that is the case, why does the Bill not acknowledge it? With those words, I beg leave to withdraw the amendment.

Baroness Cumberlege

My Lords, with the leave of the House, perhaps I may put right something on which I may have misled the House. I may have said that the panel met on two occasions; in fact they met on one occasion. My noble friend is absolutely right. It was before Christmas, in December 1993. The panel met in two groups, and that is where my confusion lay. It met in two groups because it has 80 members and it would be difficult to meet in a large group and take questions and comments with 80 people in the room. The panel was asked for its help with the detail of the tests but not, of course, the policy.

Lord Swinfen

My Lords, with the leave of the House, for a group of 80 to take questions and comments in this day and age is not all that large. Much larger meetings take place where there are opportunities for questions and comments. I am sure that, with a little initiative and forethought on the right place to meet, the panel could get together. With those words, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.45 p.m.

Lord Wise moved Amendment No. 15: Page 10 line 20 after ("examination") insert (", by a medical practitioner with relevant training").

The noble Lord said: My Lords, the purpose of the amendment is to ensure that the medical officers who examine disabled people in relation to a claim for incapacity benefit are given relevant training to enable them to carry out their examinations sensitively and to arrive at a fair assessment of the person's capacity to work.

Under the new system, as we know, GPs are to continue to assess people during the first 28 weeks of a claim, but at this stage medical officers employed by the Department of Social Security are to take on an enhanced role. The patient will fill in a questionnaire, the GP will give a diagnosis, and the case will go to the Benefits Agency. The DSS may ask the GP for further clarification, but the GP will not be asked to comment on the claimant's self-assessment nor give his opinion of the ability to undertake any kind of work.

It is this change in responsibilities for assessing capacity for work that leads me to move this amendment. As it stands, the Bill does not contain any provisions on training doctors in making assessments of capacity for work. It specifies only in Clause 5 that a person may be called, for such … examination as may be required in accordance with regulations". This is the case in spite of the enhanced role of the DSS doctors and the diminished role of GPs.

It is crucial that the Benefits Agency doctors are trained not only in the workings of the new incapacity benefit but in how to treat the patients who are sent to them, so that they allow them plenty of time to explain their symptoms and how they feel these affect their ability to work.

The National Association of Citizens Advice Bureaux has brought to my attention a number of worrying cases. One bureau had a client who was claiming invalidity benefit and was required by the DSS to attend an examination with a medical officer. She describes the attitude of the doctor as brusque and abrupt. She felt so intimidated that she concealed the pain she was suffering during the examination and as a result spent several days in bed recovering. We must remember that many disabled people have been visiting their GP for years and may feel scared when asked to undergo examination by a stranger. They may well withhold relevant information due to an attack of nerves.

Medical officers must be alerted to the extra sensitivity required in these cases and training must be provided to deal with that. We must remember that the incident I have described, and many similarly distressing cases, took place under the current system, when the GP had more opportunity to protest if he felt his patient had received an unreasonable assessment. I am very concerned that unless DSS doctors are properly trained there will be a rise in unjust assessments of disabled people and a rise in the number of people who are classified as fit for work when common sense shows that they are not. That will mean an overburdening of the appeals system. Training doctors to give sensitive and considerate examinations lasting an appropriate length of time is much more likely to lead to fair assessments of their capacity for work.

I have also seen evidence of unsuitable suggestions by medical officers of alternative work that a disabled person could do—alternative, that is, to their usual work, even though this may be the only work that they have ever done or have ever been trained to do. One bureau has a client, a man in his fifties, who suffers from severe arthritis, poor eyesight, industrial deafness and has no feeling in his fingers. The medical officer suggested that he seek work as a bingo caller, in a snack bar or as a lavatory attendant. Calling numbers out in a busy hall, making sandwiches or cleaning public lavatories would hardly appear to be suitable work for such a disabled person—even if he were to be offered it.

This amendment brings to light other issues which are at the heart of the Bill. Many concerns have been expressed in this House about the new medical test. We are worried that it will be functional, based entirely on medical factors alone, and that it may exclude many relevant non-medical factors; for example, age or experience. I understand the Minister's reason for that. Evidence from citizens advice bureaux around the country shows DSS doctors' dismissal of fluctuations in disability to be a common problem. As was said earlier, there are fluctuations in the severity of pain which may often occur and which are also of an intermittent nature.

