Social Security Benefits (Hansard, 22 October 1998)

§ Baroness Hollis of Heigham
My Lords, it is a basic principle of the social security system that only one benefit at a time can be paid to a person for income maintenance. Widow's benefit is designed as an income replacement benefit for women who lose their means of support through being widowed. Invalid care allowance provides a measure of financial support to those who give up the opportunity of full-time paid employment to care for a severely disabled person. To pay both benefits in full at the same time would duplicate provision for that need because they are both income replacement benefits. I understand that this has been the case ever since the social security system was established in 1948. It was applied to carer's benefit when my noble friend Lady Castle introduced ICA in 1975 from which so many carers have subsequently benefited.

§ Baroness Turner of Camden
My Lords, I thank my noble friend for her response, is she aware that the Question is based upon a case reported to me as a trustee of the Widows' Advisory Trust? The case involved a woman who had spent her life looking after a Down's Syndrome child. She had had the support, financially and otherwise, of a husband. He died and she received a widow's benefit which replaced the financial support that she had had from her husband, but at the same time she lost ICA. I believe that that was a rather harsh decision. Can these kinds of cases be looked at carefully in future? This view is supported by the Carers' Association, of which I am also a member.

§ Baroness Hollis of Heigham
My Lords, I am happy to assure my noble friend that this matter will be drawn to the attention of both the National Carers Strategy Forum which is being chaired by my honourable friend Mr. Paul Boateng and our forthcoming review of widows' benefits. If there is an income or earnings replacement benefit, two benefits are not paid at the same time if they overlap for the same purpose. For example, if a widow was on incapacity benefit, which is an earnings replacement benefit for an individual who has become disabled, she would not get that plus widow's benefit but she could get housing benefit or disability living allowance to meet extra costs. That is the basic principle of the social security system. But I shall be very happy to look at the case to which my noble friend has referred to make sure that that family claims every benefit to which it is entitled. There is a full range of other benefits, from disability living allowance to carers' premiums and so on, to which such a family is entitled. It is worth ensuring that that family is claiming its entitlement.

§ Earl Russell
My Lords, will the Minister consider whether she has just committed the logical fallacy of false 1562 division? I heard what she said about income replacement benefits, but is not invalid care allowance entirely correctly classified as an income replacement benefit, or should it be classified as a benefit for meeting additional costs?

§ Baroness Hollis of Heigham
My Lords, I look to my noble friend Lady Castle for support in this matter. It is an earnings replacement benefit for those who, by virtue of their caring responsibilities, which we all value, come out of the labour market and care instead. That is why at earnings of £50 a week, for example, the benefit stops. The assumption then is that someone is replacing care income with earnings income. It is an earnings replacement benefit and that is its intent. As a result, ever since 1975 when it was first established it is not allowed to overlap with any other earnings replacement benefit. It is not compensation or an extra cost benefit, which is DLA, but an earnings replacement benefit. That was its purpose and, as I understand it, it retains that purpose.

§ Lord Addington
My Lords, to follow up my noble friend's Question, does the Minister agree that two sets of costs are being incurred which these benefits are designed to meet but as they come to the same kind of payment one is disappearing? Is it not the case that the rules have been set and will be followed no matter how ridiculous they are?

§ Baroness Hollis of Heigham
My Lords, this is the basic principle of the social security system. I gave the example of a widow who had previously been receiving incapacity benefit, which is an earnings replacement benefit. She would not receive IB and widow's benefit because both are earnings replacement benefits. She would get a benefit for a different reason—that is, extra cost, which is disability living allowance, housing benefit or council tax benefit which meet a different need. Clearly, it is open to any government not to have any overlapping benefits. I suspect that the overall social security Bill would go up from its current £100 billion approximately by perhaps 20 per cent., 30 per cent. or 50 per cent. That is the principle on which we are currently operating. But I shall consider the particular case raised by my noble friend to ensure that all proper moneys are being paid.