§ Mr. JackTo ask the Secretary of State for Social Services if he will give details of the changes to social security benefits which were announced on 27 April.
§ Mr. ScottThe measures announced last week included changes to the rules of the housing benefit, income support and family credit schemes and arrangements to provide transitional protection to those claimants in vulnerable groups who have lost significant sums at the point of change to the new schemes.
First, we propose to increase the limit on the amount of capital which renders a claimant ineligible for receipt of housing benefit to £8,000. Subject to the necessary consultation with local authorities and others, this change will be made as soon as possible to take effect from the date when the regulations become effective.
Secondly, some minor changes are being made to the detailed rules of income support and, where applicable, housing benefit and family credit. In particular, we are amending the procedures for taking account of the value of a home no longer occupied by a claimant: for example, because the claimant has been admitted to long-term residential care or has left the marital home because the marriage has broken down. There will now be a period of 26 weeks to allow for the disposal of the property, with provision for extension in exceptional cases of genuine difficulty. Other detailed changes, including those to provide transitional protection to people affected by the changes in rules relating to full-time work, are described in my reply to my hon. Friend the Member for Saffron Walden (Mr. Haselhurst) on 28 April. at columns 253–54.
The third main change is the introduction of a measure of transitional protection for pensioners, including those in receipt of a widow's pension, long-term sick and disabled people (including those in receipt of industrial injuries benefit), lone parents and families with children who have lost significant sums in housing benefit as a result of the changes introduced on 1 April. The scheme will include those in the relevant groups with capital between £6,000 and £8,000 who will have lost all entitlement to housing benefit between 1 April and the operative date of the change to the capital rule.
The precise way in which assessments will be carried out will be decided in the light of detailed discussions with the representatives of local authorities about the information that can readily be provided. The main basis for payments will be a comparison between the cash sum received by claimants as housing benefit and housing benefit supplement immediately before 1 April and their present cash amount of housing benefit. For those affected by the change to the capital rules the comparison will be with the cash entitlement after the new limit of £8,000 is applied. The comparison will be adjusted to take account of the minimum contribution claimants are required to make to domestic rates which will not be eligible for any protection beyond that already included in the personal allowances. Transitional payments will be designed to ensure that the resulting cash difference does not exceed £2.50 a week. Payments of family income supplement and family credit will be taken into account in making the comparison, with an allowance for the loss of entitlement to free school meals.
These transitional payments will be made from a new departmental central unit to be located in Glasgow. 551W Payments will be made monthly, or less frequently for small amounts, continuing unless there is a significant change in the claimant's circumstances. They will not be uprated and, as is usual with transitional arrangements, will be phased out as increases in benefits and other changes reduce the necessity for them. The period of phasing will vary from case to case, but for the larger losses protection may be necessary for some time. The new unit will not be fully operational for some weeks, but detailed procedures for claiming these payments will be announced as soon as possible and payments will be backdated to 1 April.
We estimate that the full benefit cost of these measures will be some £100 million in the current financial year. Parliamentary approval for the payments will be sought in a Supplementary Estimate; pending that approval, urgent expenditure of up to £25 million will be met by repayable advances from the Contingencies Fund. The provision for administrative costs of local authorities in paying housing benefit will also be adjusted as necessary to reflect additional work arising from these changes.