This amendment seeks to encourage a partnership between the GP and the DSS doctors. Giving the medical officers proper training will encourage them to use GPs' knowledge of their patients' medical histories. None of us wishes to see a further rise in inappropriate withdrawals of benefit due to poor appraisal of a person's capacity for work. A rise in appeals is costly for the taxpayer and for the claimants, who, if their appeal is successful, have to wait for the benefit that is owed to them and who in the meantime are greatly worried by their loss of income.

I welcome the Minister's promise in Committee that Benefits Agency doctors will take account of the claimant's past medical history and the information submitted by the claimant and his doctor. Will she confirm that guidelines and training on this and the other matters I have spoken about will be given to all doctors who are entrusted with the decision on whether a person is fit to join or to return to the workforce?

I urge the Government to accept the amendment, which will help GPs, DSS medical officers and disabled people. It will also help to avert an undesirable rise in appeals. It can only aid the smooth operation of the new system. I beg to move.

Baroness Masham of Ilton

My Lords, this is a very important amendment. The Department of Health's own statistics show that between 1979 and 1992 the success rate of invalidity benefit appeals rose from 21 per cent to 53 per cent. In previous debates in this House and another place we have heard about evidence from the Citizens' Advice Bureaux showing how there has been a further significant increase in recent months.

Poor decision-making by the Benefits Agency Medical Service results in an increase in appeals which in turn leads to unnecessary expense and time wasting. Let me give two examples to illustrate the point.

A CAB in Yorkshire reports the case of a man with severe tinnitus, causing lack of concentration, loss of memory and prolonged periods of sleeplessness at night owing to the barrage of noise. He was called for a medical by the Benefits Agency and at the examination was asked to undress, bend down, touch his toes and so on. Only when he mentioned tinnitus did the condition come up at all. Without any discussion, the doctor dismissed it as disturbed sleep.

A CAB in Northern Ireland reports that, although the medical examination is supposed to last for 25 to 30 minutes, it was found that in practice it sometimes took less than 15 minutes and that the emphasis was only on physical incapacity. That was inappropriate for one client who was suffering from post-natal depression.

Such incidents could be prevented by ensuring that the medical examinations are undertaken by doctors with relevant training. In turn, that would lead to fewer appeals and less wasted expense in the system.

I should like to ask the Minister some specific questions about the training provided to examiners. If she is unable to answer those questions today, perhaps she will write to me with the answers. What training will be provided for medical examiners? In particular, will they receive training to assess the practical consequences of poor health and disability on a person's ability to perform in the work setting? Will the Government arrange for disability organisations to provide their input and expertise as part of the relevant training?

There is evidence that the standard of decision-making varies considerably from one area to another. Will the Government establish minimum standards for the delivery of service? For example, will they ensure that everyone has been assessed under the new work test by the 28th week of incapacity?

Moreover, for many people the examination process is very intimidating. That point has already been made. Evidence indicates that doctors frequently are bad at encouraging clients to bring out the full implications of their disability or ill health. Will training be provided to address that issue? That is another area in which voluntary organisations have expertise to offer for training.

I reiterate that it is very important that decision-making by doctors should be good, well informed and accurate. Appropriate training is crucial. If that does not take place there will be a huge rise in appeals and backlogs in the system. One would not wish to see a situation such as that which arose with the introduction of the disability living allowance, when claims took many months to process because of delays in the system.

I urge the Government to accept the amendment and ensure that good training is provided and high standards set for the delivery of service by the Benefits Agency Medical Service. That must be good management. There are a great many different disabilities. It is necessary to understand the various disabilities if assessments are to be undertaken successfully and justly.

Earl Russell

My Lords, I have not yet heard the response to my remarks on Amendment No. 12 about the dangers of politicising the medical tests for fitness for work. I have known enough medical people to know that they do not always agree with each other. Nevertheless, the decision on whether somebody is fit for work ought not to be a matter of party political controversy. I know that today most admirably that has not been so. However, were the matter to go outside this House and were this Bill to become law, inevitably those tests would be debated as an issue between the parties.

I understand, from having consulted other people, that practically everybody outside the range of Whitehall simply cannot believe what is being done. I am quite convinced that if the Government go ahead with this allegedly objective test the measure will collapse in the same way that the poll tax and the Child Support Act collapsed. It will happen round about the time of the next election. I would rather not have it happen that way. It calls in doubt too much. It creates too much distrust in the whole political system. I would rather see approaches made to the task of trying to tone down the measure.

