HL Deb 20 April 1995 vol 563 cc646-94

House again in Committee on Clause 1.

[Amendment No. 7 not moved.]

Baroness Dean of Thornton-le-Fylde moved Amendment No. 8:

Page 1, line 20, at end insert ("or is studying for less than 21 hours per week").

The noble Baroness said: In moving Amendment No. 8 I wish to speak also to Amendments Nos. 61A and 61B. This amendment seeks to confirm the present entitlement; that is, 21 hours of study, and it will remove the provision of 16 hours of guided tuition which the Government wish to impose. It is alleged that the present 21-hour rule is not applied consistently throughout the country. We accept that that is the case. Certainly there have been many complaints about that. However, we do not believe that reducing the provision from 21 hours of study to 16 is the way to deal with that kind of inconsistency. Although this is not an issue which will necessarily require a long debate, it is a fundamental issue and it goes to the heart of the Bill in that the Government's declared intention is to get people in Britain out of unemployment and into work. I do not believe that the Government's wish to reduce the hours of study to 16 will in any way assist that situation. While I accept that there are different points of view as regards whether some people will lose and some people will gain from the provision, those involved in education have said that about 36 per cent. of people will be discouraged from taking courses. Individuals will be discouraged and so will employers.

In the UK there is an increasing problem of long-term unemployment, especially among men. Some 21 per cent. of the unemployed have no qualifications at all and 38 per cent. of the long-term unemployed—over 400,000 of them —have no qualifications. The Bill does nothing to address that problem and yet it is supposed to be a Bill which is trying to encourage unemployed people to get back into work. I would suggest also that the Bill does nothing at all to rectify the skills shortage. In some areas of work there is a real skills shortage. There are not enough people to fill those positions and now it appears that training will be cut back.

A wide range of reports from within the UK and from outside —and indeed the Government's own statistics on this are perfectly clear—show that the qualifications level in this country is low. Where there are low qualifications, there is high unemployment. People are increasingly vulnerable to unemployment. The CBI report Tackling Long-Term Unemployment, the work done by the TUC, the universities, the Institute of Personnel Management and indeed other organisations and the OECD report or the ILO report all show that those countries which invest most in education and training have populations with better employment prospects. That is at the core of this Bill. We do not understand why the Government wish to move away from that and have at the same time, in parallel, cut back considerably on the training places available.

Statements by the Minister in another place give little comfort in this area. People will be forced out of education and into low-paid jobs because they will be required to take any job no matter what that job pays. Low pay is a substantial problem in Britain. Some 328,000 people earn less than £1.50 an hour and over one million earn less than £2.50 an hour. The only way we will begin to rectify that problem is by encouraging more people to take better training and be better educated. In that way they will have some chance of getting back into the work market and having better job security. It would be better investment in the individual, it would be better for the taxpayer and it would certainly be better for the employers in Britain to have a workforce which is skilled.

With that philosophical approach, underpinned by a Bill which will make that a reality, I believe we will begin to make some progress. This Bill does not do that. It is regarded by people who are unemployed as mean and penny-pinching. It is a Bill which neither gives them encouragement nor practical help to get themselves off the unemployment list and back to work. I beg to move.

Baroness Nicol

So much unease has been expressed about this particular provision in the Bill that I wonder whether the Government consulted the training providers about the possible effects of what they propose. If they did, what was the result? Are they able to tell us?

I am very impressed by the evidence from the Association for Colleges which supports the view that helping unemployed adults to study benefits both them and society as a whole. By gaining new skills and refreshing old ones, as my noble friend on the Front Bench said, the unemployed can be helped back into the job market. I have heard spokesmen from the Government Front Bench say that so often that I wonder whether they have thought through the consequences of what they suggest with this provision.

The Association for Colleges says that the changes will introduce new inconsistencies and confusion and lead to thousands of adults being forced to give up their study, thereby undermining their attempts to return to the workforce.

I have also heard from the British Retail Consortium, which normally supports most of the Government's actions. It is very concerned about the effect that this provision will have, particularly on part-time workers. In a letter to me the consortium says: Recent discussions with TECs have indicated that there are already insufficient training for work weeks for those currently seeking training opportunities and those weeks which are available are being offered to those looking for full-time work. Consequently, we believe those seeking part-time work who require training could already be experiencing difficulties… There is therefore a real concern that if TECs have less hours to offer they will be less inclined to part fund part-time courses and the NRTC's entitlement to apply for EU funding for training will be lost without equal funding from TECs, thereby reducing opportunities to offer training for retail skills to those who seek part-time employment within the industry". The Committee will appreciate that a vast number of jobs in retailing are part-time. Without those part-time jobs, for which a considerable degree of skill is needed in some cases, the industry would be in difficulty.

The BRC makes a second point. Retailers are seeking clarity as regards the number of hours which the unemployed will have actively to seek work in order to qualify for the JSA, and would be grateful for assurances that if those people who want part-time work sign up for part-time training courses of 16 hours a week they will still be eligible for JSA.

I very much support the amendment moved by my noble friend. I hope that the Minister will have second thoughts on the issue.

8.15 p.m.

Earl Russell

I should like to thank the Ministers for their courtesy in giving us a meeting on this issue and for listening very sympathetically and helpfully to what we had to say.

There is a substantial measure of common ground between us. We are agreed that we welcome the unemployed undertaking study in order to increase their qualifications. I think that we agree that the issue of benefit for full-time students, whatever we think about it, is not involved in this Bill or this amendment. I think that we agree that there is difficulty in working out how a distinction should be made between some students who are eligible and some who are not.

I understand that the Government have had difficulties with the old 21-hour rule. They will have at least equal difficulties with the new 16-hour rule. In my view, particularly since the modularisation of courses, a distinction by hours is not viable for the reason, among others, that it does not work equitably between subjects.

There is also a cultural problem of interface between the Benefits Agency, the Employment Service and the institutions. If there was any room for concession along that cultural interface that would be very welcome indeed.

Meanwhile, I understand that this is a point which does not require primary legislation. For all I have said, I perfectly understand that flexibility has advantages as well as disadvantages. This is a matter which does not have to be settled finally now, and I ask the Minister whether he can undertake that if between us, perhaps in consultation with the Association for Colleges, we could find a better way of making a distinction he would be prepared to listen and see whether we could do anything about it.

Lord Mackay of Ardbrecknish

Perhaps, with the indulgence of the Committee, I may say a few words harking back to what we discussed before the dinner break, when I answered a number of interventions which came fairly thick and fast from the other side of the Chamber, to make sure that I got one point exactly right.

That point concerned the clarification of arrangements for hardship payments for disabled people who fail the availability requirement for JSA. As I explained, where claimants fail the availability test but fall into a vulnerable group they may have access to hardship payments. However, if a person does not fall into a vulnerable group he can have access to hardship payments only if the adjudication decision takes longer than two weeks. He can then receive payments while awaiting that decision. However, once an adverse decision has been reached, a claimant who is not in a vulnerable group will not have access to payments and must make himself available for work.

Baroness Hollis of Heigham

There may not be very much between us if the Minister were able to remove the two-week provision for those people who, whatever the definition of vulnerability, move from incapacity benefit or have points which nonetheless fail to take them to the incapacity benefit level. Perhaps the definition of vulnerability could be expanded to include such people. That would meet the issue. Alternatively, the two-week rule would not apply to the group of people with points which are insufficient to qualify for incapacity benefit, irrespective of their family circumstances, such as having dependent children. If the Minister could move either way, that would meet a very worrying concern of some very vulnerable people who might not fit into tidy categories of what constitutes vulnerability. It would not be costly.

Lord Mackay of Ardbrecknish

I should like to study what the noble Baroness suggested and give some consideration to the alternative options that she suggested.

To return to the amendments in front of us, we recognise that undertaking courses of study can help unemployed people improve their employability and get back to work more quickly. That is why the Government are spending £574 million this year to provide 225,000 opportunities for training for work in England alone. We also continue to provide for people to study part-time while claiming JSA. Our proposals are designed to allow the same number of people to study part time while receiving JSA (about 80,000) as do so under the current rules, and to ensure that the rules can be administered fairly and consistently. I believe that it would set an unacceptable precedent to treat people as actively seeking work just because they were studying part time. Unemployed people are able to study only if they remain available for and are actively seeking work. It is not, and never has been, the purpose of unemployment benefit to support those whose first intention it is to study. While I appreciate that the noble Earl, Lord Russell, may not entirely agree with that proposition, he is at least prepared to accept that there is no point in reopening it so far as concerns the present argument.

We believe that it is entirely reasonable to expect someone who is claiming benefits as an unemployed person to seek a job actively. It is important that he maintains contact with the labour market. This will ensure that he is aware of any opportunities that are available. These principles apply to claimants studying part time as they do to others.

Perhaps I may set out the Government's proposals and look at the amendments in that light. In the further education sector, the definition of part time courses which we have used to date is no longer workable. The Further Education Funding Council now uses the concept of the guided learning hour. We have proposed a limit of 16 guided learning hours per week. A limit of 21 guided learning hours per week will mean a considerable increase in the number of people who are able to claim JSA, and of course in expenditure. We estimate that some 6,000 more people will be in a position to claim. If other benefits were in line with that, the additional cost would be some £40 million per year. The new rules that we are bringing in will produce a greater degree of consistency and clarity than is possible under the current rules.

Commenting on this, the Further Education Funding Council, as reported in The Times Higher Education Supplement of 17th February, said that 16 guided learning hours were broadly equivalent to the 21 hours of supervised study that currently applied. The point I have made is that the old system and the system that we have proposed will cater for approximately the same number—80,000. The report went on to say that the council thought the changes would probably be cost-neutral and would align the benefits system to the way courses are now delivered. They said: It clarifies the position for all students and will bring consistency to the decisions of local benefit offices. There appears to be a misunderstanding about the term guided learning hours. This terminology is used by the Further Education Funding Council for England as a basis for funding colleges for the courses they offer. A similar definition is used by the FEFC for Wales. The term has no meaning in Scotland or Northern Ireland. In England and Wales the definition of a guided learning hour will be that used by the FEFC. The arrangements for Scotland will be similar, but will need to reflect the education arrangements there. The Bill does not extend to Northern Ireland. It is not practical or sensible to use the same definition across the whole of the United Kingdom. This would create difficulties in applying the rules consistently and could lead to similar anomalies to those experienced under the present system.

There are one or two other amendments in this group. While I do not believe that anybody has spoken to them, I think it is only fair that I say one or two words about them. I refer to Amendment No. 61B. I understand the spirit of this amendment. It is important that guidance to staff on how to apply the jobseeking conditions, and indeed the other conditions for benefit, should be made available to the public so that claimants and advice bodies can fully understand their rights and responsibilities under JSA. That is an important part of open government. I can give an assurance that this amendment is unnecessary. The guide of the chief adjudication officer to adjudication officers in the performance of their functions is a document published by HMSO and available in libraries. The majority of ES internal guides on unemployment benefit and advice and services to jobseekers are also available to whoever wishes to consult them. The same approach is followed in the Benefits Agency. We intend to continue these open arrangements for JSA.

I turn to Amendment No. 73A. Your Lordships have heard me say that the Government keep all of their programmes and policies under review as a matter of course. That is prudent management. Therefore, I suggest that this particular amendment is unnecessary. Public expenditure and public policy must always be monitored to ensure that resources are focused where they are needed and that we get value for money.

The education sector is undergoing rapid development at present. There is rather a deficiency of detailed information about study while on benefit, and the advantages it may bring. It is therefore particularly important that we keep the rules in this area under close review. That we shall do. We shall make any particular results of such work available in the normal way. The changes to the rules on part-time study are intended to ensure that the rules can be applied consistently, and they have been carefully defined to ensure that the same number of unemployed people will be able to study as do so currently. The current regulations rely on education establishments defining their courses as either part- or full-time. This is no longer workable in the further education sector. The Further Education Funding Council funds courses depending on the number of guided learning hours students spend studying each week. That is why we have made changes to the rules for FEFC-funded courses. There will be no change for higher education and other sectors where the part-time definition is used.

I hope that with that explanation the noble Baroness will feel able to withdraw her amendment.

Baroness Nicol

Before my noble friend rises to speak, perhaps the Minister will answer my question about the degree of consultation that occurred before the changes were made. There appears to be a great deal of unease among training providers. It would be helpful to know whether they were consulted.

Lord Mackay of Ardbrecknish

I cannot give an immediate answer regarding the people who were consulted. One of the problems is that someone who feels that he ought to have been consulted and has not been is aggrieved. However, I can assure the noble Baroness that there has been consultation. The Further Education Funding Council has indicated that it feels that what we have arrived at will bring clarity for all students and is roughly the same as the previous position.

Baroness Dean of Thornton-le-Fylde

I thank the Minister for his reply. I should like to press him a little further on a number of problem areas. These matters arose at a meeting with the Minister the other day when he kindly said that he would look at these issues. Referring to those in work at the moment, a considerable number accept that they have to upgrade their skills. Many are in part-time education and also hold down jobs. That is to be encouraged and welcomed. When those people are made redundant—an example is the 150 redundancies declared today at the Financial Times—they register for work and find that if a job is offered they cannot refuse it on the grounds of the education course. They have to decide whether to give up the course or take any job that may be offered. That may be a false economy, particularly if the course will give them added skills so that they may get better forms of work. They will lose that investment in time and their commitment to it. That is a real anomaly faced by people in work today. I do not believe that the Bill deals with that situation.

