Departmental Expenditure (Hansard, 8 November 1999)

§ Mr. Rooker

Subject to Parliamentary approval of the necessary Supplementary Estimate for Class XII Vote 2 and Class XII Vote 3, the Department of Social Security Departmental Expenditure Limit for 1999–2000 will be380W reduced by £111,836,000 from £3,377,638,000 to £3,265,802,000. This is the net effect of increased Voted provision of £130,974,000 and reduced non-Voted provision of £242,810,000.

The increase on Class XII Vote 3 is the net effect of additional Comprehensive Spending Review funding of £37,000,000 (running costs), a take up of £8,000,000 (running costs) from the Departmental Unallocated Provision (which will not change the gross running costs limit), an increase of £3,137,000 (running costs) in respect of the reform of all work test and active case management, an increase of £120,407,000 (running costs) under the end year flexibility scheme as announced by the then Chief Secretary to the Treasury, my right hon. Friend the Member for Darlington (Mr. Milburn), on 27 July 1999, Official Report, column 393, and an increase of £8,520,000 and £9,769,000 under the capital and other discretionary end year flexibility schemes respectively.

Other changes result from a reduction of £6,631,000 (running costs) arising from a number of small transfers offset by a corresponding increase on Class I Vote 3 (Employment Services), a reduction of £24,351,000 (running costs) arising from the continuing effects of the transfer of responsibility for Contributions Agency and Working Family Tax Credit to Inland Revenue, offset by a corresponding increase on Class XVI Vote 4, Inland Revenue: administration, a reduction of £1,670,000 (running costs) arising from the transfer of responsibility for the Womens Unit to the Cabinet Office, offset by a corresponding increase in Class XVII, Vote 1, a net reduction of £261,000 (running costs) and £998,000 (capital) arising from the continuing implications to DSS of the Scotland Bill, offset by a corresponding increase in the Scottish Executive and a reduction of £486,000 (running costs) towards increased Administration costs of Motability, offset by a corresponding increase on Class XII Vote 2. There is also an increase of £11,972,000 (running costs) associated with services provided to other Government Departments on a repayment basis, an increase of £160,000 to meet the costs of overseas medical examinations of War Pensioners, an increase of £37,997,000 (running costs) arising from increased payments of Value Added Tax on contracted out services. Also an increase of £13,814,000 resulting from the virement from capital expenditure to running costs. Appropriations in aid increase by £86,427,000.

Changes in the Welfare to Work provision arise from an increase of £755,000 in the administrative costs of measures to help people with a disability or long term illness move into or remain in work, an increase of £3,378,000 under the end year flexibility scheme as announced by the then the Chief Secretary to the Treasury on 27 July 1999, Official Report, column 393, an increase of £18,000 in costs associated with the unemployed project team offset by a corresponding reduction on Class I, Vote 1 Education and Employment, a reduction of £55,000 for costs associated with innovative schemes relating to the programme of measures to help people with a disability or long term illness move into or remain in work, offset by a corresponding increase on Class I Vote 3 Employment Service and a reduction of £80,000 in the Child Care disregard provision.

381W

As a result of these changes the running cost limit of this Department will be increased by £141,119,000 from £2,868,735,000 to £3,009,854,000 and the running cost limit of the Welfare to Work programme will be increased by £4,016,000 from £6,952,000 to £10,968,000.

Changes to Class XII Vote 2 arise from the transfer of £486,000 for increased administrative costs of Motability offset by a corresponding reduction on Class XII, Vote 3 and an increase of £14,350,000 under the end year flexibility scheme as announced by the then Chief Secretary to the Treasury on 27 July 1999, Official Report, column 393.

The net change in non-Voted provision of £242,810,000 arises from a reduction in payments from the National Insurance Fund to other Government Departments and Department of Social Security following the transfer of responsibility for the Contributions Agency to Inland Revenue (£281,027,000) and also a switch from non-Voted to Voted from the Departmental Unallocated Provision (£8,000,000) offset by an increase in National Insurance Fund payments to Department of Social Security (£46,217,000).

Increases will be offset by transfers or a charge on the DEL Reserve and will not therefore add to the planned total of public expenditure.