It is not often that I recommend to other government departments the practice of the Department for Education and its minions but on this occasion I do so. I have referred before to the test for the university teaching assessment, where again there is a temptation to use an allegedly objective test. That has provoked a storm. The Barnett Report produced by the Higher Education Funding Council and published today recommends dealing with the problem by reducing the proportion of the assessment which is done by the allegedly objective test and increasing the proportion which is done by visits. It is just possible, though not yet certain, that that might achieve an element of compromise which will enable the measure to go forward with all-party support.

If there is a route which would enable the tests of unfitness to go forward with all-party support, it is along the lines of this amendment, by increasing the role of the doctor, in particular the doctor with specific knowledge of this specific problem, and by downgrading the share in the assessment taken by the allegedly objective test. If the Government want the Bill and the tests in it to enjoy a general reputation and the results to be accepted as having some approximation to the truth, they will either accept the amendment or institute consultations along the lines that it suggests. If not, this issue will become a party political battle outside the Chamber. It will happen if it must, but I hope that it will not.

Lord Swinfen

My Lords, I should like to take up a point made by the noble Baroness, Lady Masham. She asked my noble friend Lady Cumberlege what training was given to the DSS doctors so that they could properly carry out assessments. In other debates we have heard of doctors in hospitals, sometimes training hospitals, who rarely see people with, for example, spinal injuries. They rarely see people with particular kinds of disability. Some doctors will go through the whole of their career and never come across a case of multiple sclerosis.

Disability is recognised because it is uncommon. It is becoming more common because of the advances of medical science. Even so, it is uncommon among the general public and that is why so many are frightened of it—but that is a different question. Can my noble friend tell the House what specific training will be given to the doctors? Where will they be recruited? Will they be doctors who have come to the end of their careers either as GPs or in hospital and want a little something to keep them occupied in their retirement, at any rate for a few years?

I am not trying to cast aspersions on the doctors. But once we reach a certain stage there is not the same likelihood that those doctors will keep up their training; it will not be necessary. Or will the doctors be recruited from potential GPs who, after moving as locum from one practice to another and being unable to be taken on as a partner, settle down with the DSS because no one else wants them? It is essential that we know what training will be given to the doctors and from where they are recruited to enable us to know that they are up to the job.

7 p.m.

Lord Carter

My Lords, the arguments for the amendment have been extremely well expressed by those who have already spoken. I want to ask just a few factual questions of the Minister. I received, as did other noble Lords, a brief from the National Association of Citizens Advice Bureaux showing cases where pressure was placed on GPs by the DSS and many other examples which do not reflect well on either the speed or quality of some of the assessments. It will be helpful if the Minister can say whether the department has made any determination of how many assessors and how many actual assessments there will be. In other words, what is the likely work rate expected of the assessors? How long will they have when they are exercising the clinical judgment to which the noble Baroness referred at Committee stage? At the same time, how many visits to the general practitioner does the department expect the claimant to make? What is the comparison between the involvement of the GP and the length of time that the BAMS doctor will have to make the assessment?

I cannot believe that the DSS does not possess those figures. They are needed to form an assessment of the cost of the Bill and the effect on manpower. It would be extremely helpful to the House if the Minister could tell us.

Baroness Cumberlege

My Lords, I am extremely concerned by the comments made by my noble friend Lord Wise that occasions have occurred when doctors have been brusque and not as sympathetic as they should have been. I understand also some of the criticism made this afternoon. I therefore believe, as do your Lordships, that it is essential that the doctors engaged in conducting assessments should be appropriately trained, especially when we are starting an entirely new system. Not only do the doctors need to be trained, but also the adjudication officers who will make the decisions and apply the tests. And not only do the doctors need to be trained for the examinations but also for the other aspects of the test—for example, the checking of the questionnaire for consistency.

We must ensure that the medical examination is focused principally on determining the incapacitating effects of disability and that functional assessment is documented across a wide range of physical, sensory and mental disabilities. BAMS doctors will therefore be participating in guidance and training courses to equip them both with knowledge of the new benefit and the place in it of the clinical assessment of function and its relevance to the new more objective medical test.

The noble Baroness, Lady Masham, asked specific questions about training, as did the noble Lord, Lord Carter. I suspect that what I have just said is not detailed enough and I am willing to come back with a letter setting out the information in more detail.