Another anomaly arises where somebody says he wishes to go on a course and is prepared to pay for it. The money for that course may come from savings. It is quite often the case that a family member who has been unemployed for some time suddenly realises that the only way to get out of that situation is to gain added skills. He may go on a course. At the meeting that we had the example of the heavy goods vehicle licence course was referred to. One has to pay to get training to obtain a heavy goods vehicle licence. There is a whole range of other skills that can be acquired and paid for. Yet, if more than £100 is paid, the current interpretation placed upon it is that because of that commitment one is not available for work. That is a double-whammy in that sense. It penalises someone. It is a false economy for the taxpayer. It is a penalty on the individual who is prepared to give up his time and put his nose to the grindstone to try to obtain further skills so that he does not remain on the unemployed register.

I must press the Minister on those two points. Is he prepared to consider whether it is possible to deal with those kinds of anomalies, which are not individual examples but anomalies which genuinely arise and in considerable number in some areas?

8.30 p.m.

Lord Mackay of Ardbrecknish

As I explained, it is difficult to deal with individual cases without knowing all the aspects of the case. If an officer's view on a matter appeared to be wholly unreasonable, the claimant has the opportunity to appeal to another adjudication officer and up through the system. I should have thought that if it were wholly unreasonable, the first adjudication officer would see that. So I find it quite difficult to give cast-iron guarantees about hypothetical cases.

I have discussed the matter with officials since the noble Baroness and others came to see me. We find it difficult to create a case and make a decision about how an officer might deal with it. I find it a little hard to believe, if the HGV licence in question would clearly help that person get a job and do it reasonably quickly—I do not suppose that such courses are terribly long, although they may be very concentrated—that an employment officer would insist on desertion with a week or two to go when, on completion of the course, there was every prospect of a job.

It is not necessarily the case that every course will leave you in a far better position to get a job. There must be circumstances in which, frankly, taking the job on offer on that day or week gives a much better prospect of obtaining employment than continuing with the course to its end. The course may not in fact increase your chances so very much when it comes to jobs. It is difficult to say.

I should like to be more helpful, but these matters are difficult. One of the reasons why there are adjudication officers' guidance and other things all around the country is to enable these situations to be dealt with fairly. Frankly, I should be living in a totally unreal world if I were to pretend that occasionally mistakes are not made on either side of the divide. Sometimes people have remained in benefit who did not deserve to do so; at other times people may have fallen out who, equally, did not deserve to do so. We all know that, in any system which has to deal with the individual cases of people, those things are always likely to happen in a very small number of cases.

I should like to think that the officers of the employment agencies, with the background and all the guidance that they have, would take a realistic and fair view of the course continuing compared with the job offer. There is always the possibility and much more than the possibility—the prospect—that a person can redesign the time of attendance at a course in order to work and go to the course. The great majority of people in further education already do both. That is one of the strengths of the FE part of our system. It allows people to study and work at the same time. I believe that, even if somebody had to take up a job but wanted to keep on studying, there is every prospect that he would be able to, do so, just as some of the people beside whom he is working will equally be studying at the same time as they are working.

Earl Russell

Perhaps the noble Lord will allow me to say a few words. I believe that there are slightly greater problems here than the Minister suggests. For example, I know of a case in which someone was required to sign on 15 times a week. The problem here is that most people can only get hold of one idea at a time. Perhaps the Minister will remember the time when 16 and 17 year-olds were first disentitled from benefit. It used to be very difficult to get people to tell them that the right to severe hardship payments existed. In fact, in some cases they were told directly that they did not exist. That is because people had got hold of the idea that 16 and 17 year-olds were disentitled and that idea blotted out everything else.

I rather feel that what is happening here is that people have the idea that students are disentitled and do not think beyond that to all the complexities of which of them is disentitled and which not. A little more guidance in this area might possibly he useful.

Lord Mackay of Ardbrecknish

I am very clear in my own mind that if someone is genuinely undertaking up to 16 hours' guided learning, which it is perfectly legitimate for them to do, it would be unreasonable for an officer to ask him to come 15 times, especially if those times coincided with his study times. That would be unreasonable. I shall discuss the matter with officials to see whether somebody would, indeed, be able to do that. Of course, they may have considerable suspicion that there was a lot more to "study" than study, but that of course is another matter.

Baroness Dean of Thornton-le-Fylde

I do not accept the statements made by the Minister. With all due respect to him, it betrays a lack of knowledge of what is going on in the real world. I do not mean that in any offensive way. The fact is that working patterns have changed considerably. To say that someone could go in to work and be on a course at the same time is not necessarily the case. I chose those 150 workers from the Financial Times because they are a very good example of that. Their normal pattern is to work at night time. If unemployed, they would no doubt go to the unemployment office and sign on. They could well be offered a job with work during the day. That is my point. Someone could be a half or two-thirds of the way through a course and have to give it up because the work that may be available—if there is any available—does not fit into the course time. It is a reality.

When the Bill was discussed in the other place, the government Minister was absolutely clear in her statement to that Chamber. She spoke of: part-time courses provided that they"— "they" being the unemployed persons— remain available for, and actively seeking, employment"—[Official Report, Commons, 21/3/95; col. 133] I do not know many employers who would interview an unemployed person and take him into employment if he said, "By the way, I go to college two half-days or two days a week." In today's job market, the reality is that the employer would say, "Good luck to you, but that's not good enough to me. I need someone who can be here for the hours that I want him. I do not have any commitment to you as an individual."

The Minister, when discussing this matter in the other place, went on to speak of: the increasing flexibility of modern courses, to combine work and study. But it will continue to be the case that claimants may not turn down or refuse to apply for a vacancy notified to them merely because it conflicts with their course of study".—[Official Report, Commons, 21/3/95; col. 134.] For instance, does the heavy goods vehicle driver give up the course? Does the print worker who has paid for a course in modern technology for transferable skills give up the course and become unemployed, staying on the job register in a contracting market? Does the young woman who has paid fees to attend a course to learn other skills to make sure that she can stay in work or get new work, give up the course? I do not press the Minister through any flight of fancy. These are the realities of the job market today.

I ask the Minister if he is prepared to consider whether anything could be done to ease that situation at all.

Lord Mackay of Ardbrecknish

I do not think that I can go any further. There may be a fairly deep chasm between us on this matter. I take the view and have expressed it on a number of occasions that everybody on JSA is there because he is available for work and actively seeking it. The 16-hours' guided learning, as the 21-hour rule was, is a concession to encourage and help those people who wish to study. But I do not believe that we can set aside the principal reason why someone is on JSA —namely, that he is looking for a job—and if a job comes up, he should take that job. I do not think that we should set that aside in order to allow those people in all cases to continue to study. That, I am afraid, goes very close to actually having a special group that are no longer expected to be available or actively seeking work. I think that gets us into much more difficult territory, in which I accept there is a deep division of opinion between the two sides of the Committee.

Baroness Dean of Thornton-le-Fylde

The Minister is right: there is a major division of opinion, and whereas the Jobseekers Bill is there for people available for work, it also has provision within it for exclusions for individual categories. It is one of those categories I am talking about this evening. I hear what the Minister says and I will obviously read his exact words in Hansard. I will not press this amendment at the moment, but I shall wish to come back to it at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 9 not moved.]

Amendment No. 10 not moved.]

Clause 1 agreed to.

Clause 2 [The contribution-based conditions]:

Lord McCarthy moved Amendment No. 11:

Page 2, line 12, leave out ("two complete years") and insert ("complete year").

The noble Lord said: This is the most reasonable of all the amendments put forward from this side of the Committee. Simple equity demands that this amendment be accepted. There are in fact three amendments which are linked: Nos. 11, 12 and 14. The substance of what I am suggesting is that because the benefit period has been cut in half the contribution period should be cut in half. Instead of having two complete years, we should have one complete year —the last complete year—and as long as the applicant for benefit has one year's contributions he gets six months' benefit. As I say, I shall find it hard to understand how on earth the Government could resist this amendment, but of course I hope they will not resist it.

It must be stressed that a number of things are happening as a result of what the Government are intending to do. I would ask your Lordships to remember what is happening. As a result of halving the period in which the unemployed person gets unemployment benefit, for example, a person with a working partner loses £1,200 as a result of the Government's proposals and a person with a non-working partner and savings of £8,000 will lose £2,700. That is the effect of cutting the benefit period in half. We know that since 1979 there has been a strong and steady reduction in the value of the benefit. In 1979 the benefit was worth 31 per cent. of average earnings, and now it is worth 14 per cent. of average earnings. So, even if the Government have not decided to cut benefit in half, the value of the benefit is reducing steadily and no doubt if the Government were to stay in office for a lengthy period it would be reduced still further.

However, naturally enough, the contribution rate continues to rise, It has just been increased from 9 per cent. to 10 per cent., and so we have a consistent reduction in the value of the benefit and an increase in the contribution rate required to produce that benefit. Now we have a sudden cutting in half of the benefit period and people are being told that for the succeeding six months, or whatever, they must go on to a means-tested benefit. I will not go through all the consequences of that. This matter has been dealt with in other amendments by other people at other times. The question is: how can it be defended that the period of contribution should not be reduced when the period of benefit has been reduced? That is the argument behind this amendment and I look forward to hearing what the Government have to say. I beg to move.

8.45 p.m.

Lord Mackay of Ardbrecknish

The noble Lord, Lord McCarthy, certainly started off in a very optimistic state of mind, and I hope I shall not disappoint him too much. This is one of a series of amendments which is really moving towards the principal amendment which, I do not doubt, the Opposition wish to move regarding the reduction of the period for unemployment benefit from a year to six months. The reality of the job market is that today something like two-thirds of people looking for work find a job well within six months, and indeed many people, because of their family situation, are eligible for income support at present rather than unemployment benefit, because in fact unemployment benefit does not give them as much as income support would give them in their particular family situation.

The noble Lord made the point I expected—I thought it might come a little later—that if you have reduced the period from 12 months to six months then you ought in some way to reduce some other part of the equation, so to speak. But of course national insurance contributions pay for a great deal more than just unemployment benefit, or in the future for JSA. They pay, for example, for pensions and a very significant part of the benefit system. I do not myself believe that you can trade off one benefit against a contribution without actually looking at the total amount that we all pay for the potential benefits that we get in return for paying our national insurance contributions.

It is not an assurance: people do not necessarily get out of it what they put into it. Probably all that many people get out of it is their retirement pension, and in some ways they are fortunate. Those who are perhaps less fortunate become ill or unemployed and they have to fall back on the benefits that are there under the national insurance system. But there is not a direct link between the contributions paid and the rate or length of entitlement to benefit. It is not a personal insurance scheme. Even the people who become unemployed and find that the benefit is only for six months and not for a year will perhaps in the fullness of time be claiming the not insignificant benefits that arise from old age pensions, retirement pensions and the like.

So while I think it is a nice argument that the noble Lord has used, I do not really think it is one that the Committee should take on hoard. We shall probably return to other parts of this debate but I think that Amendment No. 12 is linked with this one and perhaps I could say a word or two about it because it addresses an important point. It would remove the need for contributions to have been paid before a claim for jobseeker's allowance is made. The effect of that would be that a small number of people could simply pay the contributions when they make the claim, and thus satisfy the contribution condition. I think it could be open to abuse in a small number of cases where people pay their own contributions. I did wonder if there was a concern here about people who perhaps found that, although they thought their contributions were being paid—they had certainly been stopped from their wages—in fact that was not the case.

I can assure the Committee that that is the concern behind Amendment No. 12. This clause allows contributions to be treated as paid. It protects an employee whose employer has evaded his national insurance responsibilities without the employee's knowledge. This could occur, as I have said, if a person dealing with national insurance contributions is dishonest or if an employer has gone into liquidation and cannot meet his national insurance obligations. In such cases, if there is no negligence on the employee's part he is not penalised and his contributions arc treated as having been paid. I thought I would say that, because Amendment No. 12 could have been directed at that concern. I hope, that although I did not need to say what I said, I have allayed at least one concern, even if I might not perhaps have entirely satisfied the noble Lord's optimistic view at the beginning of his contribution.

Lord McCarthy

I am glad the noble Lord referred to Amendment No. 12; we shall come to that in a moment. I said that I could not imagine what the Minister would say, but I did not imagine that he would say nothing. But that is in fact what he said. I shall not go into it now—it is far too late—but at one stage he said that two-thirds of the unemployed are not long-term unemployed, which means that one-third are. He said that they are better off on means-tested benefits. I do not believe he meant that, but that is what he said.

Lord Mackay of Ardbrecknish

In fact there are circumstances—for example, where there is a spouse and children—when a person may find that he receives more money on income-related benefit than on unemployment benefit. In certain circumstances they are able to do that. Not everybody in the first 12 months currently receives only unemployment benefit. Many receive income support because that is a fairer benefit for their circumstances.

Lord McCarthy

I thought that income support and unemployment benefit were obtainable now. In fact the Government are taking them away. Is that not right? I am sure we can agree that few people will be better off on income support.

