Disability Benefits: Arrears (Hansard, 4 July 1996)

§ The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish)
My Lords, the Benefits Agency has identified and paid arrears to 24,000 people who had missed receiving the severe disability premium as part of their income support entitlement. It is estimated that a further 11,000 people who are no longer on income support may also be due arrears of the premium. We are currently attempting to identify these cases. It is not known how many people will have died without receiving their full entitlement of benefit.

§ Lord Ashley of Stoke
My Lords, I am grateful for that reply. Will the Minister confirm that the PAC criticised the Government, and asked why it had taken so long to repay the £90 million underpayment to some of the most disadvantaged people in our society? Will he tell us what was the Government's response? Will he also kindly tell us with regard to those people who have died without receiving the repayments, whether the Government endorse the view of his ministerial colleague Roger Evans who, speaking in another place in December last year, said that he had not asked the Benefits Commission to take any specific action to 1572 identify those people who had died without repayment? The Minister may not like it, but I am asking him a different question. Does not that mean that money owed to those people has been confiscated by the state? The Government should take every step to identify the people who have died and pay the money into their estates.

§ Lord Mackay of Ardbrecknish
My Lords, the noble Lord asked me five or six questions. If I can remember them all, I shall start with the last one. One of the problems with identifying people who might have died is that we only keep records on the database for six months. We then move them to the archives for a further 18 months, and then they are removed entirely. So it is not possible to trawl back and find them all. It is arguable whether one should pay to the estate (to someone's heirs) benefit which was supposed to allow that person to help themselves during their own lifetime. On the general point, the noble Lord is right. The PAC did criticise my department. We have taken active steps to put the matter right. The noble Lord overstated the case when he talked about the most deprived people, because to be eligible for SDP one must already be eligible and have in payment income support, disability premium, and the disability living allowance, which would come to a total of £116 a week for someone under 60 and £122 a week for someone over 60. In addition, they would receive their SDP. The case is not helped by the noble Lord being extravagant in his language.

§ Lord Ashley of Stoke
My Lords, that was a long answer.

§ Lord Monkswell
My Lords, can we press the Minister a little more about payment to the estate of deceased eligible claimants? He suggested that the payments were to enable people to live a decent life. Given that that is the situation, the chances are that those people may have had to borrow money to ensure that they had a satisfactory standard of living. Surely it is only right that money due to them from the Government should be paid to their estate to reconcile the borrowings they may have incurred.

§ Lord Mackay of Ardbrecknish
My Lords, I am not entirely sure that the noble Lord, Lord Monkswell, listened to my answer when I said that people over 60 would probably be receiving about £122 a week. They would have to be receiving about that before they would become eligible for SDP. If any deceased person's representative requests it, we will examine claims to establish whether they are justified, and if there are arrears to be paid we will pay them to the estate and therefore to the heirs.

§ Lord Boyd-Carpenter
My Lords, so that the House may understand the proportion which these claims represent, can my noble friend say what is the total number of these payments which are made, and made without criticism, every year?

§ Lord Mackay of Ardbrecknish
My Lords, my noble friend asked me about the total number of 1573 claimants. The number in receipt of SDP at August 1995 was 327,000. My noble friend will recall that I discussed paying arrears to 24,000 claimants, so my noble friend is right to draw attention, as I think he was, to the fact that the great majority of people correctly and rightly received their payments.

§ Baroness Hollis of Heigham
My Lords, in 10 days' time will not the House be asked to speed up procedures and expedite through the House a DSS Bill to permit fast recovery of overpayment of benefit? Why is it acceptable to speed up the recovery of overpayment while at the same time the department is delaying the paying out of legitimately entitled SDP? Why is it acceptable to claw back and not pay up? Or is it merely that the department is following the guidance of the Deputy Prime Minister with regard to bills and going for delay, delay, delay?

§ Lord Mackay of Ardbrecknish
My Lords, I just wish the noble Baroness had listened to my answer. We have paid back some £90 million to those 24,000 people. That averages out at back payments of £3,500 to each person. If someone had been eligible from 1988 and was only discovered in 1993 not to have been paid it, wrongly, the maximum pay out would be £11,000. We are paying it back as quickly as we can. As to the other matter about the Bill that is coming to us, I understood that it had all-party support. It is to ensure that payments which the department paid out, from the taxpayer, it must be said, which are paid wrongly can be properly recovered.

§ Earl Russell
My Lords, I understand that it is heartbreakingly difficult for the DSS to avoid errors, but does the Minister think that the projected 25 per cent. cut in his department's administrative budget will make it any easier?

§ Lord Mackay of Ardbrecknish
My Lords, perhaps I may remind the noble Earl that in order to achieve a 25 per cent. efficiency saving and therefore reduce the money which we take from taxpayers in order to run the system we are looking at the whole process by which we arrive at benefit decisions and at the multiplicity and complexity of the benefits system itself. We believe that in order to achieve the savings that we are looking for we must simplify the processes, the benefits and the rules surrounding them. That would be to the benefit of taxpayers as regards paying the bills, to the benefit of the staff who try to run the system and to the benefit of the claimants who will find it easier to understand.

§ Lord Ashley of Stoke
My Lords, the Minister says that it is impossible to identify all those people who have died and I accept that because there are difficulties. However, will he not recognise that they lost money as a result of his department's errors and that they should be identified and the money paid into their estates? That is his responsibility.

§ Lord Mackay of Ardbrecknish
My Lords, I hear what the noble Lord says. As I explained, if someone 1574 comes to us and says, "My parent who is dead ought to have had these benefits. I want you to calculate them and see", we will certainly do that. However, we cannot do a trawl ourselves because we do not hold information on dead people forever. We take their records off the database after six months, quite rightly, put them into the archives, and after 18 months we remove them. If we did not do that we would spend a considerable fortune storing information which is of no further use.