The structured training course will deal with the functional assessment of physical, sensory and mental disability and how those relate to capacity for work. The training will emphasise that doctors will be obliged to take account of pain, stiffness and fatigue in reaching an opinion on the effects of the person's functional limitations. Emphasis will also be placed on the importance of fluctuation, variability and relapse in those medical conditions whose nature is characteristically one of instability or variability. In particular, the "snapshot" approach will be strictly avoided. Training and guidance will emphasise that assessments will not be based on performance at the day and time of examination. The history given by the claimant and the normal evolution of the specific disease or disorder will be given for consideration.

By the very nature of their training, experience and expertise, all doctors will have gained a knowledge of the effects of disability on the functions of the body and mind. Moreover, they will be well equipped to evaluate physical and/or mental disease, the effects of such diseases and the ways in which those effects may limit function in the individual person. I am glad to say that we have already started the training programme for the Benefits Agency Medical Services doctors who will be carrying out any examinations required.

I can say to both my noble friends Lord Wise and Lord Swinfen and the noble Baroness, Lady masham, that already around half of BAMS sessional doctors are existing general practitioners. There will therefore continue to be a close relationship between the various groups of doctors. The training programme has several elements. There are 200 full-time doctors employed by BAMS, many of whom are general practitioners; all those who will be conducting the incapacity test will be required to attend the training programme. Because of the numbers involved, we had to start early. In conjunction with the Benefits Agency customer services team, we have already contacted a number of disability groups to arrange a pilot series of training seminars and courses for the BAMS staff. Last week a group of about 40 doctors conducted trial incapacity examinations on 500 volunteers as part of the evaluation study. Those examinations reflected the latest developments in the test. The feedback from the doctors who took part will be used to redesign the full BAMS training programme.

I understand the reservations of the noble Earl, Lord Russell, in regard to party political controversy. I share his view that we do not want this to become a patty political matter. I understand that he feels that the system we are proposing will not prove to be a success. We do not share those views. We listened carefully to what your Lordships said in this Chamber in regard to the current system, which was heavily criticised. We feel therefore that the proposal we are putting forward in terms of the medical tests and the training of doctors will be an improvement.

To return to the amendment, I hope noble Lords will be reassured that proper measures and programmes are being put into place to ensure that all those involved in the incapacity assessment—not just the doctors—are appropriately and fully trained. A further, important part of the assessment procedure is of course the guidance for staff; as I said earlier, that will be published.

In view of those comments I hope that your Lordships agree that it would not be appropriate to place this measure on the face of the Bill. I hope you will feel sufficiently reassured to withdraw the amendment.

Lord Carter

My Lords, before the noble Baroness sits down, perhaps I may say that I am grateful to her for offering to write to me with the detailed figures for which I asked. However, I am a little surprised that she does not possess them. The Explanatory and Financial Memorandum to the Bill gives the increase in administrative costs. Apparently, 1,100 additional staff will be required for the first two years, reducing to approximately 260 from 1997–98. It will be extremely helpful if the noble Baroness will write to me and place a copy of the letter in the Library to show how many assessors there will be, the estimate of the number of assessments and the time that will be given to those assessments.

Baroness Cumberlege

My Lords, perhaps I may come back on those two points. We expect there to be around 1 million references to the BAMS doctors, which is around the same as there are now. About half of those will be examined. The number of BAMS doctors will therefore be around the same. The length of time taken for an examination will vary from case to case but the average will be about 30 minutes.

Baroness Masham of Ilton

My Lords, with the leave of the House, why does the Minister think it would not be appropriate to write this into the Bill? It seems to be a helpful amendment.

Baroness Cumberlege

My Lords, as I have said, training has already started. It is very comprehensive. I have not given quite the detail that the noble Lord, Lord Carter, asked for—and I shall do that—but we feel it is unnecessary as this work is already going on.

Lord Wise

My Lords, I thank my noble friend the Minister for that detailed response. I must agree with the noble Baroness, Lady Masham, in that I cannot understand why this cannot be in the Bill if training has already taken place. My noble friend said that 50 per cent. of the doctors doing the medical test will be general practitioners. Will they continue with their own practices and just fill in part time with the tests? I do not know. But having said that, we must accept what my noble friend said, that training is taking place and that it will be adequate. I just hope that the sensitivity part of it will be thoroughly explored. It is so important that disabled people are not treated brusquely and abruptly and that full note is taken of their sensitivities and their problems. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 16 not moved.]