The Minister said also that we should not worry about comparability between what people pay in contributions and what they receive in benefits because there is a kind of cross-subsidy. The Government are cutting the benefit in half but the contribution is exactly the same. Nevertheless, they say, "Never mind, you may receive an old-age pension". That appears to be their justification. I do not regard that as an appropriate argument.

The Minister says that there are certain overall benefits to be obtained from this system. We all know what they are. The Government are doing this to reduce expenditure in the hope that they can justify a round of tax cuts. At the end of the day that is what will happen. So in fact there are no benefits for people who will one day receive the old-age pension. It seems perfectly reasonable to us that, if a benefit is cut in half, the contribution should be cut in half or at least reduced.

We cannot see the reason for the provision to which Amendment No. 12 relates. We do not believe that the Government think that there really is any case. The Government do not give examples. Where is the circumstance when somebody somehow pays in a sum of money in the last week to pay themselves into a benefit? Why do not the Government give examples? An issue of this sort must be based on the belief that there is observable, clear misuse of the benefit; that there are a range of people who at the last minute come along and pay up their benefit in the last week. If that is so, why do not the Government stipulate two or three weeks or perhaps a month? Why do we have this strange provision that one cannot get out of being disentitled to a benefit by paying the money in during the last week? I do not believe that those circumstances will ever arise. Unless the Government can give me an answer to that question, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 12 not moved.]

Lord Carter moved Amendment No. 13:

Page 2, line 24, leave out ("25") and insert:

("(i) in the case of a person aged 25 or over, 25; and
(ii) in the case of a person aged under 25, 20").

The noble Lord said: In moving Amendment No. 13 I shall speak also to Amendment No. 15. When introducing the last group of amendments my noble friend Lord McCarthy said that they concerned a matter of simple equity. These amendments are even more simply equitable than the previous group and I hope we can convince the Minister of that.

The purpose of the amendments is to adjust the contribution conditions for jobseeker's allowance for the unemployed aged less than 25 to reflect the lower level of benefit that they will receive in return for those contributions. We believe that because they receive less they should pay less. It is a matter of simple equity. I am not sure that the Government fully understand that concept. The Labour Party believes in the ultimate perfectibility of man and will continue to try to convince the Government of that.

We want to ensure that the rules which govern entitlement to jobseeker's allowance are fundamentally fair. Unless the existing rules are reviewed, young people who become unemployed will find themselves, having worked and having paid the same level of contribution as older people, receiving less benefit in return. That is not equitable. The amendment will ensure that the contribution conditions of the jobseeker's allowance for young people reflect the lower rate of benefit to which they are entitled. We know why there is a lower rate of benefit; it is for no other reason than to save money.

Under the jobseeker's allowance it is proposed that unemployed people under the age of 25 will receive a lower rate of benefit which will be paid at the same rate for this age group as income support. Thus, at the 1995–96 rates, an unemployed 24 year-old will receive £36.85 per week in jobseeker's allowance as opposed to £46.45 for a 25 year-old —a difference of 20 per cent. or a £520 25th birthday present.

The Government accept the general principle of paying less benefit to unemployed people under the age of 25. All the evidence we see from the CAP and elsewhere indicates that their cost of living—and this is a matter of pure common sense—is no lower than for those aged over 25 and the lower rate of benefit will cause severe hardship. It will make it much more difficult for those people to seek work. The CAP provided us with examples. I shall not take up the time of the Committee by going through them, but there are extremely worrying cases.

While the rate of the jobseeker's allowance for the under-25s will be significantly reduced, the amount that they pay in national insurance contributions remains unchanged. It means that young people will be paying more than those aged over 25 relative to what they receive in return. The amendments seek to reduce the contributory conditions for under 25 year-olds and the proposed reduction to correct the imbalance is 20 per cent.

On the broader issue of allowances for people under 25, the Government may justify the lower rates of benefit for that age group on the basis that they do not have the same earnings expectations and commitments as those who are older —that is what the noble Lord, Lord Inglewood, said at Second Reading. However, we all know that a young person living independently has the same needs as somebody who is older. A person's 25th birthday does not alter the level of expenditure. Bills for food, electricity, gas and water are no higher for somebody aged 26. The lower wage levels do not justify a rate of benefit which is below survival level.

The Government may argue also that there has never been a direct relationship between what people pay in national insurance contributions and what they receive in benefits. That will not surprise us; the Bill is all about removing by statute the rights to benefit which people thought they were paying for while they were working. Unless the contribution rules which govern the entitlement to JSA are reviewed, young people who have worked or paid at the same level of contribution as older people—who have paid the same amount into the system—will in fact receive a lower rate out of the system if they become unemployed. The amendment seeks to reflect the lower rate of benefit by making their contributions more equitable.

Unless the Minister, when he replies, can explain the rationale for the reduction for those under 25, we can only conclude—I think we know the answer already—that the issue is about saving money and has nothing to do with the real needs of individuals who find themselves unemployed. The amendments seek to reduce the contributory conditions for the under 25 year-olds under the JSA to make them proportionate to the lower rate of benefit which that group will receive. The amount of contribution with which the person will have been credited will be reduced. The amendment proposes a reduction of 20 per cent. to reflect the lower rate. The figures justify that in terms of return for the contributions which have been paid. It is a matter of simple equity. Those two words have not convinced the Government so far, but I hope that in this case, where the argument is so strong, the Government will feel minded to accept the amendments. I beg to move.

9 p.m.

Lord Mackay of Ardbrecknish

As the noble Lord, Lord Carter, explained, his amendments would reduce the amount of national insurance contributions someone aged under 25 will have had to have paid, or been credited with, in order to receive a contribution-based jobseeker's allowance. Our proposals to pay lower rates of benefit to young people are not a breach of the contributory principle: the national insurance scheme is a pay-as-you-go scheme. People are not paying in specifically to fund their own benefit, and there is no direct relationship between the contributions paid by an individual and his personal level of benefit. It is an established principle that Parliament can alter rules of individual benefits and adapt them to meet current needs.

JSA is about bringing together two benefits—unemployment benefit and income support. It is a well established feature of income support that young single people receive a lower rate of benefit. Under JSA we will be adopting the same treatment for all unemployed young people.

The lower benefit rates recognise the fact that younger people generally have lower earnings expectations and commitments. The average earnings for the 18-to-24 age group are less than two-thirds of the average for all adults. However, I say to the noble Lord, Lord Carter, that those who are not living at home and are on their own—many in this group are still living at home—are eligible for housing benefit and council tax benefit. Young people who have families can claim income-based JSA and get the same rate of benefit as any other family in the same income circumstances. There are ways in which young people in such circumstances can receive benefit at the same level as those aged over 25 years. If they are in circumstances where they are eligible for HB and CTB, they get those benefits without any reduction.

The main point I wish to make is that in the job market the average earnings for those aged between 18 and 24 are less than two-thirds of average adult earnings. I believe that that is a sensible reflection of the rules of the current income support system and more adequately reflects the reality of the job market in which young people are working or are trying to find jobs.

Lord Carter

There are two points on which I can agree with the Minister. It is clear that the Government can alter the rules, and they are doing that with this Bill in the way in which they have reduced the period of time from 12 months to six months before JSA becomes applicable. As we know, this rule is designed, as the Minister said, to meet the current needs, and those are the needs of the Government to fund tax cuts. I can see that I shall be unable to change the Minister's mind. We may wish to come back to this matter at Report stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 14 and 15 not moved.]

Baroness Hollis of Heigham moved Amendment No. 16:

Page 2, line 32, leave out from ("Act") to end of line 33.

The noble Baroness said: We want to know why there is a different definition of the benefit year than in the usual social security benefit legislation. We worry that them may be some malign intention in terms of needing to build up contribution records. I beg to move.

Earl Russell

I too would like to ask one or two questions about this matter. This issue looks to me suspiciously like a Henry VIII clause. It creates a power to alter by regulation something which is in primary legislation. I understand that it follows Section 21 of the Social Security Contributions and Benefits Act 1992. It has the same power in that legislation because it states: 'Benefit year' may by regulations be made to mean such other period (whether or not a period of 12 months) as may be specified in regulations". It sounds to me like a Henry VIII clause. Clearly, it has been approved by Parliament in the past, so one presumes that there must have been a reason for it. Can the Minister tell me, first, why he needs this power and, secondly, why it was necessary to repeat it.

Lord Mackay of Ardbrecknish

The noble Earl, Lord Russell, rightly identifies Section 21(6) of the Social Security Contributions and Benefits Act 1992 as having similar wording. I can take him further back and suggest that the consolidation Act of 1975 also has the same wording in it. Therefore, the wording has been in legislation for quite a long time.

The purpose of the whole clause is to set out the contribution conditions that the claimant must satisfy. There are some complicated terms in it such as the "relevant tax year" and the "benefit year". It is the latter that we are talking about. To get us into the feel of it, the relevant tax years are the two complete tax years which end on 5th April before the benefit year in which the jobseeking period begins. The benefit year is a calendar year starting on the first Sunday in January.

We intend that the "benefit year" should have the same meaning for the contribution-based jobseeker's allowance as it has currently for unemployment benefit—in other words, the calendar year starting on the first Sunday in January. The subsection would allow for the term to be redefined in regulations if that is ever thought necessary in the future. That would be important if the definition of "benefit year" were changed for the purposes of other contributory benefits.

Having this power avoids the need for primary legislation to achieve what would perhaps be a simple technical change of an alignment nature. I can assure the Committee that the provision has been on the statute book for many years and that neither governments of the Right nor the Left have used it in any devious ways: in fact, I do not think that they have used it at all. However, I believe it is sensible to have this means of changing the definition if ever it becomes necessary to align it with changes that have been made elsewhere in the benefit system for other reasons.

Baroness Hollis of Heigham

With that reply from the Minister I would hate to break a long hallowed and well-established tradition. I shall clearly want to read what the Minister has said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Carter moved Amendment No. 17:

Page 2, line 37, after ("period") insert ("to include any period of incapacity for work, itself not interrupted by a period of more than twelve weeks").

The noble Lord said: This amendment is concerned with the linking period of up to 12 weeks for someone who experiences periods of incapacity and is receiving JSA. We know that it is not uncommon for people to have periods of unemployment and periods when they are incapable of work. Indeed, according to DSS research on invalidity benefit, almost one in five people on that benefit have spent some time signing on in the previous two years.

Both unemployment and invalidity benefits could link together to form one period of interruption of employment known as PIE. That means that someone whose invalidity benefit had been withdrawn could sign on as unemployed. If they subsequently fell ill, they could go straight back onto invalidity benefit without having to re-qualify for sickness benefit.

PIEs have also been important for people re-qualifying for invalidity benefit, as it is the first day of PIE which determines the rate of allowance. We know that the Social Security (Incapacity for Work) Act, with which a number of us were involved, replaced PIEs with periods of incapacity for work (PIWs). I cannot think of a convenient acronym for PIWs which does not sound rude. Therefore, I shall have to say "PIW" each time. PIWs change the relevant contribution years for incapacity benefit. In the future, it could be more important for people to link PIWs as it will take 52 weeks to requalify for the higher rate of incapacity benefit.

We know that the Bill removes the reference to the specific period of eight weeks which was used before, and instead refers to a "prescribed period". We feel that there are sound reasons to have a longer linking period between PIWs so that people who are trying out work do not lose out. There, is already a precedent in the linking rule of two years to enable people claiming the disability working allowance to requalify for their previous levels of invalidity benefit.

The DSS Research Report No. 19, which has been referred to in connection with other amendments, was a survey of invalidity benefit recipients. It showed an increase in the invalidity benefit caseload as a result of people spending longer on that benefit, rather than because of an increase in the number who are claiming for the first time. Over three-quarters of long-term IVB recipients surveyed no longer saw themselves as attached to the labour market in the sense of looking for work, planning to look for work or thinking that they could look for work.

The amendment is directed at long-term recipients of benefit and will positively encourage individuals to try out employment and to move off benefit altogether. We know that Mr. Lilley stated on 24th January 1994 that the Government want to help people back to work, adding that many people who receive incapacity benefit would prefer to work. We can all agree with that. We want the process to work more easily.

I believe that in Standing Committee in the other place the Minister indicated that he would look at the whole question of linking rules in the longer term. He observed that the amendment that was moved there—it was similar to this—would almost certainly have resulted in some savings. I should have thought that that would be attractive to the Government. Indeed, we have had some easement of the linking rules for specific groups of claimants. We know that the period will increase from eight weeks to 12 for people on training courses. However, a similar concession was not given with regard to incapacity benefit, which means that thousands of sick and disabled people will be caught permanently in the benefits trap.

The amendment would encourage people to consider employment and would enable them to attempt it in either the short or longer term. It would appear to be a no-cost amendment but could, in fact, produce considerable savings by enabling individuals to come off benefit and become economically active once more. I hope that the Minister will not reply by saying that it is a good idea, but administratively difficult, which is what the DSS usually says when it cannot think of another answer. I hope that the Minister will look at it constructively. If the amendment is not drafted correctly, we are willing to withdraw it and bring it back. Indeed, the Government might like to draft their own amendment. I believe that there is strength in the argument behind this amendment which, as I have said, could result in some savings for the Government. I beg to move.

