Social Security: Unclaimed Benefits (Hansard, 2 June 1998)

§ The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham)
My Lords, the Government want everyone who thinks that they may be entitled to a benefit to make a claim. We have already taken steps to encourage claims to industrial injuries benefit and other in-work benefits. Given my noble friend's long-standing commitment to disability issues, he may have in mind the take-up of DLA and attendance allowance which is estimated to be about 50 per cent. If that is his concern, we share it. We are investigating why that should be the case.

§ Lord Morris of Manchester
My Lords, it was my noble friend, much to her credit, who first disclosed here that, far from cheating the system, about half the number of disabled people do not claim their disability benefits. Is she aware of what the disability organisations now call "the stigma attached to claiming—all the more so because of baseless allegations of fraud"? How do the Government respond to the Commons Select Committee on Social Security's withering criticisms of the costly Benefit Integrity Project which, uncovered hardly any fraud and caused great distress"? And what total sums go unclaimed in disability benefits and in income support by the frail elderly people Age Concern and Help the Aged work so humanely to help?

§ Baroness Hollis of Heigham
My Lords, my noble friend asks a number of questions. On the last one, if, for example, 90 per cent. of disabled people entitled to DLA and AA claimed their moneys, expenditure would go up from about £7.5 billion to £13 billion on that benefit alone. Equally, we know that something like 1 million elderly people—mainly single women over 75—fail to claim the income support to which they are entitled and therefore miss something like £17 a week. We are anxious that they should take up that money. The wider point that my noble friend raises is right: entitlement is a two-way process. The Government have the responsibility to ensure that the right money is going to the right people—that people are not claiming when they should not but claim the money to which they are entitled. As my noble friend said, out of the 72,000 or so benefit integrity cases that the Government have reviewed—about 2,000 were followed up in greater detail—only five cases have gone forward to the courts. There is very little fraud. There is a great deal of error and serious under-claiming. The Government must address all of those problems.

§ Lord Higgins
My Lords, so far as concerns the take-up of unclaimed social security benefits generally, will the Minister tell us whether there is any exchange 183 of information between the Inland Revenue and other departments, as there is clearly concern that that might be so? If there is such an exchange, is it done on an individual case basis; and at what level is it approved within the Civil Service?

§ Baroness Hollis of Heigham
My Lords, I shall have to write in greater detail on this to the noble Lord. My memory is that when we dealt with a previous social security administration Bill there were powers within the confines—if I may put it this way—of data protection to exchange information through data matching to ensure that, for example, where there was evidence of abuse or fraud that person could be checked through other systems. Clearly that has to be through data protection. I think that the noble Lord will find that that is primarily an exchange of information between the DSS and local authority-administered social security benefits such as housing benefit. There are additional protections vis-à-vis the Inland Revenue. I shall write to the noble Lord, because clearly the Inland Revenue and the protection of the privacy of Inland Revenue records are sensitive subjects, and rightly so.

§ Baroness Williams of Crosby
My Lords, what proportion of those who take the all-work test have failed to pass it? Of those who failed to pass it, what proportion to the Minister's knowledge have subsequently gained work? Is she prepared to reassess the cases of those who failed the test who after a year have been unable to obtain work of any kind that they can do?

§ Baroness Hollis of Heigham
My Lords, about one in six people who take the all-work test are regarded as fit for work. So about 18 per cent.—if I may put it that way—fail it. There is research in progress, but we do not yet know how many go on to find full-time work. We expect to have those findings soon. The noble Baroness is right to highlight a problem: that the current all-work test which says that one is either fit for work or disabled—either/or—does not reflect the reality of the continuum of disability from which many long-term sick and disabled people suffer. That is why in the Green Paper we are committed to reform of the all-work test. We hope that we shall have the co-operation of the House in so doing.

§ Baroness Castle of Blackburn
Does not the Minister's reply show that—in her own words—something like a million pensioners are failing to claim the means-tested benefits to which they are entitled? Is not the lesson of that that even the poor have dignity and find it an affront to have to claim means-tested benefits? Does she therefore agree that the real answer is to build up universal benefits as of right, to which people contribute during their working lives?

§ Baroness Hollis of Heigham
My Lords, my noble friend is obviously right. Many pensioners, particularly women over 75, as I said, do not claim the income support to which they are entitled. At the moment we 184 are engaged in about nine project areas, involving 50,000 pensioners, to see why they do not take up that money. We believe that it is a mixture of complexity, ignorance and the stigma associated with means testing in the eyes of many older people. On average, about two-thirds of all pensioners claim the income support to which they are entitled. That is a means-tested benefit. About 50 per cent. only of disabled people appear to be claiming DLA, which of course is not a means-tested benefit. It is not necessarily the case that means testing as such is the major barrier to claims.

§ The Countess of Mar
My Lords, does the Minister appreciate that individuals suffering from ME or chronic fatigue syndrome are in a particularly difficult situation when they claim social security benefits because their condition varies so much from day to day? Many of them have had their benefits withdrawn on the basis that they are fit for work on a particular day, although they are not on other days. Will the review take that into account?

§ Baroness Hollis of Heigham
My Lords, I have had a number of helpful letters from organisations representing ME sufferers. The all-work test, with its either/or requirement, is inappropriate for those who suffer from fluctuating conditions. That is one of the reasons why we need to review the all-work test. We shall be taking such conditions and illnesses into account.

§ Lord Dholakia
My Lords, what efforts are being made to publicise such information in ethnic minority newspapers so that those who have language difficulties can exercise their full rights in claiming the benefits?

§ Baroness Hollis of Heigham
My Lords, that is an important point. We are taking steps to publicise the situation. It may be that we are not doing enough. I shall follow the matter up and let the noble Lord know exactly what we are doing on that.

§ Lord Ashley of Stoke
My Lords, is my noble friend aware that her sympathetic response is warmly appreciated? However, it will require special measures to solve the problem of low take-up. Will the Government consider a special disability benefits week so that the availability of benefits can be highlighted and the rights of eligible people emphasised, with the stigma of applying for those benefits removed?

§ Baroness Hollis of Heigham
My Lords, we have already engaged in campaigns to promote—and successfully so, I believe—the take-up of industrial injuries and in-work benefits, for example, family credit and income support. However, there is a specific problem with disability benefits. We do not know why some of the benefits are not being claimed. It is not that they are means tested, because many are not. It may be that the forms are complex. It may be that healthcare professionals do not promote them in the way they should. I welcome the advice of my noble friends on this matter. I propose to raise the issue with the 185 disability benefits forum, with which we are consulting as to how best to ensure that disabled people claim the benefits to which they are entitled. My noble friend and I are entirely at one on this.

Noble Lords
Next Question!

§ The Lord Privy Seal (Lord Richard)
My Lords, the noble Baroness, Lady Knight, has been trying to ask a question. I should have thought that we could perhaps take the question.

§ Baroness Knight of Collingtree
My Lords, I am most grateful. Can the Minister assure the House that when a couple in receipt of well over £3,000 a year draw child benefit they pay tax on that benefit?

§ Baroness Hollis of Heigham
My Lords, I apologise that I am having trouble with the microphones on this side of the Chamber. If I am right,. the noble Baroness asked whether we shall be considering taxing child benefit. That is a matter for the Chancellor.