7.15 p.m.

Lord Swinfen moved Amendment No. 17: Page 11, line 4, leave out ("197th) and insert ("365th").

The noble Lord said: My Lords, while an amendment debated earlier considered restoring the payment of benefit at 28 weeks, this amendment seeks to delay the application of the all-work test until long-term benefit is payable; that is, 52 weeks. The Bill redefines long-term incapacity from 28 weeks to 52 weeks, delaying the higher rate of benefit entitlement to a full year. As was debated during the Committee stage, people will receive a lower level of benefit between weeks 29 and 52 than is currently the case under invalidity benefit. However, long-term incapacity is now presumed to start after 52 weeks yet the new all-work test will be applied in most cases after 28 weeks of incapacity. This means that people who pass the test will be regarded as incapable of all work but not entitled to benefit for a further 24 weeks. That is quite extraordinary; quite, quite extraordinary.

During the Committee stage the Government reiterated that the definition of long-term incapacity is more reasonable at 52 weeks than at 28 weeks. There has been no convincing reason, as far as I can see, for this change. Since the introduction of a separate benefit —invalidity benefit—for long-term incapacity in 1971, "long term" has been defined as 28 weeks both for payment of benefit and assessment of incapacity. "Long term", I know, is a matter of imagination sometimes, but the Government seem to be changing definitions left, right and centre, rather like waiting for a No. 11 bus.

For the first 28 weeks incapacity is assessed against the person's usual occupation. Thereafter, alternative work is considered. This corresponds with payment of invalidity benefit after a period of 28 weeks on sickness benefit or statutory sick pay. While changing the definition of long-term incapacity for the purposes of incapacity benefit, a status quo of 28 weeks remains for severe disablement allowance. This is a long-term incapacity benefit for people without national insurance contributions and is payable in full after 196 days. It is therefore difficult not to escape the conclusion that the Government are choosing definitions which enable more money to be saved rather than genuinely focusing resources on disabled people who are unable to work.

The Government have said that payment of benefit is now to be divorced from the all-work test. The different rates of benefit were designed to reflect the cost of short and long-term periods of incapacity. And, to quote my noble friend Lord Astor, recorded at cols. 101–102 of the Official Report of 19th April: They are not in any sense a reward for passing the medical test. The rates of benefit and the test are independent of each other. If a link was intended, then the Bill would provide that the long-term rate of benefit was dependent on satisfying the all-work test". However, it is clearly within the power of the Government to reinstate the link between incapacity assessment and payment of benefit. How will my noble friend the Minister explain to someone who has been assessed as incapable of all work that he will have to wait 24 weeks for him to be paid at the long-term rate? I believe that both my noble friends on the Front Bench have children. They may promise them a pay rise in their pocket money on their 10th birthday but then turn round and say, "But you have to wait another 24 weeks before it will actually come through". That is not quite the same, and in no way would I say that disabled people are the same as children. But it is an example.

In Committee this amendment was moved and withdrawn. In replying to that debate my noble friend Lady Cumberlege referred to case law as determining the point at which an all-work test is to be applied. She said: In providing for two tests of incapacity in the Bill, we have used the case law as a basis. For the first six months of incapacity, therefore, the test will be the claimant's capacity to do his own job. Later, however, he will be tested against a wider definition, as the commissioners' decisions show. We considered that six months was a reasonable period to apply the 'own occupation' test".—[Official Report, 21/4/94; col. 322.] Later, in the same column, she added: In considering an unemployed person's availability for work, the Department of Employment allows only 13 weeks for the person to look for a job similar to his previous one; thereafter, he must consider all work". Subsequently, and again recorded in the same column, she said: Depending on its construction, a link would discriminate for —or against—those claimants who have not had a recent regular occupation and so who are not eligible for the 'own occupation' test, but will take the all-work test at the outset". My noble friend quoted case law which takes it that a period after which someone should be assessed against alternative work should normally be about six months, although there is no specified period. Case law in fact suggests a test of reasonableness. The commissioners have held that it is not normally reasonable in the case of short-term incapacity to expect a claimant to change his occupation. If incapacity is continued it may be reasonable to do so. Therefore, if it is reasonable to change the definition of short-term incapacity, the expectation of what type of job someone can undertake should follow the logic of case law and be consistent with what is defined as short and long-term incapacity.