Lord Mackay of Ardbrecknish

The noble Lord, Lord Carter, may be surprised to hear that in the dictionary of the Department of Social Security, the words, "Yes, that isn't a bad idea" also occur. Of course, there is a warning that they should not be used too often, but in this case I think that I can use them.

The amendment seeks to ensure that periods of incapacity benefit, where they are not separated by more than 12 weeks, will be included in the linking provisions for jobseeker's allowance. As my honourable friend the Under-Secretary of State announced in another place—in Committee, I think—the linking provisions for jobseeker's allowance will be set out in regulations. Nevertheless, the Government have decided that periods of incapacity benefit will be included in those provisions.

We have further agreed that the linking period of jobseeker's allowance will be 12 weeks. Thus, periods of incapacity benefit separated by up to 12 weeks will link for the purposes of contribution-based jobseeker's allowance.

We propose to achieve that effect in regulations. At the risk of tempting the noble Lord to fall into a severe trap, if he will accept that we shall do that by regulations, I am sure that he will be able to reject—

Noble Lords


Lord Mackay of Ardbrecknish

—to withdraw his amendment.

Baroness Hollis of Heigham

Freud says that one never makes mistakes!

Lord Carter

We now know what happens to Ministers and officials when they have served in the DSS for a period of time—their unbridled and uncontrolled enthusiasm for amendments is converted into, "Yes, that doesn't seem too bad an idea". I am extremely grateful to the Minister who has seen the sense of the argument. Obviously, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 2 agreed to.

Clause 3 [The income-based conditions]:

[Amendments Nos. 18 and 19 not moved.]

The Deputy Chairman of Committees (Lord McColl of Dulwich)

If Amendment No. 20 is agreed to, I cannot call Amendment No. 21.

Baroness Hollis of Heigham moved Amendment No. 20:

Page 3, line 6, leave out paragraph (e).

The noble Baroness said: This amendment relates to the hours that a partner of someone on means-tested JSA may work. The aim of the amendment is to abolish the rule whereby a partner's hours of work rather than his or her level of wages can disqualify a couple from receiving means-tested JSA. Why is that necessary? Under income support rules, one partner loses entitlement to income support, pound for pound, when the other partner is in work. We will return to debate the folly of that on Amendment No. 35. However at least it is an income-based test: his part-time earnings, if he has any; her earnings, if she has any; and the putative income from any savings, are all taken into account in determining the level of income support. It is a test of need based on income. As I say, we may object to it but at least it is a clear and consistent rule.

Why then do we have another test based on hours worked? Admittedly most women—we will assume for this purpose that it is a woman—working 24 hours or more are likely to earn enough to float both of them off income support, and, if they have children, on to family credit. What if they do not? We are saying that if someone works 24 hours or more and does not have children, the couple will retain an income which amounts to less than income support.

With the abolition of the wages councils, as my noble friend Lady Dean said, wages have been forced down. We now have plenty of reports of retail work—hairdressing and the like—which pays less than £2 an hour. Nearly 1.25 million people are currently earning less than £2.50 an hour. If someone works 25 hours for £2.50 an hour, he or she earns £62.50. From that they pay national insurance. That is less than the £73 a week regarded as the poverty line for a couple and which would incidentally passport them on to housing and council tax benefit. Yet, by working for more than 24 hours a week, even though that person may be earning less than he or she would receive on income support, the partner loses entitlement to income support. It is calculated that some 60,000 couples with one partner in work for more than 24 hours may have an income lower than income support.

That is perverse as well as being difficult for those families. Clearly if the couple have children the problem tends to be resolved by family credit, which tops up an in-work benefit, but if they do not have children, and if they are not in a piloting area—we have some concerns about that—they will have to live on an income below income support. In practice the woman will leave work so that the couple may have an enhanced standard of living based fully on benefits. We get back into the disincentive trap about which we were talking earlier. Because, once the woman has lost her work, the family has moved from being work-rich to work-poor; they become locked on to benefit; they fall out of touch with the world of work, and it costs us all as taxpayers infinitely more to pick up their total benefit bill. It is a vicious downwards spiral when it can so easily be rectified by merely scrapping the hours rule. The income test should be enough. We do not need an hours test as well.

The Government recognise the problem by saying that they may extend family credit to families without children; in other words, couples. We have real doubts about that, because family credit was designed as a benefit whereby the taxpayer contributed to the support of children in low-wage families. If there are no children it becomes a benefit which merely encourages the employer to pay whatever wages he likes, knowing that they will be topped up by the taxpayer through an in-work benefit. I should have thought that we would have wanted to avoid that situation if possible.

Why not instead let people work the hours that are appropriate and then apply the income rule alone and not the hours rule? That would save us all money. It would keep the second partner in work and give both partners the opportunity to return to the world of work, something we surely want. I beg to move.

9.15 p.m.

Lord Swinfen

It may be for the convenience of the Committee if I say that I propose to deal separately with Amendments Nos. 21 and 181, which were originally grouped with this amendment.

Baroness Williams of Crosby

I support the noble Baroness, Lady Hollis. She has made out a strong case with regard to the effect on the one member of a couple who is likely to hold a part-time job of 24 hours or less. Incidentally in many cases that can now be a man, because one of the interesting facts which is emerging from the recent employment statistics is the rise of short-time work among men as well as women. Therefore it could be the man who might have to abandon his job or live on a lower income than he would receive from benefit. As I understand it, that has never been part of the Government's policy. Indeed the reverse has consistently been their policy: that people should be persuaded to work and not to live on benefit.

There is another factor which applies also to the amendments in the name of the noble Lord, Lord Swinfen. All the subsections of the clause are essentially family-breakers. The way someone can continue receiving income support is by leaving the family of which he or she is part, one of whose members has some kind of income-based support benefit. That cannot be in anyone's interests. When all of us talk a great deal about the importance and strength of families, not least in bad economic circumstances, do we want to make it the case that someone can receive benefit if he or she leaves the family but cannot receive benefit if he or she stays with it? I cannot think that that is what the Government intend, but it is what the face of the Bill appears to say. Perhaps the Minister will be kind enough to address himself to that point when he answers the amendment.

Lord Mackay of Ardbrecknish

Amendment No. 20 would mean that income-based jobseeker's allowance could still be payable when a claimant's partner is engaged in remunerative work. It would remove a long-standing principle of income-related benefits that couples are treated as a single unit and benefit is payable only if neither is in remunerative work. JSA is a benefit for people looking for work. The removal of the rule would mean that people undertaking substantial amounts of work for low income could still be entitled to the benefit. Those people cannot be classified as unemployed, and other in-work benefits, such as family credit, are available and are more appropriate for the people in those circumstances.

We have also announced plans to pilot a new in-work benefit for single people and childless couples. It will help those without children who cannot qualify for family credit. I am sure that on another day we shall discuss whether or not that benefit is good. However, we recognise the importance of incentives for partners of unemployed people to remain in or to take up small amounts of work. JSA will introduce a number of new measures which will help those whose partners undertake part-time work. We are increasing the remunerative work rule for partners from 16 to 24 hours. We are introducing a new £10 earning disregard for couples. Moreover, a partner's part-time earnings will count towards the build-up of the back-to-work bonus, which can be paid when either the claimant or his partner moves into work.

All those measures will help to address the problem of the working partner and will encourage the working partner to remain in work. The idea that working partners necessarily desert work is not widely observed. As the noble Baroness said in respect of work-rich and work-poor families, there is no doubt—

Earl Russell

I do not believe that my noble friend Lady Williams said that anyone must desert. She said that the rules created an incentive to do so, and that I believe to be correct.

Lord Mackay of Ardbrecknish

I believe that the noble Earl misheard me. I was talking about deserting the job and was addressing a question put to me by the noble Baroness, Lady Hollis, that partners would desert a part-time job in those circumstances. As a result of the undoubted problems of unemployed couples and their disadvantage compared with couples where one party has a part-time job, the attractions of staying in work, in particular in the light of the improvements that we have made, will be considerable. I hope that they will prevent people from making a wrong decision and leave a part-time job because that may appear in the short term to be of benefit. There is a great deal of evidence that staying in work, even part-time work, is a better position from which to develop and to get more work, or for the partner to get work, than deserting the work. I do not believe that any responsible person would take the decision to desert work and place herself and her husband in a worse position.

The noble Baroness, Lady Williams, opened up a wider issue about the treatment of families and couples as opposed to single people. The subject is causing a great deal of anxiety but I do not particularly wish to address myself to it because I do not believe that there are any easy solutions. However, at least one of our European partners does not provide as we do, but pays a couple double the benefit of a single person. We have tried to be more generous to a single person, which leads inevitably to the kind of problem that the noble Baroness suggests. I hope that there exists more moral and social pressures and advantages in staying together and staying married than the possible economic advantage that may lead one to desert a marriage. I fear that marriage break-up, which is all too prevalent, is caused by other deep-seated social reasons and conditions arising from (dare I say?) our more permissive society.

Baroness Hollis of Heigham

I am sorry that the Minister did not take the very simple point that I made. The income support level for a couple is £73 per week and that will passport the couple on to other benefits. It is regarded as a poverty threshold.

Perhaps I may take the example of two couples. In one couple, the woman—and I choose the woman, although I take the point raised by the noble Baroness, Lady Williams—is working 21 hours per week for £3 per hour and receives £63 per week. At that point, because the woman is working for fewer than 21 hours per week, the benefits of the couple may be topped up by income support. In other words, there is offsetting and that income is floated up to £73 per week. The woman remains in work and the couple receive other benefits.

In the next-door house, the woman works for 25 hours per week receiving £2.50 per hour, which means that she is also receiving an income of £63 per week. Because of the hours rule, that couple are disqualified from receiving income support and, consequently, their income is not floated up to £73. Therefore, that woman is financially worse off because she is in work and she would be stupid to stay in work.

If the Minister means what he says—and I am sure that he does—that we wish to keep people in work and that part-time work may be a pathway into full-time work, we should do our damnedest to encourage people to stay in part-time work. I am not knocking the additional bonuses and so on to which the Minister has referred. But how can he defend the proposition that one family with a member working for 21 hours a week for £3.00 has its income topped up by income support but the other family with a member working for 25 hours a week for £2.50 per hour does not? As a result, that latter family would be financially better off to pull out of work. Will the Minister explain why we need an hours test over and beyond an income test?

Lord Mackay of Ardbrecknish

I have attempted to explain but clearly I have not succeeded. The point is that the benefit is paid to people who are out of work, unemployed and all the other matters which we discussed today. Remunerative work is just that and does not count for the payment of benefits.

It would be unreasonable if all remunerative work were to knock people out of the system and I should have thought that the increase from 16 to 24 hours was a generous concession to the argument which the noble Baroness makes. I hear that she wants the Government to go further and virtually abandon the rules but she will not be surprised to hear me say that that would involve a cost implication.

Baroness Hollis of Heigham

But why are the Government testing remunerative work by the hours worked rather than by the amount of remuneration received? The Minister says that there are cost implications but once a person leaves work and becomes unemployed, that costs us all £120 per week.

Lord Mackay of Ardbrecknish

Dare I say that it is a good deal easier to judge the hours of work than it is to try to compute hours against wages and the wage level earned? It is a simple rule which has existed for some time. We are making an increase from 16 to 24 hours, which is a concession. I doubt whether many people are tempted to follow the route which the noble Baroness says almost everybody is tempted to follow. I believe that this provision is sensible. When the £10 is added and the back-to-work bonus is added, that provides generous assistance to people in the circumstances which we are discussing. That assists them to not only look for work and to stay in part-time employment but it defines the number of hours that a person may work without looking as though he really is working and can no longer be considered an unemployed person.

Lord Swinfen

The noble Baroness, Lady Hollis, makes an extremely good point. I hope that between now and the next stage of the Bill my noble friend will read and consider this debate and see whether he cannot make a proposal to answer and ameliorate the situation.

Earl Russell

The Minister's argument that the hours are easier to measure reminds me of the Black Country man who was found looking in the gutter under a lamp post. Somebody asked him, "What are you looking for?" He said, "I dropped half a crown." He was asked, "Did you drop it here?" The reply was, "No, I dropped it over there". He was then asked, "Well why are you looking here?" The reply came back to him, "Because the light is better here". I admit that the Minister has got the better light; but he may not see anything by it.

9.30 p.m.

Baroness Hollis of Heigham

I am grateful to all Members of the Committee who took part in the debate. We hope that the Minister will not only have the light but that he will also see the light. When we return to the issue on Report—as I am sure we must because it is a silly anomaly which costs us all money—we ought to be able to resolve the matter. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Swinfen moved Amendment No 21:

Page 3, line 6, leave out ("or unmarried").

The noble Lord said: In moving the above amendment I shall, with the leave of the Committee, speak also to Amendment No. 181. Amendment No. 21 is a probing amendment. I should like to learn from my noble friend the Minister what is meant by the phrase "an unmarried couple" in the context of the Bill as set out in Clause 3(1) (e). While I am in favour of marriage, I do not believe that it is necessary for a couple to establish a long and satisfactory relationship by going through a formal ceremony either in a religious or a civil establishment.

However, I believe that the matter needs some explanation from the Government. An "unmarried couple" is not necessarily a stable relationship. How long do the couple have to be in a relationship, living together? What happens if there are regular, possibly even frequent, changes of partners? What is the position with a couple who have got together while abroad and then come to this country where they claim benefit after having been here for only a very short time? What is the position if one of the partners in such an unmarried relationship has a living spouse from whom there is no legal separation? Can someone possibly have more than one partner?

If a married man comes to this country having legally married more than one wife abroad, I believe that he can support both, or more, wives on benefit because they were legally acquired abroad. But would that be the same situation if he entered into a legal, unmarried relationship with more than one woman? Will people who share a home but who do not cohabit automatically be considered as an unmarried couple?

There are all kinds of permutations that one could go into. However, at this hour of the night I shall not do so. Nevertheless, I should be grateful if my noble friend could explain what is meant by "an unmarried couple" in the Bill. On the face of it, it looks as though it is straightforward and very simple. But in the real world we know that some partnerships change, and change quite often with some individuals. I believe that all parties in this country want to establish and protect long-standing relationships. I beg to move.

Lord Mackay of Ardbrecknish

My noble friend is asking for elucidation. Therefore, he does not need me to tell him that his amendment would mean that in the case of unmarried couples the income-based jobseeker's allowance would treat them in quite a different way from married couples. Perhaps I may explain how we tried to venture into what I fully concede is by no means a straightforward area.

As a general rule, unmarried couples who are living together as husband and wife are treated in the same way as a married couple. The principle underlying that rule is that they should not be treated either more or less favourably than married couples. We will be defining "partner" in the JSA regulations. We intend to follow the definition currently used in Income Support, which is tried and tested and which includes both married and unmarried couples and indeed polygamous marriages too. I hope that my noble friend does not ask me about that regulation, because I look forward to reading it tomorrow.

Lord Swinfen

I hope that my noble friend will send me a copy!

Lord Mackay of Ardbrecknish

My noble friend rightly asks me how we decide whether a couple are living together as man and wife. Some of the factors that are taken into account include membership of the same household, stability of the relationships—which I think answers the point about time—financial support, public acknowledgement, sexual relationship, if that information is volunteered, and any children. The criteria do not represent a rigid formula. I am sure most Members of the Committee appreciate that they cannot and the presence or absence of any single factor does not of itself determine the decision.

The basic policy intention is that unmarried couples who are living together as husband and wife should not be treated either more or less favourably than married couples. The emphasis in the treatment of couples is on either the existence of an actual contract of marriage or on an unmarried couple living together as though a contract of marriage existed between them. Our comparison is a general one. We are looking to see whether the unmarried couple are living together on the same kind of basis as they would do when they are married. I hope that, with that rather complicated explanation, my noble friend will at least go away and contemplate what interesting points he might make in his next speech on this subject.

Lord Swinfen

I wonder whether my noble friend would be kind enough to send me a copy of the regulations because I would like to see that. I feel that this is a rather dangerous and difficult area because one does not want, in my view, to encourage not extra-marital relationships but unmarried relationships that will not be stable over a long period. However, I look forward to reading the regulations. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees

If Amendment No. 22 is agreed to, I cannot call Amendment No. 23. I now call Amendment No. 22.

Earl Russell moved Amendment No. 22:

Page 3, line 9, leave out from ("of") to the end of line 14 and insert ("16").

The noble Earl said: It is part of the price of having a tight timetable that some amendments come up at inconvenient times on which one nevertheless cannot soft-pedal. This is one such amendment. It attempts to reverse the disentitlement of 16 and 17 year-olds to benefit which was brought into force in 1988. It is the first chance we have had to address this issue in primary legislation since 1990.

I may as well say now, since I think it will simplify the discussion, that I cannot let this go and let the Bill leave this House without taking this issue through the Lobbies. Whether I do so now or whether I do so later depends on whether I think that our timetable will allow a more convenient time in our proceedings later in the Bill's progress. What I will say to the Minister now is that I will beg leave to withdraw the amendment. If he gives me that leave, I shall take it that he has listened to his noble friend Lord Boyd-Carpenter as regards the timetable. If he has not listened to him and chooses to negative the amendment, then we shall go through the Lobbies.

One of the key points here, I think, is that the Government relied, for disentitling 16 and 17 year-olds, on a justification which this Bill makes obsolete. So the Government can now afford to think again if they wish. I have here the speech of the noble Lord, Lord Skelmersdale, on the Second Reading of the Social Security Bill 1988, when he introduced the disentitlement. He said: the expectations of young people leaving school should never include unemployment. Not only is it demoralising but it usually leads inexorably into the so-called benefit culture. This is a one-way street leading to a dead end and we believe that the entrance to it should be sealed off. We owe it to our youngsters to channel them in the right direction and to steer them away from getting drawn into a benefit culture from which it can be difficult to escape. That is why … we would take steps to withdraw entitlement to benefit from those who deliberately chose to remain unemployed".—[Official Report, 25/1/88; col. 412.]

That is very much the same aim as that which the Minister announced as the aim of this Bill when we discussed Amendment No. 3. If this Bill is adequately designed to achieve that aim—and I presume that the Government must think that it is—then it does not need a separate disentitlement for 16 and 17 year-olds. Every 16 and 17 year-old who would be drawing the jobseeker's allowance would necessarily be undertaking a jobseeker's agreement, actively seeking work, producing diaries of applications and so forth. There is not much room for any benefit culture there.

The Bill removes the reason for the original introduction of the disentitlement. That should create a chance to think through this issue from the beginning.

When he addressed this issue briefly at Second Reading, the noble Lord, Lord Inglewood, invoked the youth training guarantee as a reason why the disentitlement might be justified. I shall believe that assurance about the youth training guarantee when the noble Lord, Lord Inglewood, can do four things.

First, I shall believe it when he can tell me that there are not 15,849 people waiting for a youth training place. That is quite a lot of people. Secondly, I shall believe it when he can apply to the youth training guarantee the proper Citizen's Charter principle that, if a guarantee is not met, one receives compensation. In other words, if 16 or 17 year-olds register for youth training and do not receive it, they should have an instant entitlement to income support while they are waiting. If the noble Lord said that, he could call it a guarantee.

Thirdly, I shall accept the assurance when the noble Lord is prepared to up-rate the youth training and bridging allowances to restore them at least to their value in 1988 when they were introduced. Those allowances have never been up-rated.

Fourthly, I shall believe his assurance when there is suitable training for those who apply for it. We do not have slavery in this country. There should be at least some very vague suitability in what people are forced to undergo. I shall briefly give three examples, all of which have been mentioned previously in this Committee. A young man who said that he wanted to work with animals was sent to work in an abattoir. If that happened in Brightlingsea it could be conduct liable to provoke a breach of the peace. Another young man who was an asthmatic was required to work as a painter. Finally, in 1991 Blairgowrie in Perthshire had 15 people waiting for youth training and there was one youth training place in the town. Even if they have access to a car, 16 year-olds are not allowed to drive, so they cannot get a place unless it is somewhere they can reach on foot or on public transport.

The object of the noble Lord, Lord Skelmersdale, has not been achieved by this entitlement. We still have unemployed 16 and 17 year-olds. According to the official careers service figures, 6 per cent. of them are unemployed. That is probably a considerable underestimate. There are still 16 and 17 year-olds living away from home. According to the MORI sample 65 per cent. live away from home because they have been thrown out. In the Centrepoint sample that figure is 86 per cent. Those are not people idly wandering away from home. Those are people whose parents have chucked them out.

Crisis, in its study of London beggars, found two cases which are typical of many. One had been thrown out because she would not agree to her mother's insistence that she should give up the name of her divorced father. I believe that that is something on which she has a right to insist. She was disentitled in 1988 and in 1994 she was still there begging. That is to throw away a life. The other case involved someone who wished to cease to be a Jehovah's Witness and whose parents would not allow him to continue to live at home if he did so. That is an issue of freedom of conscience.

This is the one place where we have some research on what people do if they are totally disentitled to benefit. It is usually crime, selling drugs or prostitution, and prostitution in both senses. I am not particularly squeamish. However, if there is one thing that one finds more disconcerting than being forced into prostitution it is being forced into prostitution against one's sexual orientation. There are 16 and 17 year-old rent boys who sell unprotected sex because it is more profitable. The free market truly takes some very strange forms. I do not need to go into the medical risks of that practice.

According to the figures produced by the careers service among 16 and 17 year-olds there are 6 per cent. unemployed and 6 per cent. unknown. If one looks at the census validation studies, those are probably underestimates. Large numbers of 16 and 17 year-olds simply disappear. The noble Lord, Lord Inglewood, knows some of the difficulties presented by the figures. I am extremely grateful to him for the help that he has given in trying to get through them. I believe he appreciates that there are likely to be many more lost, stolen and strayed 16 and 17 year-olds out there than are indicated by the official figures. Young people these days are a scarce resource. If we waste them for two years they are liable to stay wasted. That is something that this country cannot afford. I beg to move.

9.45 p.m.

Baroness Williams of Crosby

I should like to raise one other issue that is related to a matter about which my noble friend Lord Russell has spoken. I do not know how many Members of the House are associated with the groups that look after the homeless in this country, particularly in the cities, or who have taken the opportunity to talk to some of those who live in cardboard boxes under the National Theatre and elsewhere. If they do, they will come across another very tragic phenomenon, rather similar to some of those of which my noble friend has just spoken. I refer to young girls and boys who run away from home because of sexual abuse within the family. There has been a substantial increase in the reports of sexual violence and abuse in the family, admittedly largely because it is now more acceptable than hitherto to make these matters public. If one speaks to some of the groups that deal with homeless families, and homeless young people in particular, one finds that this phenomenon is not so small that it can be dismissed. A young girl or boy who is subject to sexual abuse will run away from home. It is no good pretending that they can be forced back home by refusing benefit. That may apply to only a few thousand people, but those people deserve our sympathy and mercy. I should like an assurance from the Minister that cases of this kind will be regarded as falling within the reference to special regulations in the Bill at the present time. Although this is not widely spoken of, it is a real issue. To force these young people back to their families will not help them, their families or, for that matter, their futures.

Lord Inglewood

It will come as no surprise to the noble Earl, Lord Russell, to hear me say that this amendment seeks to overturn current Government policy, which is to help unemployed young people into training or employment, not to create conditions in which they can sink into benefit dependency. The Government guarantee every young person who wants one a suitable youth training place. That is at the heart of our policy for 16 and 17 year-olds. We are going to spend £669 million on youth training and modem apprenticeships this year in England alone. That is a very significant investment in the future of our young people and in the nation's economy.

The guarantee enables young people to focus their efforts on achieving their full potential and develop skills for the nation's economy. Young people should not become dependent on benefit. They need to take every opportunity to get the best possible start in the labour market.

We recognise that there must be exceptions, and we provide for them. First, young people in certain specified vulnerable groups, such as disabled young people, are allowed to claim income support. They will continue to be able to claim income support after the introduction of the jobseeker's allowance. Secondly, young people in prescribed categories, such as those who have recently left local authority care, will be allowed to claim JSA for a period intended to allow them to overcome their temporary difficulties. That also carries forward existing arrangements. Thirdly, young people who are waiting for a suitable youth training place will be able to claim JSA if they would otherwise suffer severe hardship. Again, that carries forward existing arrangements. We believe that the Government's youth training guarantee backed up by clear sanctions, safeguards and protection represents a fair and balanced package of measures for young people.

In the remarks made by the noble Earl, Lord Russell, and the comments made by the noble Baroness, Lady Williams of Crosby, examples were given of extremely distressing circumstances which I do not believe any of us would for a moment condone or support. But we are talking about benefits and the Jobseekers Bill. It seems to me that many of those examples which were described logically follow from the topic that we are discussing this evening—sexual abuse, for example. I do not believe that it is the right way to tackle this particular problem by saying that it has something to do with the benefits system. The problem there is much wider, and that is the way to try to deal with such problems.

I cannot give exact and specific examples of the extent to which, right to the limits, the definition of "vulnerable groups" falls. However, I should be very surprised if it does not include the kind of people about whom we are speaking. I shall write to the noble Baroness and give her full details of exactly where we stand now, because the plan is simply to roll forward the existing provisions to the future.

In his opening remarks the noble Earl, Lord Russell, referred to the comments of my noble friend Lord Boyd-Carpenter earlier this evening. We have listened but I am not in a position to give any kind of commitment or promise at this stage.

Earl Russell

I shall not attempt to answer that reply in detail. Instead, I shall say what Lord Seebohm said in this Chamber the last time that the Government defended the freezing of child benefit: that is an old cracked record; we have heard it many times before; it is worn out; it is time that we had a new one.

I shall tackle only one point—that of the severe hardship payments, which are intended to plug a gap. The problem is that when people have had to leave home, they cannot wait to go through these procedures. They need food now. So they drift off, often into illegal courses of conduct, and they disappear. That is one reason why that provision does not achieve its desired object.

I appreciate that the Minister cannot give an absolute assurance about the timetable at this time. But, as I promised, I shall beg leave to withdraw my amendment. If the Minister does not negative me, I shall be encouraged. If he does negative me, I shall go through the Lobby and be very interested to see who does and who does not come with me.

Amendment, by leave, withdrawn.

[Amendment No. 23 not moved.]

The Deputy Chairman of Committees

Amendment No. 24. If this amendment is agreed to I cannot call Amendments Nos. 25 and 26.