Case law has not been consistently applied. The Department of Social Security has criticised it for having broadened and blurred the definition of incapacity for work far beyond the original intention. That was stated in a consultation document on the medical assessment for incapacity benefit. The Minister could—I only say "could"—be tempted to have it both ways by using case law selectively to support her claim.

There is no reason to link all work with unemployment benefit. Incapacity benefit will be payable to people who are unable to work because of sickness or disability. It is only right therefore that a longer period of time should be allowed before a person is in a position to consider alternative work. Unemployed people merely need to change their work search and expectations. Disabled people may need considerable treatment, therapy or retraining in order realistically to have the chance of alternative work.

The argument that linking the all-work test and the payment of benefit would discriminate against some people does not appear to have any greater relevance to this amendment than under the provisions of the Bill itself. Some people will go on to the all-work test immediately if they are not in remunerative work in eight out of the preceding 21 weeks. I beg to move.

Baroness Turner of Camden

My Lords, I support the amendment. As the noble Lord, Lord Swinfen, said, it was moved in Committee, but he did not press it to a Division. The noble Lord has gone over the ground in great detail in explaining what the amendment is about. I do not want to cover the same ground. There seems to be a very good case for the amendment.

As we know, the Bill redefines long-term incapacity from 28 weeks to 52 weeks. People in general will receive a lower level of benefit between 29 and 52 weeks than is currently the case with invalidity benefit. We knocked a hole in that proposal to some extent by the victory we had on Amendment No.6. Nevertheless, many people who pass the new all-work test, which will be applied in most cases after 28 weeks of incapacity, will he regarded as incapable of all work but not entitled to benefit for a further substantial period. As the noble Lord, Lord Swinfen, said, it seems a little bizarre. I am certain that it will not make any sense at all to the people who come up against the legislation—unless we can somehow change it.

I have looked again at the noble Baroness's reasons for not accepting the amendment on the last occasion. I have re-read Hansard. I do not find what she had to say then acceptable. I really do not see why people are to be disadvantaged in a way which they would not be with invalidity benefit. The only reason which honestly appears to me to be one underlying all this is the desire to save money. I do not find that acceptable. I believe that many of your Lordships do not find it acceptable to have legislation which seeks to save money at the expense of people who are incapacitated for whatever reason.

I agree with the noble Lord, Lord Swinfen, when he says that it is not the same as unemployment. Of course it is not. People who are incapacitated are looking at a very different work situation to that confronting people who are unemployed or who are simply seeking alternative employment if they have lost their jobs. I therefore hope that the noble Baroness will be more sympathetically inclined to this amendment than she was in Committee. I support the amendment.

Baroness Darcy (de Knayth)

My Lords, I wish briefly to support the amendment. The noble Lord, Lord Swinfen, who introduced it so ably, said that he felt that it was extraordinary that someone who passes the test of being incapable of all work at 28 weeks nevertheless will have to wait a full year on the lower level of benefit before he or she can be paid the higher rate. I agree. It is very odd when one considers that the Department of Employment has given its full support to a scheme of disability leave, initiated by the RNIB and piloted by a number of major employers including the Midland Bank, Barclays Bank and McDonald's, which recommends that an employee who becomes disabled at work should be given up to a year's leave in which to adapt to the disability and to learn new work and daily living skills required to manage the disability. Insisting that a disabled person is assessed on the all-work test after only 28 weeks undermines the whole concept of disability leave—a concept endorsed by the Department of Employment. I agree that that is extraordinary. As the noble Baroness, Lady Turner, said, I hope that the Minister will look kindly on the amendment.

Earl Russell

My Lords, I too support the amendment. The adventures of someone seeking incapacity benefit might be written up rather like those of an Arthurian knight suffering a series of misadventures one after another. When he gets to 28 weeks he thinks he has stormed the wall of the castle. What he has done is get into the barbican and when he is there he is under fire from all sides. I support the amendment very warmly.

Viscount Astor

My Lords, the noble Earl raises the idea of the Arthurian knight. Under the old rules of invalidity benefit that knight might be told that he was then able to do rather bizarre jobs which might not suit him. The whole purpose of the incapacity benefit and the new test is that these things do not happen.