Earl Russell moved Amendment No. 24:

Page 3, leave out line 19.

The noble Earl said: This is the first of a series of delegated powers amendments. With this amendment, I should like to speak to Amendment No. 28. Both amendments concern training. The first one concerns line 19 on page 3 of the Bill: a condition that the claimant must register for training". A condition that the claimant must register for training may be introduced by regulation. The second suggested change concerns line 26 where it says: (4) For the purposes of this section 'training' has such meaning as may be prescribed.

We know all about "Educating Rita" but what we are learning about here is training Humpty-Dumpty. This is the first of a series of probing amendments about the use of delegated powers. I gave the Minister, the noble Lord, Lord Mackay of Ardbrecknish, a list of five questions that I intended to ask about each of the delegated powers. First, why do the Government want the delegated power to do this by regulation? Secondly, what do the Government intend to do with this power? Thirdly, what else could be done with this power, not necessarily by this Government but by some other government with a quite different outlook in the future? Fourthly, what are the extreme things, the worst things, that could be done under this regulation-making power? Fifthly, how could the House give or withhold its consent?

It would not entirely satisfy me if the Government could persuade me that what they intend to do with the delegated power is entirely reasonable. I would find that reassuring but not totally satisfying. The vires to make regulations are like mines that we lay across the legislative landscape and they may explode at some future date in ways that none of us can now foresee, so I would want reassurance that we are not creating the vires to do something which is particularly dangerous.

I might be persuaded to agree to either of these powers individually. What really worries me—I should like to have some reassurance on this—is their effect in conjunction. There are libertarian objections to making training compulsory. Those objections might not be conclusive but if we can make training compulsory and then we can change the meaning of "training" to mean anything we like, goodness knows what could be done with that.

I accept that at present there is no governmental intention to introduce workfare. I have no intention of starting a scare about that, but the vires exist for some future government to introduce workfare if it chose, without any further legislation. If that were to be introduced I think even those who supported it would agree that it deserved the dignity of primary legislation and serious debate.

I have looked at the Government's memorandum to the Delegated Powers Scrutiny Committee. I understand that they intend "training" to have the meaning it has in the Employment and Training Act 1973. If they did that it would not worry me. If they wrote it into the Bill it would make me happy. But why do they want to leave to their successors a power to change the meaning of "training" in entirely arbitrary ways? Do the Government really have such great confidence in the Opposition? I beg to move.

10 p.m.

Lord Inglewood

The noble Earl, Lord Russell, accepts that there is no sinister intention behind the Government's present proposals. As explained, our intention is that the definition should incorporate training to be provided for such people under Section 2 of the Employment and Training Act 1973 and that includes youth training and modern apprenticeships. I hope that that will assure the Committee that there is nothing sinister in the provision.

We wish to be able to retain flexibility in regard to whatever changes may arise in the future in respect of training programmes. We believe that it is appropriate in the circumstances that, if we wish to link JSA for a certain category to training, we should be able to make quite sure that that definition is both clear and one which, if circumstances change appropriately, can be amended in line with what would be appropriate under future circumstances.

Earl Russell

I thank the Minister warmly for that answer which is reassuring as far as it goes. The trouble is that it only goes a limited distance. He reassures me that he does not have any sinister intention behind the words at present. But I notice that he omitted to answer the question of what use another government at another time may manage to make of the regulation-making powers. He has not denied that it would be possible to introduce workfare under these provisions. For that matter, he has not denied that it would not be impossible to introduce national service under the provisions. Again, even the strongest advocate of such a proposal would agree that it deserves the dignity of primary legislation.

Lord Inglewood

I do not believe that a definition of training can be broadened to turn it into an instrument for the imposition of workfare, as the word is used in contemporary English. The noble Earl asks what possible use a future government—perhaps a sinister future government—may make of these proposals. I am not in a position to be able to give the noble Earl a categoric response; we do not know. However, taking the argument one stage further; to have the kind of sinister government in the future to which the noble Earl alludes, it would be necessary for that government to have a majority in the other place. If that government had a majority in the other place, there is every likelihood that they may be able to introduce legislation of which people disapprove by virtue of their being a government and therefore by virtue of their majority. The point being made by the noble Earl therefore is not one which in practice will be relevant. If it is possible to introduce some extremely difficult and far-ranging proposition, it will be the result of the decision of the British people in the ballot boxes.

Earl Russell

I accept the point the Minister makes in relation to a future government having a majority in another place. But a future government also may feel that that flexibility permitted them to do things which they would not risk doing with a narrow majority or a crowded legislative timetable.

Ultimately the power must stand or fall by the extent of the vires. Once the vires are there we must take the risk that they will be used. If the Minister has taken legal advice on the point that it would be impossible to introduce workfare, I would be glad to hear about that. But in relation to national service, I am sure that the Minister remembers the phrase "basic training". That could literally, within the ordinary meaning of the words, be introduced under these powers. I feel that one should be extremely careful before one leaves powers of this kind lying around. One ought, at all stages, to assume that something bad may be done with them.

I believe that all governments ex officio should be regarded as untrustworthy, and that includes any government of which one might oneself be a member. The last thing one should ever do is trust oneself with the exercise of power. So I hope that the Minister will not in any way take it personally when I say that any restrictions that they have should be put in, fearing the worst. As King James I put it, "From bad manners good laws". There is a lot in that maxim.

Lord Inglewood

I can confirm to the noble Earl that we have not taken legal advice on the particular point I raised. I shall write to him about it later.

Earl Russell

In that case, for the time being I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

[Amendment No. 25 not moved.]

Baroness Dean of Thornton-le-Fylde moved Amendment No. 26:

Page 3, line 19, at end insert ("provided that any registration required by such regulations shall be at one agency only, and that the designated persons are appropriately trained").

The noble Baroness said: Of all the amendments on the Marshalled List today, this one is very simple to read and one does not have to look at the Bill itself because the amendment is quite clear. It is sensibly asking that when people are required to register under the proposed regulations, they should go to one place only to register. Hand in hand with that, the officials whom they see should be trained over the wide range of issues that they will be considering.

For instance, currently young people have to register at the Benefits Agency, with the Careers Service and the Employment Service. The Government have said that they promise that these three bodies will be reduced to a two-stop shop. We hope that the Government will accept this amendment and we cannot see any reason why they should not. If there is a one-stop shop it will be particularly helpful to young people for a number of reasons. It will mean that they can identify the whole range of requirements of the legislation, but also their needs. They will be able to deal with one officer in that one office, whether it is about benefits, the employment position or their job opportunities and the Career Service support that is going to be given to them.

There may well be another beneficial effect that the Minister may not like as much. It may recoup some of the large amount of unclaimed benefits. We hear a great deal about people claiming benefits to which some allege they are not entitled, but there are also a great many people who are entitled to them, but who do not actually draw the benefits because they are not aware of them. This amendment will enable the individual to plug into one office and deal with one official with whom they can identify, although that may not be possible. In addition, there will be the tracking facility for them as regards employment and the benefit position. I beg to move.

Lord Swinfen

An extremely sensible suggestion has just been made. If the Minister feels that he cannot accept this amendment, perhaps he will come forward with a better drafted one at the next stage.

Lord Inglewood

As I have already explained, it is the Government's intention to ensure that as many young people as possible receive education or training and do not become dependent on benefit. But as we have also debated there are exceptional circumstances in which some 16 and 17 year-olds will have to claim JSA.

It is important that those 16 and 17 year-olds who do claim JSA receive the best possible careers advice and support to help them move quickly off benefit and into training. That is why 16 and 17 year-olds claiming JSA will be required to register with the Careers Service. They are the specialists and the people best placed to ensure 16 and 17 year-olds get all the available advice on training, education and employment with training options.

The JSA is a single benefit. Its introduction will allow us to streamline the arrangements for dealing with 16 and 17 year-olds and to improve the service they receive. As the noble Baroness said, at present, as well as going to the Careers Service, 16 and 17 year-olds have to visit the Benefits Agency as well as the Jobcentre to claim income support. Our intention is that 16 and 17 year-olds will be able to claim JSA and deal with related matters at the Jobcentre. I hope that answers the noble Baroness's point.

Baroness Dean of Thornton-le-Fylde

I thank the noble Lord for that reply, although it does not answer my point, as I am sure he accepts. The jobseeker's allowance will be paid to some young people because they are not in work. The Bill is intended to try to get people back into work, which is what we all want. Many young people see employment offices at the moment as giving them any job, whereas there should be a package and a claimant should be told, "You're on JSA until we can get you into some kind of employment which will help you forwards". People should not be offered just any old job; they should be offered a job in which they can progress throughout life. Such development is absolutely crucial.

We need an integrated policy, not a series of separate policies. The noble Lord may feel that it is not possible to do that at the moment. If that is because of bureaucratic or administrative problems, that is one thing; but if it is an ideological problem (because we have completely different approaches) that is another thing. Before I make a decision on the amendment, I would appreciate it if the noble Lord could indicate which of those two attitudes dictated his reply.

Lord Inglewood

As I explained earlier, the key to understanding the jobseeker's allowance is that it is a single benefit. That is the core approach, whatever the category of jobseeker's allowance. Part of the nature of the jobseeker's agreement which we have been debating is to try to establish a plan of action to assist the jobseeker to get into work. That is where the role of the careers service fits in. That is why we believe that it is appropriate that there should be an interface at the Jobcentres as well as at the careers offices.

Baroness Dean of Thornton-le-Fylde

Clearly we have a little misunderstanding. I hear what the noble Lord says, and although it does not respond to my point, I shall not press the amendment this evening. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 27 to 29 not moved.]

Clause 3 agreed to.

Clause 4 [Amount payable by way of a jobseeker's allowance]:

The Deputy Chairman of Committees

I should point out that if Amendment No. 30 is agreed to, I cannot call Amendment No. 31.

Earl Russell moved Amendment No. 30:

Page 3, leave out line 34.

The noble Earl said: This is another delegated powers probing amendment. I should like to ask the same five questions as before. If the noble Lord, Lord Inglewood, can indicate that he has a copy of those questions, perhaps I need not repeat them. Does the noble Lord have a copy? If so, I can save some time by not running through them again.

The amendment, deals with the question of allowing the Government by regulation to determine the age-related amount which is applicable. Again, I want to know the usual five things. In particular, as this is a highly contentious issue to which we shall be returning at a later stage, I want to know how this House could give or withhold its consent if the Government changed the amount. As we are still told that Parliament makes the law, I think that that is a question which deserves an answer. I beg to move.

Lord Mackay of Ardbrecknish

I do not have to hand the questions which the noble Earl sent me, so I am in some difficulty, but perhaps—

Earl Russell

If it would be any help, I can repeat the questions. First, why do the Government want a delegated power? Secondly, what do they want to do with it? Thirdly, what other things could be done with the power by some other government? Fourthly, what are the extreme limits of that power and what are the worst things that it legally creates the vires to do? Fifthly, how can Parliament give or withhold its consent to things done under the power? I am sorry to have assumed that the Minister had a copy of the questions when he did not. All of us have to deal with a lot of papers today.

10.15 p.m.

Lord Mackay of Ardbrecknish

I am still in some difficulty because the amendment in the name of the noble Earl at which I am looking is to delete line 34: determining the age-related amount applicable to him". I had come prepared to explain in some detail why we had come to the conclusion that the JSA for the under 25 year-olds (the 18 to 24 year-old group) should be paid at a lower rate. Therefore I should prefer to take away the noble Earl's questions, consider them and reply to his letter in some detail.

Perhaps I may say, however, that JSA brings together two benefits—unemployment benefit and income support. As I said earlier, it is a well-established feature of income support that young single people receive a lower rate of benefit. Under JSA we shall be adopting for unemployed young people the same treatment as they receive on income support. As I said earlier, the average earnings of the 18 to 24 year-old group is two-thirds of the average for all adults, and if the young person has a family he can claim income-based JSA and obtain the same rate of benefit as any other family.

I did not say this earlier, but the large majority (about 75 per cent.) of income support recipients under 25 do not live independently. Where the claimant does not live at home, he can obtain housing benefit on the same basis as anyone else.

What this group of people needs is help to get into work and out of unemployment. The service has been testing special programmes geared to the needs of young people. National programmes will provide 130,000 places from April 1995. We believe that that is the right approach and make no apology for looking at the wider earnings of young people in that age group and coming to the conclusion that they can have less than those aged 25 or over.

I am not sure whether that is what the noble Earl was wondering when he asked what the Government intend to do with the power and what else could be done. I apologise to him. I was not aware that this was where he was going to attack me with those questions. As there are other parts of the Bill in which these matters come up, I have no doubt that I shall be able to address the various points about which he has written to me.

Baroness Hollis of Heigham

I am slightly baffled. I wonder whether there has been a typographical mistake. The amendment refers to omitting line 34, which does not refer to regulations. I wondered whether the noble Earl meant it to refer to line 38 which states: shall be determined in accordance with regulations", or whether there is an issue here that has escaped me. It seems to me that the noble Earl's points and the Minister's reply just passed each other by.

Earl Russell

The best I can do is to beg leave to withdraw my amendment in as good order as possible.

Amendment, by leave, withdrawn.

[Amendment No. 31 not moved.]

Lord Swinfen moved Amendment No. 32:

Page 3, line 36, at end insert: ("( ) making prescribed additions to offset the extra costs that are incurred as a direct result of a claimant's disability")

The noble Lord said: It may be for the convenience of the Committee if I speak also to Amendment No. 37. I consider that the amount of the JSA, whether contribution-based or income-based, should be increased to take account of the extra costs a disabled person might face in seeking a job compared with the costs faced by a non-disabled person.

Those extra costs can arise in connection with travel to and from interviews and the jobcentre. Even though a disabled person may be in receipt of the higher rate mobility component of the DLA (previously termed the mobility allowance) that may be earmarked for the purchase of a powered indoor/outdoor wheelchair which, as the Committee will know, is not provided by the NHS. Moreover, even if the disabled person has a car, perhaps paid for by the HRM/DLA, or mobility allowance through the Motability scheme, he may be forced to resort to expensive taxis because parking places do not exist near the prospective employer's premises or at the jobcentre. If such facilities do exist, arrangements cannot be made for parking for casual job applicants, or they are being used by able-bodied people.

Blind people may need to be accompanied to interviews and jobcentres. They may also need the services of a reader in searching for advertised jobs. Deaf people may need to invest in equipment to communicate with prospective employers. They may incur extra expense through using the teletype system and they may need to be accompanied to interviews by a signer.

Those are but a few examples of the possible extra costs that disabled people may incur in looking for employment. Extra costs are not suffered by non-disabled jobseekers. As regards employment, the access-to-work scheme could offset all those extra costs but the scheme is not available to help disabled people seeking work.

In Standing Committee on 7th February in the other place, Mr. Roger Evans, when responding to Keith Bradley, stated at col. 253: If he is trying to argue that there are specific travel, interview or search costs, I shall go away and think on the matter". Later at the Report stage, the Minister of State, Miss Widdecombe, responding to Mr. Bradley, stated: I reassure him that the Employment Service can fund the costs of travel to interview, the cost of escorts to and from interview, which are important for people with disabilities, the cost of providing communications for the deaf at interview and other similar measures".—[Official Report, Commons, 22/3/95; col. 374.]

I have not given my noble friend notice of the following questions. If he cannot answer them tonight, perhaps he will write to me. Who is right? Exactly what help is available? Does it cover such equipment as is covered in the access-to-work scheme? Under what conditions is help offered? Are they the same as those for access-to-work? Is all the appropriate help that is available under access-to-work also available for disabled people who are seeking work on exactly the same terms? How does a disabled person go about securing help when seeking work? Is the help available immediately it is requested or, as with access-to-work, does it take several weeks for the application to be investigated and agreed? I beg to move.

Lord Carter

We on these Benches are pleased to support the amendment. During many years and in respect of many Bills we have discussed the extra costs that are faced by disabled people. Obviously that applies to seeking work. The noble Lord, Lord Swinfen, referred to access-to-work and I believe that when we deal with the disability Bill we shall have many interesting discussions on the relationship between access-to-work and the measures proposed in that Bill.

Without recognition of the extra cost faced by disabled people in their search for work, specifically in meeting the conditions of entitlement to benefit, they could be unfairly penalised through no fault of their own. I understand that in discussion in another place those issues were recognised. I hope that the Government will give the assurances for which the noble Lord has asked.

Earl Russell

We too support the amendment. I shall not repeat the argument because the noble Lord, Lord Swinfen, put it so well. I am happy to say that he spoke for both of us.

Lord Mackay of Ardbrecknish

The amendments seek to make additional payments in both contribution-based and income-based jobseeker's allowance to people who incur costs as a direct result of their disabilities. In the case of contribution-based JSA, the result would be to cut across the long-standing principle on which contributory benefits for the unemployed are based.

Those who have worked and paid contributions will be able to receive contribution-based JSA for six months irrespective of their means. The principle of contributory benefit is that it is, basically, a flat-rate income-replacement benefit, paid irrespective of other personal circumstances. Additional help for those with disabilities is available elsewhere in the benefit system, including income-based jobseeker's allowance and disability living allowance which can be paid on top of contributory benefit.

Income-based JSA will closely follow income support rules, and I can assure my noble friend that it will include provision for appropriate premia to be paid to disabled people in addition to the personal allowance. The disability premium in income support recognises increased living costs of the disabled and long-term sick for items such as extra heating, special diets, more expensive travel, and laundry costs.

We do not accept, therefore, that there is a case for a further additional payment to unemployed people who are looking for work. We believe the financial resources available are better used in measures which will actually help disabled people into jobs. I shall go through some of the help available. As I mentioned earlier today, the Employment Service will be spending an extra £71 million over the first three years following the introduction of incapacity benefit to direct just that kind of special help at disabled people.

I should say to my noble friend that there is no evidence that unemployed disabled people attending any of the Employment Service programmes aimed at helping with jobsearch face additional expenditure costs to enable them to attend or participate fully. Fares are paid to enable people to attend such courses. While there is an upper limit which is sufficient for most people, no limit is imposed on disabled people. The full cost is met for disabled people, including parking fees and taxi fares. People attending Employment Service courses such as restart courses, job review workshop and other ES provisions will be able to receive wide-ranging assistance which includes a personal reader service for visually impaired people and signers for people with hearing problems. For those with physical disabilities, help is given by furnishing access to the premises of programme providers by providing, for example, ramps or other equipment. In 1995–1996, £100,000 has been set aside for that.

The access-to-work scheme can provide a similar range of help for people attending interviews or starting work. Therefore, it is available to all people who may need to claim. It can provide up to £21,000 to individuals over a period of five years, although most will need much less than that. In addition targeted advice is provided for options available to claimants through the disability employment adviser.

I hope that my explanation of the assistance available answers my noble friend's questions. I appreciate that he asked me quite a number of questions. I shall read what he said and make sure that I have answered them all. If I have not answered any of his questions, I shall write to him. I hope that he will understand the point which I make; namely, that help is available through the special premia which exist for all disabled people. It is available also, through the Employment Service, for those seeking jobs who have the problems that I mentioned in the examples which I gave.

Lord Swinfen

My noble friend started by giving me the impression that he was going to disappoint me, but he ended up by rather encouraging me, which is always a good sign. I like to be encouraged. I look forward to hearing the answers to my questions from my noble friend. I shall read what he has said with the greatest interest. However, I reserve the right to return to this matter at a later stage. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Dean of Thornton-le-Fylde moved Amendment No. 33:

Page 3, line 36, at end insert: ("( ) The earnings disregard in respect of part-time earnings shall be reviewed annually in the light of the previous year's price inflation.").

The noble Baroness said: I hope that I may hang onto the coat-tails of the noble Lord, Lord Swinfen, and provoke the good humour of the Minister. We may, perhaps, end the evening on a bright note. However, I am not sure about that. It is a matter of money and that is something which it is always very difficult to persuade the Government to come forward with.

The proposed provision is quite straightforward. It would enable the disregard in respect of part-time earnings to be index linked. Of course, the disregard is really a means of providing a bridge to enable the individual to go from being unemployed to actually getting back into employment. Indeed, it would ease the situation and would act in a way which would not discourage people from taking part-time work which, eventually, could also lead to full-time employment.

We suggest that it not only makes sense to up-rate the disregard annually, but that it is also the honest thing to do. If the Government have reached the view that this is the level to set when the Bill becomes law, it makes sense to maintain that relative value. Of course, I am aware that the unemployment benefit disregard itself has not been up-rated since about 1982. We certainly would not want to see that situation continuing under the Bill when it is enacted.

There are a number of benefits that are not up-rated and that, too, has encouraged us to table the amendment so that it would be on the face of the Bill. That would mean that it would not be discretionary and that it would require an annual review of the level of disregard so as to provide some measure of assurance of a retention of the value of the disregard year on year. I beg to move.

Lord Mackay of Ardbrecknish

As I mentioned earlier this evening, the jobseeker's allowance will have common rules for the contribution-based and income-based claimants. The rules applying in unemployment benefit are complex and outdated relating to the daily benefit paid in respect of six days a week. We are aligning the rules with those of income support and applying an earnings disregard which, for most single claimants, will be £5 a week.

The level of the disregard is designed to strike a balance between providing an incentive to do some work without creating a disincentive to take up full-time work. Part-time work, supplemented by JSA, cannot be an acceptable long-term option. We believe that across-the-board increases can act as a disincentive to move off benefit and into more substantial work.

It has never been thought right to up-rate earnings disregard automatically. We prefer to concentrate on maintaining and, wherever possible, improving overall benefit levels rather than increasing the amount of the earnings disregard, which can only benefit those who are able to work part-time. Increasing disregards currently across income support, housing benefit and council tax benefit by only £1 a week would cost in the region of £25 million a year. Therefore, looking at increasing disregards is not exactly a costless option.

One has to look at what we are doing in JSA as a package. We believe that it is important to introduce new incentives for people to take up, or stay in, part-time work. As I have already mentioned, we shall be doing that not by increasing the disregards by small amounts each year but by giving a new joint £10 disregard for couples through the back-to-work bonus and through the increase in the partner's hours rule from 16 to 24 hours, which we discussed earlier.

We believe that that is the right way to go about such issues and not in fact to give the right of reviewing annually the earnings disregard which currently stands, as I said, at £5. I am sorry that I have to disappoint the noble Baroness, in that she has not managed to get such a satisfactory answer on this occasion as that received by my noble friend for his amendment.

Baroness Dean of Thornton-le-Fylde

As a colleague has just said, "What's new!" I am disappointed but not surprised in my disappointment. I feel that it is all of matter of penny pinching. Indeed, £5 is not a great deal of money. Perhaps we should have tried to get the whole lot index linked. However, we thought that we would have a go on this one and that the Minister might see sense. If it is worth £5 today as a disregard to act as an incentive—or not to be a disincentive—for people to go into work, then that kind of logic should follow through year on year; otherwise it does not have a logical base. I hear what the Minister says. With the permission of the Committee, I beg leave at this stage to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 34 not moved.]

Baroness Hollis of Heigham moved Amendment No. 35:

Page 3, line 38, at end insert: ("( ) In the case of a claimant residing with his spouse or contributing to the maintenance of his spouse, there shall be added the amount specified in Schedule 4, Part IV, column 3 of the Benefits Act (adult dependant's allowance).").

The noble Baroness said: This amendment concerns the adult dependence allowance. This amendment seeks to protect the status quo. What is the current situation? At the moment someone who qualifies by virtue of National Insurance contributions and the work test, receives unemployment benefit for 12 months, which for him—let us assume he is the main earner—is £45.45, and for her is £28.05. In other words, as a couple, they receive £73.50 based on the claimant's record. Any savings, any redundancy payment, or her earnings do not affect this couple's allowance. It is a benefit as of right paid for by him, covering them both. It is a contributory benefit.

Under JSA such a couple are penalised not once, not twice, but three times over. We think this extraordinarily harsh. First, the contributory benefit is cut from 12 months to six months; thereafter it is means tested. That is bad enough but, secondly—this relates very much to the point made by the noble Baroness, Lady Williams, earlier this evening—that six months contributory JSA does not include an allowance for a spouse. It is simply in other words a non-means-tested benefit of £45 for the claimant; it is a personal allowance, not a couple or family allowance, as it was under unemployment benefit. If the claimant claims what he is currently entitled to—the adult dependence allowance—he promptly moves from a contributory to a means-tested benefit on day one, without even six months on the contributory benefit for which his National Insurance was designed to pay.

He has been robbed twice. If he does not claim for her, his benefit is cut from 12 months back to six months; it is cut back from 12 months to nothing, in terms of a contributory benefit, if he does claim for her. As soon as he claims for her, and therefore goes onto a means-tested benefit, he is then penalised a third time in terms of any modest savings he may have had. He loses £1 in benefit for every £250 he has in capital over the £3,000 rule, and loses all benefit if he has savings over £8,000. Those savings may have been accumulated by weekly or monthly savings but they may be the result of a redundancy payment of, say, £10,000 which will have to be exhausted before they get means-tested benefit. Or the savings may have resulted from an injury compensation or an industrial accident compensation and that money will not be used as compensation, as was intended, but as a living allowance before he can claim the benefit they were entitled to under National Insurance rules.

In other words, he is offered the Faustian choice of, "Maintain your wife or maintain your savings, but you cannot do both". Is that what the Government really intend? Is not that an attack on the family, on the one hand, and on the principle of thrift and savings on the other? For the Government to manage both in one Bill is pretty good. The Government expect to make some £220 million savings in a full year by moving from 12 months to six months contributory benefit; and of that, scrapping the adult dependence allowance will save £20 million. The Government themselves estimate that some 5,000 people will be pushed onto means-tested benefits, thus increasing their poverty trap.

So what have we? We have a Bill that not only savages the contributory principle, reducing it from 12 months to six months, even though National Insurance payments, as my noble friend Lord McCarthy mentioned, have recently been raised by 10 per cent. bringing in £2.2 billion to the Treasury, but also attacks the principle that the noble Baroness, Lady Williams, referred to earlier on; namely, that social security benefits are household or family benefits. Yet the Government in their usual Janus-faced way casuistically are seeking to have it both ways. His contributory benefit does not cover her, but if she is working her earnings are expected to cover him and he loses benefit pound for pound. Which is it that the Government will have? His contributory benefit does not cover her, it belongs exclusively to him. The moment she works, her earnings are expected to cover them both and he loses benefit. In other words, social security benefits cover them both when it saves the Government money but do not cover them both when it costs the Government money. So much for a Government of insurance, savings and the family. The Government's Bill attacks all three. The Government have made the JSA test harsher. They have then proceeded to cut the value of the benefit, just as they have with incapacity benefit.