The amendment was previously raised by my noble friend in Committee. As my noble friend explained then, the rate of benefit payable and the assessment of incapacity are two separate issues. The Bill before your Lordships proposes that where a person has had a regular occupation, the all-work test shall be applied at the 29th week of incapacity. Until the 29th week, the own-occupation test will be applicable. This is intended to reflect the current system. The present law provides that the test of incapacity for work is capacity to do work which a person can be reasonably expected to do. Decisions taken by the social security commissioners have held that where capacity for work is only temporarily impaired, this means assessing a person's capacity for his usual job. In such circumstances it would not be fair to expect the claimant to change his usual occupation. In time, however, it is reasonable to measure his incapacity against a wider field of work.

In providing for two tests of incapacity in the Bill, we have used the case law as a basis. For the first six months of incapacity, therefore, the test will be the claimant's capacity to do his own job. Later, however, he will be tested against a wider definition, as the commissioners' decisions show.

We considered that six months was a reasonable period to apply the own-occupation test. In considering an unemployed person's availability to work, the Department of Employment allows only 13 weeks for the person to look for a job similar to his previous one; thereafter he must consider all work. Were we to extend the qualifying period for the all-work test, it could mean that, for example, a diver blind in one eye who was perfectly fit in all other respects would continue to receive incapacity benefit for a whole year before the all-work test was applied. He would clearly be unable to return to his own occupation, but on no basis could he or should he be considered incapable of all work.

The second issue is the linking of benefit rates to the application of particular tests. We have deliberately sought to keep these two areas separate because they are different. It is not the case that passing a certain test brings a higher or lower level of benefit. Depending on its construction, a link would discriminate for or against those claimants who have not had a recent regular occupation and so who are not eligible for the own-occupation test but will take the all-work test at the outset. This is not our intention. Benefit rates are designed to be linked to the length of a person's period of incapacity and the needs arising therefrom.

The all work test is an assessment of capacity to do a range of work—that is, all work—it is not a test of long-term incapacity. The test assesses the extent of incapacity rather than the length of incapacity. My noble friend Lord Swinfen asked how one can relate the three benefit rates: the long-term benefit rate; the short-term rate and the higher short-term rate. I think that we have already had that debate when we considered Amendment No. 1, which your Lordships rejected earlier. We believe that 52 weeks is a more appropriate definition of "long-term incapacity". Within the first year of sickness, many people can and often do return to work. After 12 months, return to work is less likely and the benefit structure rightly reflects that. I hope that, with that explanation, my noble friend will withdraw his amendment. I cannot advise your Lordships to accept the amendment.

7.30 p.m.

Lord Swinfen

My Lords, I shall read with interest what my noble friend has said. From what I have understood from listening to him, I am not sure that he has convinced me. He has taken a particularly exceptional case—that of a one-eyed diver. Yes, I agree that a one-eyed diver, working at very considerable depths around the footings of a North Sea oil rig and with the valves on the sea bed, would probably not be able to do his work. However, I would not be at all surprised if during that period of incapacity he did not go diving in the Mediterranean, with his one eye, purely for pleasure—but not at such great depths. I was thinking of rather less specialised forms of industrial injury, such as the case of someone who has a heart attack and who will take some time before being able to return to his own work. If my noble friend, God forbid, were to have a heart attack, he would be off work for, say, six months, but he is a capable Minister and I can see no reason why he should not return to his job after six or nine months.

I feel that I must give the matter more consideration between now and Third Reading and I hope that my noble friend will do the same. However, I reserve the right, having given the matter that extra thought, to return to it on Third Reading. With that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Viscount Astor moved Amendment No. 18: Page 11, line 31, at end insert: ("( ) Provision may be made by regulations as to the application of this section in cases where a person engages in more than one occupation or in different kinds of work.").

The noble Viscount said: My Lords, this amendment clarifies the application of the own-occupation test at the onset of incapacity. As your Lordships may realise, we intend that, for the first 28 weeks, a person's incapacity should be measured against his own occupation. We therefore require a definition of "own occupation".

When we looked again at Section 171B, it was not clear whether we had the necessary powers to include certain people within the provision. The amendment ensures that we do have the necessary powers to do so and I commend it to your Lordships. I beg to move.

On Question, amendment agreed to.

Viscount Astor moved Amendment No. 19: Page 11, line 33, leave out (", in such cases as may be prescribed,").

The noble Viscount said: My Lords, I spoke to this amendment with Amendment No. 7. I beg to move.

On Question, amendment agreed to.

Viscount Goschen

My Lords, I beg to move that further consideration on Report be now adjourned. In moving this Motion, I suggest that the Report stage begins again not earlier than 8.35 p.m.

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