We could at least mitigate some of the deep unfairness and unpleasantness of the Bill if the Committee were minded to accept the amendment. I beg to move.

Lord Mackay of Ardbrecknish

The proposed amendment seeks to introduce into the contribution-based jobseeker's allowance an increase in respect of adult dependants. We do not accept that it is necessary to introduce such payments.

Contribution-based JSA is an entitlement built up by an individual work record and will be paid as a personal benefit which does not take into account the claimant's family circumstances. No adult dependency increase will be paid. On the other hand, no account will be taken of a partner's earnings.

We recognise the anxieties of the noble Baroness about provisions for claimants who have dependants. However, claimants with partners will be able to claim income-related jobseeker's allowance. Indeed, under existing rules, the great majority of unemployment benefit beneficiaries receiving an adult dependency increase already also receive income support. The increase in unemployment benefit is already dependent on the partner's circumstances. It is currently payable only if the partner's earnings are less than the extra amount of benefit.

I accept that the removal of the adult dependency increase from the contributions benefit means the income test will be applied to more people earlier. We estimate, and the noble Baroness herself mentioned, that at any one time 5,000 people will be entitled to income-related jobseeker's allowance as a result of there being no adult dependency increase in the contributory element. However, that is in line with the aim of targeting help through the benefits system at those who need it.

We accept that it would be unfair to remove the adult dependency increase from the benefit of those who are receiving it when the jobseeker's allowance is introduced. Therefore, people receiving adult dependency increases when the allowance is introduced will be protected and may continue to receive the increase for the balance of their entitlement.

I do not suppose that I have persuaded the noble Baroness of the good sense of what we are doing. I noticed that a general attack was made on most of the Bill, but I am awaiting any indication that the party opposite might pledge, between now and the next election, that if it were elected it would restore the six months to 12 months. I understand that there was total silence on that subject in the other place.

On the subject we are discussing with this amendment, I explained why we came to the conclusion we did. I hope that, having listened to my explanation, the noble Baroness will withdraw her amendment.

Baroness Hollis of Heigham

The Minister did not offer an explanation; he offered a description. That is not the same thing at all. He described what the Government intend to do, but he neither explained, justified or excused it. He said that somebody who has paid national insurance for a contributory benefit based on the family principle that that benefit supports both claimant and partner will immediately come off that contributory benefit if he seeks to claim the benefit for his partner and will move to means-tested benefit. In other words, anybody who seeks to claim for their partner is not entitled to any contributory benefit, despite having paid national insurance contributions for that purpose.

If that is not an attack on the family and on savings and the principle of insurance I do not know what is. It is too late at night to pursue the issue further, but it is one of the more shabby and despicable elements of a despicable Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Earl Russell moved Amendment No. 36:

Page 4, line 2, after ("amounts") insert (", which shall include a premium for lone parents,").

The noble Earl said: I hope that we may be able to dispose of this amendment quickly.

The amendment is moved in order to ask the Minister for an assurance for which I asked him at Second Reading. Again because of the immense press of paper that these matters produce, I did not receive an answer. I asked him about a story which appeared in the Independent just before Second Reading that the Government intended to withdraw the premium for lone parents. I invite the Minister to tell me that that is not true. I am perfectly ready to accept such an assurance if he does, and I would be much relieved. I beg to move.

10.45 p.m.

Lord Mackay of Ardbrecknish

I do not believe that there is any need for this amendment. The income-based jobseeker's allowance will closely follow the income support rules and will include provision for appropriate premia to be paid, including to lone parents and families, in addition to the personal allowance. This ensures that lone parents who wish to look for work will be able to claim JSA and that their benefit will be no less than they would have received on income support.

As we made clear in the JSA White Paper, lone parents will have a choice whether to register for work or claim income support. But we will support and promote measures that encourage lone parents into work. There will be a £15 earning disregard for lone parents in JSA, as in income support, recognising the particular difficulties faced by lone parents in returning to work. Our new back-to-work bonus, together with the child-care disregard that we have already introduced in family credit, provide positive help to lone parents who wish to move into more substantive work.

The noble Earl referred to a newspaper report. As it appeared some weeks ago, if I have seen it I have probably forgotten it. Perhaps I may assure him that there is no campaign against lone parents. We recognise that many do an excellent job bringing up their children, often in difficult circumstances. But we have to make sure that, while supporting children of lone parents, we also give a fair deal to couples with children, and that married couples are not disadvantaged compared with others from a financial point of view. We need to look at this. We also believe that it would be socially irresponsible not to look at some of the more general problems caused by lone parents.

It is not the easiest of circumstances, especially in the sub-group that I define as unmarried mothers, as opposed to the other sub-groups of lone parents who may be divorced or, happily less frequently nowadays, widowed. There is a lot of evidence that for a young teenage girl to get pregnant and become an unmarried mother is not the best situation for her or her child. Perhaps on another day we may have an interesting debate about what responsibilities we have as a society, dare I say, to try to prevent that happening. If it does happen, one hopes that there are benefits in place to help lone parents, whether unmarried or of any other kind.

With that explanation, I hope that the noble Earl will feel able to withdraw his amendment.

Earl Russell

The Minister has said everything that I hoped he would say. I would be delighted to withdraw the amendment. Before doing so, I say only the following. If he finds a way of preventing people from becoming unmarried mothers he will achieve something that has eluded every ruler since Adam.

Amendment, by leave, withdrawn.

[Amendment No. 37 not moved.]

Earl Russell moved Amendment No. 38:

Page 4, line 37, leave out subsection (12).

The noble Earl said: Amendment No. 38 is genuinely a delegated power amendment. It relates to subsection (12) in Clause 4: Regulations under subsection (5) may provide that, in prescribed cases, an applicable amount is to be nil". Put another way, someone may be disentitled to benefit.

I have my usual five questions. I have read the Government's memorandum to the Delegated Powers Scrutiny Committee. It says that this power will be used for people in religious orders and other small groups. People in religious orders normally cannot be available for work. If they keep their rule they cannot actively seek work. I do not see why this clause is needed to disentitle them. But even if this is the only intention, is it not the case that the vires of the clause will enable any future government to disentitle any group of people at any time? If so, how will the House have an opportunity to withhold its consent? There may be some cases where benefit is withdrawn and this House as a whole, perhaps on an all-party basis, may passionately want to withhold its consent. If we vote through these vires, how can that be done? While thought is being given to that, we might think about why the vires needed to be so wide. I simply do not see it. I beg to move.

Lord Mackay of Ardbrecknish

As the noble Earl rightly pointed out, this amendment would remove our power to award a nil applicable amount of jobseeker's allowance to people in prescribed circumstances. The power will be used to ensure that small groups cannot receive jobseeker's allowance where it would not be appropriate for them to do so. The noble Earl mentioned people in religious orders. That indeed would be one small group; so would prisoners; so would certain people coming from abroad who come here on the basis that they will not in fact be a burden on the state in any way; and, at the risk, at this late hour, of rejoining a battle that we had much earlier in the day, so would those not habitually resident in the United Kingdom.

The power to prescribe a nil rate of benefit is longstanding and pre-dates income support. We believe that it would be inappropriate to specify in primary legislation the special very small categories which it excludes. The power to prescribe in secondary legislation provides a more flexible and sensible mechanism whereby regulations can provide in certain circumstances that a person is or is not to have access to benefit.

The noble Earl asked me whether we could not just give a nil amount to anyone and perhaps extend the groups. The power enables us to take out particular groups. It could not be used to take out the generality of claimants because quite clearly they could not be defined as a group as in this clause. I hope that that reassures him.

In very general terms, I am afraid that one can never give a guarantee that a future government will not behave with regulated powers in a way of which the noble Earl, or even myself, does not approve. But equally one cannot guarantee that they will not behave with primary legislation in ways of which we do not approve. Certainly, if a government tried to put through material of which the other place did not approve, that Chamber could prevent that happening.

This Chamber has conventions, but life can be made a little more difficult for government if we do not try to take on board deep-seated problems. With the kind of doomsday scenario so beloved of the noble Earl in this matter, I think that some of the conventions might not necessarily be held to, not if we are talking about a doomsday scenario with the end of the world as we know it coming about because an iniquitous government is doing quite iniquitous things with the regulations, right, left and centre.

Baroness Hollis of Heigham

Do I rightly understand what the Minister is saying? In all the events of last year, the official Opposition, even when extremely unhappy in some situations, carefully abided by the well established conventions that govern this Chamber. Is the Minister now saying that the moment that they come on to these Benches and go into opposition, they will not seek to respect such conventions? Is that what the Minister is saying? I think that perhaps he might first seek the guidance of the Leader of the House before he seeks to undermine them. The Leader himself has given an assurance to that effect.

Lord Mackay of Ardbrecknish

The noble Baroness should not jump up quite so quickly on these matters. Of course, that is not what I say. I am talking about a doomsday scenario which the noble Earl envisages. The possibility of the party opposite coming to these Benches may be unfortunate—I must have misheard; I thought that I heard the word "unlikely"—but I should not have considered for a moment the doomsday scenario. I believe that succeeding governments would not in fact abuse the powers that they are given under secondary legislation in quite the way in which the noble Earl keeps trying to frighten us into believing might happen some day in the future. I believe—dare I say it?—that even Labour governments are responsible on these matters and have been in the past. I am not old enough to remember whether Liberal governments were responsible enough.

Earl Russell

I think the Minister was cutting a corner by calling abuse of powers "doomsday". If that were doomsday I would be very surprised if any of us would be alive now. Excessive use of powers happens all the time. I think we need to clarify this just a little more. It seems to me the extent of the vires hangs on the definition of a group. Let me ask the Minister about two specific examples. Would that clause serve to give vires to regulations to disentitle people under Clause 21 or to disentitle Welshmen? If it did give those vires, and they were to be used, what could we do about it?

Lord Mackay of Ardbrecknish

I am glad the noble Earl did not want to disentitle Scotsmen: he chose more wisely than that. I am not a lawyer, which means that my advice comes free. I think I will have to put in a caveat about it and say that I would be very surprised if a lawyer could be found who would define groups quite as widely as the noble Earl is inviting me to think they might be able to do. I will certainly check that, because I understand the point he makes, although in the case of the Welshman he perhaps makes it in a rather frivolous way.

My own view would be, because this has been in legislation for some time and is not new, that the kind of groups that have been taken into legislation by this means have been very small and easily defined as self-contained groups. Of course I will check, as I am invited to do, what the lawyers say, but I really think that the wider groups that the noble Earl is suggesting would not be encompassed by the vires.

Lord Monkswell

I hesitate to intervene so late, but I am a little concerned about the Minister's descriptions. As I understand it, we are talking about the contribution-based jobseeker's allowance and the applicable amount. In his initial remarks he talked about people who might have come from abroad and were trying to claim habitual residence in this country, but did not have it. Almost by definition, these people will not have been paying contributions and therefore do not come under the scope of it.

The noble Earl, Lord Russell, mentioned groups. I would change that slightly and pick out "prescribed cases", which is what is written on the face of the Bill. I wonder whether we might get an assurance from the Minister that such prescribed cases would never apply to demonstrators, for example, who might be on a jobseeker's allowance and be demonstrating perhaps against some actions of this Government - perhaps in Brightlingsea, demonstrating against the export of live animals. Would the Minister give an assurance that that type of case would never be brought within the scope of this particular regulation?

Lord Mackay of Ardbrecknish

The noble Lord, even at this late hour, is sufficiently awake to notice that people from abroad would not in fact be eligible for the JSA because they would not have a contribution base at all. Perhaps I was slightly short-circuiting the argument. The four examples I gave, which included certain people from abroad, showed how the powers are used on income support to award a nil applicable amount, and the power is used to prescribe these groups in income support. I was simply saying that these were examples of groups that we might be looking at defining when we move across to JSA.

On the wider question - I am not entirely sure what it was other than that: it concerned whether I could guarantee - I am not sure whether we get back to the Welshmen—that the wider groups would not be prescribed.

I cannot go further than to give the answer to the noble Lord that these powers have existed for a long time. We are taking them forward from previous decisions. They could not be used for very wide groups, though I have promised to check on the wide groups mentioned by the noble Earl, Lord Russell. We are talking in the future about using this for income-based jobseeker's allowance. I will be checking the powers I mentioned, but I do not believe that they can be used to draw in very wide groups. That would be an abuse. I am not sure what the Latin tag would be, but I am sure that there is one and that the courts would have something to say if Parliament did not.

Earl Russell

I thank the Minister warmly for offering to check. I look forward to hearing the results of his checking and in the meantime beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Clause 4 agreed to.

Clause 5 [Duration of a contribution-based jobseeker's allowance]:

[Amendment No. 39 not moved.]

Clause 5 agreed to.

Lord Inglewood

I beg to move that the House be now resumed.

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

House resumed.